Slashdot Mirror
Google Execs Happy With $1 Salaries
DarkClown writes "ZDNet is on the one hand reporting that Google execs will keep their $1 salaries again this year, and on the other hand is reporting that the executives cashed in more than $160 million worth of stock last month." From the stock article: "Since the search giant went public in August 2004, Brin has sold about 6.5 million shares at a market value of $1.68 billion. Page has sold about 5.8 million shares at a market value of $1.4 billion, according to calculations from Thomson Financial. Chief Executive Eric Schmidt, who was brought in to run the company before it went public, has sold more than 2.1 million shares, worth more than $502 million." They could be getting a multi-million dollar salary *and* the stock money. Good faith efforts go a long way in my book.
But can we really say it's some amazing piece of good faith that they settled ONLY for 1.4 billion dollars in salary for the year?
I read an article somewhere that says these kinds of stock options instead of salaries lead to the massive corporate frauds....
Translation: Boo hoo, they are rich and I am teh poor!
Can we honestly say "good faith" is their motive and not income tax?
In addition to the billions they are making from their stock, their $1 salaries also allow them to qualify for food stamps. Just another perk...
Unknown host pong.
jeezus, they take out billions in cashed in options and people talk about "good faith" ...
They are doing what every other tax paying American is doing this time of the year, trying to get out of a mountain of taxes. I think it is great, I wish I had this option.
I believe that Capital Gains Tax is higher than Income Tax (at least from personal experience). I'd be willing to believe "Good Faith" based on that.
"Oh my God. This is terrible. This is the end of my Presidency. I'm fucked."; ~ Donald J. Trump
They're betting their distant future as multibillionaires on the value of their stock and securing their immediate future via cashing in as mere billionaires. Sounds okay with me.
it's a blue bright blue Saturday hey hey
You're right, but the google fanboys don't like to consider this.
I worked for a consultancy where the CEOs capped their salaries at $55,000. The place I work now has a similar deal going.
Of course, all the CEOs are wealthy from stock sales.
Shouldn't that be illegal to pay people under the minimum wage?
IANASME (I am not a stock market expert) so maybe someone can explain this too me.
The SEC has mandated stock option expensing methods because previously too many companies made executives' pay pretty much disappear - instead of paying them, they gave them options. Now that they are expensed, what is the difference? It just seems to me as if the executives are getting paid billions of dollars and Google's bottom line should reflect that with the new expensing procedures- whether it it direct compensation or stock options.
Thanks,
Jack
Even if their wages were in the millions per year, it would affect the money they were getting from stock options in the same way a feather would destroy a mountain.
Why not just let that potential money accumulate in the company and access it with much lower taxes later on as dividends. Hell, even doing this $1 salary thing could impress stockholders enough to boost the share price enough to give them even more money.
I mean, it's not like this move hurts them. They look great to their employees, get lots of great press, and don't pay as much in taxes. Later, when they don't have _quite_ as much stock money to thow around, they can ask for a nice salary, and a greatful board will shower them with riches.
I expect the next move from these guys to be buying some small spin-off for $10 million and turning it into a media powerhouse to later sell for $7 billion and a seat on the board of an even larger company...
They pay tax on those stock sales
So, do they divy their one dollar up into bimonthly pay checks?
The news here is that the executives are selling their stock -- not normally considered a show of faith in the company. Brin and Page have each dumped over a billion dollars worth, and Schmidt another half-billion.
What I'm listening to now on Pandora...
What percent of shares do they still own? If they end up selling too much stock, an unscrupulous company may swoop down, buy all these shares, and then gain controlling interest in the company.
In this case, the Google founders and executives are cashing in on their IPO. It's not really the same as the typical salary to stock option crap that's going around. Let's face it, if you could get paid via capital gains (15% tax rate, until it's not taxed at all...) instead of salary (38% tax rate), why would you want a salary?
Make dividends and true stock investments (investing in IPOs, new stock offerings, and startup stock payments) taxable at the capital gains rate and revert all the daytrading/recycled stock profits to the full tax rate; it will benefit new technologies and put the brakes on silly speculation trading (read: gambling for the rich).
Let us live so that when we come to die, even the undertaker will be sorry -- Mark Twain
How much tax is paid on that dollar?
So Steve Jobs pulls this stunt too, what about minimum wage laws? :} (seriously)
Can we honestly say "good faith" is their motive and not income tax?
Receiving additional income does not result in a situation where you're paying more in taxes than that income. So Page, Brin and Schmidt suddenly started making $1 million/year in salary, they would still be taking home more money after income taxes than if they weren't receiving that money. So there's no motivation based on income taxes to not receive additional salary.
Personally I think they take $1 salaries because they want to appear approachable at work and remain effective leaders. Steve Jobs does the same thing.
my blog
I was under the impression investment profits were considered taxable income (interest income?) Is it just a lower rate?
I can own my own google executive for just $1 a year?
"I don't get it. Well, I could ride it to the store, I guess."
1$ salaries are great, they cost your business very little and you don't have to pay any kind of taxes on them. I'm surprised all high level executives don't opt for similar salaries.
~= scwizard =~
They pay tax on those stock sales
But not income tax, which is what the parent mentioned. They probably pay the (much lower) long-term captial gains tax.
rage, rage against the dying of the light
Eric Schmidt was smart enough to say "Yes, I will be Google's CEO."
That's what he's done to earn $502M.
---
Mod me down, you fucking twits. Go ahead. I dare you.
(I read with sigs off.)
They would still make more money if they took a salary, even if they had to pay taxes on that salary. It is not more profitable to forego the salary because of taxes.
That said, I don't think it's motivated purely by their benevolence -- most of their net worth would have been tied to their stock holdings and not salary anyway, and this move makes it obvious to investors that they have confidence in the continued performance of the company/stock.
Of which I have not previously been aware. I thought hyperinflationary practices had a tendency to raise the cost of living without raising wages in concert- but this takes the cake.
SJW: a person who perceives an injustice, and while correcting it, commits a greater injustice.
It isn't about tax evasion or good faith. It's a way to link productivity to company success. If stocks are high, they make more money, if they aren't they make less. Many companies have started doing similar things, as linking rewards to success is far more profitable for everyone. Shareholders benefit greatly, as the leadership has more invested in the company, so is more focused on its success. Paying someone a 500 million/yr salary with no difference if they do well or poorly leads to poor results. It's basic economics and psychology: proper motivation results in proper rewards.
Microsoft Sucks, F/OSS Rocks. I get mod points now right?
They can take *both* if they want. If they take a salary + stock, they won't get less than if they only take stock.
-- Don't Tase me, bro!
Is what feeds corporations. Welcome to the club Google.
I believe that Capital Gains Tax is higher than Income Tax
OK. What about Google's payroll tax liability?
Also, they're keeping Google's bottom line much more impressive than it would be with a billion dollars of salary tacked on.
Returned Peace Corps IT Volunteer
There is a difference between Stock, and Stock Options. These guys aren't just the CEO's, they are the founders. When they sell off stock, they are selling off their parts of the company they founded. You know, the one you use every day for searching, that has enriched your internet experience. Presumably they and their investors have some split of the available stock, and they are simply adjusting this ratio more toward the investors. They could quit tomorrow, and STILL sell that stock, or keep it, and just live off the work they've already done.
The point is, they aren't being PAID in stock (That's not part of their current salary, reimbursement for their current work), that is the reward they have for risking their money, work, and reputations building this thing called Google in the first place.
Where are we going, and why am I in this handbasket?
But at least they aren't wasting company resources for their own salary.
Most American CEOs should take this as the way to do things instead of giving themselves dubious raises. That or somehow their salary is tied into the stock price in which if they pump and dump the stocks their salary will go through the floor.
"I am the king of the Romans, and am superior to rules of grammar!"
-Sigismund, Holy Roman Emperor (1368-1437)
Or to be more truthful-- another day another 0.0027378507871321013004791238877481 cents
Or people who know how tax works.
Capital gains tax rates are higher than income tax.
Were they to take a higher salary, that salary would be taxed, but they would still end up with more money.
There is really no obvious greed based reason to do this.
Finkployd
Continued being great?
Comment removed based on user account deletion
It's all about the taxes, whether it saves them money or the company.
One obvious reason comes to mind; a salaried employee and the company must pay the FICA taxes equally. But it is only calculated against the amount of the salary. In this case, $1. Saving millions for the company.
I'm not an accountant, therefore I'm sure there a dozens of other reasons to keep a low salary. I'm guessing "Good faith" faith is not one of them.
James Marciano
356@up-set.com
They better make sure they are set up for retirement.
Aren't they supposed to be paid minimum wage?
crazy dynamite monkey
In terms of business, Google so far is a great business that tries to do no evil and approaches a lot of problems from an academic standpoint. It makes them money and it makes people's jobs easier. Good for them and good for us.
But $160 million in stock options? $1.68 billion in 2 years? Damn! Do you know how much rice and grain you could buy for starving people? How many middle class and working class people you could employ with that? The 8th highest paid executive in the world is the CEO of ExxonMobil and he made $88 million this year.
It's good that these stock options are tied to performance, because if Google tanked, they'd get nothing. But let's put the amount of money into perspective. Can we tone down on corporate greed? Did these guys really need that much in stock options?
I'm just saying...
"All great wisdom is contained in .signature files"
>
> But not income tax, which is what the parent mentioned. They probably pay the (much lower) long-term captial gains tax.
In Kalifornistan, all income - salary, interest, dividends, and both short-term and long-term capital gains - is taxed by the State as well as the Federal government. Every dollar earned over $40000 is taxed at 9.3%. (Every buck over $1M is taxed at 10.3% starting January 1, 2006.)
So if you have, say, a $400M capital gain on a $500M hunk of stock, the Feds take $60M (to build a quarter of a bridge to nowhere in Alaska, or to blow up some Arabs), and Ahnold takes an extra $37M in state taxes (for the pensions purchased by the various government employees union' under the previous administration in exchange for campaign donations.)
And since the AMT threshold is measured in thousands of dollars, no, you can't deduct the $37M in state taxes from your Federal return, because you're so far beyond the AMT threshold that your accountant can't even see the AMT threshold without very long baseline interferometry.
Ask yourself what the various levels of government have done to earn a quarter of the wealth spawned by Google.
This isn't a right-vs-left issue. Wouldn't most Democrats be a little happier if the government wasn't able to take a huge chunk of your wealth in order to buy bombs to drop on brown people? And wouldn't most Republicans be a little happier of the government didn't take the rest of your money to spend on government employees' unions and welfare queens?
I'd feel better about investing in the company if they were taking home large paychecks. If they are taking $1 paycheck to help keep the company solvent while they selling billions in stock I'd worry about the future of the company. They don't seem too confident in the potential of the company. If they only cashed in a few mill a year to offset their loss of wages I wouldn't be concerned but they seem to be divesting as fast as they can without obviously destabilizing the stock. I'd say future earnings for the company are seriously in doubt. They certainly don't have faith.
Yep, Brin, Page, and Schmidt are only paying 15% on their haul, vs. the 28% I pay for taking a salary that's about 0.02% of Schmidt's gain.
Luke, help me take this mask off
Hi I work for the RIAA, and I don't understand what this is about? My brain explodes every time I read it, but we have a fresh supply of donor monkies.
So could anyone give me a quick synopsis of how this one-dollar pay thingie works. Add supported synopsis is OK.
If you don't know what AltaVista is (was), get off my lawn.
As an independent, I say we take a huge chunk of the wealth to buy unions to drop on bombs, and welfare queens for all the brown people.
