The Clinton Rot And Corporate Scandals
By Randall Nunn (01/29/04)
Sadly, a significant segment of corporate America has shown itself to be incompetent, dishonest and unprincipled. Our capitalist, free enterprise system has been one of the greatest engines the world has ever known for progress and economic improvement and has contributed mightily to making this country the strongest nation on earth and the envy of governments and people everywhere.
But somewhere along the line, corporate management got off track and became more interested in their personal success, both financial and psychic, than in true accomplishment that builds and strengthens their companies long term, while advancing the interests of their stockholders, employees and the country.
Too many corporate chieftains have become advocates for more government control, regulation, enforced political correctness and expansion of the welfare state, with no guiding star other than maximizing their own financial rewards and status through manipulation of their company's performance metrics to meet the expectations of investment gurus and pundits. Maximizing performance metrics is not necessarily the same as strengthening their companies. A CEO may cut thousands of jobs, move thousands of jobs off-shore to save wage expense and cooperate with government programs that are expensive and wrong-headed, and in the process weaken the company by destroying the bond of loyalty that should exist between employer and employee and by setting a false example that short-term results are more important than principle and long-term health of the organization.
The recent series of corporate scandals have been stunning in their size and scope and frightening in their number. Enron, WorldCom, Global Crossing, Tyco International, Martha Stewart, Arthur Andersen, HealthSouth, Adelphia Communications, Freddie Mac, the mutual fund and IPO scandals and many more have shown that greed, corruption, follow-the-herd mentality and incompetence were pervasive in major corporations and that too many were willing to go along or look the other way rather than blow the whistle on conduct that they knew was wrong.
What caused this outbreak of corporate crime and corruption? One reason was the acceptance by too many executives of the moral relativism that engulfed the country prior to September 11, 2001 and the rot it left behind, best exemplified by the Clinton administration. The favorable image of that administration created by the liberal media, Hollywood and the academic community led many of the movers and shakers of the corporate world to use "Slick Willie" as their model of how to achieve, exercise and hold on to power. During these years, liberal opinion leaders tried to persuade us that there were few constants and few absolute principles of right and wrong. To suggest that there were simply showed one's lack of sophistication and "rigidity". It was results that mattered, not how you achieved them. The old-fashioned virtues were just that--"old fashioned." Groupthink, conformity and political correctness were in and individualism, originality and independence were out. Bill Clinton avoided conviction in the Senate after impeachment by the House of Representatives and went on to acclaim in the media as a brilliant politician who skillfully avoided his enemies and who was responsible for the good economy. The corporate titans admired Clinton's ability to satisfy his desires without negative consequences and his skill at avoiding responsibility. Many emulated Clinton and decided that in contemporary America, it was success in achieving goals that counted, not old fashioned concepts of honor and responsibility. In their drive to acquire personal wealth, celebrity status and praise for running up their company's stock prices they didn't stop to consider the fact that, if and when their wrongdoing was exposed, their stockholders, the American public and politicians would not excuse their conduct as quickly as many did in the case of Bill Clinton. The criminal gains from their fraud were grossly excessive and the immediate effects were too obvious in the case of corporate wrongdoing to permit the public (many of whom were stockholders) to ignore them.
The corporate scandals showed that many of the corporate heads were unprincipled, lacking in foresight and judgment, and possessed of a very strong herd instinct--simply private bureaucrats with egos far more developed than their intelligence. And as a result of their conduct, businessmen in the future will be saddled with even more government regulation and second-guessing by government than ever before and those in the public who are predisposed against a capitalist economy will have lots of examples to rail against for a long time to come.
Big business has become too much like big government. Both need to be re-sized and re-invigorated with a sense of responsibility and made accountable to the citizens and the stockholders. If this doesn't happen, we will all be holding worthless stock and the enterprise the founders launched in 1776 will founder and become bankrupt.
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