Ethics in Economics

Tough times call for new, creative solutions. It calls for fresh faces and fresh ideas. Obama was elected president behind his rally cry of change. He has appointed many policy leaders for all facets of our nation. From Health to Technology, the best and the brightest are brought on to bring our nation out of our poor economic state.

Great. Now what?

How about appointing an Ethics Czar? We hear all the time in the media that things need to change. We hear about excessive pensions and bonuses while thousands are laid off, and we get angry. We hear all about how some executive cheated on this, some accountant played with the numbers like that, and something in us burns. Yet would we have been any different if we lived in the world they did? If we were given the opportunities they had? We live in a me-first culture and accumulating wealth, living the “American Dream”, whatever that is, has become such a great focus in all that we do. Media praises success and we all grow up with that inward desire to make it big.

Below is a great little article about Ethics in Economics. Some excerpts:

Code of Ethics in Business has Changed

…I recall another conversation with a successful investment banker. He told me that the first thing he had to establish was his character, his reputation for trustworthiness and honesty. Without that, he would have been unable to trade. Nowadays, he said, deals no longer depend on character but on lawyers.

Common to these stories is the gradual disappearance of the cluster of principles that went by the name of morality. Whatever its source – religion, conscience, custom or code – it meant that there are certain things you don’t do because they are not done. You don’t reward yourself when customers, clients or shareholders or employees are suffering losses. You don’t pay yourself out of all proportion to what you pay others. You don’t take advantage of your position just because you can. You are guided, even if no one is watching, by a sense of what is responsible and right. Without that internalised code of honour and trust, no institution can be sustained in the long run.

This article starts off by talking about how things used to be. Ethics played a large part of how we did business. There was a time the top lawyers would refuse to take on hostile takeover cases because they deemed it simply wrong. You can throw all the money you want, I will not do it. The point is not whether hostile takeovers are moral or not, but the point is that there was a sense of principle, a sense of morality that kept our greediness and ambitions at bay. There are things we just do not do, because our code of morality and honor wherever we get it from, dictates it to be so. But times have changed. But who is to blame? The culture? Who creates culture? We do.

Morality has become Relative, The Market follows Suit.

Markets don’t guarantee equity, responsibility or integrity. They can maximise short-term gain at the cost of long-term sustainability. They don’t distribute rewards fairly. They don’t guarantee honesty. When it comes to flagrant self-interest, they combine the maximum temptation with the maximum opportunity. Markets need morals, and morals are not made by markets.

They are made by schools, the media, custom, tradition, religious leaders, moral role models and the influence of people. But when religion loses its voice and the media worship success, when right and wrong become relativised and morality is condemned as “judgmental”, when people lose all sense of honour and shame and there is nothing they won’t do if they can get away with it, no regulation will save us.

One trend in our culture is that it has become completely relativistic. What is right for me is right for me, what is right for you is right for you. Tolerance used to mean to be respectful all PEOPLE, despite perhaps their completely wrong ideals or ideas. Tolerance is now culturally defined to be respectful of all IDEAS. As it says above, what is right and wrong has become relative and any strong challenge or perhaps condemnation is considered “judgemental” or “intolerant”. This is called moral relativism and it’s changing the fabric of our society from one of truth and morals to a culture of “niceness” and subjective truth, where the whole point is doing what feels right for oneself.

It is no wonder the latest USA Today Gallop Poll says that less than 25% of Americans give a high rating for ethical standards for the members of Congress, business executives, stockbrokers, attorneys, bankers, you name it.

With a relativistic mindset living a morally relativistic culture, is it really that surprising to find executives doing the things they do? Athletes getting caught using the things they use? Politicians getting jailed for the things they commit?

We need to find a way to return to the understanding that there is an objective truth that we must live by. That there is a right and a wrong, and we must not be afraid to condemn that which is wrong and quick to admit when we ourselves have done wrong. Shouldn’t that be the basis of all business, let alone a civilized moral society?

Full Article

Let me be clear. I am no expert in Politics. I just post articles that has to do with how media molds our perception, which unfortunately has a lot to do with politics and social issues. Below I’ve added excerpts from an article in regards our national financial problems and who is to blame. This article abhors the “fact” that liberal media continues to help build on the perception that congress is working hard to paint. That our financial crisis is all due to greedy CEOs and irresponsible spending, keeping our focus away from the fact that lot of the problems stem from government laws and programs that Congress enacted not too long ago.

Do I agree with it? Don’t ask me, I just want to promote logical thinking and allow people to make sound judgments beyond just believing and soaking in everything they see and hear in media. I do think the article is very one sided and borderlines on being a rant, but that makes the article somewhat interesting to read.

If you have some counter arguments or a link to article that supports or goes against this matter, feel free to leave a comment.

Proper Credit: RenewAmerica

I just have to laugh at all this nonsense about Detroit CEOs and their corporate jets. When the Big 3 automaker CEOs came to Washington with their hands out for a taxpayer bailout, the congressional committee seemed more interested in how they got there than in finding solutions to the problem — whether it be a government loan or anything else…

Rep. Brad Sherman (D-CA) said to the 3 CEOs “I’m going to ask the three executives here to raise their hand if they flew here commercial.” No hands went up. Then he said “I’m going ask you to raise your hand if you’re planning to sell your jet . . . and fly back commercial.” Again no hands went up. He followed with “Let the record show no hands went up.”