Set the bar high, then bring a tall ladder.
Comment removed based on user account deletion
... if my math isn't wrong is almost 4 million per month in a plain old savings account paying 3%. Didn't Bush's tax cuts make this income tax free?
I can't imagine what a nerds like those guys would spend that much money on.
Flamebait? Seriously, this is rediculous! I mean the bias here is fucking mindblowing.
Don't be greedy. There are plenty of us out here that would be more than willing to give them twice what they're currently making a year....
Ask yourself what the various levels of government have done to earn a quarter of the wealth spawned by Google.
On top of all the standard responses (cops, roads, an army, etc), they built the Internet, without which Google couldn't exist.
I don't fault the Google guys for their compensation or their decision to try and defer some tax issues. Hell, I don't even fault them for turning their pseudo-salaries into a miniature news event. They're in the business of growing Google, and part of that is playing up the "Google mystique."
Yeah, they make a lot of money no matter how you count it. But you know what? So can you, if you come up with an idea that's good enough and get people to buy into it.
We should look upon home-run successes like Google for inspiration, not class jealousy.
"It was a summer's tale: Just a boy, his Linux, and a head full of dreams..."
If Africa could almost instantly send me porn, useless trivia and the ramblings of quasi-literate teens based off of just a few English words, I'm sure its stock would go up too.
I'd never want another dime if I had that much. Hell, I could give half of it away, live off the interest, and give away most of the interest, and still live happily ever after. The headline "Google Execs Happy with $1 Salaries" is a gigantic DUH considering how much loot they have already. Working in a job they love in what has to be a relaxed, comfortable atmosphere doesn't hurt either, I'd guess.
Article moderation: -1 Duh.
But $160 million in stock options? $1.68 billion in 2 years? Damn! Do you know how much rice and grain you could buy for starving people?
Let Darwin take care of this. The people who are weak and unable to sustain themselves will die off. The strong and capable will survive and benefit
Feeding millions of starving people who are incapable of sustaining themselves will do nothing for these people and only promote the survival of a weaker group of people. This is anti-evolution.
These guys started at the bottom of the pile, right? Just like the great majority of us, they were workers. Then they had a great idea, and now years later, they're billionaires because of it. It's the american dream. Why does everyone assume that just because they've made money they've turned to the dark side? 99% of you put in the same position wouldn't be turning down the billion dollars from stock sales. You'd have earned it fair and square, and you'd be very happy with yourself. I'm happy for them too, they've created probably -the- most useful tool on the internet, IMHO. Dave
Specialization is for insects. -Heinlein
I think you missed the key point, which is that the federal long-term capital gains tax is relatively small compared to the tax you'd be paying if you had wages earned in the top bracket, or if you had short-term capital gains. Both of those are around 39% last time I checked, plus you pay out for social security on wages (another 7.5% for you and 7.5% for your business). Don't forget as a large C-corp, the business itself pays taxes which are probably in the 35%ish range.
So by paying themselves salaries of $1, the Google masters are, indeed, legally dodging some taxes. But Uncle Sam is still getting a fat chunk o' change. No doubt about that.
This is just a neat way to get away from charity. According to http://globalrichlist.com/, they are among those billions who earn less than 2$ a day, and are therefore not expected to donate.
I'm not sure how this can impress anyone. They made more than God cashing in their stocks. I say they are still being greedy. Why not take a $.01 salary. Wow...they are all about the company! Taking no salary! How many yachts to they need to water-ski behind !?! How much is enough !?!?
if they can be compensated that well without taking any money out of their operating reserves, good deal. it can't continue forever, but then again, they can invest those billions elsewhere and just keep doing what they are doing for fun. personally, if i scored that well, i'd run off on a world tour and screw working. of course, that could explain why i haven't scored that well with that kind of work ethic.
What they've effectively done is told their employees: We care about the company
actually what I gather is they told the employees "we care about Wall Street" which can be quite different from caring about the company (lay off half of your workforce and outsource and the stock will go up, be conservative with your numbers and projected earnings and the stock will go down).
I personally wish the stock market just disappeared, but fat chance of that happening.
-- the cake is a lie
Me culpa.
Minor correction: A stock option is properly the option to buy or sell a given number of shares on a given date for a given price. See Wikipedia for a more thorough discussion, but in short what a stock option as a means of compensation entails is this: The company gives you an option to buy N shares for X dollars each on D date. If the stock price on the open market is greater than X dollars per share (call it Y), then you can exercise your option by spending N * X dollars to buy N shares of stock. Actually, you can do that even if Y < X, but that would be equivalent to buying a gallon of gas for $2.50 when it costs $1.50 across the street. Once you buy the N shares of stock, you can (as most people do) sell them back into the market for their going rate, Y dollars each. So your profit from fully exercising your stock option is N * (Y - X).
If you hear someone say their stock options are "under water," it means that Y < X and the options are worthless. Also, note that most stock options given as compensation for work are not freely transferable, whereas stock options purchased on the options market can be sold back into the market. That's most of what options traders do.
But the other people pointing out that this story is not about stock options but rather about actual stock shares are probably correct, at least as far as the company's founders go. They already own shares of stock and are just selling the shares off into the market for cash. Bill Gates and Steve Jobs both do this from time to time with their respective companies. How it works is you form a company, call it Acme. You incorporate it as Acme Inc. and, in the articles of incorporation, grant yourself 1 million shares of common stock. Then you later make an initial public offering and the Acme Inc. board authorizes the issue of 1 million more shares of common stock, which get sold through the stock market (probably covered by an underwriter or something initially and sold from there). So now you own 1 million shares and other people own 1 million shares. All you have to do to get rich is sell your shares out into the market.
Investors don't like unknowns. They aren't going to dump billions into a company run by two guys (though brilliant) who have never run a business. Instead they want a company with the ideas of two brilliant guys and run by someone who has done it before. Even if that persion seems to run sinking ships. So Eric Schmidt did what probably many people could have done, but he was the one who did it. So he gets the money.
Since capital gains tax maxes out at 15 percent rather than the 38 percent tax on income, they pay a smaller percentage to the federal treasury than their secretaries. Not to mention that they also get out of paying into the Social Security, Medicare, and unemployment systems.
Of course, they aren't unique in this regard. The same is true of most people for whom salary is not the primary means of support.
that some CEOs get for getting fired that really pisses me off!
Enron. Enron. Enron. Ummm... Enron?
Does anybody here really believe that a CEO's perspective changes if they get a $1 salary versus a multi-million dollar salary when they have a ton of stock and options? Good CEO's will feel a vested interest in the company's performance, and bad CEO's will not. Awarding them scads of cash may keep them on board with your company, but that's all it buys you.
This sig has been temporarily disconnected or is no longer in service
it's time to sell google stock. I'm pretty sure they lost their interests in their company.
Your ego is Matrix!
Anti-evolution? There is no anti-evolution; it's a nonsensical phrase. Try learning some terms before you spout nonsense. Here's a hint: Darwin never said "survival of the fittest" ever in his work. Maybe if you opened a book you'd be able to realize what evolution is. I might be giving you too much credit, though. Go back to watching Sesame Street.
They're just covering their asses for when the inevitable crash to the stock comes. Might as well cash in on the company while its price is still in nevernever land.
I'll work for 1$ a year, and settle for only 200 million in shares, if that's any incentive.
Salut,
Jacques
Some of those "Will Work for Food" signs are legit.
---- "If we have to go on with these damned quantum jumps, then I'm sorry that I ever got involved" - Erwin Schrodinger
If this was Microsoft and Bill Gates most of the posts here would be calling it a meaningless PR grandstanding that is somehow worse than if he didn't do it, like they did against him giving away a fortune to charity.
Analogies.
Question 1.
One Billion Dollars Salary::One Billion Dollars From Sale of Stock Grants/Options
a) Mayonaise::Hamburger
b) String Beans::Artichoke Hearts
c) Guacamole::Avocado
d) Tomato::Tomato
Either way, you can ditch the company at any time and retire to, well, anywhere you want.
Old people fall. Young people spring. Rich people summer and winter.
Since Bush's tax cuts, Capital Gains tax on any stocks held over 1 year is a paltry 15%.
I make next to nothing, and I pay more income tax than that.
It's not what you know, or even who you know- It's how many people recognize your damn
How much do they pay normal employees? Just curious. Not just the high up engineers, but the lower tech people too? Has to be pretty decent since cost of living is so high around them.
As I sit here in my cube wasting time waiting for the clock to tick to 5 PM and dreaming of having only a couple of million dollars so I could live off the invesment income, I am pondering why would anyone want to work after they have made $500 million or $1.5 billion dollars?
I could think of so many more fun and exciting things to do than... work. How many of us here worked for dot-coms and on paper were worth millions? I was and kept pestering our CFO as to when I could dump all of my shares and quit. Sadly, we went under before I could dump. If I was an employee of Google and my stock options were worth over a couple of million, I would dump and run.
Kind of makes you wonder about what kind of people stick around when they are already super-rich. Bill Gates, Steve Ballmer, Steve Jobs, etc. Why do they continue to work? Is it because they have nothing better to do?
According to yahoo finance:
http://finance.yahoo.com/q/pr?s=GOOG
Eric Schmidt gets $82,000 and Sergey Brin and Larry Page get $45,000.
No Sigs!
They are NOT stock options, these are stocks that the founders owned because they inested their life into the company when they founded it.
You do realize that on a salary of eleventy googillian, billion, trillion dollars the FICA tax would be precisely $5,580 don't you?
I suppose they're really getting a deal on that $1,305 in Medicare tax too.
Duh.
Ask yourself what the various levels of government have done to earn a quarter of the wealth spawned by Google.
Oh I know *raises hand* Spent 8.2 trillion dollars the united states government didn't have! almost half of that during the current administrations watch!
http://www.brillig.com/debt_clock/
https://www.gnu.org/philosophy/free-sw.html
For a stock/stock options program to work properly, it really needs to last for several years, or at least long enough to not tempt executives into doing stuff which hurts the long-term viability of the company, in order to increase the short-term value of a set of stock options.
I.e. the stock options you get this year cannot be sold/converted until X years later.
Terje
"almost all programming can be viewed as an exercise in caching"
1.6 Billion is 1600 Millions
Wouldn't want to pay taxes on that chunk of change!
In regards to the aforementioned job...
I'll buy that for a dollar!
He who knows best knows how little he knows. - Thomas Jefferson
RTFSummary: "and on the other hand is reporting that the executives cashed in more than $160 million worth of stock last month."
Suits will come, and suits will go.
Just make sure Guido is well compensated. The world really needs Python.
Get thee glass eyes, and, like a scurvy politician, seem to see things thou dost not.--King Lear
There's a distinct difference here as well - if they got a salary, it would be coming from the company coffers (i.e. company networth would DECREASE). By selling shares, they are just selling what THEY ALREADY OWN. So yes, they're in a sense increasing their personal fortune by working, but at NO COST TO THE COMPANY. I.E. If they decided to pay themselves $20M a year, they would get that ONTOP of the shares they already own. Instead, they decided the shares are enough, and that $20M each effectively gets split among all the shareholders.
You mean other than create the internet? Or how about regulating commerce, building infrastructure (highways, etc) or educating the population? Wjat have the various levels of governement done for me, yet I pay taxes on my wealth... what's the difference?
"It takes considerable knowledge just to realize the extent of your own ignorance." - Thomas Sowell
Steve Jobs also claims a dollar sallery, but didnt include the $80 million jet, etc etc etc.
what are they being compensated, basically..how much free shit do they get outside of stock.
