Answer Me This....
13 January 2007
Editor, The Wall Street Journal
200 Liberty St.
New York, NY 10281
To the Editor:
Home Depot shareholder Gary Abraham hopes that "Congress can do something about the greed-based pay packages that have become common among publicly traded companies" (Letters, Jan. 13).
Why pray to a horde of power-greedy office-getters in Washington? Like nearly everyone in America, Mr. Abraham himself can "do something" far more direct and effective than anything Congress can do - namely, not invest in companies governed poorly and instead invest in companies governed well. On the NYSE alone he can choose from among 3,576 corporations. He can also invest in mutual funds whose managers specialize in researching companies and finding those that are likely to create value for shareholders.
Of course, if he thinks himself and others to be too incompetent to invest wisely, then why does he suppose that as voters these same people will wisely choose and monitor the politicians to whom he wants to entrust the power to dictate corporate practices?
Sincerely,
Donald J. Boudreaux
Chairman, Department of Economics
George Mason University
Editor, The Wall Street Journal
200 Liberty St.
New York, NY 10281
To the Editor:
Home Depot shareholder Gary Abraham hopes that "Congress can do something about the greed-based pay packages that have become common among publicly traded companies" (Letters, Jan. 13).
Why pray to a horde of power-greedy office-getters in Washington? Like nearly everyone in America, Mr. Abraham himself can "do something" far more direct and effective than anything Congress can do - namely, not invest in companies governed poorly and instead invest in companies governed well. On the NYSE alone he can choose from among 3,576 corporations. He can also invest in mutual funds whose managers specialize in researching companies and finding those that are likely to create value for shareholders.
Of course, if he thinks himself and others to be too incompetent to invest wisely, then why does he suppose that as voters these same people will wisely choose and monitor the politicians to whom he wants to entrust the power to dictate corporate practices?
Sincerely,
Donald J. Boudreaux
Chairman, Department of Economics
George Mason University
Posted by Don Boudreaux on
Tuesday September 25, 2007 at 7:18am