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They don't clear US $10 billion yearly. They get away with what amounts to fraud on a yearly basis.

> Microsoft knows what they're doing

yeah, right...

Dr. Edgar David Villanueva Nuñez's answer to Juan Alberto González's letter is the most brilliant text about free and proprietary software written by politician I've ever seen. (Juan Alberto González is a General Manager of Microsoft Perú. Dr. Edgar David Villanueva Nuñez is a Congressman of the Republic of Perú.)

I really wish we had such people among Polish politicians. I wish you, Ramsés, together with other people in Panamá to convince your politicians what's best for your citizens, even if it's not best for fraudulent megacorporations like Microsoft, and even if it means making the richest man on Earth slightly less rich.

See also the interviews with Dr. Edgar David Villanueva Nuñez on LinuxToday and Linux Journal, as well as other links from the Peruvian Activism website.

Compare that to what would happen to MS software if MS were to disappear up their own behinds in a flash of financial lucidity (make of that what you will) - I seriously doubt Microsoft would ever open their source base in any meaningful fashion, even if ordered to by the courts.

Trust me, I want to see someone make a run at M$ crap, BUT I don't see it happening. Not without an act of God.

Actually, there's no need for any act of God — Microsoft has much more serious financial problems than every technical problem with all of their products combined. Read the Microsoft Financial Pyramid Summary and other articles from the Research and Press Release Archive of Bill Parish. All we need is a critical mass of people who have read it — especially among the current and potential MSFT shareholders — and they're boned.

Trust me, I want to see someone make a run at M$ crap, BUT I don't see it happening. Not without an act of God.

Actually, there's no need for any act of God — Microsoft has much more serious financial problems than every technical problem with all of their products combined. Read the Microsoft Financial Pyramid Summary and other articles from the Research and Press Release Archive of Bill Parish. All we need is a critical mass of people who have read it — especially among the current and potential MSFT shareholders — and they're boned.

His anecdotal profiles of geeks who were not nearly as smart as they thought they were

Employees were obsessed with their stock holdings and with Amazon's almost desperate efforts to expand into new realms to justify the fanatic faith of early Net-believers.

According to an article in the Economist from August 5, 1999 entitled " Share and share unalike."

" For instance, Microsoft, the world's most valuable company, declared a profit of $4.5 billion in 1998; when the cost of options awarded that year, plus the change in the value of outstanding options, is deducted, the firm made a loss of $18 billion, according to Smithers."

Also keep in mind that not only are OpenSource/Free Software breathing down their neck with increasingly viable desktop alternatives, but Oracle, Sun, IBM as well. Plus an increasing number of governments, lately Peru, China and Germany, are getting tired of their busness practices.

Now think about the software situation. Linux, QNX and others have them beat in the embedded OS market. Windows as a server OS is beat by Solaris, Linux, *BSD. Windows as middleware is becoming decreasingly competetive with Gnome and KDE. Aqua has it beat hands down, you can even run legacy apps like Ms-Word, which is about the only thing currently holding GNU/Linux back from the general desktop. However, OpenOffice and others are filling the gaps left by Lotus-123, Borland's Quattro, WordPerfect.

Then there are indications that there is no improvment on the horizon. For example the shift from software, to marketing to legislation. The way MS is working the punishment phase of the antitrust trial it looks that their products are unable to compete in a free market. Even die-hard MS fans cannot refute EWeek's report that "[Allchin] later acknowledged that some Microsoft code was so flawed it could not be safely disclosed." Maybe coincidentally, Bill has been shifting investment money out of Microsoft. If the rest of the top execs are offloading also, (this is speculation and it would be nice to see some real figures, but where can that type of info be looked up) then it would indicate no confidence.

So with out a cash flow or at least investor confidence, all Microsoft's troubles would bite them hard. Death by a thousand small bites, plus a few medium sized ones. Perhaps the SEC backed off to avoid popping Microsoft's baloon like just another overratted dot-com.

Or would it turn out to be a collapse more like Enron's.

What would the IRS do about it? microsoft pays no federal income tax anyway.

Heh. Just thourght it was a good time to bring up good old Bill Parish who spend some time a couple of years ago looking into MS accounting pratices and claimed they don't really make money at all... Haven't been updated since November 1999 tho.

http://www.billparish.com/msftfraudfacts.html

So, basically you're saying that this is bullshit? Mr. Parish certainly seems reasonable to me, but, then again, IANAA (I am not an accountant).

-- Shamus

Bleah!

Thanks!!! That's what I was looking for.

