Ralph Nader’s open letter to Apple CEO Tim Cook demands suspension of $100 billion buyback plan; instead wants Apple to pay full year’s pay bonus to Foxconn workers, rec centers across the U.S., and more

Erstwhile politician and consumer protection/environmentalist activist Ralph Nader has peened (typo and it’s staying) the following open letter to Apple CEO Tim Cook, verbatim:

May 9, 2018

Tim Cook, CEO
Apple, Inc.
One Apple Park Way
Cupertino, CA 95014

Dear Mr. Cook:

Last week, you announced the largest single stock buyback in corporate history, amounting to $100 billion. Probably no more than you and two other Apple executives made this decision prior to receiving the expected rubber stamp from your congenial board of directors. Your company’s owners – Apple stockholders– were neither consulted nor asked for their approval.

Executive compensation packages rely on stock buybacks. (See The CEO Pay Machine by Steve Clifford, a former CEO who has served on corporate compensation committees.) From 2005 to 2016, stock buybacks by the S&P 500 totaled $5 trillion – equal to half of net income and twice as much as paid to shareholders in dividends. By the end of 2018, this figure will grow to well over $6 trillion. The owners of these companies – the shareholders – were not asked by management for their approval. After all, it is their big money, notwithstanding the out-of-control reliance on the “business judgment rule.” Were they given the clear choice between stock buybacks or dividends, most shareholders would have preferred receiving this surplus in cash dividends now.

With your $100 billion announcement, you are telling shareholders, your company’s owners, without a detailed explanation regarding other options, that this is the best you can do to advance their interests. This is short-term nonsense, except for its positive impact on executive compensation metrics.

Studies have shown that stock buybacks are just one variable in a large matrix of variables – internal and external to the company – that shape stock price and they are a weak variable at that. (See attached list of studies). You can examine major company stock buybacks for yourself (e.g., Cisco and Walmart) and see the accuracy of that observation. Cisco, after huge buybacks and much greater profits and size, has its stock about one-half of its March 2000 value.

It is the better part of prudence and foresight for you to pursue two courses of action. First, suspend the $100 billion decision or its implementation. Second, enter into a professional, detailed exchange with your shareholders – institutional and individual – explaining why you do not think there are better uses long term and short term for their $100 billion. Receive their considered feedback all in public for other interested parties to be informed and educated.

You also owe it to less-favored taxpayers in America who don’t have the offshore repatriation tax reduction demands that Apple and other companies regularly pursue. As Larry Fink, Chairman of the giant Blackrock investment firm wrote in his February 2018 letter to CEOs, “To prosper over time, every company must not only deliver financial performance, but also show how it makes a positive contribution to society. Companies must benefit all of their stakeholders, including shareholders, employees, customers, and the communities in which they operate.” (See attached).

In that context of proper expectations, here are some issues you can address in ways that would receive positive public reactions:

1. For less than 2 percent of your $100 billion buyback, or $2 billion, you could award a full year’s pay bonus to the 350,000 Foxconn workers who build your iPhones. Think of the economic relief and happiness that gesture would produce. These workers sweat for your immense wealth in difficult workplace conditions, unable to afford the Apple phones they manufacture for your company’s massive profits.

2. You can invest in research and development on ways you can diminish the effects of your company’s toxic supply chain that stretches from the dangerous mines in Africa to the hazardous solid waste disposal when users discard them. Many serious illnesses, fatalities, and injuries associated with manufacturing your products can be prevented.

3. With your reported reflective bent, you can make the case for reducing some of the collateral damage from excessive iPhone use by youngsters that comes with a sedentary life of obesity – now at risk-laden epidemic levels. Apple could invest in needed neighborhood recreational facilities all over the country.

4. Of course, you could always cut your prices for consumers. In the 1960s and ‘70s, such profit margins as Apple’s would have been an antitrust signal of possible monopolistic practices or market collusion.

