Should We Raise The Insider Trading Tax?
December 1st, 2008
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Today I came out from under my rock to see what was happening in the financial world, and found that today was one of the worst days of the financial meltdown. I found myself thinking about Martha Stewart, and wondering whether insider trading should have been included as the seventh income stream in Online Business School.
Seven years ago, Martha sold all of her ImClone stock on insider information the day before an 18% drop, avoiding a loss of $45,673. She denied it when questioned, saying “I just want to focus on my salad.” But sure enough, she was eventually convicted of conspiracy, obstruction of an agency proceeding, and making false statements to federal investigators. She was given a free five-month vacation in Camp Cupcake, and fined $30,000.
I didn’t follow this story closely, but am I missing something here? Did she actually profit from the deal, even after the conviction? I’m not an economist, but it seems that one good way to reduce the deficit is by raising the “insider trading tax.” I’m not a big fan of taxing the rich just because they’re rich, but if they’re guilty of illegal riches, can’t they share the wealth a little?
Below are the lyrics I remember from the parody song “Martha,” to the tune of Barry Manilow’s Mandy. I heard it on the radio years ago, but I can’t find it online. I wish they did a video, because it really loses a lot without the tune.
She got an inside Wall Street tip
Now she’s gonna pay for it
Her broker says she lied
She’ll soon be indicted
She’s facing lots of time
And we’re so excitedTo see her walking out in cuffs
Twenty years won’t be enough
Dress her up in stripes
Send her to Sing Sing
Keep her there for life
It would be a good thing, oh MarthaWell they’ll get you for insider trading
Then they’ll send you away, oh Martha
When we’re laughing so hard that we’re shaking
What’s your stock worth today, oh MarthaYou had everything and you spoiled it
Now they’ll lock you away, oh Martha
Pretty soon you’ll be sharing a toilet
With your cellmate
December 3rd, 2008 at 1:44 pm
I have never heard this song. It’s hilarious! I did see the pictures of her potential cell all decorated in a way that only Martha could do. It’s unbelievable to me that she actually got away with what she did with such little time spent. Amazing. I’m liking your idea about raising the insider trade tax. Next step is for you to run for office and then get it passed. For what it’s worth, I’d vote for you.
B.Wilde´s last blog post..Down In the Dumps? Put on Your Party Pants
December 4th, 2008 at 1:10 am
@ B. Wilde, when you consider the relatively small punishment, it seems like a good deal, doesn’t it? Thanks for your offer to vote for me, but I think it probably takes at least 2 votes to win an election. Oh well, we can always hope that the pro-insider trading lobbyists will lose their power one day.