I Disagree with Loomis Somewhat

Today I saw this post by Erik Loomis at the Lawyers, Guns, and Money Blog. It is a brief rant in response to Rand Paul’s absurd claim that taxation of oil companies is, well, I’ll let the Dim Son say it himself:

Instead of punishing them, you should want to encourage them. I would think you would want to say to the oil companies, “What obstacles are there to you making more money?” And hiring more people. Instead they say, “No, we must punish them. We must tax them more to make things fair.” This whole thing about fairness is so misguided and gotten out of hand.

Note: that is the same quote Loomis used.

Here is the response:

Dear Big Oil Executives,

My name is Erik Loomis. I like to drive and heat my home and eat. Because of that, I really want you to profit off of me. I was thinking about eating three meals a day this year, but it’s really more important that your shareholders kick some more indigenous people in Ecuador off their land so you can maximize profits. …

I have a problem here with one little word. Shareholders. This is something that so many people have somehow managed to miss in the last couple of decades. Shareholders are not the recipients of large profits. Sure the shareholders get thrown a bone in the form of some fraction of the declared profits. What fraction, though, of the would-be profits go directly into the pockets of executives and members of various boards? I would love to see what fraction of total income of those companies is siphoned off by these vultures. Especially telling would be what the profits would be if the CEO-to-janitor pay ratio resembled that of 1950.

Look at a listing of boards of directors and you will see a few names pop up in more than one. How can an individual be an expert in multiple unrelated industries? Investigate deeply enough, and you will notice a real pattern. A pattern, that is, of political connections. The current “board of directors” system of large corporations is the definition of crony capitalism.