5. Then there are the conventional applications of a cash-rich company to consider: productive new investments, raising employee salaries and pensions, improving hiring practices, and workforce training and consumer services.

6. Finally, it is unconscionable that the federal government decided to give Apple a huge tax windfall for repatriating its cash from abroad, while it refused to adequately fund the annual budgets of four critical agencies. The egregious examples of these budget inadequacies are the Center for Disease Control ($7 billion), the World Health Organization ($4.4 billion), the Environmental Protection Agency ($8 billion), and the IRS, whose strapped budget made it unable to attempt to collect $450 billion in uncollected taxes (it currently has a budget of only $11.5 billion).

Harvard economist John Kenneth Galbraith called attention to the problems associated with concentration of private wealth and public deprivation over 60 years ago.

The concentration of corporate power in ever-fewer hands, with expanding immunities and privileges denied “real persons,” continues to rise on matters of gravity to the American people. Conservatives call these privileges “Statism,” or “crony capitalism,” that has enormous influence over government dispensations. Mr. Fink’s cautions are worth pondering in more reflective formal settings.

The undersigned is not the only Apple shareholder who believes that stock buybacks, in contrast with other superior options, should be fully discussed with shareholders and then submitted to a binding shareholders’ vote. You will be hearing from others. Put your $100 billion stock buyback decision on hold.

I look forward to your thoughtful response.

Sincerely,
Ralph Nader

Source: The Official Site of Ralph Nader

MacDailyNews Take: Yeesh.

Some people deride Apple CEO Tim Cook as a top-notch SJW virtue-signaler, but next to Left Field Ralph, he looks like William F. Buckley Jr.

138 Comments

  1. Yes! Finally!

    It’s THE ULTIMATE SJW SMACKDOWN! Who will virtue-signal the loudest, the most often, and the with the craziest, most anti-capitalist lunacy?!

    Stay tuned: It’s NADAR vs. COOK! May the farthest left virtue-signaler win!

        1. I remind you that W in his first term was also an “electoral president”, albeit by a much closer margin.

          From Wikipedia…
          “ Bush defeated Al Gore by 537 votes. Nader received 97,421 votes in Florida (and Pat Buchanan and Harry Browne received 17,484 and 16,415”

          Do you think even one Nader vote would have gone to Bush, even if Buchanan and Browne weren’t running and all their votes went to Bush, Gore would have won.

        2. It is well documented now that had all votes in Florida been properly recounted Gore won Florida easily. Have you had your head stuck in the sand all these years? Nothing we can do about it now but the truth is that Gore won Florida.

          1. Yeah, well, if ifs and buts we’re candy and nuts everyday would be Christmas. You can’t rewrite history and Dubya won fair and square. Sorry to read you just can’t get over it …

            1. I’m not American. I don’t care who won. I’m just telling you that multiple surveys of ballots that were not included in the recount have clearly shown Gore won Florida, by a significant margin. Bush had a better legal team and strategy. That is why he won. Bush did not win via actual votes from citizens. Again, I don’t care either way. Both parties in your country are corrupt. In that context Dubya won, well, not fair and square in a civilized sense, but by American standards of what is fair, sure I’ll give that to you.

            2. “It was settled by the Clinton era Supreme Court, nuff said. Time to move in from 18 years of dwelling on it ”

              I’m not dwelling on it but it seems like you sure are. Let me repeat, I don’t care who is president of Dumberica. Bush did not get more votes than Gore in Florida. Bush did end up with the higher vote total in Florida due to a very smart PR and legal strategy.

            3. “Amen and ENOUGH of this sour grapes revisionist NONSENSE …”

              For it to be sour grapes I would have to care who won and I don’t care at all. It isn’t revisionist nonsense, even the article cited in this thread to prove Bush won says that Gore would have won a statewide recount of all votes. It shouldn’t bother you. Bush was president. Nothing can change that. However, it is a fact that Gore did get more total votes in Florida than Bush did. That isn’t what counted though, only the partial recount mattered and Bush won that. I’m not sure why this is so hard to understand. The partial recount is not a statewide recount. Bush won the partial recount and his legal strategy made sure that was all that mattered. Gore would have won a statewide recount but that was never carried out.

