Bush Live - Speech on Corporate Responsibilty

MSNBC

[Sub-Driver]

Says Fraudulent CEOs Should Lose All Compensation

[caddie]

Martha Stewart would be the perfect person to indict for her alleged insider trading.

She is popular, but she appears to have received insider information about FDA approval of a drug, from her friend, the CEO of the company making the drug.

Then she allegedly dumped the stock, and saved about forty thousand dollars in the process.

Then she basically has denied wrongdoing, and the Justice Department is tiptoeing around her accountant. Nothing will happen to her.

Sure wish I had somebody give me a heads up when one of these high-tech stocks was about to tank.

Now, it would be very significant if Bush overlooked the fact that she is a politically correct icon of the soccer moms, and had his justice department indict her.

Politically costly, but very demonstrative of his sincerity to apply the law equally.

That's why it's never gonna happen.

Because Bush will talk a good line about justice, and protecting the little guy, but when a clear-cut, egregious violation occurs (Hillary, Martha, McCauliffe, etc.,) he will head for the tall grass.

You watch and see.

And millions of honest entrepreneurs will deal with the actual consequences of his posturing: tons and tons of more regulation, on top of the ridiculous amount that already exists.

And the evildoers who are politically connected will go scot-free.

You watch.

You watch those polls drop, too.

They are in the seventies, not the nineties as you claim, and falling.

[Freee-dame]

David Gregory's DNCNBC questions from yesterday....

Several major papers today wrote about the many questions President Bush was asked on the Harkin deal. If they had been truthful, they would have said that eight people asked President the SAME question over and over.

[Sub-Driver]

here it is:
The following is the full text of President Bush's speech on July 9, 2002, in New York:

Thank you all. Thank you very much for that warm welcome. I'm pleased to be back in New York City. New York City is a unique symbol of America's creativity and character and resilience. In the last 10 months, New Yorkers have shown a watching world the true spirit of your city. A spirit that honors the loss, remembers its heroes, and goes forward with determination and with confidence.

People of this city are writing one of the greatest chapters in our nation's history, and all Americans are proud of New York.

I've come to the financial capital of the world to speak of a serious challenge to our financial markets, and to the confidence on which they rest. The misdeeds now being uncovered in some quarters of corporate America are threatening the financial well-being of many workers and many investors. At this moment, America's greatest economic need is higher ethical standards -- standards enforced by strict laws and upheld by responsible business leaders.

The lure of heady profits of the late 1990s spawned abuses and excesses. With strict enforcement and higher ethical standards, we must usher in a new era of integrity in corporate America.

I want to thank Bill for his introduction. There's nothing like being recycled. But thanks for having me. I'm honored to meet your family and Uncle Jack.

I appreciate very much Secretary O'Neill and Secretary Evans traveling with me today. I want to thank the members of the New York delegation, Senators Schumer and Clinton, as well as Congressman Fossella and Congressman Rangel. I appreciate so very much the Mayor -- my friend, the Mayor, for being here to greet me as I came in on the chopper. Thank you, Mr. Mayor, and thanks for the great job you're doing for New York.

I'm honored that Cardinal Egan is here. And I appreciate so very much seeing John Whitehead, the Chairman of the Lower Manhattan Development Corporation. And thank you all for coming, as well.

The American economy -- our economy -- is built on confidence. The conviction that our free enterprise system will continue to be the most powerful and most promising in the world. That confidence is well-placed. After all, American technology is the most advanced in the world. Our universities attract the talent of the world. Our workers and ranchers and farmers can compete with anyone in the world. Our society rewards hard work and honest ambition, bringing people to our shores from all around the world who share those values. The American economy is the most creative and enterprising and productive system ever devised.

We can be confident because America is taking every necessary step to fight and win the war on terror. We are reorganizing the federal government to protect the homeland. We are hunting down the terrorists who seek to sow chaos. My commitment, and the commitment of our government, is total. We will not relent until the cold-blooded killers are found, disrupted, and defeated.

We can be confident because of the amazing achievements of American workers and entrepreneurs. In spite of all that happened last year, from the economic slowdown to the terrorist attack, worker productivity has grown by 4.2 percent over the last four quarters. In the first quarter of 2002, the economy grew at an annual rate exceeding six percent. Though there's much work left to do, American workers have defied the pessimists and laid the foundation for a sustained recovery.

