A question for Sonia Sotomayor

President Obama's announcement of Sonia Sotomayor as his Supreme Court Justice Nominee unleashed a flood of favorable and unfavorable comments about her competency as a Supreme. Then came these 32 words from a 2001 lecture at UC Berkeley:

I would hope that a wise Latina woman with the richness of her experiences would more often than not reach a better conclusion than a white male who hasn't lived that life."

I am in the midst of a long overdue spring cleaning so I know how much glass is in my home. Therefore, I will not cast stones at Judge Sotomayor. I will ask a very rhetorical question.

Do you know about the Supreme Court ruling "Brown vs. Board of Education?" The long version is "Oliver Brown et al vs. the Topeka Board of Education." In 25 words or less, this decision declared the separate but equal doctrine for racial segregation in public schools unconstitutional. This decision kick started the civil rights movement and made this nation a much better place for everyone. This decision was also reached by white males. The arguments were made by Thurgood Marshall, a black man, but nonetheless the decision was made by white males. (Thurgood Marshall became the first Black Man to be appointed a Justice of the United States Supreme Court)

My question to Judge Sotomayor. How would your wise Latina wisdom and richness of experiences have improved this decision? Maybe, just maybe us white males have richness of experience as well. Remember, you put a lot of emphasis on your experiences, but you seem to have overlooked the wisdom and richness of experience of us white males. Besides, what difference does richness of experience make? This is a country that respects rule of law. Everything I read about you prior to your gaffe makes me think you respect and will defend this concept.

Oh well, that's off my my chest. I wish you the best even if you do not get the appointment. (I think you should get it. Nobody's perfect!)

News from the wonderful world of USA finance

First, Edward Liddy announced that he would be resigning from his $1.00 CEO position at AIG when a replacement was found. He felt that AIG has reached the point where a long term CEO was needed. ( See my 3/19/09 posting "congressional follies about AIG") AIG's Trustees are also requesting 6 new independent board members at the June 30, 2009 annual shareholders meeting. Earlier, Mr. Liddy had said AIG was on track to pay back the bailout money within the next 5 years. Mr. Liddy and the trustees are on the path to recovery for AIG. The USA owes them a well deserved Thank You Very Much for all your effort and endeavor to help get our economy strong again. Our fearless leaders in congress will probably berate them every chance they get. My advice to Mr. Liddy and the trustees, don't let the turkeys get you down!!

Second, Treasury Secretary Timothy Geithner will be announcing rules for executive compensation for the banks receiving bailout funds. Nothing concrete has been announced yet but there are some interesting ideas on the subject already. In a May 24, 2009 Rueters article by Dena Aubin and Corbett Daly, they quoted 2 Harvard Law professors, Lucian Bebchuk and Holger Spamann On the subject. The professors believe executive compensation should be based on more criteria than stock price. Since equity (the bank's stock) is only 5% of a bank's assets, other items such as deposits, loan portfolios & credit ratings should also be used to set performance rewards. The professors argue that if stock price is the only criteria for rewards, the stock price can be artificially boosted at the expense of the rest of the banks assets. I agree with this idea. The purpose of incentives is to reward work that makes the company more profitable, not just the stock. If the company's overall profitability improves, the stock will improve as well.