|Bush says "Criminal CEOs need jail." ????||ColnagoFE|
Jun 28, 2002 11:30 AM
|Isn't that the pot calling the kettle black? Can you think of a much worse run corporation (at least fiscally) than the USA?|
|As Uncle Guido used to say,||AllisonHayes|
Jun 28, 2002 11:43 AM
|"The government would be a lot more efficient if the mafia ran it." :)|
|Wasn't his brother (not Jeb) President of a Savings & Loans?||jose_Tex_mex|
Jun 28, 2002 11:52 AM
I wonder what he would have to say about the failure of the S&L's under his father and Reagan. If memory serves me correctly, his brother was in charge of an S&L during that time period. The S&L's cost the US much more than Enron and WorldCon.
|Neil Bush - Silverado S&L||Me Dot Org|
Jun 28, 2002 1:47 PM
|Neil Bush was sanctioned by regulators for getting a $100,000 no-payback loan from a major borrower of Colorado S&L while sitting on the board of Colorado S&L.|
|You misunderstood. He said "Criminal CEOs need BAIL" ;-) (nm)||Me Dot Org|
Jun 28, 2002 2:25 PM
|re: Bush says "Criminal CEOs need jail." ????||weiwentg|
Jun 28, 2002 11:24 PM
|> Isn't that the pot calling the kettle black?
> Can you think of a much worse run corporation (at least fiscally) than the USA?
my humble opinion? it's no more than words; white-collar crime will continue to go unpunished. frankly, I would be happy, in a sick sort of way, if there were very many more such incidents. then, there would be significant public demand to do something about the corporate system, and then an effective solution might be found. of course, most of you know this.
|Answer to ColnagoFE's question - Canada nm||OutWest|
Jun 28, 2002 11:33 PM
|How Corporate theft is underming market economics||128|
Jul 1, 2002 8:19 AM
Greed Isn't Good
by Gregg Easterbrook
Only at TNR Online | Post date 07.01.02 E-mail this article
The corporate world is now embroiled in two controversies. There's the fraud at Enron, WorldCom, Arthur Andersen, and elsewhere; and there's the payment of absurd sums to CEOs. Both developments threaten the free-market system--you're kidding yourself if you don't think that big firms deliberately duping investors, or CEOs awarding themselves hundreds of millions of dollars that should have gone to stockholders, does anything other than erode the reputation of market economics. Both practices also trample important principles of conservative economics, as we'll see in a moment.
But the two controversies really aren't separate--they are one and the same. The motive for almost all the corporate deceit now being exposed was not "the pressure of quarterly profit statements," as spin has it. Yes, shareholders exert demands for positive earnings statements. But they would be irrational if they wanted to be deceived, which is what the unpersuasive "quarterly profits pressure" pretext boils down to. The motive for almost all the corporate cheating was not to issue pleasant earning statements but to run up the pay of CEOs.
Top managers of firms such as Enron, Global Crossing, and, it now appears, Xerox systematically lied about the condition of their enterprises to rationalize granting themselves huge sums diverted from equity. If this isn't common theft--lying in order to abscond with someone else's money--what is? While, we assume at this point, most CEOs haven't lied, many have exploited the lying-triggered "exuberance" to pay themselves exorbitant amounts. All the corporate lying has been devastating to shareholders, to the United States economy, and to the world standing of market economics. But, boy, has it been great for CEOs! Systematic corporate lying has created an environment in which top managers feel justified in paying themselves $100 million or more per year. And, amazingly enough, this cash-grab now continues even as business fortunes turn down.
The overt cheaters have profited brazenly: Kenneth Lay of Enron pocketing an extra $101 million in the months before Enron's collapse wiped out shareholders; Bernard Ebbers of WorldCom "loaning" himself $366 million in the months before his cooked books wiped out shareholders; L. Dennis Kozlowski of Tyco paying himself $426 million, from 1998 to 2002, even as his self-serving decisions were wiping out shareholders and driving the company into the ground.
Yet reach-and-grab by presumably respectable CEOs has been just as shameless. In 2000, to cite a few of many examples, John Welch of General Electric paid himself $144 million, Stanford Weill of Citigroup paid himself $90 million, Rueben Mack of Colgate paid himself $85 million, Louis Gerstner Jr. of IBM paid himself $102 million. The top ten CEOs in earnings for 2000 averaged $154 million, versus a top ten average of $3.5 million in 1980--a 20-fold increase, adjusting for inflation.
Originally, some of these huge paydays were rationalized as rewards for raising returns. Since then, big firms such as Xerox, Sunbeam, and Sun Microsystems have begun "restating" prior claims of returns--that is, admitting they lied about profits. (More than 500 corporate profit restatements have occurred in the last two years, dozens of times the historic rate.) Yet after phony profit claims are redrawn, the CEOs get to keep the cash effectively stolen. Ken Lay retains the millions he made by lying about Enron. Paul Allaire of Xerox picked up $16 million in 1998 and 1999 by cashing options when the company's stock price was artificially inflated based on fake profit numbers. Now the compan
|Systematic lying; brazen theft = criminal culpability||AllisonHayes|
Jul 1, 2002 12:54 PM
|thx for the article 128! Pisses me off...
