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Killing The Goose.(ISSUES & INSIGHTS)(EDITORIALS)(Editorial)

Investor's Business Daily

| April 01, 2004 | COPYRIGHT 2004 Investor's Business Daily, Inc. This material is published under license from the publisher through the Gale Group, Farmington Hills, Michigan.  All inquiries regarding rights should be directed to the Gale Group. (Hide copyright information)Copyright

Markets: The nation's top accounting group wants companies to expense the stock options they give to their best talent. It's a bad idea -- one that will hurt American companies' ability to compete.

Employee stock options have been blamed for many of corporate America's supposed ills -- from runaway executive compensation to phony and misleading income statements.

The Financial Accounting Standards Board wants to cure these ills by making companies expense the options on their income statements when they're given -- not when they're exercised.

This will have a devastating impact on America's innovators, the small and startup businesses that create virtually all of the new products, ideas and jobs that fuel rising living standards.

Most small companies can't compete with bigger ones for talent by paying big salaries. They don't have the cash.

Instead, they give their best workers stock options -- that is, a chance to get rich in the future, if they're successful.

It's been one of the bedrocks of our high-tech success since shortly after World War II, when options first began to be used.

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