What is wrong with Armstrong?

Lance Armstrong is (was?) the most successful cyclist in modern sporting history. But soon after the US Anti-Doping Agency showed how he and his team "ran the most sophisticated, professionalized and successful doping program that sport has ever seen" (here), Nike terminated his contract (here), he was forced to step down as chairman of his Livestrong charity (here), and he is said to "a cheating bastard..." among other epithets (here).
Now, we are talking about cycling and doping. Of 21 podium finishers in the Tour de France between 1999 and 2005, 20 were directly linked to doping (here). We are talking about competitive team sports, where it is acceptable to do things you are not supposed to do when you play alone or with your friends. There is room for both a defense of doping and a defense of cheating in professional team sports. There is no room, though, for lying. And that should be the main charge to Mr. Armstrong.

Good pay and obscene pay

Citigroup shareholders rebuffed this week Citi’s $15 million pay package for its chief executive, Vikram S. Pandit. This is the first time that shareholders have united in opposition to outsized compensation at a financial giant. That is why this news deserves attention. According to the NYT, about 55 percent of the shareholders voting were against the plan, which laid out compensation for the bank’s five top executives. Disapproval is not common. In 2011, shareholders at only 42/3000 companies voted against pay plans. So, this looks like the beginning of emancipation. David Dreman, whose money management firm owns about $400,000 worth of Citigroup shares, is quoted arguing that “Shareholders have finally done something constructive on the whole C.E.O. pay problem.” And Brian Wenzinger, a Philadelphia money management company that voted against the pay package said: "C.E.O.’s deserve good pay but there’s good pay and there’s obscene pay." A few more quotes from the same piece: Mike Mayo (Credit Agricole Securities): “This is a milestone for corporate America. When shareholders speak up about issues on which they’ve been complacent, it’s definitely a wake-up call. The only question is what took so long?” But you should not be misled... this is not part of the initiative to reduce executive compensation. The same piece makes clear that shareholders voted against the pay proposal because it "lacked rigorous goals to incentivize improvement in shareholder value," according to ISS Proxy Advisory Services. Apparently, "Citigroup has had the worst stock price performance among large banks over the last decade but ranked among the highest in terms of compensation for top executives." Mr. McCauley, a senior officer at the Florida State Board of Administration, which voted against the plan, argues that “the plan put forth reveals a disconnect between pay and performance.” Calpers, the California state pension fund, also voted against because pay was not linked to performance. And even those who were in favor were on the same page: Mr. Ackman, head of Pershing Square Capital Management, argues that the CEO Vikram Pandit "is doing an excellent job and the bank has made tremendous progress during his tenure.” So, even if framed this way, this "rebuke" is not part of the OWS thing. It is, I believe, just another chapter of the old motto, "the corporation and its executives ought to maximize shareholder value."

The Ethics of Poker

Is there an ethics of poker? Apparently it is, according to Matt Glantz, a professional poker player who sees poker both as a professional sport and a respectable profession... See here. The original post in Glantz' weblog is here.

A code of ethics for professional economists

As a reaction to the documentary Inside Job - which won an Academy Award last February - the AEA (American Economic Association is rafting a set of professional standards for economists). Apparently, the main concern is the existence and appearance of conflicts of interests. Hope it is not too late... The article in the WSJ here.

Buffett calls for higher taxes on the Super-rich

And 16 French millionaires are making a similar call... (link)

Josh Cohen on Citizens United

Sokol: Guilty

This is the answer to the assignment you wrote on David Sokol's behavior according to Berkshire Hathaway. The statement said Berkshire Hathaway's investigation of stock purchases by David Sokol showed the former executive violated company policies and concluded he misled senior management. Link here.