A few greedy executives topple markets
BY ANDREW GREELEY
Chicago Sun-Times
Editorial
July 19, 2002
and could spoil it all for Republicans
Last week we saw a speech by the president on Wall Street send the stock market tumbling again. When he began to talk, the market had inched up in hopes of tough reforms. In the midst of his talk it turned down and then plummeted for the rest of the day and the rest of the week. Investors quickly realized that his program was long on rhetoric and short on enforcement. The president's words were just what the market didn't need. Despite his speech and perhaps because of it, the plunge continued down almost 700 points.
According to subsequent stories, the weakness of the speech was the result of a powerful intervention from Vice President Dick Cheney, who argued that tough action against business corruption would punish the whole of American business for the crimes of a "few rotten apples."
So many Americans watch their retirement savings slip away in the name of protecting American business from too much government interference. On Election Day in November, they may protest with their votes. Indeed, the president's Wall Street speech may in retrospect appear to be the most decisive political event of the campaign. He came to New York to talk the market up. Instead he talked it down.
The fundamental flaw of a socialist economy is stagnation. The fundamental flaw of a capitalist economy is greed. Both lead to corruption. Greed is the necessary risk of economic growth. Not all American corporate leaders are greedy to the point of corruption, yet there is, perhaps necessarily, a miasma in the American business world that creates a certain predisposition to the "deal," the "fast one," the "big buck." Not all the apples are rotten, but the tree may have many rotten branches.
One merely has to consider the huge salaries paid to CEOs, the dazzling golden parachutes that are given to a CEO who has been forced out, the egregious loans to company officers or directors, bonuses unjustified by corporate performance, mergers that leave big debts (like the AOL Time Warner mess), and dubious stock options. Obviously shady games are played every day in the business world. Most of them are not technically illegal, but perhaps more of them should be.
However, these and similar matters of corporate routine create an atmosphere in which, especially during a time of prosperity, one can easily slip over the line to behavior like that which characterized Enron, Global Crossing, WorldCom, Tyco, ImClone, etc., etc. The temptations in a "quick buck" environment to take chances with other people's money and perhaps with the law are not irresistible perhaps, but very powerful.
Both the president and the vice president made their fortunes in such a corporate environment, indeed in the quick-money world of oil millionaires--a world in which they were obviously insiders. They may have violated no laws (or they may have), but understandably perhaps, they find it hard to yield to public demand for the containment of corporate greed. It is hard for them to be part of the solution because to some extent--how much we don't know--they are part of the problem.
We do not know the full story of the president's ventures with Harken Energy. He argues that the Securities and Exchange Commission ''cleared'' him. He does not admit that his father had appointed the head of that agency and that its general counsel at the time of the investigation had been the younger Bush's personal attorney. Moreover, there are some aspects of Halliburton's financial arrangements when Cheney was in charge that on the surface raise questions which the SEC does not seem interested in asking with any degree of urgency.
Similar doubts led to the Whitewater investigations of former President Bill Clinton, which found no evidence of wrongdoing and then veered away into an exploration of his sex life. Compared to the games that Bush and Cheney may have played, the hundred thousand dollars of Whitewater seem to be chicken feed.
Where, then, are the demands for impartial investigations? Why are there not editorial suggestions that a special prosecutor be appointed to investigate both men?
Maybe after the November elections, the timid Democrats in Congress may ask some serious questions.
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