Here's a quote from the article by Bill Parish, Microsoft Financial Pyramid: "The fundamental problem is that Microsoft is incurring massive losses and only by accounting illusions are they able to show a profit." (The quote is from the second paragraph of the article.)

Will Microsoft even allow you to recycle your Win2k license on a new computer?

This really pisses me off. This should of been part of the settlement from the DOJ. M$ Screwed Consumers.

The OEMS had to accept the M$ price discount plan, and only sell OEM versions to stay in business. M$ should of never been allowed to tie an OS to hardware, too late, damage done.

We had a site license for m$ at work. We bought 40 pc's and could not get them without windows. We just paid for an OS which we would never use, and couldnt sell. What about all the schools across America that got double billed for an OS? Thats alot of tax money M$ should pay back. I wont even go into the tax scam m$ has, they do not pay federal income tax.

If I was going to roll out desktops.
1. Terminal Services/Citrix/etc... Will NEVER tie M$ into hardware, repeat never, rinse repeat, never.
2. Linux workstations.
3. Fast network, with gigabit upstream to the TS servers.
4. Ghost images on CD.

BTW, 400mhz boxes make good linux workstations.

-
Where does an 800 pound gorilla sleep, anywhere he wants.

I think the papers you are thinking about are here and here with the index here.

I think the papers you are thinking about are here and here with the index here.

I think the papers you are thinking about are here and here with the index here.

Many of their employees get a significant amount of their compensation in stock options.

I wonder how many of those employees have read this.

Not so much from a consumer standpoint, but if this the official MS line, then maybe MS shouldn't exist.

If you want to finish the harmful existence of Microsoft, then just spread the word about Bill Parish's MSFT Fraud Facts: Microsoft Financial Pyramid Summary and other updates to current and potential MSFT shareholders. That should do it.

Not so much from a consumer standpoint, but if this the official MS line, then maybe MS shouldn't exist.

If you want to finish the harmful existence of Microsoft, then just spread the word about Bill Parish's MSFT Fraud Facts: Microsoft Financial Pyramid Summary and other updates to current and potential MSFT shareholders. That should do it.

When I found Parish's analysis some time ago, that's what I thought: If this is all true, than just letting people know about it can kill Microsoft. Because if some potential Microsoft stockholders know about it, they will wait before they buy the stock, if they don't buy the stock, the value of other stock won't increase so fast any more, the existing stockholders would notice that and some of them will start selling their stock, if finally so many people starts selling the stock that its value starts decreasing, then even more of stockholders will start to sell, but no one will want to buy it at that point (those who will want to buy it, would want to wait until it's even cheaper), etc.

The only condition needed for such scenerio is the critical mass of people reading Parish's Microsoft Financial Pyramid. I assume that Microsoft stockholders are smart people, not the kind investing in other pyramids.

If I was Bill G. & Co. I would hire Bill Parish for $100M/year as a financial consultant working at home and doing nothing, if he only agrees to stop publishing his reports. And if I was Bill Parish I would accept this offer...

Bill Parish's Microsoft Financial Pyramid is now on the first place in Google results when searching for Microsoft fraud. Just imagine if we all started linking to his article and it will became the first place when searching Google for Microsoft, just like the Anti-DMCA website is the first hit searching for DMCA. Something to think about. If this is true and if Microsoft is the greatest financial pyramid scheme and the greatest financial fraud of 20th and 21st century, then it would be really interesting to see it finally collapsing. Our granchildren will read books and watch movies about it.

When I found Parish's analysis some time ago, that's what I thought: If this is all true, than just letting people know about it can kill Microsoft. Because if some potential Microsoft stockholders know about it, they will wait before they buy the stock, if they don't buy the stock, the value of other stock won't increase so fast any more, the existing stockholders would notice that and some of them will start selling their stock, if finally so many people starts selling the stock that its value starts decreasing, then even more of stockholders will start to sell, but no one will want to buy it at that point (those who will want to buy it, would want to wait until it's even cheaper), etc.

The only condition needed for such scenerio is the critical mass of people reading Parish's Microsoft Financial Pyramid. I assume that Microsoft stockholders are smart people, not the kind investing in other pyramids.

If I was Bill G. & Co. I would hire Bill Parish for $100M/year as a financial consultant working at home and doing nothing, if he only agrees to stop publishing his reports. And if I was Bill Parish I would accept this offer...

Bill Parish's Microsoft Financial Pyramid is now on the first place in Google results when searching for Microsoft fraud. Just imagine if we all started linking to his article and it will became the first place when searching Google for Microsoft, just like the Anti-DMCA website is the first hit searching for DMCA. Something to think about. If this is true and if Microsoft is the greatest financial pyramid scheme and the greatest financial fraud of 20th and 21st century, then it would be really interesting to see it finally collapsing. Our granchildren will read books and watch movies about it.

