Good reporting from a store?

Despite my concern about a Costco founder publicly supporting tax increases, then making a special December Costco dividend to avoid these higher taxes, I’d like to commend Costco’s member magazine, the Costco Connection, for setting an example of good journalism.

Costco members receive this publication each month. It mostly has information on products available at Costco, but there is a smattering of other content. One recurring piece is the Yes/No page.

Each month, the Costco Connection asks an issue-related question to which they publish the response from two “experts,” one supporting the answer Yes and the other supporting No. The Connection also includes three short sound bites from customers on each side of the debate.

That’s a model other publications can learn from. I often stop reading news articles because of how poorly the facts and opposing arguments are presented. Often there is no attempt to present the opposing argument. Other times, when opposing arguments are included, they are token attempts that misrepresent the actual arguments.

Consider the recent reporting about the fiscal cliff. What arguments for Republican resistance to raising the top income tax rate did your news source present? I heard inaccurate and inept reporting on both sides.

Liberals seemed to think that Republicans wanted to protect their wealthy buddies, or just didn’t want to compromise with Democrats or were beholden to the power wielded by puppet-master Grover Norquist (who?).

Even when a fairer presentation of the Republican resistance was presented, it seemed to come with editorial gestures, like eye-rolls, that made it clear that such intentions should not be trusted and you’d be stupid to believe it.

Why didn’t we see more of the style of reporting that I can only seem to find in the Costco Connection?

Why not present the arguments in as fair and clear a light as possible and let people decide for themselves?

Maybe the Costco Connection will cover this issue before it all comes up again very soon.

How rude

I’ll quote the from the same well-written Wall Street Journal editorial as W.E. Heasley:

When President Obama needed a business executive to come to his campaign defense, Jim Sinegal was there. The #Costco co-founder, director and former CEO even made a prime-time speech at the Democratic Party convention in Charlotte. So what a surprise this week to see that Mr. Sinegal and the rest of the Costco board voted to give themselves a special dividend to avoid Mr. Obama’s looming tax increase. Is this what the President means by “tax fairness”?

Specifically, the giant retailer announced Wednesday that the company will pay a special dividend of $7 a share this month. That’s a $3 billion Christmas gift for shareholders that will let them be taxed at the current dividend rate of 15%, rather than next year’s rate of up to 43.4%—an increase to 39.6% as the Bush-era rates expire plus another 3.8% from the new ObamaCare surcharge.

More striking is that Costco also announced that it will borrow $3.5 billion to finance the special payout. Dividends are typically paid out of earnings, either current or accumulated. But so eager are the Costco executives to get out ahead of the tax man that they’re taking on debt to do so.’

Later in the editorial, they point out that based on the number of Costco shares owned by Jim Sinegal and his wife, this special dividend will save them $4 million in taxes.

How rude.

This violates a rule from my previous post: If you want more government, then you pay more also.

I wonder what Sinegal’s shareholders would have thought if he had taken a stand in line with his espoused principles. Sorry shareholders, the Board wanted to give you a special dividend so you could keep more of your money, but I’m a big supporter of big government so we won’t do that.

Update: Thanks to Speedmaster at The Pretense of Knowledge blog for the prominent link to my post. I’m honored. I also want to mention the cronyism that he included in the WSJ article that I left out:

“As it happens, one of those new stores opened Thursday in Washington, D.C., and no less a political star than Joe Biden stopped by to join Mr. Sinegal and pose for photos as he did some Christmas shopping. It’s nice to have friends in high places.”

DC is notorious for its opposition to big box retailers. This makes me question Sinegal’s motives for publicly supporting higher taxes. Higher tax support for a new store?