            4. “For it to be sour grapes I would have to care who won and I don’t care at all.” So if you don’t care WHY OH WHY do you keep posting this NONSENSE? BUSH WON! He served eight years. The media and Supreme Court AGREED. Move on …

            5. “BUSH WON! He served eight years. The media and Supreme Court AGREED.”

              All of that is true. It is also true that Gore got more votes in Florida. Do you not understand how both statements can be correct? I fear for our future if this is the intellectual level of the tech crowd.

            1. You do realize the article you cited says exactly what I said, that if a statewide recount had been held Gore would have won. Do you read anything before you cite it?

            2. It says that would have been the case only if everything was decided in Gore’s favor in disputes. That is NEVER the case. Sorry, TowerTone. Gore lost.

              The US Supreme Court decided the case on the law, not on what you wished could happen.

            1. Can anyone on MDN read? The article cited says Gore would have won a statewide recount, meaning if they counted ALL the votes Gore wins. The recount you’re talking about was just the partial recount of votes that took place and Bush did win that. I don’t care who won. However, it is a fact that in a statewide recount Gore wins. You don’t even need to factor in Nader as a spoiler. If you count all the votes properly Gore got more votes in Florida. Period. If you redo the partial recount Bush still wins that way.

            2. You have to read the STUDY which I have, not the article about the study, to learn that only way Gore would have won a state side recount (especially when you learn he would not even have won a recount of the four majority Democrat areas he had requested be recounted) is if EVERY SINGLE DISPUTED VOTE was decided for Gore. Every hanging chad, every butterfly ballot, every non-vote, every presidential double vote, every ballot from suddenly produced “found” ballot boxes with no official provenance, with every single one decided in Gore’s favor. Then, and only then, would Gore win, and then only by between 42 and 171 votes. . . and that was still excluding the overseas military mail in votes which had never been counted at all due to the Secretary of State ruling the lack of a signature on the outside of the envelopes invalidated them. The likelihood was a Federal Judge would have ruled that decision void and the military vote would have gone heavily Bush. . . but we will never know because they were never counted.

              However, Gore had to REQUEST and FUND a state wide recount and he had a window of opportunity to make that request. Instead, his campaign only requested to recount the four heavily Democrat areas that was in the process, being done only by DEMOCRATS, LOCKING OUT THE REPUBLICAN ELECTION JUDGES FROM THE PROCESS, an extreme violation of the election law, when it was interrupted by the US Supreme Court for other violations of the Florida Election laws.

          2. No, even the New York Times agrees that had the vote been recounted correctly as you say, Bush won. Gore did not. Gore did not win Florida.

            Per the Liberal Factcheck.com:

            “According to a massive months-long study commissioned by eight news organizations in 2001, George W. Bush probably still would have won even if the U.S. Supreme Court had allowed a limited statewide recount to go forward as ordered by Florida’s highest court.

            Bush also probably would have won had the state conducted the limited recount of only four heavily Democratic counties that Al Gore asked for, the study found.”

            Only super-liberals go on to claim that Gore won and that is only if every single decision about hanging chads, allowing challenges about the butterfly ballots, and accepting every disputed ballot was decided for Gore. , , and even then it was estimated he would win by between 42 to 171 votes. That is not winning “easily.”

    1. Fuck you First Fuckoff. You’re too shallow to acknowledge the valid points that Nader is making, and too much of a lowlife to think of anyone but yourself. You hate anyone who proposes virtuous actions because you have no positive virtues. Go get yourself an android if you prefer to support companies that don’t signal virtues. Prick.

      1. … typical response from a lib snowflake who can’t come up with an intelligent comment. As for virtue, it appears you are lacking in that area yourself Nancy.