"No other nonfinancial firm has more liquid money at its disposal, and only a handful of banks do. [...] Who wouldn't love to have a bank account like that?" Some food for thought.

Have you read the Microsoft Financial Pyramid, the MS financial fraud analysis from November 1999 by Bill Parish? There's more on Parish's Research and Press Release Archive. Let me quote few paragraphs:

We live in extraordinary economic times here in the U.S. and this success could ignite a whole new cycle of economic prosperity. We must first, however, take a hard look at what is occurring at Microsoft. Microsoft is a great company with terrific employees. Sadly, many of these brilliant people have been blinded by the stock price and unable to see that Microsoft is also the key architect of the greatest financial pyramid scheme this century. It is not uncommon for participants in pyramid schemes to lose their emotional bearings. My close friends who work at Microsoft are particularly upset over my work and it is possible that even Bill Gates and Steve Ballmer do not realize the implications of their financial practices.

The fundamental problem is that Microsoft is incurring massive losses and only by accounting illusions are they able to show a profit. Specifically, Microsoft is granting excessive amounts of stock options that are allowing the company to understate its costs. You might ask yourself, what would happen to Microsoft's stock price if the public suddenly realized that they lost $10 billion in 1999 rather than earning the reported $7.8 billion? If 80 percent of its stock value or roughly $400 billion is the result of a pyramid scheme, one might also ask what kind of effect this could have on the retirement system. It is also important to note that this is a relatively new situation that did not occur before 1995. Microsoft has always been a highly valued stock and that might have been justified prior to 1995.

This situation is not about stock valuation, product quality or whether or not Microsoft has monopoly power in its markets. Nor is it part of a pro or anti-Microsoft movement. This situation is instead a shining example of financial fraud and corruption enabled by bad government policy. If not quickly and aggressively addressed, we will all be losers as credibility in our financial markets is destroyed.

[...]

What do you people think about it?

"No other nonfinancial firm has more liquid money at its disposal, and only a handful of banks do. [...] Who wouldn't love to have a bank account like that?" Some food for thought.

Have you read the Microsoft Financial Pyramid, the MS financial fraud analysis from November 1999 by Bill Parish? There's more on Parish's Research and Press Release Archive. Let me quote few paragraphs:

We live in extraordinary economic times here in the U.S. and this success could ignite a whole new cycle of economic prosperity. We must first, however, take a hard look at what is occurring at Microsoft. Microsoft is a great company with terrific employees. Sadly, many of these brilliant people have been blinded by the stock price and unable to see that Microsoft is also the key architect of the greatest financial pyramid scheme this century. It is not uncommon for participants in pyramid schemes to lose their emotional bearings. My close friends who work at Microsoft are particularly upset over my work and it is possible that even Bill Gates and Steve Ballmer do not realize the implications of their financial practices.

The fundamental problem is that Microsoft is incurring massive losses and only by accounting illusions are they able to show a profit. Specifically, Microsoft is granting excessive amounts of stock options that are allowing the company to understate its costs. You might ask yourself, what would happen to Microsoft's stock price if the public suddenly realized that they lost $10 billion in 1999 rather than earning the reported $7.8 billion? If 80 percent of its stock value or roughly $400 billion is the result of a pyramid scheme, one might also ask what kind of effect this could have on the retirement system. It is also important to note that this is a relatively new situation that did not occur before 1995. Microsoft has always been a highly valued stock and that might have been justified prior to 1995.

This situation is not about stock valuation, product quality or whether or not Microsoft has monopoly power in its markets. Nor is it part of a pro or anti-Microsoft movement. This situation is instead a shining example of financial fraud and corruption enabled by bad government policy. If not quickly and aggressively addressed, we will all be losers as credibility in our financial markets is destroyed.

[...]

What do you people think about it?

"No other nonfinancial firm has more liquid money at its disposal, and only a handful of banks do. [...] Who wouldn't love to have a bank account like that?" Some food for thought.

Have you read the Microsoft Financial Pyramid, the MS financial fraud analysis from November 1999 by Bill Parish? There's more on Parish's Research and Press Release Archive. Let me quote few paragraphs:

We live in extraordinary economic times here in the U.S. and this success could ignite a whole new cycle of economic prosperity. We must first, however, take a hard look at what is occurring at Microsoft. Microsoft is a great company with terrific employees. Sadly, many of these brilliant people have been blinded by the stock price and unable to see that Microsoft is also the key architect of the greatest financial pyramid scheme this century. It is not uncommon for participants in pyramid schemes to lose their emotional bearings. My close friends who work at Microsoft are particularly upset over my work and it is possible that even Bill Gates and Steve Ballmer do not realize the implications of their financial practices.

