As if we needed another reminder of the fruits of avarice, the business press is on fire with the news of the conviction of Raj Rajaratnam, the founder of the hedge fund Galleon Group, on all 14 charges of conspiracy to commit securities fraud. I hope he looks good in federal orange.
As the dramatis personae in the theater of greed continue to grow — yet another recruit in the Ebbers, Madoff, and Skilling company — it does more than pile on the battered reputation of Wall Street, finance, investing, and common sense: It also broadens the already expansive reach of government into financial affairs.
Orthodox. Faithful. Free.
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Sorry, Mr. Gecko: Greed is not good. These characters that swindled or unfairly profited billions undercut confidence and created a Trojan horse of greater federal involvement that so far has not supplied the promised transparency and accountability. Meanwhile, the administrative consequences of these actions will no doubt result in more legislation (like Sarbannes-Oxley or Dodd-Frank), more agencies, and more so-called oversight. But given the fact that it was criminal law-enforcement officials using wire-tapping and RICO tactics to catch these crooks, one has to wonder how effective all this financial legislation, agency creation, and oversight actually is.
The bad guy in this case will meet his just end. But who is monitoring the effectiveness (or ineffectiveness) of the government’s pass-through mandates? If there’s such a thing as “projected representational subsidiarity,” this is it: Let the lowest level foot the bill, while decision-makers try to protect the folks funding this scheme.
The land-grab of oversight will take years to undo. Hopefully, the push for austerity measures will slow the momentum and dispense with the illusion that more “targeted” legislation will create an environment of safety. No amount of oversight can control an industry if it is fueled by a deadly sin — the greed will merely shift.
Sin is a fact; but thankfully, so is redemption. Our Catholic responsibility isn’t to support the creation of foolish policy, but rather to bring our values to bear on sensible business practices.