Where did the information asymmetry in stock options come from?
Executives -- especially unethical executives -- thrive on information asymmetry. In fact, many will go out of their way to create as much asymmetry as possible and to prevent employees from being able to access or get the data that helps them understand the full value of their earnings. The less employees "know", the more executives can take without fear of scrutiny or retribution. But intentionally harming the workers as a means to prevent them from receiving the value they've earned is the most unethical thing a company can do. It's happening every day to innocent and hard-working employees, but it doesn't have to. Private firms with too much unchecked and unregulated power are the primary scammers; executives and their BODs defrauding, manipulating, and setting the stage for hyped IPOs is essentially fraud perpeutated by the elite for the elite. This really is a covert form of tax evasion. The stronger and more financial retribution we can push on these unethical scammers, the sooner the gap between the 1% and the rest of us can begin to shrink.
"Bill Clinton in 1992, one of his campaign causes, was that no company should be able to deduct the cost of executive compensation in excess of $1,000,000.
But when it came to actually implementing, the treasury department decided: As long as CEO pay is linked to company performance, you could deduct over a million dollars. Well, that was a signal to a lot of these executives and to their boards of directors to make more and more of executive pay into stock options. That's where the whole stock option thing came from. It was a kind of a perversion of Bill Clinton's promise in the 1992 election."
-- Robert Reich, Inequality for All ~ :47 minutes
Executives -- especially unethical executives -- thrive on information asymmetry. In fact, many will go out of their way to create as much asymmetry as possible and to prevent employees from being able to access or get the data that helps them understand the full value of their earnings. The less employees "know", the more executives can take without fear of scrutiny or retribution. But intentionally harming the workers as a means to prevent them from receiving the value they've earned is the most unethical thing a company can do. It's happening every day to innocent and hard-working employees, but it doesn't have to. Private firms with too much unchecked and unregulated power are the primary scammers; executives and their BODs defrauding, manipulating, and setting the stage for hyped IPOs is essentially fraud perpeutated by the elite for the elite. This really is a covert form of tax evasion. The stronger and more financial retribution we can push on these unethical scammers, the sooner the gap between the 1% and the rest of us can begin to shrink.
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