A DC-based lobbying outfit called the American Shareholders Association has produced a study showing a sharp increase in payment of dividends following the dividend tax cut:

According to the latest ASA analysis of S&P 500 dividend data, favorable dividend activity among S&P 500 companies increased 55.2 percent since the tax cut was enacted. A total of 298 favorable dividend actions (increases and initiations) were taken on the S&P 500 compared to just 192 in the previous 12 month period. 19 more companies are paying a dividend than before the tax cut and companies increased their dividend 277 times. As a result, $185 billion of cash will be returned to S&P 500 shareholders in 2004.

The group's head argues that this is good corporate governance, given that unlike reported earnings, cash dividends can't be faked:

"More cash in shareholders pockets is disciplining managers to undertake only the most productive investments. This has re-elevated shareholders to be true owners of the corporations they invest in and has improved corporate governance more than any regulation passed by Congress or the Securities and Exchange Commission."