...it also makes the younger generation have a job at Google their dream job. Lots of free time, fun work, good company atmosphere, and a possibility of producing the next big thing combine to make Google look like the best IT job around.
Wrong.
Did these guys really need that much in stock options?
If the market (in this case, investors) wanted to pay them that much, then yes. They didn't use violence to obtain their money, they didn't bribe the government to pass laws in their favour, they simply produced a product (stocks) that other people of their own free will were willing to buy.
Welcome to freedom.
Incidentally, no one on this planet is starving due to lack of food. We produce far more than we require, even for all 6 billion of us.
Endless arguments over trivial contradictions in books written by ignorant savages to explain thunder in the dark.
Nowadays, that depends on whether it's long-term capital gains tax or short-term capital gains tax. Long-term capital gains are usually taxed at a much lower rate.
if you make "next to nothing" i doubt you pay 15% or more in federal income tax. you have to make "a bit more then nothing" to pay 15% in federal income tax.
why do you say 15% is paltry when you don't have to pay it and then imply it is too much when you have to pay it? it either is or it isn't.
Ask yourself what the various levels of government have done to earn a quarter of the wealth spawned by Google.
There's two separate issues raised by that question. The first is what has the government done to deserve a part of that money and the second is why it comes out to a quarter of these very large values. These are two very different issues.
The first one seems pretty obvious for people who accept the social contract. As others have stated, the government builds roads, provides fire stations, police stations, hospitals. They build schools (one or more of which likely provided a pretty good education to Page and Brin), and provide an army that would protect Google from the Chinese military if they decided to invade Google for not censoring search results. It's far fetched, but the point is still valid...the military, as a concept, offers protection to people and businesses in the US. As part of our participation in our society, we agree to pay a reasonable amount to fund all this.
What's reasonable is another matter...
Which brings me to the "why does it have to be a quarter?" question. This is less a philosophical question and more a question of how everything is implemented in this country. I'm not going to argue that things aren't broken. Government spending is out of control. If an individual spent money like the government, they'd be bankrupt with the lowest possible FICA score. Billions of dollars are wasted on pet projects for senators that just want to make their constituents happy and aren't taking into account whether it makes sense to spend the money at all. It doesn't take a genious to see the impending currency crisis that'll hit this country in the next couple of decades. If the government were to get out of debt (yeah, yeah, you can stop laughing now...I'm talking hypothetically) and curb it's spending by cutting back on unnecessary spending, it could be a whole lot less than a quarter that would need to be carved out of those capital gains.
That would be called Socialism, an economic model that has consistently failed when put into practice.
If the key execs are basically forgoing salary, that's fine. Despite the fact that they've been monstrously profitable via stock and other incentives, I personally think it is commendable that they don't have massive executive officer salaries as well.
If the corporate officers of a company have been instrumental in making their company profitable/valuable, I think it is important that they are well-compensated.
However, it is important for the company to remember the people who have really made it actually work where the rubber meets the road (marketing, development, sales, support, IT, and all the folks in between).
A Passionate Independent Musician
Ask yourself what the various levels of government have done to earn a quarter of the wealth spawned by Google.
..they just gave a motivation.
I'll also ask myself if Google generated any wealth or if some investor moved their wealth into Google stock by valuing it and paying for it at very high prices. Please remember that moving money isn't the same as generating wealth, no matter how "creative" (in the criminal sense) your accounting can be.
That doesn't obviously imply Google isn't introducing some interesting innovation and selling some advertising space..they apparently do, but they didn't create the money spent to buy their stock
Will it be a success ? Only if these who bought the stock will manage to sell it before anything bad happens..so far some CEOs did cash out part of their stock and this isn't always good news for other stock owners.
I don't agree. If you give Brin's money to all those starving africans, they buy food, multiply and there are suddenly 100x as many of them as there were before, but they don't really have that much money each. You have just greatly reduced the average wealth of us all. On the other hand, if you let them starve to death, you reduce the population at the low end of the wealth scale, so you immediately have a great increase in average wealth. Now, what exactly are you in favor of?
Jiggity
I'd be happy too. The top bracket on the $1 in salaried income is a twice what the top bracket is on the capitol gains tax they pay for the stock sale. If they pay even that... They could dodge by having a personal C-corp that holds the stock. As long as the corp reinvests the money elsewhere before the end of the fiscal year they don't pay any taxes on it at all. The personal corp could invest in lots of things... houses, cars, jewelry...
Moderating "-1, Disagree" is simple censorship. Have the guts to post your opinion.
Well, technically wouldn't sterilization be anti-evolution? I wouldn't go so far as to say that there's no such phrase- after all, if there wasn't, and he just said it, well, now there is a 'anti-evolution' phrase. I agree however- it may be cold and cruel, but sustaining people who don't have the resources to sustain themselves is simply illogical.
It's poetry with a beat behind it! And guns! They're like beatniks with automatic weapons.
it is because for some, there is no limit (in +ve sense). They dont reach a stage and conclude they have earned enough, but strive for something more. They have a determination, and an infinite apetite for more, as there are lots more to be achieved, if everyone thought I have done my part for my lifetime, we would have been more backward
Sure, and the Earth might just stop spinning and reverse direction. Could be why they sell millions of dollars worth on a regular basis. You think they live on the $1? And, even if Google stock tanked, do you really suppose that all their stock would not amount to much more than a dollar? Anything is possible, not realistic.
"Who are in control, they are not in control of anything - they don't even control themselves!" - Glen Beck
This example of only getting paid by selling stock works for the major stock holding executives of a new public company on the rise. I think the decision is in good faith, but will not last forever. Over the next 10 years, when the stock begins to stable off and another round of executives are brought in, I don't see executives working for only stocks that they can sell. If google keeps their plan of paying executives $1, you will see huge executive bonuses, to make up for the slowly growing stock prices. No company can keep growth like google has seen!
With your intelligence, it's probably the Christian Bible.
Capital gains tax rates are higher than income tax.
7 ,00.html):
And you're higher than a kite!
From the IRS (http://www.irs.gov/taxtopics/tc409.html):
"You may have to report capital gains and losses on Form 1040, Schedule D (PDF) . If you have a net capital gain, that gain may be taxed at a lower tax rate. The term "net capital gain" means the amount by which your net long-term capital gain for the year is more than your net short-term capital loss. The highest tax rate on a net capital gain is generally 15% (or 5%, if it would otherwise be taxed at 15% or less). There are 3 exceptions:
The taxable part of a gain from qualified small business stock is taxed at a maximum 28% rate.
Net capital gain from selling collectibles such as coins or art is taxed at a maximum 28% rate.
The part of any net capital gain from selling Section 1250 real property that is due to recapture of straight-line depreciation is taxed at a maximum 25% rate. "
The important part is that your long term capital gains are pegged based on your tax bracket. If you would normally pay more than 15% in taxes, your capital gains are 15%. If you would pay less, you pay only 5%. Short term capital gains are just figured as normal income and taxed as below.
And here are the tax schedules (http://www.irs.gov/formspubs/article/0,,id=13351
"If taxable income is over-- But not over-- The tax is:
$0 $7,300 10% of the amount over $0
$7,300 $29,700 $730 plus 15% of the amount over 7,300
$29,700 $71,950 $4,090.00 plus 25% of the amount over 29,700
$71,950 $150,150 $14,652.50 plus 28% of the amount over 71,950
$150,150 $326,450 $36,548.50 plus 33% of the amount over 150,150
$326,450 no limit $94,727.50 plus 35% of the amount over 326,450 "
So, if you earn $1 billion from the sale of stock held over one year, with only $1 dollar in actual income, you pay ($1 billion * 5%) $50 million (since the tax rate on $1 is 10%, which is less than 15%). If, however, you earned a $1 million salary, then cashed out $1 billion in stock, you'd pay ($1 billion * 15% = $150 million) + ($94,727.50 + (1 million - 326,450)*35% = $330,470) = $150,330,470.
By paying themselves $1 per year, they saved themselves over $100 million. Yeah, it was completely altruistic. Altruistic like a fox!
God invented whiskey so the Irish would not rule the world.
Let's to a little math: the stock market values Google at around 100 times earnings. When Larry and/or Serge forgo say $1 million in salary, that translates directly on the balance sheet as $1 million additional earnings for Google, and boosts Google's market cap by around $100 million, a substantial fraction of which belongs to Larry and Serge. Say they own 30% of the company, then by not taking the $1 million in salary, they boost their net worth by about $30 million. So if Google can appreciate at a rate of more than 3.3% annually, they're actually doing better than if they took the salary.
I don't know if it's good-faith or not. It could be just selfish. Instead of $X in cash, take $X in stocks, wait a year, and (if you're google), you could very well have doubled your money.
steve
Oh, you're not stuck, you're just unable to let go of the onion rings.
I hate to refer to my own previous post on this subject, but by taking a one dollar salary, they are saving themselves over $100 million per year. Each. That is the only reason they are doing this, if anyone tells you anything else they are selling something.
God invented whiskey so the Irish would not rule the world.
um no the point of "Capital Gains" is to make it less than normal income to encourage investing...at least that's the pro-capital gains crowd's line....the anti-tax line is that it's purpose is to double tax your income ;)
I make about 2/3 of the industry average wage in my field. That puts me well above the poverty level- and indeed above 15% bracket in federal income tax- but for what I do, it is next to nothing. But that's really irrelevant.
If you'll check this chart, http://taxes.yahoo.com/rates.html, you'll see that people making between $30,000 and $70,000 a year are paying a federal tax rate of 25%. In that range is a good swath of middle class Americans.
So the point is that even people not making a lot of money are still paying a higher tax rate because of the manner in which they made their money. And lo and behold, those who make money through capital gains- which the wealthy are more likely to- pay a lower tax rate.
15% is paltry compared to the 35% those google boys would be paying if it was taxed through the federal income tax.
It's not what you know, or even who you know- It's how many people recognize your damn
It would not be surprising that they would quit in a few years, but right now working at Google would have to be one of the most interesting jobs in the world. And this is for an outsider, can you imagine if you'd created the company yourself?
Well, to sum it up... ;)
They only get the nominal 1$ as a yearly salary, and instead get paid in stock and stock options.
This means that they have strong faith in their company (if the stock crashes they'd lose alot of money compared to just having a ordinary 6-7 digit salary)
And regarding the sale of stock - its stock they already own, so they are taking nothing away from the company. Its like turning part of your coin or stamp collection back into cash. Well, its a tiny bit bigger than that but the principle is the same.
+++ MELON MELON MELON +++ Out of Cheese Error +++ redo from start +++
Linking pay to stock prices, or paying in stock, is a bad idea, because stock prices can be fraudulently manipulated.
Think about it. Who makes the announcements that affect the stock price? Management. Who then benefits from inflated stock prices? Management. (Because ordinary stockholders aren't in on the scam, they are as likely to lose as win.)
So you get frauds like Enron and Worldcom.
"Wouldn't most Democrats be a little happier if the government wasn't able to take a huge chunk of your wealth in order to buy bombs to drop on brown people? And wouldn't most Republicans be a little happier of the government didn't take the rest of your money to spend on government employees' unions and welfare queens?"
Sure but you don't get to pick and choose do you. The repubs don't want the unions or the teachers getting any money but they want to dole it out to miners, loggers, oil barrons, ranchers, hunters, farmers, defense contractors and other people who vote for them.