          1. Let’s put it this way had those foxconn employees been making more $ Apple would have made less $ and that positive earnings report could have been negative and Nader wouldn’t have a tree to even bark up on

            every single person in this post would’ve been singing the blues because Apple stock would have dumped and losers with no skin in the game like Ralph Nader would just virtue signal on another company for attention

            that’s how those guys get laid

    2. Roll up! Roll up! It’s all here on TDN
      The ultimate sociopathathic, half_wit, reality_denying Tea Party for sub-optimal IQ freaks. The lies! The anti_truth! The loudmouth lunacy! The kakistocratic crew of cretins reveal their inner selves! The horror!

    3. I agree with every one of Nader’s points.

      People forget how Henry Ford rocketed thousands of Americans from subsistence living into middle class by simply offering his workers a living wage and his customers a great value. Now the greedy rich extoll the virtues of taking advantage of everyone and playing shell games to hide the money that isn’t going to be used for any productive purpose.

      Did all the prior stock buybacks push Apple to be valued at a higher ratio than the other tech biggies? Of course not. That is because the other tech stocks keep pushing out new products and services constantly. They show they are working for the future. Apple on the other hand uses the same near slave wage factories as the scum companies, and Timmy can’t keep 3/4 of the legacy products fresh.

      If you want to run an exceptional company for the long term, you need to spend that huge cash pile to invest in your people and your future products, not just stock games.

      For the record, every poster on this blog signals values. For some, it’s enhancement of Apple quality and sharing the good fortune so Apple will become stronger in the future. For others, greed and self aggrandizement is the only value they have ever praised here. Nader has saved more lives than any one of you here. His points are valid and would make Apple a better company.

      1. “If you want to run an exceptional company for the long term, you need to spend that huge cash pile to invest in your people and your future products, not just stock games.”

        Certainly Apple can invest enough money into manufacturers to provide a living wage …

    4. What part of Foxconn’s employees are NOT Apple’s employees does Nader not grasp? As a stockholder I would file suit against Apple’s management if they did any of this with MY money.

  2. I never thought I’d ever say this, but Ralph makes several strong points.

    Two key takeaways:

    1) Raise the salaries of people that made you RICH.

    2) Consult the shareholders and not run ROUGE …

    1. One, Apple consults the shareholders every year at the Shareholders Meeting where the issue of dividends and buybacks get discussed. Apple has already returned $200B thru buybacks and dividends. The additional $100B is totally inline with past actions. Shareholders have not been run over roughshod before, and they’re not being run over roughshod now.

      As for raising the salaries of people that made you rich: one, those aren’t Apple’s employees, and any bonus, will result in Foxconn compensating workers less. Essentially, any bonus will end up in the employers pockets. Two, Foxconn workers, like my family in Zhengzhou, made anywhere from 2000 to 6000RMB in a year, farming the land. At Foxconn Zhengzhou, salaries start at over 2000RMB a month. Ex-farmers make many times more at Foxconn than they did as a farmer.

      1. “Apple consults the shareholders every year at the Shareholders Meeting where the issue of dividends and buybacks get discussed.”

        Every year? How about every day. We now have instant e-mail, text messaging, etc.

        “As for raising the salaries of people that made you rich: one, those aren’t Apple’s employees”

        So they mean nothing to Apple’s success?

        I have to give you credit for defending a greedy company making products thinner and cheaper like the old robber baron days, but now in 2018 …

        1. There is a process. If any shareholders want to put a question on the shareholders’ ballot, there is a process. If any shareholders want to sue, there is a process.

          Clearly, you like to read meaning into people’s statements that don’t exist.

          “I have to give you credit for defending a greedy company making products thinner and cheaper like the old robber baron days, but now in 2018 …”
          Ah, now I get it. You have an agenda, and no amount of reasonable discourse, will open your mind to consider anything but your own ill-formed opinions.