We can be confident because we're pursuing pro-growth reforms in Washington, D.C. Last year we passed the biggest tax cut in a generation, which encouraged job creation and boosted consumer spending at just the right time. For the sake of long-term growth, I'm asking Congress to make the tax reductions permanent. I'm asking Congress to join me to promote free trade, which will open new markets and create better jobs and spur innovation. I ask Congress to work with me to pass a terrorism insurance bill, to give companies the security they need to expand and to build. And I will insist on -- and, if need be, enforce -- discipline in federal spending, so we can meet our national priorities without undermining our economy.

We have much to be confident about in America. Yet our economy and our country need one more kind of confidence -- confidence in the character and conduct of all of our business leaders. The American economy today is rising, while faith in the fundamental integrity of American business leaders is being undermined. Nearly every week brings better economic news, and a discovery of fraud and scandal -- problems long in the making, but now coming to light.

We've learned of some business leaders obstructing justice, and misleading clients, falsifying records, business executives breaching the trust and abusing power. We've learned of CEOs earning tens of millions of dollars in bonuses just before their companies go bankrupt, leaving employees and retirees and investors to suffer. The business pages of American newspapers should not read like a scandal sheet.

The vast majority of businessmen and women are honest. They do right by their employees and their shareholders. They do not cut ethical corners, and their work helps create an economy which is the envy of the world.

Yet high-profile acts of deception have shaken people's trust. Too many corporations seem disconnected from the values of our country. These scandals have hurt the reputations of many good and honest companies. They have hurt the stock market. And worst of all, they are hurting millions of people who depend on the integrity of businesses for their livelihood and their retirement, for their peace of mind and their financial well-being.

When abuses like this begin to surface in the corporate world, it is time to reaffirm the basic principles and rules that make capitalism work: truthful books and honest people, and well-enforced laws against fraud and corruption. All investment is an act of faith, and faith is earned by integrity. In the long run, there's no capitalism without conscience; there is no wealth without character.

And so again today I'm calling for a new ethic of personal responsibility in the business community; an ethic that will increase investor confidence, will make employees proud of their companies, and again, regain the trust of the American people.

Our nation's most respected business leaders -- including many gathered here today -- take this ethic very seriously. The Business Roundtable, the New York Stock Exchange, the NASDAQ have all proposed guidelines to improve corporate conduct and transparency. These include requirements that independent directors compose a majority of a company's board; that all members of audit, nominating, and compensation committees be independent; and that all stock option plans be approved by the shareholders. I call on all the stock markets to adopt these sensible reforms -- these common-sense reforms -- as soon as possible.

Self-regulation is important, but it's not enough. Government cannot remove risk from investment -- I know that -- or chance from the market. But government can do more to promote transparency and ensure that risks are honest. And government can ensure that those who breach the trust of the American people are punished.

Bold, well-considered reforms should demand integrity, without stifling innovation and economic growth. From the antitrust laws of the 19th century to the S&L reforms of recent times, America has tackled financial problems when they appeared. The actions I'm proposing follow in this tradition, and should be welcomed by every honest company in America.

First, we will use the full weight of the law to expose and root out corruption. My administration will do everything in our power to end the days of cooking the books, shading the truth, and breaking our laws.

Today, by executive order, I create a new Corporate Fraud Task Force, headed by the Deputy Attorney General, which will target major accounting fraud and other criminal activity in corporate finance. The task force will function as a financial crimes SWAT team, overseeing the investigation of corporate abusers and bringing them to account.

I'm also proposing tough new criminal penalties for corporate fraud. This legislation would double the maximum prison terms for those convicted of financial fraud from five to 10 years. Defrauding investors is a serious offense, and the punishment must be as serious as the crime. I ask Congress to strengthen the ability of SEC investigators to temporarily freeze improper payments to corporate executives, and to strengthen laws that prevent the destruction of corporate documents in order to hide crimes.

Second, we're moving corporate accounting out of the shadows, so the investing public will have a true and fair and timely picture of assets and liabilities and income of publicly traded companies. Greater transparency will expose bad companies and, just as importantly, protect the reputations of the good ones.

