Politics

Reform we can live with

The Supreme Court recently reversed a long-standing tradition that corporations couldn’t directly fund political advertising. I believe the core argument for the reversal is that the restrictions impinged on the corporation’s right to free speech, as though a corporation is a person.

Alarmists are warning that corporations will flood the airwaves  with political commercials in the days before an election to promote their bought and paid-for candidate, or to denounce the candidate they couldn’t buy. That may be, but what is the price of Free Speech, enshrined in our holy founding documents? 10 billion dollars? 100 billion dollars? We shall soon find out.

I would like to suggest a political finance reform.

Only registered voters are allowed to donate to political campaigns or to fund political advertising. I would allow unrestricted amounts to be donated, with the caveat that all donations must be made publicly available within 24 hours with a means to uniquely identify the donor. Using the name and address and precinct where  they are registered should be sufficient. And publicly available means something like an election board website, generally available to the general public and not hidden away in some hard-to-access site that only policy wogs are likely to know about.  I want to know who is trying to buy my representative; you can tell a lot about a candidate by who is paying to support them.

This includes contributions to PACs. As a collective they are allowed to accept contributions from registered voters and to use those contributions for a common goal. They also have to disclose the source of their contributions – same list. And any other political entity, like: Party, Committee to elect or re-elect, etc.

PS. For any corporations that I hold shares in- I do not approve of the use of corporate funds for political advertising.

General

What are they thinking?

I heard that the Post Office is considering going to 5 day delivery to reduce costs and is thinking of dropping Saturday delivery.

What are they thinking? If you want 5 day delivery, drop Wednesday, not Saturday. I really don’t want to go 2 days in a row without delivery.

Economics, Politics

Just Compensating

Daniel Gross, at Slate, wrote a Moneybox commentary on Wall Street bonuses. He makes a point in it that I did not realize:

At most companies, bonuses are paid out of profits. No end-of-year profits, no bonuses. But on the island nation of Wall Street, they’re paid out of revenues.

Bonuses out of revenues, what sort of nonsense is that? No wonder they can pull down ridiculously obscene compensation. Let’s see – we are doing a 10 billion dollar refinancing, we want 10% to do it and 50% of that will go into the bonus pool. The other 50% will go to pay for the office building, the corporate jets,  the million dollar salaries; your basic operating expenses. Anything left over would be profit. How do they get away with it?

Since the 1980s, notes Brad Hintz, an analyst at Sanford C. Bernstein, it’s been the standard for half of revenues to be devoted to compensation. So long as these outfits were private partnerships, that practice didn’t really matter to the rest of us. But since the 1990s, when investment banks went public, compensation has evolved into a zero-sum game between employees and shareholders. Guess who lost?

Any compensation in excess of the annual presidential salary is not deductible from corporate ledgers and the corporation must pay corporate taxes on excessive compensation.

The Thoughts and Luminations of Jack Heneghan