Category: Citizens United

by Dave Mindeman

I'm sure you have heard the expression "corporations exist to maximize shareholder value".

Somebody should tell that to Medtronic.

Medtronic Inc. chief executive Omar Ishrak got an earful from stockholders who got their first chance Thursday to directly question the company's planned purchase of an Irish company. Medtronic's $43 billion deal to buy Covidien Inc. has drawn enormous media and political scrutiny as one of a growing number of U.S. companies purchasing firms in countries with lower tax rates, then relocating their legal headquarters abroad to take advantage of those rates. For Medtronic's shareholders, there's another issue to the deal: Its structure creates a surprise taxable event for them -- one that could cost thousands of dollars depending on how many shares they own.

Medtronic merged with Covidien in order to "disavow" American citizenship and avoid taxes on overseas holdings.

But, unfortunately for Medtronic shareholders, the completion of the sale will cause a trigger of capital gains taxes for long time shareholders. And how does that "maximize shareholder value"?

Chief executive Omar Ishrak had problems placating those shareholders at their annual meeting. And there were other concerns....

1. Inversion - this tax ploy which other corporations have looked at is now going to get the scrutiny of the Federal regulatory agencies....which, in turn, could result in new laws to prevent such blatant tax avoidance.

2. Protecting Board Members and Officers - instead of "maximizing shareholder value", Medtronic is, instead, going to work to protect its board and officers by absorbing the $65 million in excise taxes that would apply to them personally.

3. Tax Avoidance - Some shareholders even complained about the fact that US taxes were being avoided. Especially when that avoidance was going to trigger shareholder tax liability in the thousands per individual.

It is hard to justify Medtronic's actions on the basis of "looking out for the shareholder".....because this action clearly does not. The Medtronic shareholders are the victims of the corporate plot.

If Medtronic is a corporate "person" then it doesn't have many friends right now.

Category: Citizens United

by Dave Mindeman

Here is a future scenario based on today's Supreme Court ruling:

Time: In the near future

Place: White House briefing room with press present

Sheldon Adelson strides toward the podium.

ADELSON: Good morning. I called this press conference so that I could help clarify some of the positions of President Gotembytheballs. There has been some confusion of late and I'd just like to clear it up. In regards to online gambling, the President's position is to repeal last year's bill that allows this form of gambling. In addition, we are going to proceed with the new missile plant near Arlington, Texas. We need to keep America strong. Also, Israel has been granted a wing in the Pentagon to coordinate Israeli defenses. Are there any questions?

REPORTER: Some people are saying that the positions you just "clarified" are simply catering to your business needs and policy wants. Do you think that criticism is justified?

ADELSON: Let's be clear. While those policy positions are coincidently my own, they have come about after deep discussion with the cabinet. And since I paid for most of those people to get there, they may have a bias towards the ideas I present. That doesn't mean that these ideas are not good for the American people.

REPORTER: But the administration has made the repeal of online gambling its number one priority. Is that really a necessary position?

ADELSON: Well it is necessary to maintain my wealth and if I do not maintain my wealth, then George Soros' candidate Senator Gotembythethroat might be making policy and the President is not going to let that happen.

REPORTER: But, Mr. Adelman, even the new missile plant is going to be built on land you own and the plant will be operated by a business you own. How is that fair?

ADELSON: It is fair because I have to increase my campaign contributions. President Gotembytheballs' term expires and I need to work on my support for Senator Myfootsuphisass' campaign. We need continuity to make these policies work.

REPORTER: In regards to the Israeli "wing" at the Pentagon - isn't that going to require Senate approval?

ADELSON: Good question. Yes, it will and I am in the process of purchasing my 51st Senator as we speak. I am working in Minnesota to form a coalition with Stanley Hubbard and Bob Cummins to get our candidate IlovePolymet into office. As soon as we get that into place, Senate confirmation shouldn't be a problem. Senate Majority Leader Senator Suckup is doing a great job and will make it happen.

REPORTER: There are rumors that the President is considering dismantling the social safety net. Millions of people will lose government support for their subsitence. Is that true?

ADELSON: Well, I -uh, the President- hasn't made up his mind about that yet. I -um, the President, is looking into all the possibilities. It is a question of how many rich people we need to mollify in order to keep those policies going. After all, the poor don't have a lot of money to fill campaign coffers. We have to make sure the important people are kept happy. The Soros' wing of the government is buying up more political people - well, I mean "capital" - lately and we have to stem that tide.

AIDE TO ADELSON: Sorry ladies and gentleman, that is all we have time for.

ADELSON: Yes, sorry. I have to Jet out to Las Vegas to open a new casino. Finally got those property tax breaks I needed. Governor Whateveryousay in Nevada finally got his act together. I had to threaten to support his opponent State Senator Ilikebribes to get his attention.

ADELSON: Thank you all.

*****************************************

And thank you to the US Supreme Court for making this all possible.

Category: Citizens United

by Dave Mindeman

I still can't figure out how Minnesota elected officials have this puzzling misinterpretation of conflict of interest.

Red Wing Mayor Dennis Egan probably still thinks that being mayor and a silica sand lobbyist is not a problem....even though the controversy finally made him rethink and resign.

After Steve Sviggum's rationale about the U of M Trustee and Senate Caucus spokesman being an OK thing....or former Rep. Steve Gottwalt and his health care lobbyist position....now Mayor Egan....you would think the logic would be obvious.

Does it have to be spelled out? Do we need specific legislation that says being an elected official and a lobbyist or political spokesperson at the same time is a full blown conflict of interest? Maybe we do. Maybe the logic of it all escapes those in power.

I have always been uncomfortable with the relationships of elected officials and lobbyists. They have to have relationships, but the revolving door of legislator to lobbyist is too easy and convenient. There is a silent quid pro quo that seems evident in such cases. When the lobbyists dangle future lucrative jobs in front of poorly paid legislators, the tempatation is much too great.

It would seem that elected officials need to sign a contract with the electorate. If they represent the people then representing corporations or special interests are not in the cards. A lobbyist cannot become a legislator and a legislator cannot become a lobbyist. Ever!

I realize that such an idea will never come to fruition....but we must at least establish a moratorium that has a significant time lag. My guess is, that to be effective, it should be at least 10 years.

It may be naive to think this way....but in an ideal world it would certainly make for better decision making.