After all the phony baloney of the recent past, a requirement that companies report real numbers doesn't sound particularly onerous.
No sooner did FASB weigh into the debate last March then opponentsas truly evil stuff, if not downright un-American. It was an example of bad thinking by tax-and-spend Beltway types that would only harm working families. Even worse, they argued, it would wreck productivity and rob companies of the incentive they need to continue to innovate.
The hardball approach worked. When I spoke with TechNet CEO Rick White a day after the vote, he was still ebullient about the one-sided magnitude of the 312-111 vote.
"We were really pleased," said White, a former congressman who also serves as chairman of the International Employee Stock Options Coalition. "(The numbers) definitely exceeded our expectations."
TechNet, which serves as the political voice of the technology industry, lauded the House vote for preserving employee stock options for rank-and-file workers. But what he couldn't explain was how the FASB proposal would drown the very spark of Yankee ingenuity.
So it goes in a republic, majority rule and all that, but did the majority get hoodwinked by the minority--and a very self-interested one, at that? FASB never called for the elimination of stock options. Not even close.
Radical types like Federal Reserve Board Chairman Alan Greenspan and Berkshire Hathaway CEO Warren Buffett are on record saying expensing options is a sensible idea. Now go try convincing the barons of Silicon Valley.
The tech industry, slowly clawing its way back after three years of post-bubble misery, does not want to rock the boat and possibly derail chances for a full-fledged recovery. That's a reasonable concern, but after all the phony baloney of the recent past, a requirement that companies report real numbers doesn't sound particularly onerous. You'd never think that by just listening to the rhetoric. Folks who stand to benefit mightily by maintaining the status quo spun this as a victory for the little guy.
Rep. David Dreier, R-Calif., dismissed the notion of stock options being an expense as "absurd," declaring that options align the employee interest with the company interest. That sounds a lot more palatable than saying he wants to help the rich get richer. (I'm sure it's entirely coincidental, but the American Electronics Association, the nation's largest high-tech trade association, inducted Dreier into its "High Tech Legislator Hall of Fame." The Business Software Alliance awarded him its "Cyber-Champion" title in 1999, and in 2000, Dreier was named "High-Tech Legislator of the Year" by the Information Technology Industry Council.)
I'll avoid taking the mandatory cheap shot by pointing out that Dreier hails from the same governmental body that brought us the genius "freedom fries." (Ah, I couldn't resist.)
The House vote isn't the last word on the subject. A bipartisan group of senators is pushing a measure urging the body not to undercut FASB's authority by following the House vote. Maybe I'm just too old-school, but I still have faith that wiser heads of government will win out in the end.