RURAL ROUTES/Margot Ford McMillen

Morality Left Out of Corporate Calculations

I don’t know about you, but I’m sick of people coming to the progressive tent in their later years, apologetic after having screwed the public out of millions during careers in the Wall Street transnational corporate world.

Yes, John S. Reed, former CEO of Citicorp, I’m talking about you. And you, Wendell Potter, former corporate communications chief for CIGNA, one of the largest US health insurance companies. These guys—and there are a lot of them—benefited from excellent educations, schooled in how to think out of the box and innovate, but their innovations have been to destroy people less able than themselves. Reed was in on the destruction of the Glass-Steagall act, put in place after the depression to prevent banks and investment companies from merging. Keeping the two entities separate meant that banks served their own communities rather than having to profit and create wealth for stockholders. It was a regulation that worked for seven decades, protecting communities and people from the excesses of speculators.

Removal of Glass-Steagall was done at the behest of a Reed friend, Sandy Weill, of Travelers Group, who approached Reed and convinced him that a merger would benefit both of them. Weill had insider connections with the Clinton administration in 1998. It was a time when Clinton was looking for distraction (remember Monica Lewinsky?)

The merger benefited Citicorp and Travelers, for sure, making them the biggest conglomerate ever. It also led to creation of the strange financial “instruments” that led to housing loans for unqualified and clueless buyers who thought they could afford fabulous homes with no money down and low interest rates.

It also led to “bundling” those loans into worthless wads of papers that would quickly lead to financial crisis and meltdown of the economy. A mere ten years after the repeal, the conglomerate, now called Citigroup, had to be bailed out, creating a $45 billion bill for taxpayers.

Reed was on a recent edition of Bill Moyers’ excellent PBS show, trying to explain that, no, it’s not greed that makes a guy screw over the public. It’s something more like forgetfulness. As he tells it, good ideas and intentions sometimes lead to riches and the riches, somewhat accidentally, come from innocent people who are taken advantage of. In the Moyers’ conversation, Moyers asks if democracy isn’t supposed to be sort of a brake.

“Supposed to be …” Reed says, somewhat dreamily. He forgets that morality is supposed to be a brake also — you know, that do-unto-others stuff that keeps us from shoving folks into the path of a speeding subway train. Or, less dramatically, keeps us from eating all the cookies on the plate when it’s parked on our side of the table. That kind of morality, I mean, that everyone learns as a pre-schooler.

But, morality never occurs to the confessional John Reed. In the same interview, he expresses surprise at the government that’s been once burned and should be now twice shy. “I’m quite surprised the political establishment would listen to groups that have been so discredited,” Reed said. “It wasn’t that there was one or two or institutions that, you know, got carried away and did stupid things. It was, we all did … And then the whole system came down.”

Reed insisted that the “stupid things” weren’t aimed at making a lot of money. Instead, he says, he was surprised by the windfalls that came his way. In fact, in his world view, getting lots of money is a by-product of having a grand scheme. He uses the examples of Bill Gates and Steve Jobs, two leaders that set off to do something else — change society, or improve communication or just prove their geniuses. As a by-product of their goals, they each became filthy rich. Never mind that Gates and Jobs might have spread the wealth out by insisting that raw ingredients for computers were fairly mined and fairly paid for.

Watching the interview reminded me of another confessional leader, just a few years ago. Remember the apologies of Wendell Potter, the Cigna Insurance bigwig? He admitted he threw insurance reform under the bus time and again, until he saw hundreds of uninsured people waiting in the rain for free medical help.

In his apology, he said, “I’m ashamed that I let myself get caught up in deceitful and dishonest P.R. campaigns that worked so well that hundreds of thousands of citizens have died and millions of others have lost their homes and been forced into bankruptcy so a very few corporate executives and their Wall Street masters could become extremely rich.”

The confessions of Potter and Reed, too late to change the games they played so well, makes you wonder if leadership is ever about stewardship and, if not, what these folks think the final result will be.

Margot McMillen farms and teaches English in Missouri. Email margotmcm@socket.net. See progressivepopulist.blogspot.com.

From The Progressive Populist, April 15, 2012