Same with demos, they don't want the money going to kill a-rabs but they want to dole it out to the teachers, cops, firemen, road workers, welfare queens and other people who might vote for them.
evil is as evil does
Actually, according to this year's 1040 form, you can make about $82,000 and still pay only 15% in federal taxes (married filing jointly, standard deductions and exemptions with four people in the family). If you consider this next to nothing, you are living in a different world than me.
----- There are two kinds of people in this world, my friend; those with loaded guns, and those who dig.
No, for what you do, it is less than average.
Eric Schmidt sold shares in Google worth more than half a billion dollars. This was considerably less than the shares Brin and Page sold were worth -- does that mean half a billion dollars is "next to nothing"?
"Wise men talk because they have something to say; fools, because they have to say something" - Plato
...Capital Gains tax on any stocks held over 1 year is a paltry 15%.
If you hang on to if for less than a year, you tack the amount to your income and pay that rate. Holding it for 12 months helps, as that 'income' gets taxed at a fixed rate rather than what you make at a normal income. But no worries on the tax front. Once you break a certain threshold where you get to play with the glorious ATM (alternative minimum tax) codes, which these guys certainly hit... No changes there at all...
+++ UGUCAUCGUAUUUCU
Many companies have started doing similar things, as linking rewards to success is far more profitable for everyone.
First, they shouldn't be rewarding "effort" so much as "results". Effort doesn't cut it- ability does. Second, there has been a growing trend such that executives are compensated in such a way as that, from their perspective, makes it less consequential one way or the other if the company doesn't do well under their leadership. If they get canned, they often still walk out the door with a fat chunk of change- more than most people will make in their entire lives. If they stay on, they get paid their rediculously high salaries along with whatever perks they've managed to include. For the CEO, it's a no-lose proposition, while the company, shareholders, and employees stand to lose a great deal.
I believe there is such a disconnect between CEO compensation, the rest of the company, and company performance in general, we're quite aways off from the true, results-based compensation that gets so much lip service these days.
So the point is that even people not making a lot of money are still paying a higher tax rate because of the manner in which they made their money. And lo and behold, those who make money through capital gains- which the wealthy are more likely to- pay a lower tax rate.
Who cares? If they received 1.68 billion in stock and paid 15% capital gains on that, their tax bill for this year alone would be $252 MILLION.
Are you really going to try and pretend like they aren't contributing enough because their PERCENTAGE is lower than yours?
Sweet jesus, give me a fucking break!
Let's switch to the FairTax, and then you guys can complain that they are keeping a higher percentage of their income compared to you, even though they are spending (and thus being taxed) a hell of a lot more.
By all means, please continue to be sucked into class warfare. The politicians love that shit.
Ironically, the word ironically is often used incorrectly.
Depending on what kind of corporation they are a $1 salary is meaningless anyway. There is more than one way to pay an employee in real money.
Remember state taxes as well, and the two biggies: OSADI and Medicare. True enough, federal liability isn't all that bad, at least for low earners. I paid 8.8% this year. Ok but then let's add in state tax, now I'm at 10%. Still better than capatial gains, but we are't done yet. I also had to pay OSADI and Medicare, and I don't get toreduce those with deductions in any way. Well now I'm at 17.5%. Oh and I'm under the median saliry as well.
So you have people who are making lots more money, but paying a lower percentage of taxes. Same with your $82,000 case. Add state, OASDI, and Medicare and I bet it's 25-30%.
Therefore accepting a $1 salary has little effect on the tax bracket of someone earning billions from investment income.
my blog
85% of a VeryLargeAssload is still a VeryLargeAssload.
Ahh, wish I hadn't posted, because I'd mod you insightful. I had forgotten about the ALT, of which my knowledge is limited. But you're probably right, I'm sure that they get caught in there somewhere.
It's not what you know, or even who you know- It's how many people recognize your damn
That Eric Schmit was involved with Google. Is this the man who tanked Novell? Goggle erred in bringing Him on board if he is the same one.
The marginal tax rate is 15% for Married jointly filing between $14,300 and $58,100, after that it is 25% up to $117,250. Remember that is Jointly, I hope that any married couple is pulling in more than $58k.
I'm not not licking toads.
It is the World dream!
The american dream is to have a job, house with a tiny garden, two or three kids, a dog and a cat, and of course a wife. All of them fat. And then to live on credit for the rest of your life.
Let's face it ... Google's stock is WAAAAYYYYYY over-valued (see: insanely-so)...
... it's tied to the balls of the complete idiots who are paying $400+ per share.
/rant.
The company's stock price *will* fall and it won't be because the company is performing poorly or anything like that. It's just over-valued at the moment and it's a perfect time for Brin and Sergei to get the best bang for their stock.
Google's stock price is not tied to performance
Continued being great?
This is no small feat - look at how that chick from HP fucked up the company. I'd say schmidt IS doing this job just by keeping the ball rolling.
Horns are really just a broken halo.
There are trust fund you cn put the money in, that for all intentr and purposes is exactly like having no money.
Except the interest, and it only counts if you take it out. Completly untouchable by the Feds, including IRS.
I jst watched someone ccome into a sizable inheritence. It is amazing what it gets you in the way of service. He paif hardly any fee to his broker. Everytine asomething incurred a fee, they said "Don't worry about it".
They don't do that if you have a paultry 200K in an account.
So if the desired, they could be qualified for food stamps. Of course, that would be insane. Not touching the interest on billions just to get a couple of hundred buck in stamps.
The Kruger Dunning explains most post on
Time to SHORT SELL GOOGLE, its about to tank if the top execs are bailing out Ride the bubble, sell out the top, get out, let someone else clean up the mess when its all over. Preferably the Feds, on the public dollar.
You should count yourself lucky! These poor Googlers only get $1 a year!
The stock market wouldn't exist if it weren't for those pesky civil liberties. You know, the ones that say you can do pretty much what you want with your money except buy hookers, drugs, and politicians.
Get rid of those freedoms, and you can get rid of the stock market. I'm just saying...
The radical sect of Islam would either see you dead or "reverted" to Islam.
How you're taxed also depends on what type of stock options you have, Incentive Stock Options (ISO) or Non-Qualified.
Execs are given (give themselves) Incentive Stock Options. They can excercise them, and sell them at a later date. If they hold them for a year before selling them, they are taxed as long term capital gains.
Rank and file workers are given Non-Qualified stock options, which must be reported at exercise time. Your profits on that stock option sale are taxed as normal income -- so, it pushes you up the tax bracket and inevitably gets taxed at a much higher rate than 15% LTCG. (Back in the Internet glory days, I was fortunate to get some stock option proceeds, and with Federal Tax + California State Tax, I got to keep about 50% of the profits.)
Either way, stock options proceeds are nice.. It's just that "The Man" gets to hold onto a lot more of his money than the rest of us.
Do you happen to have a source for that? As I recall, the infrastructure of the Internet (land-lines, routers, servers, etc.) is almost entirely privately owned. The government (DARPA, specifically) may indeed have performed some of the initial research and development work, but by far the largest investments in the Internet have been made by private citizens and corporations. I'm not saying that Google didn't benefit greatly from the present of the Internet, just that the Internet does not owe its existance to the government. There's no way that the minimal R&D investment DARPA made decades ago in any way justifies the kind of taxes I'm sure Google is forced to pay every year.
Of the "standard responses" you mentioned, only the army (or the military in general) is paid for by national taxes. Police, roads, fire protection, schools--almost everything else, in fact--is the state or county's responsibility. In any event, I'm certain that Google could probably have provided all of the services it desired for its own protection for far less than a quarter of its annual income, and probably does so anyway (most major companies seem to employ their own security forces, for example), which means that Google is forced to pay for services it will probably never need to use.
"The state is that great fiction by which everyone tries to live at the expense of everyone else." - Bastiat
They aren't options if you are just selling stock you aquired through some other means than an actual options award. I dunno, say you started the company and you retained a percentage of it. Don't confuse Larry and Sergei's cashing in with flipping options. It's not the same thing, and it doesn't mean the same thing to Google's bottom line.
Paltry? Fuck off, you commie. It should be 0%.
Completely OT, however:
Humanitarian efforts have nothing to do with logic, unless you count "maybe if I help them now, they'll turn around and help me later if I need it."
--Jeremy
Jesus was a liberal
Unlike the FICA portion, which caps out at 94,200 (2006) there is no cap on Medicare... so 1.36% of eleventy googillian, billion, trillion dollars is A LOT!
This issue is a bit more complicated than you think.
Most of those who starve do not do so because they are 'weak' and inherently 'unable to sustain themselves'. It is usually due to the fact that they do not have the opportunity to improve their condition. To use starving Africa as an example, you could be the smartest, strongest person in the world there, but I reckon you would still have trouble finding food if your entire country is a battlefield.
I'm not trying to say that the Google Boys should give up all their money; it is theirs, they earned it through their own blood and sweat. I am saying, however, that it is a ridiculous notion that feeding starving people somehow perpetuates a strain of less-evolved subhumans who really should not have survived into today's world.
And if you meant that in a sarcastic way (which I hope you did... why oh why would anyone mod that comment anything but funny?), you have my apologies.
'Every story, if continued long enough, ends in death.' --Ernest Hemingway
I think your entire world-view is warped. You're talking as if one company getting big precludes another from getting big, and you're saying that by having very rich people, others can't get rich.
Unfortunately, Adam Smith and his masterpiece "The Wealth of Nations" explains very profoundly how wealth is not a zero-sum game. It can be created and destroyed, sure. It can be siezed and redistributed, yes. But in a free market system, wealth is created with every transaction and even every non-transaction, as long as those transactions are informed and done by free will.
That's why the US is able to have a trade deficit for most of the past century yet still be the wealthiest country in the world. We create wealth faster and better than any other country. We can export that wealth in exchange for cheap products. In fact, by doing so, we create even more wealth.
In short, we can ALL get rich, we can ALL have big companies, and one person's success doesn't mean another's failure.
I will go into the simple explanation of why this is. It has to be what wealth and value really mean. Wealth is a measure of how much valuables you have. You are wealthy when you have more valuables than you really need, and poor when you don't have enough. (Wealth and poverty in this sense are very subjective.) But what is value? What makes one thing worth more than another?
Simply put, value is in the eye of the beholder.
When you walk into the grocery store, ask yourself some questions. Pick up one of the items in your cart, and ask yourself:
(1) What would life be like without this item? Imagine putting it back on the shelf and not buying it. Imagine what you would do without it. Perhaps you would buy something else, right?
(2) How much would I really pay for this item? (NOTE: Don't tell anyone, particularly the clerk what this number is!) That is, at what price would I stop buying this particular item? Think also about the price you are paying by engaging in this trade. You could've done any number of other things besides shopping that may have value.
(3) How much is the retailer willing to sell this item for? That is, at what price will they stop carrying the item? (Keep the cost of buying and shipping the item constant--we're concerned about profit.) Be sure not to exclude opportunity cost--the cost of not doing something else they could've done.
Now, hopefully you have two numbers: The maximum price you are willing to pay, and the minimum price they are willing to sell at. I know you can't guess these numbers precisely. Just rest assured that for our purposes the following is true:
(1) The maximum price you will pay is above the current price of the item. After all, if it was equal, why go through the trouble of carrying it to the checkout counter? You're just causing yourself unnecessary pain.
(2) The minimum price they will sell at is below the current price of the item. If it was equal, they would rather not sell it.