To expose corporate corruption, I asked Congress four months ago for funding to place 100 new enforcement personnel in the SEC. And I call on Congress to act quickly on this request. Today I announce my administration is asking Congress for an additional $100 million in the coming year to give the SEC the officers and the technology it needs to enforce the law. If more scandals are hiding in corporate America, we must find and expose them now, so we can begin rebuilding the confidence of our people and the momentum of our markets.

I've also proposed a 10-point Accountability Plan for American Business, designed to provide better information to shareholders, set clear responsibility for corporate officers, and develop a stronger, more independent auditing system. This plan is ensuring that the SEC takes aggressive and affirmative action.

Corporate officers who benefit from false accounting statements should forfeit all money gained by their fraud. An executive whose compensation is tied to his company's performance makes more money when his company does well -- that's fine, and that's fair when the accounting is above-board. Yet when a company uses deception -- deception accounting to hide reality, executives should lose all their compensation -- all their compensation -- gained by the deceit.

Corporate leaders who violate the public trust should never be given that trust again. The SEC should be able to punish corporate leaders who are convicted of abusing their powers by banning them from ever serving again as officers or directors of a publicly-held corporation. If an executive is guilty of outright fraud, resignation is not enough. Only a ban on serving at the top of another company will protect other shareholders and employees.

My accountability plan also requires CEOs to personally vouch for their firms' annual financial statements. Currently, a CEO signs a nominal certificate, and does so merely on behalf of the company. In the future, the signature of the CEO should also be his or her personal certification of the veracity and fairness of the financial disclosures. When you sign a statement, you're pledging your word, and you should stand behind it.

And because the shareholders of America need confidence in financial disclosures right away, the SEC has ordered the leaders of nearly a thousand large public companies to certify that the financial information they submitted in the last year was fair and it was accurate.

I've also called on the SEC to adopt new rules to ensure that auditors will be independent and not compromised by conflicts of interest.

The House of Representatives has passed needed legislation to encourage transparency and accountability in American businesses. The Senate also needs to act quickly and responsibly, so I can sign a good bill into law.

Third, my administration will guard the interests of small investor and pension holders. More than 80 million Americans own stock, and many of them are new to the market. Buying stock gives them an opportunity to build wealth over the long-term, and this is the very kind of responsible investment we must promote in America. To encourage stock ownership, we must make sure that analysts give honest advice, and pension plans treat workers fairly.

Stock analysts should be trusted advisors, not salesmen with a hidden agenda. We must prevent analysts from touting weak companies because they happen to be clients of their own firm for underwriting or merger advice. This is a flat-out conflict of interest, and we'll aggressively enforce new SEC rules against this practice -- rules which take effect today.

And the stock markets should make sure that the advice analysts give, and the terms they use, have real meaning to investors. "Buy" should not be the only word in an analyst's vocabulary. And they should never say "hold" when they really mean "sell."

Small investors should also not have to have the deck stacked against them when it comes to managing their own retirement funds. My pension reform proposal would treat corporate executives the same as workers during so-called "blackout periods," when employees are prohibited from trading in their accounts. What's fair for the workers is fair for the bosses.

My reform proposal gives workers quarterly information about their investments. It expands workers' access to sound investment advice, and allows them to diversify out of company stock. The House has passed these measures; I urge the Senate to do the same.

Tougher laws and stricter requirements will help -- it will help. Yet, ultimately, the ethics of American business depend on the conscience of America's business leaders. We need men and women of character, who know the difference between ambition and destructive greed, between justified risk and irresponsibility, between enterprise and fraud.

Our schools of business must be principled teachers of right and wrong, and not surrender to moral confusion and relativism. Our leaders of business must set high and clear expectations of conduct, demonstrated by their own conduct. Responsible business leaders do not jump ship during hard times. Responsible leaders do not collect huge bonus packages when the value of their company dramatically declines. Responsible leaders do not take home tens of millions of dollars in compensation as their companies prepare to file for bankruptcy, devastating the holdings of their investors.

Everyone in a company should live up to high standards. But the burden of leadership rightly belongs to the chief executive officer. CEOs set the ethical direction for their companies. They set a moral tone by the decisions they make, the respect they show their employees, and their willingness to be held accountable for their actions. They set a moral tone by showing their disapproval of other executives who bring discredit to the business world.