When the hearing was about $25 billion in government loans, why was Sherman so interested in a few thousand dollars a flight for the CEOs to get there, and to be sure it went on the record? Because he knew the media would cover it, and make a big deal about it, to influence public perception against the Big 3 CEOs and corporate America.

We are simply supposed to believe that all of the financial problems encountered by corporate America today are always the fault of “greedy” CEOs, and never the result of lame brained congressional regulation or union extortion of business management to pad the pockets of union officials and workers.

Now to get all controversial by provoking names of parties..

Corporate Jets, How about Congress Jets?

Had it not been for government regulations, created by Democrats and applied to the mortgage industry to ensure toxic home loans were granted, the mortgage meltdown would not have occurred. Had it not been for liberal legislation banning domestic energy production throughout most of the country, a gallon of gasoline would not have become unaffordable to millions of Americans who took advantage of those mortgage regulations. Still, Congress wants us to believe that it was all the fault of “greedy” CEOs, and they depend on the liberal alphabet media to create that public perception. The deception worked most effectively.

What’s the big deal over corporate jets? Most all corporate executives and CEOs use corporate jets to get around the country for meetings and seminars. They don’t really have the time or the need to travel on commercial aircraft and risk delays. That’s what corporate jets are for. The Big 3 automakers are not in financial trouble because of their private jets.

If a private jet is good enough for Nancy Pelosi — who demanded her own upgrade it to a 747, then it should be good enough for the CEOs of Ford, GM, and Chrysler who actually work for a living and create millions of jobs and funnel billions of dollars into the economy.

Big 3 Auto Firms in a Bind, by the Government

GM used to make a fair profit, but that was before Democrats took control of Congress and the price of gas began to skyrocket. GM lost $38.7 billion in 2007. The socialist UAW became to big and powerful, and began demanding too much of the industry pie, while accepting little of the losses. Meanwhile, Toyota has been cutting deeply into GM auto sales with their lower operating costs.

It’s not that their cars are better than GM, Ford, and Chrysler. It’s that it costs less to build them when they don’t have to pay excessive UAW extortion expenses. They can therefore sell them for a lower price which the Big 3 then have to compete with at a higher manufacturing cost that leaves no room for profit. On top of that comes the costs of retooling their factories to comply with government-created environmental regulations like CAFE, but Congress fails to fund these regulations so compliance by the automakers puts them deep into debt.

What’s a CEO to do when you’re bound by government regulations and union extortion with threats of labor strikes if you don’t pay for workers who aren’t working anymore? UAW demands add $1300 to the cost of every car GM sells. That means that Toyota and Honda can make the same car for more than $1300 less when you factor in automation.

It’s not as though GM has just been irresponsible with its spending. The company has been going through restructuring to cut costs since 2005, but one time buyout expenditures were necessary and expensive, which put the company into the red. Still, in 2006, GM cut its costs by $6.8 billion, and an additional $2.2 billion in 2007.

What is a CEO to do when Bound Down?

Did the congressional committee consider this when they told the CEOs to go home and come up with a plan to reduce costs? Of course not. Word might leak out that the CEOs are already doing the cost cutting job that Congress is demanding of them. The last thing Congress wants is for the CEOs to actually look like fiscally-responsible leaders of their companies. The public perception that CEOs are to blame for the financial crisis must be maintained, and the failed policies of Congress must never be questioned.

Congress will Bail out the Economy! By Spending More Money!

What a scam this whole idea of a bailout is anyway. America didn’t just win a global lottery. Hank Paulson and President Bush decided that we suddenly have $700 billion to hand out (which we don’t) and suddenly everyone has their hand out for a piece of the pie…

The $700 billion is not a “bailout;” it’s a handout by government of money stolen from the taxpayers. Obama, ACORN, Clinton, and the Democrats got us into this economic crisis and blamed it all on Bush and the Republicans to win the election. Unfortunately, McCain/Palin did nothing to combat it and defend Republicans. Now Obama is telling us that Democrats have no exit strategy from this crisis, and the only thing he can suggest is another multi-billion dollar “stimulus” handout. Isn’t that Einstein’s definition of insanity — doing the same thing over and over again and expecting a different result?

How about if Barack Obama, Nancy Pelosi, and Harry Reid get rid of their private jets to help cut the costs of government to the taxpayers? Where do these congressional hypocrites — who continually show a $3 billion deficit in their own budget — get off judging professional corporate executives who are enslaved to unions and government regulations?

Take Credit Congress for the Good and the Bad

If politicians insist on taking credit for running the country, then it’s time they take credit for this current crisis that they have created as well. If an unscrupulous media want to do the bidding of dishonest politicians to guarantee their invitations to beltway dinners, then they also need to share the blame for creating a false public perception of Congress and the private sector, and for failing to do the job that their professional code of ethics demands of them…

The decline of confidence in the broadcast and print media is expected to continue in coming years until they become a no longer viable media for news and political information.

As more and more people turn to “new media” internet and talk radio, they become more informed and more aware of the truth concerning important issues, and more aware of the misinformation and lack of information being distributed by the elite liberal media. Public perception of mainstream media is changing rapidly, and that’s a good sign for America’s eventual recovery from the liberal wasteland of ignorance that has prevailed for too long now.

Thoughts? Agree? Disagree? Have a counter argument or article you want to share? Just be courteous.