The magnitude really isn't important. What is important is that these numbers are greater than and less than the current price. (If you were a brilliant genius and knew everything, you would only be doing things that profited you the most. You'd probably be richer than the Google guys by now. But we're not, and we generally don't make the best decisions. That isn't to say we don't make good decisions.)
So, note what happens as you pay for it in the checkout line:
(1) You sly little fox, you just made yourself slightly wealthier! You gave away that worthless money for something with true value! Congratulations, you have won the jackpot, you have created wealth for yourself and thus your country. Walk home proud! In fact, go indulge yourself a bit with your newfound wealth.
(2) That cheating little store just made out like a fox in the henhouse! They gave away that cheap product and got in return more cash than they thought it was worth! They are walking to the bank laughing: "Can you believe he ACTUALLY paid THAT much
The radical sect of Islam would either see you dead or "reverted" to Islam.
Ugh! All this complication.
All this arguing over whether it's fair for them to be making such small income and such massive moneys otherwise, whether they're paying enough into the system or not--
This is why I'm in favor of the Fair Tax- a nice clean simple equalizer.
Support the FairTax
oh yea?.. try being one and not breaking apart what is already there
Except they sold the friggin stocks so they're billionaires, and what happens to Google now really won't affect them one way or another, except perhaps that the rest of their stock might not be worth $1B when they get around to selling it. It's generally Not a Good Thing when executives sell off lots of stock. See: Enron, Worldnet AT&T, et al.
True, except that most financial planners tell people to diversify their holdings. Now, if your whole fortune was tied to a single company's stock, wouldn't that be a bit risky? They've only sold a small chunk of their total holdings, so it's not an entirely bad thing from a shareholder standpoint.After all, you wouldn't want most of your 401(k) to consist of your company's stock, why should the Google founders do the same?
I believe that Capital Gains Tax is higher than Income Tax (at least from personal experience). I'd be willing to believe "Good Faith" based on that
At the lower end of the income scale, the capital gains tax rate is higher. However at the end of the pay scale that the Google founders are at, the tax rate for the income tax is MUCH higher. See the IRS tax rate schedule (http://www.irs.gov/formspubs/article/0,,id=13351Oh please, only Slashdot could praise someone making billions off stocks for foregoing a salary as if they are so selfless. The last I heard Bill Gates, along with other Microsoft execs, was taking home a salary of around $865,000, (this was a few years ago it may be different today). A salary of $865,000 for a top executive at one of the worlds largest companies is puny, it might as well be zero. Executives at much, much smaller companies take home 10 or 100 times as much. Compared to the value of Microsoft stock he owns his salary might as well be zero. Yet he is routinely lambasted as one of the most evil people in the business. In fact Gates is the one who has pledged the majority of his fortune to charity, a $29 billion endowment to the B&M Gates foundation so far. That's putting your money where your mouth is. Foregoing a salary when you're already making billions? yes if only we were all in a position to be so altruistic.....
It is a red flag. It shows that Google stock is way overvalued. But we knew that already.
Wouldn't it be more of a red flag if they had sold MORE of the holdings? They only sold a fraction of what they had, according to the article. Why shouldn't they be able to diversify and sell a small part of the Google stock holdings?Drat... need sleep.
I suspect that much of the animus seen in the comments stems from the fact that the Google crowd are so unbearably smug about their success. One can just imagine Largey at the the press conference: "Yes, we have decided to forego our salaries this year. It is one of the many ways in which we practice our credo of not being evil." Ok, ten points for style, and it puts you a pip ahead of most of the other corporate giants, but with a billion and a half in the bank it doesn't exactly make you St. Francis of Assisi, does it?
Likewise, all the hype about Google's technical staff being the smartest in the business. It may well be true that you are smarter than everybody else, but if you go around constantly and loudly reminding everyone of the fact, it's a bit much to expect them to love you for it.
Yup, 24 checks for $0.04 each, minus tax and social security withholdings, each mailed to their homes with $0.39 cents worth of postage.
Not if they use direct deposit or have the statements delivered at the office.Why???? You ask why??? Because as a fellow cubical dweller much like "peter" from "Office Space" otherwise known as my life story. When you are low level you have to deal with a never ending raft of crap, some moron is always causing a problem, systems are failing processes are breaking down, trouble is happening, every 2-bit manager of some group presumes to have some kind of authority over you, and you recieve no credit for anything good that you do, oh yeah you work in an unpleasant setting(cubicle) and your salary is not great.
Now lets look at the executive founders at google. Lets see, hmm no manager, no cube, nice office, no money problems, receive the credit for everything, run the show make the decisions, do what is interesting no need to toil to make the product a reality they have developers. Acquire companies with your overly valuable stock... No question there, they answer to no one but the market who loves them for some crazy ass reason, god forbid the stock market actually regard a real honest to goodness company or huh innovator the way they regard google. Their job is good, its fun, its in the lime light, they have few real onerous responsibilities.
As for the stock dump, these guys are no dummies stanford phd, university od michigan undergrad CE. If you look at google where is the real innovation, where are the hard assets, they have an advertising model some dubiously patented search technology(Markov called he wants his chain back), and a brand. The valuation is insane they have a single source of income that is vulnerable, a list of competitors 10 miles long, and a raft of litigation ahead of them(Gmail, google print, etc). Hell they are even using core technologies licensed from their principle competitor yahoo. Honestly I also dislike that they leverage off open source then treat it like a redheaded stepchild. I'm so sick about hearing about google, if they disappeared tomorrow I would not care.
Can you pray tell us how the hype was created given the small factoid that this company did not advertise on the msinstream media at all?
Nah, why let the facts get in the way of a good old fashioned baseless character assasination, that would not be fun, would it?
IANAL but write like a drunk one.
Of the "standard responses" you mentioned, only the army (or the military in general) is paid for by national taxes. Police, roads, fire protection, schools--almost everything else, in fact--is the state or county's responsibility. In any event, I'm certain that Google could probably have provided all of the services it desired for its own protection for far less than a quarter of its annual income, and probably does so anyway (most major companies seem to employ their own security forces, for example), which means that Google is forced to pay for services it will probably never need to use.
But in many states and localities, the things you mention (police, roads, fire protection and schools) do have federal funding tied to various national programs. Think of all the highway bills passed by Congress, funded by gasoline taxes, for example. And there are all sorts of educational bills that are passed, with federal mandates (and funding). And the police compete for anti-terrorism funding, to buy stuff like better radios and such.all the "free market" theories assume things that are in general not true in real life, where governments, corporations and special interest groups routinely engage in misinformation, protectionist practices, etc. and do their best to stack things in their favour.
You engaged in free trade. You both exchanged something of lesser value in exchange of something of greater value
yes, company A exchanged something of lesser value (a US employee) with something of greater value (an overseas, cheaper employee) with outsourcing company B: both companies are happy (company A saves money, company B generates money) but in the end the US employee gets the shaft.
"free" markets would be free only if there was as much mobility for employees as there is for jobs/capital: as things stand now jobs can move anywhere that is cheaper, however employees can't.
I do agree that eventually things will stabilize, where all of the world will enjoy the same standard of living and consequently outsourcing won't happen anymore, however I personaly really doubt that will happen any time soon.
Oh, and I personally wouldn't gloat too much about
That's why the US is able to have a trade deficit for most of the past century yet still be the wealthiest country in the world
besides the risks inherent in a huge trade deficit, being the wealthiest doesn't mean at all having the highest standard of living. I'd rather have 1000 people earning around 100,000 a year than 1 person earning 1,000,000,000 and 999 people earning 20,000: yeah, scenario B is "wealthier", but unless you were the lucky one you'd do a lot better in scenario A.
-- the cake is a lie
Feeding millions of starving people who are incapable of sustaining themselves will do nothing for these people and only promote the survival of a weaker group of people. This is anti-evolution.
I can not beleive this has been modded insigthful+5 (when i read it) . Go read a book on the IMF or someting. I never thought the slashdot crowd could be so ignorant , obtuse and stupid.
Enjoying what you is not a prerequisite to become a millionaire.
Most dirty rich people see an oportunity, apply themselves to a task and are at the right place at the correct time, very often these people are very passionate about what they do, but they do not necessarily love what they do, but understand that it is a means to an end.
IANAL but write like a drunk one.
Although make sure to keep in mind that you lose a little control with each share. The correct way to maintain control is to remain the majority shareholder with 51% or more of the total shares.
Buy Steampunk Clothing Online!
larry and sergey (or however you spell his name) may have billions in the bank, but they don't have women. i think they are quite pathetic -- i've seen larry at undergraduate parties here at stanford. i mean seriously, these guys have no girlfriends and probably never will. it's sad.
You should send me all you possesion and money and the kill yourself.
If there is one thing I've learned, it's that geeks make horrible investors.
... well, I'd still probably do it. :)
I've seen a number of posts on here complaining about the Google share price being outrageous. I'd be interested in hearing what they would have to say about Berkshire Hathaway (BRK.A) at an astonishing $89,600 per share. I suppose you think they are overrated too?
It's all in the market cap. While it might seem that might post is a thinly-veiled insult to the Slashdot crowd, I actually intend for it to be encouragement for most of you to go out and take a few stock market classes or read up on investopedia or wikipedia.
Here's your free lesson:
Market cap of Google is $130.94 billion. Market cap of Apple is $64.30 billion. Berkshire-Hathaway is $112.99 billion. IBM is $126.93 billion. Microsoft is a whopping $279.74 billion. Yahoo is $49.47 billion.
(Current as of EOD 1-24-06)
Based on this, a geek can deduce their interpretation of which company is "worth" more and thus determine which stocks to buy and which ones to "short". (For more on how to short a stock, use your favorite search engine or check with your brokerage)
Assets and Liabilities also play a huge part in valuation. A company can have a high market cap but have a crappy current ratio or debt to equity ratio. Personally I think Google is slightly overvalued, but here's the list that I have with actual market cap and where I think each of the above companies market caps *should* be.
TICK-ACTUAL-WORTH
GOOG-131-110
AAPL-64-80
BRKA-113-130
IBM-127-100
MSFT-279-230
YHOO-50-80
It's up to you how you determine what you currently value a company at, but I think valuing based off of market cap is a good way to get started. For example, Yahoo at one point had a paltry market cap of something like 7 billion after the dot-com crash of 2001-2002. Astute investors (like myself and others) invested in these companies that we suspected would rebound. Several of us make off very well because of it. And it didn't take much more than time for us to learn.
Of course, I gradually taught myself this over the course of about 6 months. I do not regret using the time between graduation and first official full-time job to do so. What a risky time to be playing with my money, though. If I had to do it over again
Oh, and I lost money too. But if you invest in safely and stay away from the lure of pink sheets stocks, you'll do fine.
I wonder if they get a 3% christmas bonus at the end of the year. An extra three cents can go a long way during the holliday season.
are the executive compensation packages worth more more than this company made in the trailing year?
now that's a business plan to pay a google pe ratio to own...
"Ask yourself what the various levels of government have done to earn a quarter of the wealth spawned by Google."
Well I don't know how much of the following justifies the government taxation, but it certainly lists ways in which the government has assisted Google.
Firstly, Brin & Page were grad students at Stanford, recieving their undergraduate education from publicly funded Universities and reciving federal grant money to do the fundamental research that made Google what it is today. Part of their success revolves around being at the right place at the right time, but another part is that they had the opportunity to solve a problem first, and come up with the money strategy second, rather than the other way around. Because they a quality education and the government paid opportunity to study interesting problems, they were able to create an enourmous amount of weath, for themselves and for society. Hell, even Stanford operates on the charity of a former governor, rather than a series of well informed and rational choices made by students. And I think it's fair to say they still recieve a good sum of money in the form of federal research grants.
