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"I was just not thinking when I signed my tax return...it just got confusing." -- Ex-Tyco CEO Dennis Kozlowski explaining to a jury why forgiven loans did not appear on his 1999 tax return With President George W. Bush's efforts to overhaul Social Security in deep trouble, its fate now sits with Senate Finance Committee Chairman Chuck Grassley (R-Iowa). His panel will try to draft a bill by summer. But Grassley tells BusinessWeek that he'll abandon the President's goal of private accounts if that's what it takes to pass a measure that restores financial stability to the Social Security program. "I'm hoping the Senate will decide to include personal accounts," he says. "But if it doesn't, the solvency issue is very important and we should do what we can do."
He says only a bipartisan measure can clear the Senate. But no Democrats support the accounts. And they're joined in opposition by a handful of Republicans. That leaves Grassley at least one vote. The dot-com bust seemingly ended the practice of private companies selling early-stage shares to executives of customers and partners, allowing them to make a bundle when they sell the shares after an initial public offering. But salesforce.com is bringing it back to life.
) a maker of sales-management software, was one of the hottest IPOs in 2004. According to Securities & Exchange Commission filings, it sold pre-offering shares to key executives at business partners BEA Systems (BEAS
) and Microsoft (MSFT
) and to Japanese customer Macnica. They, in turn, filed to sell the stock post-IPO for a total of more than $1 million.
The practice is legal, but governance experts say it raises questions about whether recipients are acting in the interest of their employers or their personal portfolios. Salesforce had no comment.
On Feb. 23 former BEA Chief Architect Adam Bosworth filed to sell 49,791 shares of salesforce stock worth more than $770,000. The year before, Bosworth promoted BEA's alliance with salesforce in a press release and spoke at a salesforce event. Bosworth, now vice-president for engineering at Google (GOOG
), declined to comment. David Vaskevitch, chief technical officer at Microsoft, gave a speech at the same conference. On Dec. 22, 2004, he filed to sell 10,000 shares for more than $160,000. Vaskevitch says his investment was a personal matter, while Microsoft says it is unaware of the salesforce investment falling outside its own guidelines. A spokesman for Macnica's Haruki Kamiyama says he was unaware that any of the company's divisions were salesforce customers and his allocation had nothing to do with the relationship.
The price of the pre-IPO options is not available, but options granted salesforce execs in early 2004 were valued at $8 each. The company went public at $11. You'll be wowed by a new feature from search engine Google (GOOG
) that offers a detailed satellite picture of the real estate at any street address in the U.S. just by typing it into Google search, retrieving the map, and then clicking on satellite. What the new service also exposes is the lack of a consistent national-security policy when it comes to such images.
Type in 1600 Pennsylvania Ave., and you get a carefully edited image that blots out the White House. Same with the U.S. Capitol and the Vice-President's residence -- only they're pixelated out of focus. But you can get a satellite picture of CIA headquarters so sharp that you can count the cars in the parking lot. And no problem getting an overhead view of the Pentagon.
Why the inconsistent cloaking? It's up to the individual agencies responsible for security to decide what can be viewed. "There isn't a consistent national policy," says Mark Naftzger, with the U.S. Geological Survey, which pro-duced the images that made their way through private suppliers and onto Google's service. "The Secret Service demanded that those features be blurred," he says. Naftzger says unedited pictures of mili-tary installations are available. A Defense Dept. official says: "From a military analysis perspective, [a satellite picture is] just a post card. It's not militarily significant."
Using the new Google tool, you can pull up a clear image of Area 51 in the Nevada desert, which the U.S. government has long denied even existed. Although UFO buffs may believe the military works on flying saucers there, no aliens are visible. God rocks. So say Trinity, Melody, and Harmony, the three pious, rock-star characters soon to be plastered over everything from dolls to room decor. In January, 2006, G Studios in Newport Beach, Calif., will launch the "Chosen Girls" to promote Christianity's coolness to tweens. They'll join One2Believe's new "Messengers of Faith" talking Bible character dolls, which begin selling this month. Big sales are not far-fetched. Veggie Tales -- a series of animated vegetable cartoons that teach kids about Christian values -- has sold 40 million copies since 1994. Victoria Hale scours the globe for promising drugs that universities and drugmakers have discarded because they see little profit in developing them. "You just can't build a good business market for some diseases," she notes.
But Hale, 44, doesn't worry about markets. She runs OneWorld Health, the world's only nonprofit pharmaceutical company to market drugs to the developing world. Five years after launching OneWorld, Hale is completing trials for its first drug, an antibiotic for patients who contract deadly black fever from sandfly bites -- nearly 1.5 million of the world's poor each year.
Now, with $46 million from the Bill & Melinda Gates Foundation, the San Francisco group is helping to develop a malaria drug that will sell for less than a dollar a dose. With three promising drugs in the pipeline, Hale hopes that OneWorld will soon be able to pay its own way. IBM (IBM
) started off the year with a strategy aimed at "lowering the center of gravity." The idea was to revamp the 330,000-person staff to reduce costs, shift work to lower-cost countries, and strip out bureaucracy. So far, the program has mainly lowered employee morale.
Workers in Western Europe are up in arms over job cuts. More than 2,000 are likely to lose their jobs in France, Germany, and Sweden. On Apr. 26, some 600 union employees rallied outside IBM's German headquarters in Stuttgart, and more protests are planned in France. "People are angry about how this is being done," says Gerhard Rohde, a director at Switzerland's Union Network International, a labor coordinating group.
The company, which wouldn't comment for this story, is wooing shareholders with a $5 billion stock buyback and an 11% dividend increase. It's also hinting at a major restructuring charge for the cuts -- which analysts estimate at 10,000 jobs.