Steven Mintz Writes a Perfect Paragraph
The paragraph at the bottom of the page is from The Ethics Sage‘s latest post called – Bespoke Tranche Opportunity: It’s déjà vu all over again
I call it a perfect paragraph and in terms of business ethics, it is. The lessons of the 2007 financial crisis that would have made an intelligent man cautious about financial innovation have not been learned. The one lesson that has sunk in, is that if your institution is big enough and influential enough not only will the government prevent its failure, you will keep your job and with a little luck your bonus.
The Ethic Sage’s analysis is correct. There is going to have to be more government regulation. If not, we risk another global catastrophe.
The financial crisis and its aftermath created a hole in the moral ozone that is supposed serve as a check on excessive, risky behavior by investment bankers. It is a breach that, in my opinion, is irreparable absent any dramatic steps to better control the risk appetite of some in the financial services industry. This saddens me because the last thing we need is more government regulation. Unfortunately, it may be necessary because the very ethical standards that are supposed to protect the public under capitalism have broken down. Adam Smith in his iconic The Wealth of Nations stated that: By pursuing his own interest he [the capitalist] frequently promotes that of the society more effectually than when he really intends to promote it. His theory no longer describes the way our free market economy works and its breakdown explains, in part, the economic gap in our society.
As always, I recommend you to go to The Ethic Sage’s blog and read the entire post. Further, you should favorite the site and read it regularly. I do.