Second, Google exists to search the vast amount of information available over the Internet. For Internet Libertarians, the funding behind DARPAnet and even the development of HTML has to be a strange paradox. Certainly, there are plenty of governments under which the free dissemination, indexing and ranking of communications is not welcome. If I wished to be misleading, I might say that the Libertarian camp is divided over the issue -- there are as many Libertarian governments in favor of internet censorship as there are opposed!
Thirdly, Google the corporate entity benefits from a large number of local, state and federal services. The SEC provided them with a framework within which they could safely offer a number of shares for initial public offering, even in a unique way (despite complaints from many within the private sector), and gives shareholders confidence that the reports they read are accurate and should the need or desire arise, they can get a fair market price for their stock. The legal system provides Google with a fair and impartial jurisdiction within which suits by and against Google may be held (certainly Google gets its fair share of suits from those upset about being indexed--justified or not). Should the Googleplex burn down, the local fire department has been and will continue to be on watch for them. And for those Googlers that don't rollerskate to work, the State of California and the Federal government help to provide safe roads and highways with which to commute over. Should Google go bankrupt, the government provides a fair system of bankruptcy within which the company may survive, to the benefit of the majority of creditors.
Finally, the employees of Google don't have to worry about their status as Immigrants, Jews, Blacks, Men, or Communists interfering substantially with their business dealings. Should they be treated substandardly for these inherant traits (for example while finding a house in the SF market), the governments provide them with a recourse under the law for this irrational discrimination.
Now you're certainly welcome to claim that taxes are too high, that the government is accomplishing their goal too wastefully, or the like. But perhaps the State of California uses the high tax rates as an migratory throttle, to make sure that people planning to make money on a large scale do so outside their state? If California is still enjoying a growing economy and population, despite the high tax rate, perhaps enough people like the system to make it work?
I Browse at +4 Flamebait
Open Source Sysadmin
I cannot believe this got moderated to +5, just goes to show you there exists sick bastards that actually believe this shit. I'm not a bleeding heart by any means, but how can such a statement stand to even the most cursory of inspection.
The question is, does the sale of stock count as taxable income? I think not.
I Browse at +4 Flamebait
Open Source Sysadmin
...that reduced the long term capital gains tax to 15%.
"I make next to nothing, and I pay more income tax than that."
You can thank George Bush for that.
You say that like building highways is a good thing.
Are senior executives so morally bankrupt they need to be bribed just to do their job?
The marginal tax rate is 15% for Married jointly filing between $14,300 and $58,100, after that it is 25% up to $117,250. Remember that is Jointly, I hope that any married couple is pulling in more than $58k.
Of course, that's taxable income. To estimate an AGI, add at least $10k for standard deduction, $6400 for exemptions the individual and his or her spouse. So the AGI should be more like $30,700 - $74,500.
If they have 2 dependents, then add $6400 more, so then AGI would be $37,100 - $80,900.
At the low end of that, they could qualify for the child tax credit or even EIC, which would both help out a lot in terms of tax. (Not much help in terms of income of course.)
And remember that they only pay a 15% rate on income on the AGI within that range. For the two-dependent couple, the first $22.8k of AGI is tax-exempt, and the next $14.3k is taxed at the 10% rate. So even if the income is $80,900, the total amount of tax paid is $8,000.
So the tax liability for a married couple filing jointly with two dependents and an income of $80,900 is 9.9% of their income.
And that's using the standard deduction, no education tax credits, assuming all income is wages, etc. With a little paperwork and planning, they may qualify to knock a significant amount off of that.
Legal warning: this is not tax advice. I am not an expert. Etc., etc.
with that many billion, you own your women.
Do like tony hawk and Skull did: Make a foundation. You see if you own a for proffit. Then give a ton of mony to your NGO xyz.org and it gives a ton (equal to or greater than your "gift") The feds (generally) don't pay much attention. The cool part: Since your getting a ton of "free" stuff then you don't need to have 1.5billion dollers sitting around. (and with the chouce of loose 1.5 mill to the feds or use that 1.5 mil to make a NGO...)
Comment removed based on user account deletion
Wot a bunch of crap. So they make $1 and their primary income is from selling stock. They live in California for crying out loud, not some cradle-to-grave welfare state. They built a $130 billion company from nothing. Most execs get lucrative salaries AND stock. So they get some long term hold tax breaks, boo hoo. You go build a $130 billion dollar company from your own brain power and you can get some tax breaks and stock options too.
-- "In order to have power, I must be taken seriously." -Mojo Jojo
Um paid for education?
Education which tends to spawn people like.... Google executives?
Oh and you know roads and health care....
You really don't have anyone to vote for do you?
I'm pretty sure we'd be mocking and laughing at Microsoft if they did this. Google sure does have public opinion by the nuts, though.
Comment removed based on user account deletion
...where making legitimate money was evil?
Over 9 million shares have been sold with insider transactions. Ie with an average price of $350 it means that they have sold around $35 billion in stock in the last 6 months or about 20% of its market capitalisation. It is also grossly over valued and is due for a stock to earnings realignment.
What the hell is the government doing taking 25% of someone's income that NEEDS it to survive while a guy selling stock for some extra disposable income keeps 85% of it?
$1 Salaries!? Haven't these people been informed about minimium pay!? Prolly not, they're EXECTUTIVES after all, it's not like they even WANT to know.
It's never just a game when you're winning. - George Carlin
Since long term sales on stock is just 15% - short is 28%
If they were getting those salary, they would have to pay the income tax bracket of 38 to 42%
I say Google CEO and uppermanagement are all tax cheater, and that the IRS should close this loophole.
did Steve Jobs start this $1 salary thing or did someone else do it before him?
i see it's moderade flamebait now, good.
a sp
go read this AC http://www.globalissues.org/TradeRelated/Poverty.
Wasn't their entire business built on the purchase of one copy of RedHat linux for the OS? (or so the legend goes)
Should they give something back or not?
They certainly have 'fuck you regular Chinese people' money, it seems.
What's the deal here, and when is the big splashy 'Your Rights Online' article going up about Google basically censoring themselves 'to compete more aggressively in the world's second biggest Internet market.'
"Do no evil." Whatta bunch of bull.
I won't even bother submitting the above link. Someone else already has. Slashdot editors???
This is great! The People will fall in love with Google because they did this move, They will have a good visibility and even they alwals have a large visibility but this will blind some people and tell them that Google is a friendly compagny that is there to help the world with all their super power Products 3000 XXX_-001 ultra... Whtch out, they are so big, I'm afraid of the future !!!! But thanks god to give us Google news that give me the possibility to see the sports news today!!! With another dollar I will happy!
Thanks for visiting my Web site! Post your comments on my forum!
The company I work for has an over the hill CEO who pulls in almost $1,000,000 and hasn't done anything for the company for the last 5 years except see its stock go from $5 before the .com boom to $180 at the height of the .com boom and back to $5. Good leaders know how to sail in a headwind. Anyone can sell water in the desert. This asshole for a CEO sees fit to lay people off besides himself and reward himself with bogus performance bonuses because the company is profitable for one fucking quarter before tanking the rest of them. The best companies have leaders with vision who help themselves AND their investors. This fuckhead only helps himself, and the dumbass board doesn't have a damned clue how clueless this Medicare-aged, fuck-gummer.
This is a perfect rant on the message board but I'd get caught and fired. Hell, they might be doing me a favor.
I'm pretty sure Googlers lollerskate to work.
So what? Do you call it double taxation when the profits are taxed at the corporate level, then taxed when payroll is dispersed to employees?
When someone receives income, they pay taxes. Double taxation isn't some strange exception, it's a natural result of incorporating to form a new legal entity. The corporation adds an extra someone to the chain of payment, and that someone pays taxes. Calling for an end to the dividend tax is essentially asking to have one link in the circular chain of income to not have to pay taxes while the rest of the links still do. It's a shameful handout to a subset of the population. Taxes on dividends no more encourages companies to see other ways to pay shareholders than taxes on salaries encourages companies to find other ways to pay employees. Maybe it will change some details (indeed, benefits like health insurance are a common non-taxed form of compensation), but people still want the cash.
Ruben Bolling summarized the situation effectively in his Tom the Dancing Bug comic "Can you spot the double taxation?"
Search 2010 Gen Con events
Oh please. Steve Jobs does the same thing, and undoubtedly many others. If you look around, you'll realize there are plenty of things which were not, in fact, invented by google (or apple, for that matter).
What the hell is the government doing taking 25% of someone's income that NEEDS it to survive while a guy selling stock for some extra disposable income keeps 85% of it?
Are you telling me that somebody who makes $40k pays $10k in taxes? I didn't pay that when I made $60k. You pay taxes - shouldn't you know what your tax rate is?
"We returned the General to El Salvador, or maybe Guatemala, it's difficult to tell from 10,000 feet"
see, almost everbody has a price ... now tell me that they all deserve every penny
meanwhile, i wonder just how many people are currently starving due to lack of capital?
no pun intended
You are incorrect.
You need to go read that tax guide again. Look up the difference between earned income and capital gains. They're treated very differently.
God invented whiskey so the Irish would not rule the world.
We have similar debates over the funding of the National Health Service in the UK. The answer is that to allow the rich to opt out would undermine the whole point of any social security system, which is to protect the poorer members of society who *can't* afford a pension, health care, or to be unable to work for a period of time for whatever reason.
Social funds like SS and the NHS recognise that capitalism depends on inequities in the distribution of wealth as part of its basic mechanism and spread the cost of their funding across the whole of society, leveraging the wealth of those with more money to help out those who have less to help mitigate that.
The alternative is to suggest that all taxation should be hypothecated and that you have the right to withdraw your participation in those areas where you're not going to directly benefit from a particular levy. People who don't have children or who send their children to private schools would be allowed to opt out of paying for state education, etc. The logical outcome would be that you pay a fee to the fire brigade when they attend a fire at your house, or to the police to investigate a burglary there and pay nothing at other times.
Taxation is not a consumer service fee.
The GP poster got the terminology wrong but the numbers right. If you sell stock for a profit you receive capital gains. These capital gains are now taxed at 15% due to the Bush tax cuts.
The dividend tax rate is also at 15%. This was done on purpose, to give companies more freedom in how they handle their profits. Since there is no tax difference, they are free to choose capital investment or dividend distribution.
Build a man a fire, he's warm for one night. Set him on fire, and he's warm for the rest of his life.
I believe that Capital Gains Tax is higher than Income Tax (at least from personal experience).
And you're wrong. Amazing that people would find a completely bogus comment "Insightful." Short term capital gains rates are the same as regular income tax rates, and long term capital gains rates are much lower. I know a few people who share your bizarre view of capital gains tax, as if it's some tax burden worse than regular income tax. They tend to be the same people who think that earning extra money might 'bump you into the next tax bracket and lower your overall after tax income.' In other words, they are clueless about taxes and have no business spreading their igorance upon the unsuspecting.
It's been a long time since I've felt compelled to "friend" anyone here on slashdot, but I've just added you to my friends list. I agree completely with your post.
The nice thing about capitalism is that it is one of the few scientific theories of the 1700's to stand the test of time. Since capitalism, there have been several theories that have seen the light of day and have been burned by it. For example, socialism and communism have been shown to be absolute and complete failures.
The fascinating thing about capitalism is how simple the theory is. Go ahead and attack any of its fundamental principles and theories. But you'll be fighting a losing battle. After two hundred plus years, it is still logically sound.
