By DAVID MOON, Moon Capital Management
After I recently suggested that business malfeasance was on the rise in our
country, a friend responded that people are just as crooked today as they have
always been; we're just learning about it more frequently these days. He
thinks the media and law enforcement are just doing a more thorough job than
they once did.
Yes, that is partially true. But in the bigger sense, I think business
ethics really are worse than they used to be.
Fortunately - or unfortunately, actually - it is not just in business.
The decline of scruples on Wall Street is matched by a similar decline on Main
Street. The business community didn't lead America into this morass; it
marched right along side some charities, disintegrated families, television,
movies, record companies and the church. As I suggested several weeks ago,
corruption and malfeasance do not move in a straight line; like the economy,
they move cyclically - sometimes improving, and sometimes (such as lately)
Consider the sex abuse situation in the Catholic Church. The problem is
about more than just teenage boys, perverts, hush money and violations of sacred
trusts and vows. It is a reflection of where we are as a society.
On the surface, the details are disheartening enough. As Maria
Cornelius wrote so bravely and eloquently two months ago, a survivor's hurting
does not stop when an attacker ceases his abuse; these private terrorist
activities continue their punishment for years. In some cases, the
consequences linger for generations.
But the sickness of this current situation extends far beyond a small group
of priests; it infiltrates and perverts our entire society. And the
reverse is also true; it is our society that created the circumstances that
allowed this scandal to happen. Consider this: when the Pope called the 12
U.S. Cardinals to the Vatican to discuss the situation, every network news
department sent a satellite crew to cover the meeting. For weeks,
commentators speculated about whether or not his Holiness would actually convene
the meeting and, if so, what he would say.
What do you imagine he said? The Pope summoned the Cardinals from the
United States to Rome so he could advise them to tell their employees to stop
raping little boys or sleeping with teenagers? He had to hold a staff
meeting to get this point across?
But even stranger than the meeting was our nation's anticipation about
it. This was the lens that provided the true insight into our entire
culture. Did Connie Chung actually think there was a chance the Pope might
tell the cardinals that it was OK to abuse children? Why the
anxiousness? Newspaper headlines praised the Pope for his stern stance, as
if it was a surprise. "Pope Condemns Sex Abuse." "Pope Calls Child
Sex Abuse Crime." 'U.S. Clerics Urged To Draft New Rules.' This
sounds like an episode of Seinfeld. I can hear George Costanza saying,
"Oh, it's against policy. I didn't know that."
The fact that our media sat on the edge of its collective seat, pretending
not to know the right and moral action, is the very environment that allowed -
and perhaps even encouraged - Enron, Arthur Andersen and the daily headlines
about greed and moral indifference from the Wall Street Journal.
The good news is that these problems are self-correcting. Although it
takes some time, Wall Street, like the rest of society, will realize that it is
in the best interest of its survival to act in a way that is decent.
Imagine the arrogance of a business that assumes it can act in any way it
pleases, the customer be damned. That is a recipe for self-destruction in
David Moon is president of Moon Capital Management, a
Knoxville-based investment management firm. This article
originally appeared in the News Sentinel (Knoxville, TN).