The behavior of too many on Wall Street is a violation of biblical ethics. The teachings of Christianity, Judaism, and other faiths condemn the greed, selfishness, and cheating that have been revealed in corporate behavior over decades now, and denounce their callous mistreatment of employees. Read your Bible.
– Jim Wallis, www.sojo.net/blog/godspolitics
September 18, 2008
Jim Wallis, the evangelical founder of Sojourners, has thusly summed up the theological implications of the recent capital market meltdown so eloquently that I hesitate to presume to add to the discussion.
With so many Americans believing that we live in a Christian nation, the disconnect between our economic practices and the Bible’s repetitive trumpeting of warnings against greed and economic injustice is truly astounding.
Beginning with the laws given to Moses by God right on up through the post-Resurrection preaching of Paul, Scripture consistently tells us that we must always be on the guard against greed and that we must always seek economic justice for all.
And yet, here we are again, suffering through another devastating economic catastrophe brought on by greed.
We can erect all of the regulatory schemes our imaginations can spawn and we can have politicians denouncing Wall Street from now until the next millenium, but until we learn to embrace the totality of Biblical teachings about economic morality as a part of our social fibre, we can expect to see this cycle repeated once every few decades.
For me, the economic events of the last several months have had the eerie sense of living through a nightmare I thought was in the past.
We have an industry that was once flying high. We have a crisis within that industry triggered by a fundamental flaw in its business plan. We have that crisis spreading throughout the entire economic structure of the nation. We have a panic mentality in the capital markets brought on by that crisis. We have a government that spent a decade or so asleep at the switch falling all over itself to prevent catastrophic failure in the economy at large. We have politicians trying to make hay while the sun shines, simplistically pointing fingers at scapegoats.
Yes, it sure seems like the savings & loan debacle all over again. Close your eyes, change the names, and it’s 1989.
THE FIRREA LAST TIME
As savings & loan institutions began to fail, Congress jumped on the problem, passing the Financial Institutions Reform, Recovery and Enforcement Act of 1989 (otherwise known as “FIRREA”). FIRREA set up the Resolution Trust Corporation (otherwise known as the “RTC”) to buy up and liquidate the bad assets of failed thrift institutions. The Justice Department swung into action, indicting many former s&l executives for fraud and gross negligence.
And the politicians, God bless them, ramped up the rhetoric, expressing their shock and outrage that an industry so vital to our economy had apparently been taken over by such greedy and bloodthirsty pirates. Before the bottom had fallen out, many of these same Senators and Members of Congress had been quite willing to accept substantial donations from thrift industry political action committees.
LEARNING FROM OUR MISTAKES
So, what did we learn from our experience with the savings & loan collapse?
Apparently, we learned nothing. We learned absolutely nothing and, as expensive as that fiasco may have been, it may be dwarfed by the cost of cleaning up the sub-prime mortgage garbage dump.
We’re following the same template now. The ultimate crisis will be averted. Strict reforms will be slapped on Wall Street and the home lending industry. There will be prosecutions. Thousands of hours worth of political sound bites will be generated.
Eventually, there will be a sigh of relief. The economy will stabilize.
And America will forget.
And then . . .
It will all happen all over again.
Somewhere, someplace in some sector of the financial industry, some people who believe themselves much smarter than the rest of us will come up with a new way to do business. They will undoubtedly congratulate themselves by invoking such cliches as “building the better mousetrap”or “thinking outside the box.”
They will snicker when the risks inherent in their new scheme are pointed out. They will rail derisively against outmoded business thinking that seeks to recognize and control those risks.
And, in the beginning, they will make money. They will make lots of money. They will make stinking and obscene amounts of money.
But . . . they will not be the real villains of the story.
We will hit the crossover point on the road to our next economic doomsday when people who ought to know better buy into the plan.
The sub-prime mortgage industry grew from a small group of high-rollers willing to take on risky borrowers into a giant capable of making or breaking our economy the day that Wall Street decided to join the party. And so the virus began to spread.
The little voices of doubt along the way didn’t stand a chance against the wave of greed that struck Wall Street. Some saw this coming. Nobody heard them. Nobody wanted to hear.
