The Enron witch hunt, and double standards:
The first written legal code was the Code of Hammurabi. They set out a list of specific punishments and fines,for different crimes. But the punishment was different, depending on the social status of the criminal and victim. A noble, or a soldier, got a different punishment, than the same crime done by a commoner.
It seems to me that we have the same differential justice system now, in practice.
If a teenager from the ghetto robs a convenience store, and steals 50$, he will probably do jail time, if he had a gun (even if he didn't use it). If an executive (or Board member, or accountant) gets rich (millions) in a scheme that ends up destroying the life savings (billions) and careers of thousands of other people, he probably won't do jail time. He probably won't have to give up more than a tiny fraction of his ill-gotten gains. I'll bet right now, every decision-maker at Enron who got rich, is busily hiding his money in untraceable foreign accounts. For the rich, educated, and powerful, we feel sympathy. We make excuses. They have many resources available to them, to defend themselves. They can "work the system" in a way the poor teenager can't. They get rehabilitated (the idiot savants who ran LTCM into the ground, are back in business, doing the same thing), a concept that has gone out of fashion when the poor get punished.
When I listen to the excuses made for the Enron Board, it reminds me of the excuses made for President Clinton, when he got caught lying to a Grand Jury. What Clinton did was a felony, and he admitted guilt. If he had been the manager of a McDonalds, he would have been fired. If I had done what he did, (circumstances precisely the same, except I'm not the President) I would have gone to jail.
To me, the question of what the Board members knew, is irrelevant. There are two, and only two, possibilities:
1. They knew, and therefore are criminals.
2. They didn't know, and therefore are incompetent.
Either way, they should not be allowed to continue in similar positions of power and trust, at other companies. If they aren't punished for their mistakes (of omission or commission), then they will, inevitably, repeat those mistakes elsewhere.
Recessions are a good thing, because Creative Accounting only comes to light when times are tough. We haven't had a real recession, one that really hurt, since 1974. We are long, long overdue for a cleansing, purifying witch hunt, where the lax standards and fuzzy morality that built up during Good Times gets punished. If a nation doesn't do this, every few years, you end up like Japan, where bad debts never get written off, bad decisions never get punished, bankrupt companies are not allowed to go under, and nobody is ever held personally responsible. And systemic problems never get solved.
It seems to me, the more power a person has, the higher a standard we should hold them to. Yet we seem to do it exactly the opposite. The more damage a person does, the easier we are on him.
JS@closetcommunist.com |