Here's the bet: form a company (you are allowed to lie, cheat, defraud, scheme; don't embezzle, that's illegal) Hey its a license to print money.
Upside: hundreds of millions in cold hard cash
Downside: a few years in jail at most, but you get to keep the money. Oh yeah, and scores of employees and small investors caught holding the bag. But hey, they all had pretty disfunctional families anyway.
OK, do you take the bet? For too many of these guys, in a heartbeat. GREED GREED GREED GREED yum yum yum yum
What would you do?
Jul 1, 2002 12:30 PM
|It's a bit hard to accept any of some you guys' political rantings when it comes to the Reagan, Bush I, or Bush II administrations. Face it, you despise them, and there is absolutely nothing they will do that you will ever support.
Here, an action is announced that clearly has a more liberal slant to it. What could be more "anti-conservative" than going after big CEO's and accountants? Yet, the bunch of you liberals still hound the guy, ironically on the basis of U.S. fiscal policy, which has been dominated by the tax and spend policies of Democrats since the 1950's.
You all will gain much more credibility if once, just once, you announced support for anything Bush suggests. Until then, I think we can assume the loyal opposition will do everything possible to denigrate the leadership.
|why is the deficit up under bush and went down under clinton?||ColnagoFE|
Jul 1, 2002 1:20 PM
|i imagine it's somewhat sementics and creative accounting, but if any corporation were run as fiscally irresponsible as the good ole USA--republican OR democrat--there would be hell to pay from the shareholders.|
|The idiocy of the metaphor,||TJeanloz|
Jul 1, 2002 1:45 PM
|A lot of people, usually candidates for office with a business background, draw the metaphor of the United States as a large corporation that is typically being poorly run, and they will use their business acumen to right the ship. There is an inherent problem with this metaphor. Businesses exist for the sole purpose of making profits for their shareholders, that is their only role in the world.
It may be argued that governments exist for the sole benefit of their constituents- but, even if that narrow definition were true, much more than financial stability would go into the equation. It is incredibly short sighted to say that the government exists only to make its people wealthier. There is an ethical element that doesn't exist in business per se; the government needs to do the 'right' thing, even if it costs more money than it can afford right now.
The government is not a corporation, and it should not be run like one. It is, at best, a bit more like a charitable social club- a group of people who are trying to better the world, and their lot in the world- but a corporation, it is not.
|GWB: I will balance the budget unless there's a war or recession||jose_Tex_mex|
Jul 1, 2002 1:53 PM
|Remember when Bush and Gore were debating? Baby Bush said words to the effect of "I will balance the budget unless there is a war or recession." The second I heard this I decided that if Bush got anywhere near the OPOTUS I would dump every stock I had. I did and smile a lot these days.
Needless to say, we're still in a recession and Gulf War II is coming soon.
|GWB: I will not lie unless there's a war or recession:||128|
Jul 2, 2002 7:09 AM
Stop Him Before He Lies Again
Post date 06.20.02 | Issue date 07.01.02
Back in Houston last week, President George W. Bush again told what is gradually becoming his favorite political anecdote: "You know, when I was one time campaigning in Chicago, a reporter said, `Would you ever have a deficit?' I said, `I can't imagine it, but there would be one if we had a war, or a national emergency, or a recession.' Never did I dream we'd get the trifecta." Even we're getting a little tired of pointing out that this story is almost certainly untrue. No reporter who covered the 2000 campaign can recall Bush ever having said anything like this; and despite repeated inquiries from the media, the White House has never produced any evidence that he did. (There are numerous examples, by contrast, of candidate Bush pledging not to touch the Social Security surplus under any condition.) The first public mention of Bush's exceptions came, conveniently enough, last August--just as it became evident that the tax cut and slowing economy would likely force him to dip into Social Security. Why does the truth or falsity of this anecdote matter? Because perhaps the key policy issue that divided Bush and Al Gore during the 2000 race was the Texas governor's massive tax cut proposal. Bush claimed there was enough money to continue paying down the debt, fund any additional spending needs that might arise, and still afford his tax cut; Gore claimed there wasn't. Gore was right. Bush's budget forecasts were a tapestry of rosy predictions, accounting gimmicks, and outright falsehoods that were already unraveling well before September 11. (Remember the trillion-dollar contingency fund that Bush was promising little more than one year ago? Us neither.) This is why Bush insists on reciting his fraudulent "war, recession, or national emergency" story at every possible opportunity--it gets him off the hook for the mountain of economic dishonesty he shoveled in order to pass the tax cut. And it's why as long as he keeps telling the story, we'll keep pointing out that it is almost certainly a lie.
|Should we file this with the rest?||DougSloan|
Jul 2, 2002 1:49 PM
|"I hate Bush, and no matter what he does I'll attack, mock, complain, and ridicule." (Repeat phrase 10,000 times until Bush is out of office.)
