Center for Ethics and Leadership

Wednesday, September 16, 2009

Financial Messes and Corporate Welfare III

A year after the Lehman collapse, the last thing I thought I would be doing is writing about Wall Street's irresponsibility again, but President Obama needed the anniversary of the meltdown to reprimand the financial community and warn that there would not be a second bailout.

It seems the previous behaviors have crept back in -- if they ever left. The courts had to reject the sweetheart settlement that arose from the Merrill Lynch/Bank of America merger; financial houses are once again lending with more risk than they should, and even the Financial Accounting Standards Board (FASB) has backed down under pressure from Congress, which, of course, is under pressure from lobbyists.

We hear the same tired rhetoric: regulation stymies the market and, besides, is unnecessary. The high pay is legitimate because it is pay for performance. Can anyone understand that regulation should exist because humans misbehave? Does anyone ask whether the compensation formulas are in themselves appropriate? Can we have a conversation about the social responsibility of corporations and a genuine understanding of the jobs and savings lost by average Americans as the financial shock waves rippled through all society as they still are doing?

Where are the ethics? Where is the leadership?

1 Comments:

  • I suppose low pay is legitimate because pay it too is for performance?

    Funny, I thought profits were due to unreimbursed value accruing to the corporation rather than to the laborer - I must misunderstand...
    as the mysterious market continues to function for the benefit of the few...

    I'll keep trying to get it.

    By Blogger kobe2, At September 20, 2009 12:14 PM  

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