The fundamental problem is that Microsoft is incurring massive losses and only by accounting illusions are they able to show a profit. Specifically, Microsoft is granting excessive amounts of stock options that are allowing the company to understate its costs. You might ask yourself, what would happen to Microsoft's stock price if the public suddenly realized that they lost $10 billion in 1999 rather than earning the reported $7.8 billion? If 80 percent of its stock value or roughly $400 billion is the result of a pyramid scheme, one might also ask what kind of effect this could have on the retirement system. It is also important to note that this is a relatively new situation that did not occur before 1995. Microsoft has always been a highly valued stock and that might have been justified prior to 1995.

This situation is not about stock valuation, product quality or whether or not Microsoft has monopoly power in its markets. Nor is it part of a pro or anti-Microsoft movement. This situation is instead a shining example of financial fraud and corruption enabled by bad government policy. If not quickly and aggressively addressed, we will all be losers as credibility in our financial markets is destroyed.

[...]

What do you people think about it?

[...] if your universities are doing work that can be commercialized, you will have IT jobs in your country. And if they are not, then fine, just say that farming is your thing, or whatever it is. All the taxes will be paid by those guys or something -- I don't know.

Taxes? What taxes? Those which would be otherwise paid by Microsoft?

Take one hour to read about this creative accounting

It's not that Microsoft's trajectory has necessarily passed its apex, it's that websites like slashdot focus more attention on pointing out Microsoft's missteps.

Hey, thanks a lot! Couldn't you say it before I told all people I know to sell MSFT stock and watch the evening news tonight to see how the Great Microsoft Pyramid is finally collapsing?

> MS pays its employees less than the industry average and compensate with employee stock options

The best report on this I’ve seen up to this day is by Bill Parish.

3) So what if they have $40 billion in the bank? What does that have to do with anything?

5) Despite your inflamed rhetoric the US government has never been for the people. Go read A People's History of the United States by Howard Zinn and you'll quickly find that the government has been siding with business and industry over individuals for 200+ years. Yawn.

The extent to which Microsoft escapes its current antitrust case with a slap-on-the-wrist penalty will likely be inversely proportional to the number of major corporate customers' defections from their new annual "software rental" product licensing schemes. I stand by my analysis.

We're _not_ stuck buying Microsoft's inferior OS and applications software - there are alternatives springing up all around us - and smart CIOs, CTOs, and even business PHBs _will_ migrate to them for competitive advantages. Microsoft's days are numbered, but we just don't know that number yet.

If you'd like to read the best independent analysis of Microsoft's financial fraud, go here.

Meanwhile, sell your Microsoft stock because its about as high as it's going to go on the way down.

I would almost agree with you that my tax dollars were wasted on this but only because the guilty party is being allowed to continue leveraging their monopoly power to gain additional monopolies.

It was also free as can be, even though it was boxed in shelves. I don't know anyone (laymens included) who ever purchased NS.

I'm not surprised that you don't know anyone who bought Netscape. I'd bet that you steal most of your software and the only thing you've ever paid for has been windows because it was included into the cost of your pc.

The reality of the situation, was that MS made the better browser. You should note that most IE4.0 browsers where downloaded (just like NS) since Win98 was not even released yet. Most copies of Win95 being sold still had IE3 AND Netscape on it. Really, by the time Win98 came out in June of 1998, IE4 already had made huge gains, based on consumer choice. Furthermore, many remember that at the time most all ISP software packaged Netscape as the exclusive or preferred browser, yet IE still gained marketshare. Again, remember that this is all before IE packaged with Windows.

The actual reality of the situation is that your version of history is a flight of fancy. *You* should note that hardly anyone downloaded IE4 over a modem just like Netscape. The vast majority of users used what came bundled on their pc or on their AOL or Earthlink or whatever diskette that their ISP sent to them. And that was almost always IE because of the exclusive deals that microsoft's OS monopoly allowed them to strongarm out of the providers.

You must have slept through the mid-nineties. The only choice that most consumers made was to not download 10-20 megs of software over their 14k or 9600 baud modems and then have to install a big scary windows program and that was if they even knew there was an alternative and where to get it. Also, IE was packaged with windows in all OEM versions. Only the original packaged version did not contain IE by default and that was soon changed.