And one of the principal ways that CEOs set an ethical tone is through their compensation. The pay package sends a clear signal whether a business leader is committed to teamwork or personal enrichment. It tells you whether his principal goal is the creation of wealth for shareholders, or the accumulation of wealth for himself.

The SEC currently requires the annual disclosure of a CEO's compensation. But that information is often buried in long proxy statement -- proxy statements, and seldom seen -- seldom seen -- by shareholders. I challenge every CEO in America to describe in the company's annual report -- prominently, and in plain English -- details of his or her compensation package, including salary and bonus and benefits. And the CEO, in that report, should also explain why his or her compensation package is in the best interest of the company he serves.

Those who sit on corporate boards have responsibilities. I urge board members to check the quality of their company's financial statements; to ask tough questions about accounting methods; to demand that audit firms are not beholden to the CEO; and to make sure the compensation for senior executives squares with reality and common sense. And I challenge compensation committees to put an end to all company loans to corporate officers.

Shareholders also need to make their voices heard. They should demand an attentive and active board of directors. They should demand truly independent directors. They should demand that compensation committees reward long-term success, not failure. Shareholders should demand accountability not just in bad times, but especially in boom times, when accountability frequently breaks down. Shareholders are a company's most important constituency, and they should act like it.

The 1990s was a decade of tremendous economic growth. As we're now learning, it was also a decade when the promise of rapid profits allowed the seeds of scandal to spring up. A lot of money was made, but too often standards were tossed aside. Yet the American system of enterprise has not failed us. Some dishonest individuals have failed our system. Now comes the urgent work of enforcement and reform, driven by a new ethic of responsibility.

We will show that markets can be both dynamic and honest, that lasting wealth and prosperity are built on a foundation of integrity. By reasserting the best values of our country, we will reclaim the promise of our economy.

Leaders in this room help give the free enterprise system an ethical compass, and the nation respects you for that. We need that influence now more than ever. I want to thank you for helping to restore the people's trust in American business. I want to thank you for your love of the country. And I want to thank you for giving me the chance to come and address you today. May God bless you all.

[caddie]

You end up looking like you are on the side of the crooks.

I probably do look that way, to those not accustomed to critical thinking.

I definitely don't support crooks, of any kind.

[Miss Marple]

Well, excuuuuse me, oh critical thinking expert! LOL!

Not too smug, are you?

[Kaslin]

thanks

[Freee-dame]

the form that got lost was the form that verified the sale.

If I understood it correctly, at yesterday's press conference President Bush said that they had copies of all the paperwork and that his lawyer was supposed to have filed it and that he had waived his attorney-client privilege when the SEC investigated it. I think our investigative journalists (?) should go talk to his lawyer.

[caddie]

It's very simple:

When laws are violated, I would like the people who broke the law indicted, tried, and convicted.

I am not impressed by the creation of superfluous programs (of dubious Constitutionality) when what really needs to happen, is plain, hard, law enforcement.

Trouble with Bush here, is that he is spouting off as if he's going to take on a bunch of multimillionaires.

Do you really think he will indict McAuliffe, Hillary, Martha, Lay, and do you think he will force Michael Eisner to file a justification for his salary?

Or do you think, as I do, that he will let the extremely powerful get away with it?

I think he will make speeches like this, saying things like corporate ethics should be strong, wrongdoers will be punished, and, other self-evident banalities.

But I am not easily impressed by words. X42 taught me not to be.

And I am sorry if you view my critical thinking as arrogance, it is really not arrogance.

I just hate to see innocent businessmen saddled with yet another layer of bureaucratic nonsense from the Federal government.

Just because Bush lacks the courage to indict a few really big dogs who have gone astray.

And he feels he must do some tap dance (but never indict the wrongdoers -- that's too dangerous) to make the uncritical believe he is interested in justice.

It is not personal contempt for the President.

It is just my enlightened self interest as an American citizen, whose President has no regard for my freedom, my income, my property, or my safety.

Who wants only to be reelected.

[ohioWfan]

They are in the seventies, not the nineties as you claim, and falling.

