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I have heard a lot of talk lately regarding the composition of the New York Stock Exchange's board of directors. "Reforming the Big Board" (Newswatch, November 2003) quoted a securities lawyer who said of the old board, "It's a classic case of the fox guarding the henhouse." I believe the chairman of the NYSE desires to have a new board made up of corporate executives who are not members of the NYSE. This proposed elimination of Wall Street investment bankers as board members only to be replaced with corporate executives with business and personal relationships with Wall Street investment bankers sure doesn't sound like independent directors to me. This action would have friends and associates of the fox serving as directors.
I spend part of my time as an arbitrator. Before I am allowed to serve on a case, I must attest to my independence. I doubt if any of the proposed new NYSE directors could attest to theirs.
Frank A. Dusek
Weiss, Sugar, Dvorak & Dusek Ltd.
I was disappointed with your article "Whistle-blower Woes" (October 2003). It conveys an undertone that whistle-blowers are a nuisance to be managed, and that they ought to expect (perhaps deserve) the worst, based on the fourth-grade notion that "the tattletale often suffers more than the guilty party."
Enron's Sherron Watkins and her peers at other firms heroically helped reveal immorality, pathological greed, and egregious criminal behavior in Corporate America. At the same time, CFO magazine was presenting some of the perpetrators with awards for their innovative financial-management practices. If CFO is to be forgiven for this profound error, it ought to be honoring and encouraging ethical vigilance, rather than patronizing whistle-blowers.
And where is the unalloyed criticism of the latest example of federal-government duplicity; that is, hyping the fundamental reforms of the Sarbanes-Oxley Act of 2002 while placing whistle-blower protection in the notoriously bureaucratic hands of OSHA?
Raising the Standard?
In "The China Syndrome" (October 2003), you say that "IT outsourcing...work is done in other countries where labor is generally cheaper." This causes unemployment and reduced business capital investment in the outsourcing country. Why do you not mention that the costs of consumer and business goods and services are also generally cheaper in those countries to which the work is outsourced? Offshore IT outsourcing exports employment and the business capital investment that goes with it. The employees in those other countries are not being exploited by low salaries and wages; rather, they are having their standard of living raised.
Lawrence A. Tillinger
Morristown, New Jersey
The November cover story, "Where Credit Is Due," incorrectly described the benefit of substituting long-term debt for short. Such efforts postpone payments not of interest, as the article stated, but rather of principal.