          1. OK, so there is a process. Would that be revelant today to a $100 billion stock purchase? Please provide evidence that all the shareholders were notified and approved …

            1. Wow, I’d give you a nickel to buy a clue, but I think I’d be wasting the nickel.

              Every year at Spring conference call since 2012, Apple has announced their capital return plan. And, every year, in the Spring, shareholders have a meeting where they can ask Tim and Luca about that capital return plan, express their support or displeasure, or put a question on the shareholders’ ballot if they so wish. That’s the process. I think I’ve already stated it a couple times, but hey, some people don’t read the answer the first time.

              Now, as I’ve pointed out to you before, you have a tendency to read into people’s comments. NOWHERE did I say shareholders were “notified”. So, why would I need to provide evidence for something I didn’t say?

              And, if some shareholders don’t like what Apple is doing, they can sue. Has anyone sued Apple over returning $200B already? Has anyone sued Apple over returning the $100B now? No? What are they waiting for?

            2. Wow, I won’t give you a penny fanboy.

              Yes, you have accurately described the status quo process. What I asked you and you failed to respond to is Apple allowed to go ROUGE and consult shareholders after the fact only once a year? You say yes, correct?

              “And NOWHERE did I say shareholders were “notified”.

              Right. You did not say it I said it. Sheesh …

            3. The management of Apple, of or any company for that matter, cannot just willy-nilly just give the assets of that company away to some other company’s employees, GoeB. That would be considered a criminal act. The management must perform their duties under the laws of the United States and they cannot just usurp their fiduciary duties. The money they are holding is NOT THEIRS to do with as they please or you or Ralph Nader pleases. It, along with the rest of the company, belongs to the investors. There are only certain things they can do with it. Giving it away to someone else to whom it does not belong is not one of them.

            4. My naive point was simply to inform shareholders for INPUT before making the largest stock repurchase of all time. Guess that is pie in the sky and not how it works …

    2. Your passion and logic are noted. (Rare to see both from a single commenter!) But I think you meant rogue when you said rouge, which is a cosmetic product I use to make my face more appealing. You seldom fail to amuse me, GoeB, even inadvertently! 😄

  3. How about Nader quit telling others what to do with their money. Nice socialist he is.

    Hey Ralph, how about I tell you to give your home to the homeless and your money to workers in Turkey…

    Ugh…

    1. With clarity, he lays out the liberal’s penchant to claim ownership of another’s resources. I always wonder where the mindset comes from, or how does one live with it w/o guilt or shame? Kind of like Obama’s statement, “I think at a certain point you’ve made enough money.” To be the judge of what that amount is for another person is mind-boggling to me. Pompous, righteous, omniscient, god-like are just a few adjectives that come to mind. Needless to say, for Obama to then go on and make millions of dollars & buy a few mansions, adds hypocrisy to the mix of words.

      Liberals…where does this urge come from and how is it rightfully justified?

      1. Besides my befuddlement of the Liberal’s god-like judgement, as it relates to other’s money/resources, there’s a more repugnant reality to the story. In short, the liberal is less charitable as an individual, as a voting block and as a country. The book titled “Who Really Cares,” cites data that households headed by conservatives give 30 percent more to charity than households headed by liberals. The Red states as a voting block also give more to charity. Americans give almost 2x of their GNP to charity, compared to the British. French are the tightest in Europe (from Book; Philanthrocapitalism). Our more liberal neighbor, also gives less to charity.

        Author of “Who Really Cares states; ““When I started doing research on charity,” Mr. Brooks wrote, “I expected to find that political liberals — who, I believed, genuinely cared more about others than conservatives did — would turn out to be the most privately charitable people. So when my early findings led me to the opposite conclusion, I assumed I had made some sort of technical error. I re-ran analyses. I got new data. Nothing worked. In the end, I had no option but to change my views.”