I was referring to his approval among Republicans who call themselves Conservatives, not the general population. Read what I said. That makes it 90's and not 70's.

And don't worry, I'll be watching to see if they drop, just like I've been watching since all the experts said they'd be down in the 50's by July.

It's too bad for you that your anger and cynicism have robbed you of objectivity and distorted your view of reality. The fact is that George W. Bush is a man of integrity, who does what he says he's going to do...........I've been watching.

btw, can you please cite the source of your 'information' that the President's pollsters have told him to ignore his base right now, as I asked? You stated it as fact. Back it up.

[section9]

Because Bush will talk a good line about justice, and protecting the little guy, but when a clear-cut, egregious violation occurs (Hillary, Martha, McCauliffe, etc.,) he will head for the tall grass.

Oh, I get it now.

You're not interested in cleaning up Wall Street. You're only interested in putting white liberal Democrats in jail.

Look, I want to see corrupt Democrats in jail as much as the next guy, but I also want to see any Republicans who committed wrongdoing to be breaking rocks. If Ken Lay is guilty of defrauding investors, I want him to be someone's prison bitch. Period.

You're only interested in what Clinton people Bush can toss in the slammer. The game is much larger than that. It is about the administration of justice and the restoration of confidence in the system of trading and accounting. Thankfully, it appears that the Bush people understand that in the end, all we have left is the rule of law.

Be Seeing You,

Chris

[caddie]

Your post is strong, and you have made many points, some of which I agree with. But I would like to make two comments.

1.) The war on terror is nonexistent: I believe we should have declared war on the true cause, source, inspiration, and economic and philosophic cause of the Jihad on us: Saudi Arabia (and maybe Pakistan). They instead have had their fat feminine asses kissed by none other than George W. Bush, who personally had them over to his house to do the honors.

The three thousand New Yorkers slaughtered September 11, 2001: Bush doesn't care about them. Their deaths have been unavenged.

The heroes of the Pentagon killed the same day: Bush doesn't care about them, he would rather have Muslim prayer services in the White House to be sure none of this minority is offended.

The innocents slaughtered in Pennsylvania: Tough noogies, says Bush, you don't matter, I need to seek approval instead from the leftist Europeans, who don't think I should retaliate. We Americans had it coming. That's what the world thinks, right?

So, from that standpoint, Bush is a disgrace, a terrible Commander-in-Chief, who suffered a greater attack than Pearl Harbor on his nation and chickened out of the rematch. He is a total loss, IMHO.

Because bombing the rockpile called Afghanistan, and attacking Osama Bin Ladin, is ducking the real fight.

It would be like declaring war on North Africa, and holding up Rommel as your nemesis, instead of attacking Hitler and the Third Reich.

Face it, Bush has basically chickened out of the WOT.

Except he still wages the war against YOU, my friend.

And if you think I'm full of it, go on an airplane ride sometime soon and get patted down by Wanda the wander. After she gets done with the toothless bluehaired lady in the wheelchair.

2.) My second point relates to your quote,

But none of what we have heard these two days has anything to do with small business. It has to do with corporate boards, CEO's, and megamillions in compensation while the execs are defrauding the company.

This reminds me very much of the institution of the income tax in 1919 or thereabouts. It, too, was supposed to deal with the one-half percent of the citizens who were millionaires.

As you know, many more persons than millionaires (in 1919 dollars) are now subject to the Federal income tax.

I see the same thing happening with this vague mucking around by Bush: a ton of regulations and infringements on my freedom, and the rich and powerful getting away with murder as they always have.

I really appreciate you arguing with me in this civilized forum. No kidding.

[maica]

Re: the Harken line of questioning: The talking points seem to have the style of Terry McAuliffe all over them.

Journalist: We just want the President to release all the documents, if he has nothing to hide.

Truth: SEC documents are public information. Any journalist could have access to them.

[Mo1]

Good Lord, no! I couldn't even watch him on TV -- I literally became ill if I watched him. But the legitimacy of EOs should not be dependent upon the character of the person issuing them.

Well if President Bush signed one EO after another like Clinton did throughout his Presidency to suite his OWN needs then I could see your point

[Cogadh na Sith]

ROTFLOL! I can tell that you are more of my generation than the "younger" generation.