Netscape is down to a measly 20% share. But is it any wonder? Who wants to use a browser that hasn't had any serious development work done on it since 1996? (I am only referring to 4.x here, obviously Mozilla will be making waves pretty soon.) How could Netscape afford to spend tens of millions developing a program when a $16B monopoly making 65% margins was burying their development costs in Windows (forcing consumers to buy it) and giving theirs away for "free".

Yes Opera is gaining a small share, no thanks to you. But what a coincidence that 10% of US families now have high speed internet access making the multi-megabyte download fast and painless. Users are also more sophisticated today and are not as afraid to install software by themselves. And as you grudgingly admit, Opera is free software.

You can laugh today because Microsoft is off the hook. Billion dollar lawyers, political donations, and legal maneuvering has won the day for another of our nation's rich law-breaking corporate entities. But I am still laughing at you tshak because your MSFT stock hasn't increased in value in a long, long time. In fact if you bought it about 3 years ago at $120 a share then you have lost half your investment.

And now that Enron has been caught doing some of the same things as Microsoft, don't expect to see your shares split anytime soon. 8^D

Actually this guy has. And it ain't pretty.

Bzzt. They can only claim actual expenses. If they claim the $1 billion in software as an expense, they would have to claim $1 billion in revenues as well. You can't write off the value of services.

Mebbee.. They've been pretty good at doing things like this (maybe not so openly) to fiddle their tax returns. I seem to recall that Microsoft hasn't really paid any tax whatsoever since they became this behemoth they are today.

If (and last time I check they do) corporations pay taxes, corporations have rights

So does this mean that Microsoft has no rights?

---
DOOR!!

Parish & Co. would tell you that AOL and MS won't work together because they are mortal enemies, since MS is killing AOL.

He may be viciously biased, but I like this guy. There's a refreshing purity to his sincere hatred. He's not promoting anything, just attacking MS, and he comes up with some good ammunition.
--

Parish & Co. would tell you that AOL and MS won't work together because they are mortal enemies, since MS is killing AOL.

He may be viciously biased, but I like this guy. There's a refreshing purity to his sincere hatred. He's not promoting anything, just attacking MS, and he comes up with some good ammunition.
--

Not just that, but M$ doesn't actually make money anyways. Here's an old (1999) article on that. They're one of the many companies living on their overinflated market value. Does anyone know if this "redhat's breaking even" refers to their market value, or their actual revenue and profit. And yes, I realise how closely tied those are, and how difficult to seperate. While the modern business system seems to focus on overinflating ones own stock, not on actually contributing to the economy as anything other than a horse to bet on.

Jim Allchin.

said something to the effect that copylefting software (GNU, open-source, GPL, Free Software, you know the deal) is harmful.

He said:

Open source is an intellectual-property destroyer.... I can't imagine something that could be worse than this for the software business and the intellectual-property business.... I'm an American, I believe in the American Way. I worry if the government encourages open source, and I don't think we've done enough education of policy makers to understand the threat.

That issue has been flogged thoroughly elsewhere.

As a parting off-topic shot: Microsoft pays no taxes, so Allchin's claim that tax-paying companies should be allowed to co-op taxpayer-funded code doesn't apply to Microsoft anyway. Put that in your tax-loophole pipe and smoke it.

--Patrick

I don't claim to be qualified to understand all the mumbo jumbo, but it's food for thought at least.

Ryan T. Sammartino

Incidently, I found an article on the net today (the article is from '99), stating that Microsoft would be showing huge amounts of losses on their books if they weren't granting so many stock options to understate their costs. From the article:

Specifically, Microsoft is granting excessive amounts of stock options that are allowing the company to understate its costs. You might ask yourself, what would happen to Microsoft's stock price if the public suddenly realized that they lost $10 billion in 1999 rather than earning the reported $7.8 billion? /me plays twilight zone theme

I don't think you are correct.

Isn't this the basis of this genius/crackpot (you make the call) who has a web site (and a Slashdot story about him) claiming that MS was actually *losing* money and not making money?

Ie, that they bury their true labor costs by printing shares instead of paying cash, if they had been paying true market salaries in cash they would be losing money. And due to an SEC/IRS loophole the shares they pay employees with don't have to be reported as expenses.

Anyway, reading the above gave me a deja vu..

[The following is a revision of a letter I have been distributing via email. I ought to have posted this earlier, but I lacked the courage. You can find the original on my website.]

Dear US Citizen,

I am writing to remind you to vote conscientiously tomorrow. I will also indulge in a little political activism by introducing some issues (watered stock, free trade, and others) for your consideration. As you read this message, keep in mind that I am not recommending that you vote for this or that candidate, but only that you think about what is at stake, make a choice, and vote.