Notice that you didn't attack the theory. You only tried to say that no theory is correct in practice. You probably accept the theory of evolution. How would you like to argue with someone about evolution when that person says, "It's a nice theory, but it's just a theory. We know reality and theories don't match."
Free market capitalism works in the labor market as well. Moving jobs overseas keeps Americans competitive. Would you rather force American companies to hire Americans on bloated salaries? What would be the net effect? The absolute destruction of our economy as American companies fail and foreign companies decide they would rather not hire Americans. Oh, you didn't know that did you? Foreigners have moved more jobs to America than we have lost to foreign countries! If we decided to stop exporting our jobs, then Japan and Europe would stop exporting theirs, and we would be worse off.
Unfortunately, your last bit is sorely misguided. In America, we not only are wealthier, we have the highest standard of living. How do I know this? Name one country you'd rather live in than the US because it has a higher standard of living. Now explain why you haven't left the US for that country. Now also explain why the people in that country are clamoring to live in the US.
There is a field of economics that is unfortunately loosely coupled with Adam Smith's basic theory of capitalism. That field is named "macro-economics" while Adam Smith's theories are called "micro-economics". Somehow, people get the picture that these two theories are equivalent when they are not.
Macro-economics is the field where we try to measure GDP, Cost of Living, and the interest rate. This is where government tries to set a tax-and-spend policy to boost the economy and smooth the cycles. Unfortunately, this field is not based on solid, simple theories that can be easily proven or disproven as easily as micro-economics. And unfortunately still, this field gets too muddled with politics to the point that it is misrepresented in the public arena. Recently, several key theories in macro-economics have been overturned. The idea that a nation can't endure deflation without a fiscal crisis has been disproven in practice. We have recently experienced actual deflation with only beneficial effects. Also, for a very long time, the US has had an unemployment rate far below what the macro-economists say is healthy. And our interest rates have been far lower than what they say we should. And we keep increasing the deficit and yet we haven't come to the catclysmic end predicted.
Wealth, if you paid attention to my earlier discussion, is not measured in dollars. It's not measured in anything tangible. It is purely subjective, dependent on the observer. You may look into my household finances, and then look into someone else's, and then say I am the poorer of the two. But I will disagree. I have everything I want, and then some, so I am wealthy, and I can't ask for anything more. And I have things the wealthier don't have: A wife that loves and tolerates me, three beautiful children who respect their mother. I also happen to have a piano and a computer. The piano is worth more than the most expensive stereo HD-DVD system money can buy to me. It's probably the most valuable item I own right now, because I enjoy it so much.
Wealth is not as simple a concept as you are making it out to be. Don't be fooled into thinking it is. There's no happiness in thinking wealth can be counted in dollars.
The radical sect of Islam would either see you dead or "reverted" to Islam.
You are correct; The American way does not ensure the two absolute requirements: freedom of choice and information.
But you are missing the big picture. The American Way is MORE free and MORE informed than the others.
You are arguing for limited government. I am all for that as well. We need to reduce the scope of the regulations and kick government out of the places where it doesn't belong. For instance, the FDA has been shown to be plagued with fraud and scandals. Why not make it a private institution that relies solely on its reputation to make a profit? Why not allow other organizations to evaluate drugs and food and then convey which drugs and foods they find preferrable over others and why?
You are making another mistake as well. You are assuming that corporate executives are somehow less human than you are. I imagine you have never taken the time to get to know any at all. For the most part, and I do mean "most" as in the grand majority, corporate executives are actually very nice and noble people. They are not corrupt. They are not mean. Many of them see their role in life as producing good products for less money and at the same time creating well-paying jobs for Americans.
Of course, the minority, the small, tiny, minority, abuse their positions of power, try to hide their abuses, and commit fraud on a large scale.
I propose to you that America is the least tolerant of all nations towards this kind of abuse of power. Name one corporate executive that has committed this kind of crime and gotten away with it? When I mean, "get away with it", I mean, without facing any of the penalties, government-imposed or not, that comes with the discovery of the crime?
Now, I want you to shift the context to any other country. Name the people in that country who commit these kinds of crimes, are not discovered, or do not face the penalties of the crimes. I can tell you one country in particular is especially corrupt at high levels: Japan. You don't hear about it, but it's there if you look for it. Here's another, where bribery is a way of life for the corporate executive: France.
America can be better about this, and we should be better. I can't think of any American who says, "Well, we worked hard, we tried to eliminate all forms of oppression anywhere in our society, and guess what? We did it! Give yourself a pat on the back, we can all go home in peace because America is perfect and will be forever!" No! We are constantly striving in our own way to make our own corner of the country better.
But you know what else? America is the best there is. Not many countries come close to what America already has.
I will submit this: If we are more careful about the ethics and morality and in being informed and free in our economic decisions, we will only have brighter days ahead. The minute we stop being careful about this, then we will descend into poverty once again.
The radical sect of Islam would either see you dead or "reverted" to Islam.
Repeat the party line: only wages should be taxed.
... is that you might well think that market speculation is not PRODUCTIVE per se, since it doesn't directly output a good. But it does not mean there is no use for the community.
Indeed, the main utility of a market is to be found from an INVESTMENT point of view. Where do you think the money goes when you buy a share ? To the company, which can invest in whatever it needs. Sure, it also boosts the value of shares/stock options, but that's a side effect. The company has been financed.
However, I have to disagree with the parent as well; most of your reasoning is correct, but you do not acknowledge that some actions can boost the share value (often not for long) on false basis, therefore not improving the company itself. And unfortunately this tends to become quite common when executives have such a stake in company shares.
Then what I fail to understand is, despite its length, why on earth your comment got modded "Insightful".
That's quite interesting. I just ran a search for "tibet" on google.cn. I can't read the first two results, but the third and fourth results, at first glance, look very pro-Tibet-independence.
Perhaps Google hasn't launched this new site yet, or perhaps it's returning different results due to my IP address not being in China. Can anyone confirm?
It's not "too bad"; it's inevitable. After all, their mission statement includes the phrase Don't be evil.
Censorship is telling a man he can't have a steak just because a baby can't chew it. --Mark Twain
Can we honestly say that it's any of our god damned business?
You couldn't have said it any better and it's sad that you're not considered the "insightful" one here.
How many fulltime jobs can one man have?
Amen brother!
*applause* That was a really well written post!
The problem is, the kinds of execs you're talking about use unethical tactics to misleadingly spike the stock price, selling all their shares at the top of the spike. A better system would be to award them a more direct money bonus each day based on the growth of the stock over that day, something like
.03) * ($20 * 10) = $35. The higher up you are, the higher your bonus and sensitivity should be.
$ = ((1/s) + g) * (c*s))
Where c is the "standard" bonus, and g is the % that the stock has grown (shrunk), and s is how sensitive the bonus is to share value.
So if the stock loses 3% over the last week and the standard bonus is $50 (remember this is daily), with sensitivity of 10, the bonus is (.1 -
The twist is, you don't get the monetary award you've earned until a year after, and you must still be with the company. So your cumulative bonus earnings in Jan 2004 aren't collected unless you stay until Jan 2005. So you can't artificially inflate the stock, jump ship, and keep the bonus. The exception being is if you are laid-off, but from reasons different from trying to selfishly inflate the stock price. Then you'll get the bonus money you're entitled to.
Yeah, I'm sure that this system is either unrepairably faulty or something like it is already used by some companies. I'm obviously no expert in the field, but it seems more sensible to me than saying "here, have this stock, sell it and flee to a tropical island when you know it's about to go down".
The bottom line is that there needs to be a system where you don't get the money right away, before we get to see the aftermath of your decisions. The boys at Enron got the money first and are now facing trial. If they knew they'd have to face trial (or at least watch their daily bonus drop the same amount as it had risen) before getting the money, do you think they would have done it?
"When the atomic bomb goes off there's devastation...but when the atomic bong goes off there's celebraaaaation!"
Hey, I didn't say he didn't deserve it.
---
Mod me down, you fucking twits. Go ahead. I dare you.
(I read with sigs off.)
What the hell is the government doing taking 25% of someone's income that NEEDS it to survive
The government doesn't take 25% for someone that bad off.
while a guy selling stock for some extra disposable income keeps 85% of it?
Both guys in your example EARNED their money, and have the right to keep it and spend it as they deem necessary. However, it is reasonable that the government needs some money to provide constitutionally mandated services, so everyone should help cover that bill. The inequity is in how it's currently done. Why should the tax rate elevate with the more you earn? You're already paying more because you're making more?
Bring on the FairTax.
Ironically, the word ironically is often used incorrectly.
Do you happen to have a source for that? As I recall, the infrastructure of the Internet (land-lines, routers, servers, etc.) is almost entirely privately owned.
Possibly true now, but it's doubtful that it was built or would have been built without the government. Even as late as 2004, more than half the people on the Internet were connected over telephone services, whose infrastructure is heavily dependent on government support. I'd be pretty shocked if government funding (direct, or via the use of eminent domain power, rights-of-way under transportation infrastructure, tax easements, etc) wasn't a major factor in funding even modern Internet infrastructure. And, of course, there wouldn't have been an Internet as we know it without 20+ years of DARPA/ARPAnet research and buildout. Not to mention that things like top-level IP block allocation, DNS management, etc were all managed by IANA (a government body) when Google was being built, and Google most certainly relied on those services.
Of the "standard responses" you mentioned, only the army (or the military in general) is paid for by national taxes. Police, roads, fire protection, schools--almost everything else, in fact--is the state or county's responsibility.
Of course, the post the AC was replying to went out of it's way to bring state taxes into the equation. Indeed, the particular quote he/she was responding to was "Ask yourself what the various levels of government have done", it was not at all limited to just the federal government. States and counties are part of "the various levels of government" last I checked.
In any event, I'm certain that Google could probably have provided all of the services it desired for its own protection for far less than a quarter of its annual income, and probably does so anyway (most major companies seem to employ their own security forces, for example)
Are you serious? Building-security is a tiny fraction of what the police provide. And even there, the private security forces would be pretty toothless if there weren't public police forces roaming the land to keep criminals from building up small armies to raid places, making people know that if a crime is committed there will be tremendous investigative power brought to bear on them, and so forth. That aside, Google would certainly have trouble funding officers all over the country to deal with civil and criminal investigations, execute warrants, etc--and wouldn't have the authority to do so even if they could. And what would Google do with the criminals it caught? Execute them? Build private prisons? Surely in the absense of government the private sector could eventually replicate a lot of its services, but that infrastructure isn't there and Google is far from large enough to build it all out itself.
rage, rage against the dying of the light
UAE (The country) has a lot of oil. In fact, the whole country's economy used to be (and still is) based on exporting oil. But since recently (10 years or so) they have been investing a lot of money gained from oil exporting into infrastructure and have created some of the architectual wonders which atract tourists (mostly upper class), who in turn bring the country money. This income is not comparable to what they make from oil, but if things go as they are going, they will soon make enough money to support themselves purely from tourism. Now the question: WHY? Because oil is going to run out and if they continue to rely solely on oil, their entire country will be on welfare when that happens.
Google is a great search engine. In fact, the whole company used to be (and still is) based on the awsomeness of its search engine. But recently (about 2 years or so) Google has been investing the money gained from selling their great search engine's stocks into other areas (just about everything), which in turn bring in even more funds. However, their founders are selling thier stock. And now the question: WHY? The answer is a game of "Spot the analogy"
I'm in exactly the same position as Google regarding my own web site. I can comply with the Chinese government's wishes, or I can have them block me with their firewall.
