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PART I SUMMARY In this book, Huffington exposes all the people who corrupt, how the corrupt, and how much they corrupt. Their motive seems to be the same: greed. People like Rigas, lay, Murray, Dunlap, etc. don’t feel like they’re rich enough. They, like Huffington said, treated the company’s money like their personal piggy bank. They keep digging and digging without realizing that they have spent billions. Unlike our loans to the bank, that when you were unable to repay them, handymen will come to your house and take your car, your furniture, even your house. For these crooked businessmen, their accounting of the company can easily white-out the loans and write them out as company’s expenses. The accountants can easily manipulate numbers so it looks like the company is doing better. When you’re in charge of your own performance-and a positive evaluation can earn you a million dollars-the urge to inflate your own grade can prove irresistible. How convenient! Some loans even brought some companies into bankruptcy. But of course, they weren’t worry because they still had high bonuses and compensation out of the bankruptcy despite of their bad performance. Amazingly, companies even forgave the loans of executives who did a lousy job. Mattel, for example, wrote off $3 million loan by their former CEO, Jill Barad, even though the company’s income has decrease dramatically (more than 50%) during his three years of job. Why aren’t they put in jail for this? You can be put in jail for stealing a gum, but not if you’re stealing millions of dollars. Well, how are we ever going to get them act responsibly when we keep rewarding them for irresponsibility? The employees lost their pension plan and their 401k while the CEO got millions in his personal wealth. Take for example Bernie Ebbers. He got $1.5 per year as his pension benefit for every year for the rest of his life, the use of WorldCom jet for 30 hours a year, free life insurance, medical insurance, and free long distance service. If only these businessmen devoted half of the energy to strengthening their companies that they do to improving it as apposed to destructing it, a true economic bloom would inevitable follow. John Rigas “borrows” $3.1 billion from the company he owned, Adelphia. When someone is being paid millions of dollars a year, with options for even more millions, how could he possibly need a #3.1 billion loan? What were these guys using all this money for? What Kozlowski did was even more hilarious. He purchased $13.2 million worth of paintings but don’t want to pay for the taxes. What he did was told the dealer to send the paintings to New Hampshire instead of New York to avoid sales tax. A misunderstanding happened between them results the paintings to arrive in New York. I guess these pigs really hate tax because Ingersoll-Rand, a jackhammer industry company was willing to move the company headquarter to Bermuda to save the income tax. According to Huffington, the money they save from this trick is more than $40 million a year. Beside money, these oinkers also want fame. Fame might be more important to Sam Waksal, the founder of ImClone than money, because he desperately want to make friend with anybody who’s popular. He agreed to Bill Clinton’s invitation for golfing even though he doesn’t play golf. He spent a fortune on the clothes and instruments though. Another popular CEO, Al Dunlap, who Huffington refers as “Chainsaw Al” have a strategy of lay-offing a lot of employees to increase the company’s income. In most of the companies he handled, his strategy didn’t work. It creates even higher rate of unemployment. The financial scandals of our time were made possibly by an unprecedented collusion between corporate interests and politicians that, despite the entire breast beating about reform, is still going strong. Together, these two powerful groups tore down hard-won regulations that restrained the worst capitalist excesses, leaving in their place a shaky edifice of feckless self-policing and cowed regulators, powerless to prevent the corporate evil greed. Believe it or not, government is on their side. By injecting a lot of money on campaigns, executives can get what they want by using government as their means. Regulations that were passed by government is not made to benefit the society, they were made to benefit their campaign contributors, to fulfill what they need.
Approximate Word count = 2893
Approximate Pages = 11.6
(250 words per page double spaced)
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