Isn't that essentially what you're saying? When you attack everything, absolutely everything, and set up no-win scenarios (fight aggressors or balance budget?), you lose credibility. Sure, it's interesting to other sympathizers, but they already are on board with you. It's not very convincing.
I guess it was ok for Clinton to lie under oath, though. He had a good reason to.
|Correction - he would not touch Social Security unless there ...||jose_Tex_mex|
Jul 2, 2002 5:26 PM
The actual quote came from the first 2000 Presidential Debate where both candidates were going off on a rant about the "lock box." Gore claimed he would make social security a lock box. Bush went one step further and said he wouldn't ever allow the Social Security trust fund to be raided, except in the event of war or recession.
With that said he did go on to "imply" that if all was well he would not do anything to counteract the gov't surplus trend.
I had never heard of the trifecta comment, but did remember dumping stock at an alarming rate.
Jul 2, 2002 6:02 AM
|respect you opinion but:
Maybe your ideological inflexibility clouds the analysis:
"What could be more "anti-conservative" than going after big CEO's and accountants"
Isn't this is a false premise? There is nothing 'anti-con' about it, and casting the analysis in partisan/tax terms is a distractor and intellectually disingenuous imo. You neglected to say "lawbreaking" CEO's. You infer that b/c of the status of the offending party (apparently assuming CEO's are "conservative"), they would theorectically revieve different treatment by conservatives (which btw, is they very kind of thinking most reasonable people take issue with, and fear.) when they (CEOs) break the law. I don't understand how there is a liberal 'slant' to this. Maybe this administration's views on lawbreakers, even when they're CEOs, are less forgiving than yours?? I would hope the administration's actions would be the same whether it were CEOs from MoneyGreedCo or GreenLoveTreeCo.
With government as with business: the price of freedom is constant vigilance.
|A Modest Proposal:Eat the Rich.Feed the Poor(justice as fairness||128|
Jul 2, 2002 5:18 AM
|Ok, take it easy- let's be reasonable. Nobody's gonna eat anybody. But someone might steal your lunch!
Redirecting a Managerial Class
Who actually controls business enterprise? W.F.Buckley
I know a distinguished social pathologist who is wondering, at this juncture, whether there is a new component in the economic picture in America. Something is certainly new, given the near-daily advent of a fresh company detected in evasion and worse.
The free-market models give us: entrepreneurs; stockholders; accountants; federal watchdogs; bankruptcies; — and jails. The mix of those elements is supposed to encourage thrift; investment; merchandising; and profits — to the stockholders and to the buying public.
What appears to the inquirer as unique in today's situation is a body of actors who disengage from the accepted disciplines and do so with apparent impunity. The big question today is: Are these individual miscreants, or do we have an operating class, beyond the reach of the law, on the order of the profession of prostitution?
We have here the second wave of apparently deracinated evildoers, in the course of a single year. The first was the priests, who in outrageous defiance of primary obligations of their profession, abuse children, no less. Abusing stockholders is perhaps less iniquitous. But this set of miscreants are giving reasons why they did as they did, high exercises in self-exculpatory art. When an official of WorldCom reports that he could see nothing wrong, let alone unusual about classifying moneys dispensed as capitalized expenditures when in fact they were moneys spent in doing business, the question arises: Can that man see anything as wrong? And if so, does he emerge as simply one criminal practitioner, or is he a member of a class newly acceptable in American business?
There has been speculation over two generations about who actually controls business enterprise. James Burnham, in l940, argued the thesis of the Managerial Revolution. It isn't the stockholders who run things, it is the people they nominate to serve in management, people they almost immediately lose control of, he argued. This is so because keeping up with what they do, let alone supervising what they do, is a practical impossibility. Stockholders are left with the power to remove, which can be likened to the power of Congress to impeach. They have the advantage of a hypothetical watchdog, requiring the execution of certain formalities, like a company's annual reports. What was envisioned as supplementing stockholders' rights was the concept of the public's rights. A WorldCom CEO who dissimulates, damages his stockholders, but hurts also a public that, taking heed of what happened at WorldCom, Inc., hesitates to back other ventures; slowing down the dynamic of capitalism, and inducing skepticism about the very idea of private enterprise.
Congress is busy trying to come up with revised systems of auditing. The most prominent reform being discussed is outlawing the accounting firm that acts in a second capacity as company consultant. That idea would seem to be commendable, though the practice of it could be hard on the smaller of the 16,000 publicly traded companies which would now have to add an entire service echelon to the cost of doing business.
What is needed quickly and extensively is: punishment.
In the late l930s, no less a figure than a former president of the New York Stock Exchange went to jail for the misuse of funds.
This is not a call to the denial of due process, but a call to the legitimate use of public punishment as a retributive act. In the public-school lore of Great Britain there is the story of the senior boy nailed for public indecorum and had up for a flogging. He pleads, in deference to his seniority, to be punished
outside the view of voyeuristic fellow
|the guy has a way with words nm||DougSloan|
Jul 2, 2002 6:07 AM