But you know what? That's still a choice.
GCHQ Quantum Insert installed. If only our tongues were made of glass, how much more careful we would be when we speak
Nobody has noticed that the tax rate on their capital gains is 15% while the tax for someone making an equivalent income is exhorbitant.
I barely make 6 figures and I'd gladly trade that in for a $1 salary with equivalent(6 figure) growth in equity to the bank for the rest of my working life, duh!
Good judgement comes from experience, and experience comes from bad judgement.
- W. Wriston, former Citibank CEO
1) I don't disagree with the point that Google has benefitted from both government and private investments in infrastructure, and continues to do so. I do not, however, believe that those investments are worth the millions of dollars a company of Google's size pays in taxes every year. In most cases, the wide-scale networking potential of the infrastructure (particularly in the case of the telephone infrastructure) was only incidental to the primary use, and by now those initial investments must have paid for themselves many times over.
2) I realize that the GP was including all levels of government in his/her statement. I, on the other hand, was pointing out that a significant portion of the income and/or capital-gains taxes a company like Google would pay would be directed toward the federal government. Frankly, we could do well enough without government-assigned IP addresses and TLDs, and it is quite debatable whether their influence on the system has been positive or negative. That essentially leaves military defense as the only significant, semi-legitimate service provided to large corporations by the federal government, and I don't think that corporations should be forced to pay so much more than any individual for that protection, particularly when the individuals which make up the corporations also pay for that defense. In effect, the company's shareholders are forced to pay twice for the same service, once as individuals and again as a group.
3) Most large corporations (Google, Microsoft, IBM, etc.) have resources equivalent to those of some (minor) countries. I'm certain that they could work out some kind of civil-defense arrangement with the relevant governments, probably on much more reasonable terms than those they presently have. A major infrastructure provider (such as an Internet search directory) would have a fair amount of bargaining power, even when dealing with a "sovereign" government like the USA's. There would be no reason for Google to run their own enforcement agency so long as they could "outsource" the work (for a price) to the local government, just as most modern nations manage to maintain justice without placing their own police forces in every other country.
I agree that it's fairly unlikely that Google (or any other US corporation) is likely to "strike out on its own" like that; I'm just saying that it's feasable, and that corporations carry enough of the tax burden at present that it would probably be economical for them to do so, if no political problems were involved. As that is not the case, I doubt any US corportation wants to be the first to try such an arrangement, however beneficial it might be.
"The state is that great fiction by which everyone tries to live at the expense of everyone else." - Bastiat
That essentially leaves military defense as the only significant, semi-legitimate service provided to large corporations by the federal government
You cannot be serious. Interstates, postal service, police forces, education for the workforce, etc are all significant services. So are social programs like the food stamp and HUD programs which indirectly benefit Google by decreased crime and other tangential benefits. Social Security and Medicare programs allow corporations to offer much lower retirement plans, if any. Medicaid programs decrease the corporate out-of-pocket costs for health care plans. And they're all funded by the federal government, in completely legitimate way.
Many of those benefits are non-excludable goods and cannot be funded on an "opt-in/opt-out" private sector basis; while you may not like some of them, that discussion has to take place on a much larger arena than a single corporation for any reform to be effective or economical. It's just disingenous to claim that a single corporation (if it were legal) could opt out of widespread programs and pay for equivalent services through the private sector when in reality they would still be receiving huge benefits from those programs but freeloading to get them.
Note that I'm not claiming at all that, say, Medicare+Medicaid+Social Security is a more cost-effective way for corporations/individuals to pay for those services than a privatized approach. I'm saying that while those programs do exist, it makes the private expenditures for health/retirement lower, and Google does benefit from that--even if they said "we don't want those plans", to a large extent that doesn't matter since they are provided to individuals regardless of how their corporation feels and so there's no pressure on the corporation to provide duplicate private services. Hence the decision to privatize that simply cannot be done on a small-scale.
I don't think that corporations should be forced to pay so much more than any individual for that protection, particularly when the individuals which make up the corporations also pay for that defense. In effect, the company's shareholders are forced to pay twice for the same service, once as individuals and again as a group.
No, they pay for two services: protecting them as individuals (their homes and persons), and protecting their corporations. It takes more resources to protect both than to protect one, and double-taxation is the right approach. (that's without getting into the fact that many corporations tend to be more likely targets than individual homes in the event of a war).
Moreover, our company has come to the consensus that you do not pay strictly bases on the proportion of services received, but also based on your ability to pay, and has set graduated individual and corporate tax rates accordingly. Making such decisions is generally considered a legitimate purpose of government, and this case in particular is clearly allowed under our Constitution.
I'm certain that they could work out some kind of civil-defense arrangement with the relevant governments
I'm inclined to say that they couldn't. The US government has an established history of funding it's military through taxes, and there is no other relevant government, and the US government is unlikely to look kindly on standing private armies with appropriate military-grade equipment and weaponry. And Google sure isn't going to be able to put together an army that can stand up to the US military. Even Walmart isn't going to come anywhere close.
And you can't opt-out of those taxes and claim that you're not getting any benefit from the US military when they're still going to be protecting all of the area around you and deterring invasion of your area even when they're not putting troops on your land. Perhaps a structure like that could work on a larger scale if, say, California wanted to opt out and have its own military. Even there they would benefit enormously from a halo effect, and it's certainly not in the best interests of the nation to encourage such tragedies of the commons going forward (and yes, I know that other nations benefit from such halo effects, and some like Costa Rica depend on them).
rage, rage against the dying of the light
1) Great argument here. So, basically, you're saying that it's perfectly fine for governments (but probably not individuals) to simply provide whatever services they want to, and then force the beneficiaries (who never asked for those services) to pay an arbitrarily high price for them, whether or not they actually benefit, effectively preventing them from spending their money on things that they would find more productive? Perhaps they should extend this ability to the private sector as well -- I'm sure I could benefit from the ability to force everyone else to pay me a 1% income tax to fund some random "public service" of my choice. Exchange is either voluntary for both parties, or it's theft, even if both parties get something out of the deal. If I steal $50 from you, I can't repay you by providing something that you value less than the $50 I took, whether or not that item or service would cost you $50 to acquire. Nearly everyone understands that on an individual level, but for some reason most people just give up when governments do exactly the same thing.
2) IMHO, the entire graduated-income-tax system is unconstitutional, whatever the courts might say on the matter, even assuming that the government had any right to impose it by force. However, for the purposes if this argument, let's assume that it is both ethical and constitutional to impose a non-uniform direct tax on "income", and that the IRS' definition of "income" makes any kind of economic sense (which isn't the case). Under those assumptions, you still have the fact that the owners (or shareholders) of the company already pay, out of their own income taxes, for the protection of their persons and their property -- as you admitted yourself -- which just so happens to include their shares in any company they might choose to invest in. Thus, they already paid, as individuals, for the protection of those companies' assets, and taxing the companies (and thus the individuals, indirectly) for the same service is nothing more than a ploy to hide the real cost imposed.
3) I didn't say that Google should have its own military, only that it could enter into a reasonable deal with an existing government, something like an extradition treaty, which would protect Google from illegal activities (as defined in the agreement) performed by that government's citizens. Google would obviously have to make some kind of concession on their part -- probably monetary -- but since the cost of actually enforcing the agreement would be much less than what they're currently paying in taxes, they would probably come out ahead on the deal. I don't expect them to do this, but there's no economic reason that they couldn't (there are certainly political obstacles, of course).
"The state is that great fiction by which everyone tries to live at the expense of everyone else." - Bastiat
Great argument here. So, basically, you're saying that it's perfectly fine for governments (but probably not individuals) to simply provide whatever services they want to, and then force the beneficiaries (who never asked for those services) to pay an arbitrarily high price for them, whether or not they actually benefit, effectively preventing them from spending their money on things that they would find more productive?
Yes. That is one of the primary purposes of government: to provide public goods that even conservative economists believe a free market cannot provide efficiently. I would argue that it is, in fact, the most important purpose of government (defense being one of the most important of those goods). And the government is clearly empowered with tax power to finance such goods.
I'll object to "whatever services they want to, and then force the beneficiaries (who never asked for those services)" slightly; the government is composed of the people and (theoretically) gets its goals set by them. Certainly minorities who object to a public-good policy are forced to abide by (and fund) it, though.
Perhaps they should extend this ability to the private sector as well
The names "public good" and "private good" were chosen for a particular reason. Most libertarians abide by the strictest possible definition of "public good" (100% non-rivalrous, 100% non-excludable) but still allow for the importance of government in providing (and enforcing taxes for) that very small category and their unique right to impose taxes. And they generally agree that government is unique in this sense, and such power should not be extended to the private sector (although perhaps it can be delegated in some circumstances).
By their very nature, public goods require forced participation; free markets cannot provide them efficiently.
rage, rage against the dying of the light
My grandfather was a boot maker (craftsman for those of you in america who've never met one) in eastern europe.
:(
I still have a few pairs of boots he made before I moved to the USA.
He commanded a premium, made everything out of leather.
I've outgrown those boots, but to this day I cannot find footwear as comfortable or as high quality. (5 years of wearing and they didn't stink or break or need to be resoled, except one pair that needed to be resoled, my 8 yrs age pair, I turned 11 and outgrew that one too
My father was a contractor, and he offered 7 and 5 year warantees on his workmanship. You know the amazing thing?? He only ever had to fullfill ONE warranty repair!!!
This is because he commanded a good price (air conditioning, plumbing and gas fitting and electrical) for his area, he was VERY customer service oriented, and he delivered better quality than most (and often he would give a quote, someone would hire someone "they knew to be better" and then would call the old man a week later to fix what those "certified" guys fucked up. I'm not lying. He bought us a house with that business, cars for each family member, computer gear (I worked with him for a LONG time). He never EVER advertised on TV and only ever had ONE newspaper add (and never cold called or gave out flyers). His only advertisement was Word OF MOUTH. All because of QUALITY OF WORK.
Same thing goes for old computer gear, and some cars, I've had a 3 gig IBM from the "olden days" that FINALLY died nearly 11 years later. 1995 to 2006... show me ONE GODDAMN MAXTOR or HITACHI (ibm sold their drive setup to them) that last nearly as long.
Of course that little drive is a collector's item. MADE IN THE USA.
Then they were made in eastern europe, quality still good. Then made in chinese satellite nations,Taiwan and Singapore made good units... Then made in China, and the quality got flushed to the shitter.
Cheaper build, shorter warranties... shittier products.
Perhaps americans should STOP shopping by price. Perhaps that was the great fallacy at first. Everyone here worries about bottom line and buys the cheapest shit they can. Then they wonder why it breaks.
Corporations caught on to it, and kept making cheaper shit. Seeing that americans didn't care about quality (the majority don't) they sold shittier products at ALL ends of the spectrum.
So we ended up with service and quality going to shit. After all, one way or another you won't stay without high tech goodies and other brand name shit, because you want to be "normal".
And unless you buy stuff made in Canada, and a few in europe... almost all other "high tech goodies" are made in China. You wanted cheaper, YOU GOT IT!! NOW LIVE WITH IT OR FIX IT!
~D
" What luck for rulers that men do not think" - Adolf Hitler
Also, I'm credit card free since about 5 years ago myself :)
:)
Just finished paying off my school loans recently. Trucking's been nice to me, I just cut the checks to each of them and let them fuck themselves for all I care
~D
" What luck for rulers that men do not think" - Adolf Hitler