I wish to bring to your attention a pattern of behavior by national governments that suggests that, in the world-wide political arena, the interests of citizens rank far below those of large corporations, and that the latter seek actively to diminish the influence of citizens on their governments' legislative activity. In some countries, citizens are even compelled by law to foot the bill for this nonsense. ;) It is worth noting that the worst consequences of this are not in the future: most US citizens feel so disenfranchised today that they either don't vote or vote for the lesser evil, and US taxpayers (citizens or not) bear the burden of unprecedented personal and national debt. If you don't vote, you will be capitulating, and the future of US politics will be that much closer to a foregone conclusion. As a citizen of the European Union and a resident of Switzerland, a very small sovereign state, I have learned that the rest of the world cannot afford apathy or carelessness on the part of registered voters in the US. You can think of this message as a plea for help.

[As you read this, please excuse the careless use of "Americans" where "US citizens" would have been correct.]

The first issue I want to discuss is the connection between corporations and public money. You may or may not be aware of the emergence of watered stock and pooling as a powerful weapons in the corporations' arsenal; for example, Microsoft and Cisco have managed to attain tax-free status by writing off stock options (and then earning some of that back when new stock is issued for the purpose of redeeming those options) and Citigroup recapitalizes and decapitalizes itself arbitrarily to achieve spectacular mergers (thus posing a great risk to the banking sector) -- right under the nose of the SEC. In a perfect world, this sort of abuse would have been reigned in already but, in our world, the possibility of relief seems remote. Let me make this plain: the watered stock write-off scheme amounts to a theft of public money and pooling needlessly endangers the stability of the economy. At the very least, insofar as stock represents a redeemable claim against a company's assets, it is a perversion of the modern economic perspective in which the stock market is allegedly as adequate a store of value as gold ever was.

Actually, said modern economic perspective was already quite perverse (in ways too numerous to mention) long before watered stock was even imagined. Such perversity is a natural consequence of the absence of an adequate standard of value, which was in turn an intended consequence of changes in policy that took place earlier in the century. Long ago, Alan Greenspan explained that the institution he heads today is a powerful instrument with which the government can confiscate part of the value of your money and, not incidentally, engage in deficit spending regularly. You might argue that calculated inflation is a small price to pay for being able to float a chronic debt and sustain a deficit as needed. You might argue that your national debt is presently unassailable because American households, which on average have a negative savings rate and face unabatable credit card debt, are financially overcommitted as it is. You might be wrong. Habitual deficit spending and the resulting chronic national indebtedness, along with the corporate welfare mechanisms that aggravate them, are to blame for your misery: the federal government uses inflation and national debt to mortgage your personal assets and your public resources, respectively, as effortlessly as a corporation uses watered stock to dilute the value of your share holdings. Think what you will of Greenspan's former support of the gold standard, but you have to admit that he was correct in predicting the practical consequences of failing to provide an adequate store of value, and in identifying the welfare state as the primary beneficiary:

Stripped of its academic jargon, the welfare state is nothing more than a mechanism by which governments confiscate the wealth of the productive members of a society to support a wide variety of welfare schemes.

What he may not have realized then is that corporate welfare is just as likely a welfare scheme as any other.

It now behooves us to ask not only how this wave of abuse can be stemmed, but also how this sort of situation can arise even under the watchful eye of our elected officials. The answer is that, in the US, the Executive and the Agencies operate with considerable autonomy; many important decisions are often made away from public scrutiny, largely or altogether, and there is a vested interest on the part of large corporations to increase the autonomy, if not the stature, of these public servants. Consider the case of MAI, the Multilateral agreement on investment -- a charter of rights and freedoms for corporations. Those of you who have not heard of it should at least know that it was the culmination of attempts to transfer some important powers from the popularly elected legislative bodies to the executive officials of sovereign states and to give corporations the legal standing of sovereign states. Let me take a moment to explore the brilliance of these tactics.

• When decision making forums are sheltered from public scrutiny, executive officials can serve corporate interests with impunity.
• When corporations have the same legal standing as sovereign states, large multinational corporations have power over small sovereign states -- perhaps even those in which the company is incorporated.

Surely, you can give examples of an administration negotiating treaties that would be difficult to accept for a majority of citizens and impossible to ratify for most congresses; now, try to imagine a future in which the legislature is powerless to stop unfavorable or undesirable consequences of free trade arrangements that it did not have the opportunity to approve or reject. Surely, you can name instances of a corporation getting away with practices that a majority of citizens would condemn but which the courts are powerless to stop in the absence of adequate legislation or jurisdiction; now, try to imagine a future in which a corporation undertakes legal action against sovereign states for refusing to let it set up shop, or even for having laws and regulations that hinder it, such as strict environmental standards.