Thanks, dude, but no way.... I'm a 'gen-xer'. Did you know that 'gen-x' is pushing 35 now and is quite conservative?

[Mo1]

And WHY are so many folks wanting to pile on Martha, by the way? Could be they think they can make her a "victim" the way Hillary worked it, and make President Bush the villain? JMHO, of course.

Possible .. or it could be they (liberals) threw her out to the wolfs thinking everyone wouldn't notice them

[olliemb]

Steve, you sound like a malcontent. So far Bush has not failed--when he promises something he delivers. If he made this declaration, the crooks will go to trial.
By the way are you upset about the trillions lost by congress? Are you upset that there never has been a social security lockbox ??? Never!!!! Are you upset that the porkers of congress are using your tax monies to make themselves more presentable and palatable to their constituents?

[Mo1]

And don't worry, I'll be watching to see if they drop, just like I've been watching since all the experts said they'd be down in the 50's by July.

Didn't the Experts say that last July also ...

Hmmmmmmmm and they still haven't gotten there

[caddie]

Why indict a company, why not indict the individuals who did the crime?

I believe if you indict the company, they will spread around the punishment, make it a bunch of fines, so, ultimately, the creditors to the failed institution will pay, or, worse, the general public.

It makes zero sense to indict a corporation.

A president does shenanigans like that when he lacks the will to indict the wrongdoers.

Just as a POTUS might wage war "on Terror" when he lacks the courage to wage war on Saudi Arabia.

So, at least Bush is true to his form.

Duck this fight, duck that fight.

[Miss Marple]

The first thing you do is indict the partnership or corporation. Then you go after the officers and such.

How long do you think it took to get John Gotti? You HAVE to follow the law and correct investigative procedure, or your case gets thrown out.

Sorry to tell you, but the President doesn't indict, nor does he interfere in the internal workings of the DOJ. He is operating as an elected President, not a king. You are going to have to be patient.

[caddie]

Your advice is very good, and I will wait and see.

But I encourage skepticism of the President.

Not because I don't like him personally.

Personally, he is quite charming, in my opinion, and almost everybody agrees with that assessment.

I just don't know what he believes.

I think he would just as soon start another Social Security-sized, mega-entitlement program, tomorrow, as easily as you or I would draw a breath.

He has, as far as I can tell, the same degree of respect for the Constitution that his father, 'New World Order' Bush has...

Zero.

That is what makes me nervous.

And I think this is why the Bush supporters on the forum are so vociferous in their defense of him: They suspect he has no respect for the Constitution either, and it makes them a little queasy.

And what really freaks me out is the huge support he has here by people who otherwise would really castigate him for his actions as POTUS, were he of the other political party.

It is kind of like the novel 1984, where the people praise their imaginary projection of the character of Big Brother, this nebulous, likeable personage, who had all the right lines, and all the right sing-song, lullaby tones of voice in his speech.

But was a deadly tyrant nonetheless.

Bush is not like us, or like me, at least, IMO.

Without injecting any envy into my feelings for Bush (because I am not poor now, and I was born upper-middle class, I have never been really poor, I honestly do not begrudge him his wealth and good fortune).

I have the feeling that this POTUS has been surrounded so thoroughly by layer upon layer of insulation from the usual knocks and pings of life, that he would have no compunction whatsoever about adding on several hundred hours of paperwork annually to the average businessman's work-year, just to satisfy his naive notion of justice in his highly padded world.

I get really hinky when I hear this guy talk.

And when I read the opinions of the Founding Fathers, I believe they would have great contempt for our POTUS. The quote earlier in the thread by Jefferson is typical of the contempt they would show for someone of Bush's station in life, pretending to be Chief Executive.

Moreover, owing to his failure to defend America from its recent attack, and owing to his feckless search for approval and votes, coupled with his total disdain for us, our intellects (didn't you feel insulted when, at Bush's order, the FBI denied that the LAX gunman was a terrorist, just so we would, like children, not get alarmed?), and our Constitution, I have no doubt that the Founding Fathers would consider George W. Bush a bona fide, domestic, enemy of the Constitution.

At the very best, someone not worthy of the office.

I know that I have many here to disagree with me, but I enjoy the debate, and close with my regards and my thanks for your reply.