By Mark P. Dangelo
We heralded them as masters of their environment. They were the entitled ones, the ones that lived large, while being touted by pundits and publications as the beacons of capitalism. They made poor decisions that fundamentally bankrupt their organizations. They spent lavishly on themselves without regret. They were issuing huge bonuses on one hand as they received government handouts with the other. They flew around the country on corporate jets as they lived the lives of movie stars. Now they complain that they are unfairly being singled out, as criticism of their actions “hurts Wall Street performance?” Hollywood couldn’t have written a better script.
Yet, it was this feeling of self importance that bankrupted not only their careers, but their organizations. As they concentrated on payouts and perks, the rest of the world permanently changed driven by a new capital realizations and a lack of continuous innovation (e.g., people, processes, technologies, and operations, and risks). Perhaps Swedish intervention model was correct, fire the executive teams and start anew?
I am also dismayed at the rhetoric being played up on both sides of the political isle regarding how to move forward. It seems that most politicians are only interested in their ideological position, and not what makes sense for a country which is slowing bleeding to death as these elected Congressional officials fight for so-called principles. It would be akin to a doctor adhering to a medical procedure even though it directly caused the patient to die. Everyone loses all in the name of “principles” and camera sound bites.
Next week brings in the “big bang” financial turnaround sponsored by the government. Will it help? Let’s hope so. Will it be a cure, not even close!
Just because there is no silver bullet or one-off panacea does not mean inaction is correct — quite the contrary. One action alone cannot fix a systemic failure of structure, regulation, oversight, consumer debt beliefs, and continuous innovation. Many iterative and interrelated “baby steps” will be required.
As for the bankers and executive teams, perhaps it is time to take a page from the Illinois government when they permanently banned their former governor from ever holding a future office. Why can we not ban, as my teenagers would say, the former “players” from any future FSI roles? It seems only fair when you consider that taxpayers are now paying for their mistakes, salaries, bonuses, jets, and God knows what else for decades to come?
So that bankers don’t feel I’m picking on them, I can easily ask the same question about auditors, outsourcers, and other leaders who have deliberately profited from their own self worth.