"That's not a problem," you say, "because Public Citizen told us about MAI in the nick of time." That's not the point; the point is that MAI is evidence of an alarming, long-standing pattern of behavior: as Noam Chomsky has said, our governments really are, and have been for a long time, trying to undermine democracy. Consider, as further evidence, the case of Australia's MIGA, an agency that predates MAI and obviates the "need" for it.

Now, the two leading candidates, Al Gore and George Bush, look at the issue very differently, saying that free trade creates jobs, without mentioning what kind and where. Actually, Bush has even said that it is the duty of the administration to "sell" free trade (on WTO's terms, of course) to US citizens! Ralph Nader, on the other hand, has said that he wants the US to withdraw from the WTO and that we should re-examine the premise of so-called "free trade" agreements. I was going to give you a reference to Nader's website with that last statement, as WTO/NAFTA was one of the three key issues on his home page until just a few days ago, but now it is not even in the issue summaries. What could this mean? I think it means that he has pushed one of his favorite issues into the background because he needs enough votes to get federal funding for his next campaign. And this, in turn, suggests that American politicians think that the US electorate is politically comatose. You can help prove them wrong: a strong showing by Americans on election day would tell US politicians and corporations and the world that Americans are still in control of their political system. It would be a great sequel to the Battle of Seattle, with a lot less violence and just as much press coverage. Realistically, you probably cannot afford to act as resolutely as José Bové, but you can vote.

When I think about US politics, I think of the fable in which a master presents some options to his student, threatening to beat him with a cane if he chooses poorly; the essence of the problem is that the student cannot choose any of the options presented to him without risking bodily harm. (You should now take a moment to discover how the student can avoid the beating and what the moral of the story is.) You can and should vote for the presidential candidate who will most closely represent your interests, as you have more valid options than the mainstream media seem to suggest: you can vote for George W. Bush; you can vote for Al Gore; you can vote for Ralph Nader; you can vote for Harry Browne; and you can vote for some other candidate (yes, there are more) though his name may not appear on your ballot. If you cast a so-called "useful" vote, you are supporting a system in which you have a lot less influence than you otherwise might, and you might get beat with a cane. Of course, if you don't vote, you have no voice, nor will you ever, and when you and I finally get beat with a very stiff cane, no one will hear us scream. Please, vote.

Yours,

Alejandro Gómez de Argüello

Will this have any effect on Microsoft? No. Ms believes that it is above the law.

The Microsoft Pyramid Scheme Continues

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Now, if you're talking about the snippy remarks about Dubya getting elected and imposing a national operating system, that was an admittedly sick joke, and nobody would be happier than I to see it remain entirely fantasy (or nightmare). However, I wouldn't rule it out that easily- the idea was, 'Here's an outlandish, nightmare projection that I HOPE can't possibly happen!', hence the 'I'm picturing Dubya getting elected' rather than 'This is going to happen! The sky is falling, we're all going to DIE!' It's a combination joke/scare tactic and shouldn't be written off _too_ easily: remember how badly Microsoft wants to in effect impose a Microsoft Tax on everyone and not have to do any more work, just do new icons and count money. You shouldn't be so quick to assume they can't get paid a tax administered by the government- haven't you heard of corporate welfare? Dubya's just the sort to rubberstamp such a proposal, too.

Sorry- you strike out ;) you have no argument but ridicule and you're asking people to stop thinking. I'm not making these arguments because of karma troll bonus points, but because the situation both alarms and fascinates me, and I want to put the same evidence in front of people and see if they reach the same conclusion. In this case, I am taking Bill Parish's figures on the breakdown of MS income (I believe he got this from their annual reports and renamed the pie pieces?) for the argument that they're making more in the stock market than they are selling products, I'm assuming the top MS people are _not_ stupid idiots, and with regard to cutting projects I don't think I really need to remind slashdotters of the list of abandoned 'strategic' MS projects that tied up competition's resources for long enough to take care of the threat through further MS expansion. The difference is that I'm suggesting there is no MS project that couldn't be abandoned or defunded if PR activities would return greater profits through stock manipulation. That said, canning Office would _hurt_ the stock price not help it, and you'll not see them admitting to such a thing. On the other hand, Farenheit/COOL/C#/.NET and on and on- which will be the next to quietly fade off the radar, and do you think these fade-offs happen because someone at MS _lost_ _track_ of the project? They're killed because new products are not the most profitable thing MS could be doing, and they're killed quietly so it doesn't hurt the stock price- which _is_ the most profitable thing MS is doing.

