Kurt Ullman wrote:
In article ,
"HeyBub" wrote:


Let's get up-to-date, Slick. It was the PRESENCE of regulations that
caused the current collapse. Specifically the Community
Redevelopment Act "enhancements" in 1995 that mandated banks
provide low (or no) interest loans to people who were simply
unqualified.

There is another on-going regulation that has played a BIG part
in most of the financial hoohas over the last 15 years or so. The
Congress passed a law that mandated salaries over $1 million could
not be deducted. In an attempt to "align the interests of top
management with those of the shareholders", compensation in the form
of "performance-based" and stock options was treated favorably for tax
purposes.
This had three results: It put a floor under the salaries of the
bigwigs of $1 million. (2). It resulted in total compensation being a
few orders of magnitude above what any board of directors would have
had the balls to give the dudes and dudettes in salary and (3). It
actually divorced the interests of the bigwigs and the stockholders
by making 80-90% of their compensation dependent on ever-increasing
metrics and stock prices. I don't think it is just happenstance that
every major corporate scandal since then is to a great extent based
on executive's actions trying to boost stock price and "performance".

Yep. It's none of the government's concern (or almost anybody else's) what
the company shareholders want to pay their chief executive. Where the
government gets screwed, of course, is when the president of a (relatively)
small, closely held, corporation gets a huge compensation.

Suppose a company makes $10 million in profit and pays the entire sum to its
president as "salary." Presto, no corporate income tax! If, however, the
company paid the owner $1 million, the remaining $9 million would be subject
to corporate income tax of, say, 30%. The residual $5.4 million gets taxed
again as stock dividend.

This can be solved by simply not taxing corporations at all. Tax the profits
after they are distributed as dividends. Or, if they're going to tax
corporations, then dividends should be tax exempt since they were already
taxed. Let's do the Obama "fairness" thing - tax profits once.