Friday, January 2, 2009

Capitalism's Lost Luster

The New York Times reports: "Madoff Investor's Suicide Leaves Questions" According to the NY Times article: "Mr. de la Villehuchet, a French aristocrat and professional investor who lived in the New York suburbs, had put at least $1.4 billion of his and his clients’ money with Mr. Madoff. He had lost his entire savings. He was overwhelmed and depressed, according to people who had spoken to him."

"“He had a true concept of capitalism,” Bertrand de la Villehuchet, 74, said of his brother. “He felt responsible and he felt guilty. Today, in the financial world, there is no responsibility; no one wants to shoulder the blame.”" (Emphasis added)

We profess to live in a capitalistic society, but our corporate leaders clearly do not live by free-market principles. Corporate managers (not all) seem devoid of any social consciousness. It is time that corporate managers, when they fail begin to accept responsibility for their failures.

Recently, the New York Times reported that "China Executes Former Drug Regulator" and that the "Former Head of Chinese Dairy Pleads Guilty". Additionally the reported in 2007 that: "Earlier this year, China put to death Wang Zhendong, chairman of Yingkou Donghua Trading Group Co. .... for swindling more than 36,000 people out of $385 million. He sold cardboard boxes full of ants for as much as $1,300 in a country where this is a decent annual salary. " While Chinese justice may not comply with the western concept of the "rule of law" and some may not consider that the punishment fits the crime; it does seem to speak to the fact that those who are responsible for a failure, pay for that failure. In the US it seems that the corporate executives get a free-pass by deploying a Golden Parachute, keeping their compensation, and retiring in luxury.

What happened to Mr. de la Villehuchet is a sad testament to the bastardization of the free market system by self serving corporate executives.

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