You may now post "*yawn*" in the classic tradition of lazy-ass Usenet trolls ;)

Hasn't MSFT lost about half its valuation since the peak? Not only is it a pyramid scheme (see Bill Parish's analysis) but it is running out of steam. Choke this down: MSFT basically lost ten _billion_ dollars just in '99 and hid it with accounting trickery. How much are they losing now, struggling to not completely fail with W2K migration against Gartner Group advisories, to kluge together .NET and paper over the many quietly failed projects like Fahrenheit (sp?)? The real losses are _accelerating_ not reversing, and they can only pay people in options- they _cannot_ meet payroll if they had to pay people actual money.

If it was any other dotcom, they would be _toast_ but any fraud is based on a lot of social engineering, and this one's had a good long run. Think about it- the argument around Slashdot is typically 'is it right/sane that MSFT is so wildly successful and popular when their products/practices suck so bad?', but the idea that MSFT is wildly successful is rarely challenged. Yet when you look at the information (again, Parish is useful- people seem to challenge his interpretation but not his numbers and facts) you see that their sales are a miserably small proportion of their income and most of it comes from an options pyramid scam and 'corporate welfare' (I'd be interested to see more data on that. Define 'corporate welfare'?). This is nothing like a sustainable business model, much less 'thriving on innovation', yet because of the sheer scale of the exercise it goes largely unquestioned.

The upshot is, we're about due for another Great Depression based on the fact that too much of the economy is focussed on these pyramid-type companies- ones that have valuation wildly in excess of their revenue and assets, ones that are fostering mad speculation on the basis of _stock_ performance which reinforces the pyramid scheme until it collapses. As Parish shrewdly points out, doing this allows these companies the ability to stomp all over companies that are actually practicing _sustainable_ business models, potentially endangering them and putting them at risk of being 'out-competed' by the ones that buy into the pyramid scheme heavily. There's this one small problem: pyramids end. Always. You can tell it's starting to happen when the 'growth' _stops_ being geometric and levels off- the model doesn't allow for that, and the pyramid crashes at that point, hosing everybody who got left holding the bag.

The danger in a Microsoft setting the tone for the modern economy is this- as they are willing to go right over the edge into illegal practices to protect their pyramid but it will still end at some point, the risk is that all the pyramiding companies will successfully stomp all over 'old business models' and the old-style companies will go out of business, unable to employ people. The result would be a larger and larger percentage of the workforce paid in options as the companies adopt the MSFT pyramid model in order to keep up- options for pumping gas, options for shelf stocking at Wal-Mart- then when the pyramid tops out and collapses, it takes the ENTIRE economy out with it. That could be worse than the Great Depression- hell, through the 90s my (GenX) age bracket suffered exactly the unemployment and income burdens recorded in the Great Depression and nobody batted an eyelash because the yuppies still made their money. This time it won't be a yuppie-exempt crash- far from it.

I'd say the best thing to do is to realise that there's no disaster that someone doesn't profit by- and if you're determined to buy into the whole stock thing get ready to short like a madman, but better still, lay plans for a post-pyramid world. That means, accept being stomped on for the moment and build businesses that focus on _real_ revenue and do real work for real money- even though that is totally a losing strategy at the moment. Nothing else will survive the market correction we're due to receive- things will be incredibly nasty but with a head start in _serious_ business practices (rather than pyramid-focussed wish-fulfillment valuation) it's going to be a terrific opportunity for anyone willing to really work.

Constructive criticism you want? Fine- MSFT and CSCO's problem aren't that they're not paying taxes. Their problem is that the ONLY ARGUMENT that they're making a PROFIT is this evasion of paying taxes _or_ normal wages. It's not about them not paying taxes, it's that they have no business being stock market heavyweights when they lose shitloads of money! That's just asking for trouble! End of story.

Maybe you're thinking of the Microsoft Financial Pyramid page. The stock market thinks Microsoft is making money because those stock options are not listed on the financial statements as expenses.

Bill Parish has been tracking the creative accounting practices of Microsoft and Cisco for months now.

Bill Parish has been tracking the creative accounting practices of Microsoft and Cisco for months now.

Being no longer able to rely on a stock price which doubles every year, MSFT won't be able to profit as much from these loopholes. Furthermore, they will probably need to offer either higher salaries or a better options package if they want to retain employees.

What happens when the stock is wounded? Profits fall. What happens when profits fall?

uh-oh.