From: James S. Dugal, M.D.
Dear Secretary Cox:
I ask you to consider stopping the issuing of options by public corporations. Options have been used by corporate executives as a means of hiding their true income from the owners of their companies.
When I look at the financial statement of a company I own or am thinking of buying, I cannot understand the salary of the corporate employees, thus its expenses. Through out history, people have been paid in currency that has a known value. Options are a bird of a different nature. I cannot determine their cost or value in lil old Opelousas. But, I am not alone. The best accounting firms and the IRS cannot either. So, as an owner, I dont know what my employees are making. Seems rather ridiculous, dont you think.
Options have been at the heart of all the corporate scandals lately. Intel has spent 42 billion buying 2 billion shares of stock, just to keep the same number of shares outstanding. Who got all that money? Not the owners of the company. Carly led HP down a bad road and walked to a $42 million tune, while we owners lost money.
All the attempt at regulating, expensing and guessing about options would be mute if good executives were paid with dollars or shares of stock that can be expensed.
Thank you for your consideration; James S. Dugal, M.D.