Credit where due
I give the Republican party a lot of grief here and elsewhere on the internet. But I feel it's important to give those individual members of the party credit when they do something honorable. I applauded Senator Lindsey Graham of South Carolina when he said in reference to the Abu Ghraib scandal "If we're going to say we're the good guys, we have to act like the good guys."
Today's applause goes out to Senator Richard Shelby of Alabama. In this article for The American Prospect (one of the best progressive sources of news on the web), Robert Reich notes that Senator Shelby is taking a stand against corporate America.
Ten years ago, the Financial Accounting Standards Board proposed that stock options granted to executives and employees be treated just like any other form of compensation and therefore counted as an expense on corporate balance sheets. The proposal was entirely logical. Compensation is compensation. A company gives stock options as a form of payment in return for services. So, of course, it's a business expense.
But the corporate reaction to this modest proposal 10 years ago was so hostile, you'd have thought the Standards Board had declared war on capitalism. Corporate America furiously lobbied Congress and the Board to back down....
The hero of this deja vu drama is likely to be Alabama Republican Senator Richard Shelby who, as chairman of the Senate Banking Committee, says he is determined to let the Standards Board do its thing, even if he has to hold up the entire federal budget.
Good luck to Senator Shelby. I hope you get it done.
Strange thing is, the more I read about this sort of issue--especially the part where corporate execs are pumping up profits to give themselves higher value stock options, the more I'm reminded of the S&L scandal during the Reagan administration. I didn't really understand it when it happened--I was a teenager at the time--but I read an interesting book in my twenties about a little Texas company named Vernon Savings and Loan entitled The Daisy Chain. I don't remember many of the specifics, but the one thing that I remember clearly was the way the owner of the S&L made sure that on every loan he made to a friend or business partner--no matter how ill-advised the loan was--he got a bonus. And as his bonuses were also tied to profitability, he always made sure the company looked way more profitable than it actually was, even once it became clear that the company was losing money.
Any of this sound familiar?