The man who took 56 billion from Elon Musk

Years ago, a Governor of the Bank of England, Mark Carney, gathered together senior executives of insurance companies and gave them a formidable telling off for not paying attention to the risks that climate change would rapidly bring to their businesses. They should pay the consequences for their wealth, he suggested. Carney, who is currently the United Nations special envoy for Climate Action and Finance, is a peculiar character, but the world of finance and economics is full of similar characters.

A few years ago, for example, another economist, who was also a senior executive at the Bank of England, Charles Goodhart, proposed a radical change in the regulatory framework for banking entities. No fining entities for their irregular behavior. Banks don't do anything, people do. So senior executives must be held directly responsible. “If the chief executive of a bank knew that his own family's fortune would remain at risk throughout his later life from any failure in the behavior of an employee during his time in office, he would do more to improve banking culture than any set. of sermons and required oaths,” he said.

There are also many award-winning economists who strongly agree that high taxes should be imposed on disproportionate inheritances. It is not that parents cannot leave two apartments, or limited savings, to their children. The point is that, because of this desire, inheritances that have reached exaggerated volumes have stopped being heavily taxed. There is nothing to justify the new generations not starting from a more similar level, they agree.

These economists generally agree that tax systems are fundamentally based on the notion that the rich accept taxes in exchange for guaranteeing the right to property.

It seems like a reasonable agreement, but the deal could be jeopardized if gross inequality occurs.

It is equally a tall tale to argue that senior executives deserve exceptional incentives because if they are not paid with those amounts they will go to work in Abu Dhabi. An old director of an English bank summed it up very well: “Our CEO is not going anywhere because he is not a footballer and he really likes going to the club to have drinks with his friends, walk the dog through the tree-lined and humid streets of his neighborhood and spend weekends at his friends' country house.

Today, says the Economic Policy Institute, it is not unusual for a CEO of a large company or bank to earn between 30 and 40 million dollars a year, something that has nothing to do with their performance and everything to do with their relationships with customers. counselors. The result is a brutal increase in inequality. Even more so when things as absurd as Tesla's decision to pay $56 billion to Elon Musk occur. A small shareholder (nine shares) did not swallow and sued Tesla “for excessive and unjustified enrichment” of its CEO.

It turns out that this week a judge from Delaware (which is not just any place, but rather operates in the United States as a kind of internal tax haven, with more than 200,000 domiciled companies, and which has super-specialized judges) has decided that the small investor has very right and that those $56 billion incentives are nonsense.

The small protesting shareholder is called Rich Tornetta and like many small heroes he is stubborn. Mr. Tornetta also has a curious story, because years ago he played drums in a group of heavy metalrather, of a group of trash metal, he doesn't go any harder. He must not have had much success because there is no record that he recorded more than one album, back in 2008. In any case, If you want to see him in action, just visit The Pit, “your home for heavy metal news, opinions and culture.” Mr. Tornetta could start a new show titled: “The Man Who Took $56 Billion From Musk.”

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