Corporate Culture & Travel


I’ve written before about Madison’s air travel challenges and opportunities.
I continue to believe that only the arrival of Southwest will truly change Madison’s air transportation opportunities. The “Southwest Effect” is just what Madison needs: the average fare decreases and the number of passengers dramatically increases when Southwest enters a market.
I recently phoned Gary Kelly, Southwest’s CFO to encourage them to fly to Madison. Southwest gets major points for having a real person answering the phone and playing good music while the call is being routed around the company.

Tax Avoidance & Intellectual Property


Dave writes about Amazon’s controversial one-click purchase patent (many business process patents, are I believe an abuse of the patent process). Evidently, Amazon assigned their patent(s) to Deutsche Bank as part of a credit agreement between 1995 and 1997.
I wonder if there might be a tax shelter angle to this (amazon was generating huge losses at the time, and other firms might wish to do a deal for the tax benefits of those losses)? Years ago, I worked for a major international beverage firm. One of their (this firm was not unique) tax reduction/avoidance strategies was to create the flavors in tax havens (Puerto Rico, Cyprus, Ireland among other places) and sell that essential component back to US entities at high prices (this is of course a rather simplistic analysis). The US entities then generated small margins or losses while the offshore unit generated the large margins. This tax strategy, among many others is discussed in the very enlightening book by NY Times reporter David Cay Johnston: Perfectly Legal.
Deutsche Bank, like many others, has been part of a number of tax shelter strategies.
This abusive patent process is the major reason I do not link to amazon (barnes & noble online is a fine alternative).

Madison Schools Budget Updates

Barb Schrank updates us on the winners & losers in the recently passed $308+M 2004-2005 MMSD Budget:

  • Winners
    • Student Services increased 30%
    • Business Services 7%
    • General Administration increased 6% (!)
    • Educational Services (spec. ed/bilingual) 1%
  • Losers
    • Elementary Education -1%
    • w/o Assist. Supt. Office -2%
    • Secondary Education -1%
    • w/o Assist. Supt. Office -2%

Schrank also provides a complete comparison (excel file) here.