        Liberals, isn’t it time to note the significant discrepancy and emptiness of a political “nerve” that has a “short?” Speaking so loudly and proudly that another’s money is “yours,” when in effect it’s empty group-speak, is really tragic. For those that lean even farther than liberal and embrace the virtues spoken of Bernie and other socialists, this mindset is how the monster is fed. Do as I say, but not as I do.

        1. These people will never realize that every single time socialism has been tried, no matter by whom, it abjectly fails and its surviving victims, those that are still alive, always take generations to recover from the good intentions of those who inflicted what ever form of socialism of the day on them.

          Whether it be communism, Nazism, Fascism, the modern form of socialism being practiced in Venuzuela, it always ends badly. Even the “civilized” socialism of modern Europe is burning to the ground as its do-gooding leaders are turning blind eyes to raping and rioting “Immigrants” who demand more-and-more free stuff and refuse to join society while demanding society bend to their norms, while the native people must accept their leaders’ invitations to even more of the invaders who set up larger and larger no-go zones where even the leaders’ police cannot safely go, much less the native population.

          Yet these same socialist leaders still claim “everything is fine,” and bury their crime statistics, as their women are beaten and raped while native citizens are killed and their countries burn around them, being rapidly turned into replicas of the third world hellholes their “refugee” guests-with-beards supposedly fled pretending to be children.

    2. Hypocritical freeloaders.

      I dont need anyone forcing me to be charitable…

      I am and will be when i choose to…

      Remember the concept of freedom of choice?

    3. Proposing that a corpoation invest in its people is freeloading? Wow. How terrible it would be for a Foxconn worker to make enough money and have enough free time to legitimately buy and enjoy Apple products. Capitalism should not revert into feudalism just because unscrupulous greedy investors want to get rich quick.

      1. No , someone suggesting that my risks/ due deligance / investment and returns should be dustributed to others becouse they just idealize so is freeloading. Its Lazy.. it promotes entitlement and lazeness… ( hey your are doing good.. not fair.. give me some ) …… path to mediocrity!!
        “unscrupulous .. greedy investors..”. Talking about an insulting blanket statements.. …….. so if one invests.. they are greedy and unscrupulous! How shallow minded and shortdighted can a comment get . Wow

        Its not for Nader to suggest what i should with my money… ill be charatible when i choose to be.. i dont need someone making that decision for me.
        He can do whatever the f he wants with his..

        In the meanwhile…
        anyone has problems with capitalism ..
        i suggest you move to a country with a more harmonious system for your ideologies.

        ( do u have any idea how much apple has contributed to well being of workers at fox-con and alike … it is one of the most sought after jobs for the upcoming class …. everything is relative.. you should travel more. )

        A Flat society is a dead society… it easy to idealize BS.. go get a taste of what that ideology actualy looks like in its implemented form. Ie communist societies…..

        1. I suggest Paul try a command society such as Venezuela, see how that’s working for them.

          The workers at Foxconn, especially those on Apple’s assembly lines who already receive more than their fellow workers on other assembly lines working on other companies’ products, are actually receiving a living wage for THEIR economy and cost of living. Not, of course, for our economy and cost of living, but those are two entirely different things. The Chinese cost of living is considerably less then is our cost of living. The two are not one-to-one comparable.

          Many of the workers actually DO own the products they assemble. How else do you think that China just grew to become a larger market for Apple’s products than the EU?

  4. Ralph makes a lot of sense. The smack talkers are likely high net worth people who stand to prosper in a buy-back. Letting the owners (shareholders) decide makes all the sense in the world.

    1. Exactly! Unfortunately we as a society are lazy to stereotypes and past history. We are reluctant to look beyond the knee jerk response and evaluate present day …

    2. Uhm, Ralph argued that buybacks don’t work. Yep, he argued both sides of the coin.

      “Studies have shown that stock buybacks are just one variable in a large matrix of variables – internal and external to the company – that shape stock price and they are a weak variable at that. … Cisco, after huge buybacks and much greater profits and size, has its stock about one-half of its March 2000 value.”

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