Dear Malefactors of Great Wealth:
Teddy Roosevelt isn’t around to chastise you anymore, so I thought I might channel him for you.
Do you boys at British Petroleum wish now that the Minerals Management Service might have made you put a non-leaking blowout preventer on the Deep Horizon oil rig? Do you think it might have been a good idea to put up with some fussy inspector who insisted you have a working battery in the “deadman trigger” that would have shut it down when the preventer failed? So far your ability to avoid government regulation has cost you $80 billion. And the tab is still running. Your stock price is cut in half and you are going to have to forgo an upcoming dividend.
Wouldn’t a battery and a non-leaking blowout valve have been a lot cheaper?
How about you fellas that used to work at Lehman Brothers? Do you wish the Securities and Exchange Commission had told you and your fellow investment banks that you couldn’t leverage your capital at 30 to 1? You might not be bankrupt.
You fellows that used to work for Enron (before you went to prison), do you wish your accounting firm had told you that off-the-book liabilities hidden from your stockholders were illegal? Don’t you wish they had told you to knock it off or get reported to the SEC? You wouldn’t have made as much money, but chances are you would be making more than the $1.30 and hour in the prison laundry.
All you smart investors who put millions into the hands of Bernie Madoff, money that has since disappeared, do you wish the SEC had questioned his ridiculous returns and stopped the madness before he decimated the Upper West Side of Manhattan?
It’s one thing for Republican politicians to tell the rubes that government regulation is a drag on free enterprise, but it’s time for all you smart boys to sit down and ask yourself just how smart you have been over the last decade. No, you don’t want to deal with regulators. But if you and your competitors all have to comply with the same regulations, you have an even playing field. Don’t you think you’ve seen enough examples of smart guys destroying their companies and wrecking an entire business sector by taking shortcuts?
Regulation keeps you from being stupid.
We have some concern about whether we are going to have an economic recovery and there are a couple of things you fellas have done that may prevent it.
Firstly, you have ruined the credit of an entire generation of productive Americans. You sent credit cards to college students with no income and signed them up for long term cell phone packages that they couldn’t pay. Add that to staggering college loan debts. (Google Glenn Reynolds’ excellent recent piece on student loans in the Washington Times.) How is the recent college grad supposed to buy a car, furniture, or a home when they are deeply in debt with a lousy credit score? It is the young who make the purchases that drive the economy. Don’t look for geezers like me to buy suits, new cars, furniture, or another house.
Secondly, the handicaps of the current generation could be overcome if they had good jobs. But you’ve moved the jobs overseas. I’ve heard the argument that it’s better to move manufacturing jobs overseas and let our workers concentrate on high-end, high-tech jobs. I’d like you to go down to the local high school and figure out how many of the students are potential computer science and computer programming geniuses. Or how many of them would just like to have a good job down at the auto parts plant with a decent salary enabling them to raise a family? How many of each will you find in the average high school?
So in your pursuit of driving the stock price next quarter, you have wrecked the economy and produced the first generation of Americans who will not have it better than previous generations. And some of you have gone to jail. More of you ought to.
Perhaps it’s time to revamp the ethics courses at America’s business schools.