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December 2, 2009

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Letter: Congress ignores stock options

Thursday, July 18, 2002 | 9:49 a.m.

Congress has failed to address the underlying cause of the problems with today's economy. That underlying problem is greed in the executive suite and board room. The management of large companies has been driven by greed at the top, manifested by the use -- or better yet the misuse -- of stock options.

When a chief executive officer's or chief financial officer's compensation is driven more by these options rather than his salary, they lose sight of why the company exists. In many cases they will cook the books to aggrandize the picture of the company's financial success, hence artificially raising the price of the stock and resulting in outrageous compensation through these options.

Why has Congress, in its proposed reform legislation, ignored the issue of stock options? Is it because of pressure from the business community? It surely is not because of pressure from the small stockholders, whose future security rests on the stability of their investments.

RAYMOND HARBERT

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