And, unless we as a nation can do some serious soul-searching, the counterparts to those voices in twenty or thirty years will also be marginalized. And there is no telling how bad that crisis might be. The savings & loan crisis was bad. The sub-prime mortgage market disaster is worse. That’s not a favorable trend.
Until we can learn to curb the sort of greed that leads to a Lucifer Effect-esque mob mentality in the capital markets, we can expect to see that trend some day play itself out to its logical conclusion and we will dig ourselves a hole which we cannot escape simply with legislation and rhetoric.
What a timely and instructive blog. It does combine our original intention of wedding theology with various aspects of psychology -- in this case the Psychology of Greed.
I would add, in line with the thinking in my new book,
THE TIME PARADOX, that what greed does is to transform usually prudent future- oriented business folks who typically make rational long-term decisions based on cost-benefit analyses into mindless present-oriented hedonists.
As such, their decisions are always short-term, they are captivated by the immediate prize before their eyes, the big killing, the get rich scheme and scam.
It becomes worse as the number of players increases, then there is a kind of communal Groupthink, where outside constraints are ignored, ranks close to include only like-minded insider confederates, and rational men make irrational decisions, like the Bay of Pigs invasion and JFK's inner circle buying into that notorious disaster.
Greed is also central to the Commons Dilemma, whereby each farmer or fisherman wants his cows to graze freely or to catch as many fish each day out of the sea, despite obvious limits to the resource. They ignore the long-term costs for the short-term gains. In Monterey California, the teeming bounty of sardines, that made that city famous, no longer exist, they were over fished into extinction.
So I agree with your thesis about the pantomime of politicians and media pundits pointing fingers here and there and soon forgetting that unless regulated
Human Greed trumps Human Reason, rationality yields to
self-centered focus on gain without concern for societal costs. Again we have voracious money lenders who should have no place in our Temple of Humanity running too many of our shows with a Devil may care attitude.
It is very sad and I fear this time the worst is yet to befall us, meaning workers, home owners, small businesses, and honest American citizens.
By Phil Zimbardo | Posted on September 23, 2008, 8:14 pm
Rev. Webster's article is profound, and wise in areas
that a big segment of the public has not considered at its deeper levels. I am co-author of THE CULT THAT DIED, the definitive book on Jim Jones, published by Putnam's Sons of New York. But there is a concept in my second book (LEDNORF'S DILEMMA)that everyone would find worthy of consideration. The concept is "Grath's Paradox" (cited in the index of the book). "Grath's Paradox" essentially says that, if a nation continues in its ignorance of the kinds of moral principles we find in Rev. Webster's article, then the nation will quickly reach a point where it will be too late to bring the nation back on course. That is to say, even if every wrongful action is eliminated, the collapse will nevertheless take place--the reason being that the infrastructure had finally become inexorably dependent upon the entrenched corruption. That, in a nutshell, is Grath's Paradox. The theme of LEDNORF'S DILEMMA, however, has to do with the "spiritual insanity" that leads us down a path so dangerous that "Grath's Paradox" is the unavoidable point from which there is no way out.
By David Conn | Posted on September 24, 2008, 10:01 pm
Form an historical standpoint the fall of any nation is inevitable, due to a host of factors. "Rome wasn't built in a day." It also didn't fall in a day. The gorwth of anything is achieved with inherent flaws that the builders cannot see, and so cannot correct, but which are magnified with it's growth, until it is so encumbered with it's flaws it collapses through expenditure of too mcuh energy in the growth period. I believe this is the entropic principle, if I understand it right. I often hear that only 60% of Americans believe in a God, but I think that statistic is actually the number of people who say they are religious, because when you ask if they are believers the stats show almost 95%. So if people believe, and I know many business leaders do, then it would seems that part of the problem, despite people clinging to their faith in these times, they are not acting on that supposed belief. I'm reminded of the Bush teams first run for the presidency, and all the statements about their Bible camp they attended. But they sure don't seem to act out their beliefs. Anyway, a question: could it be that despite people believing in God, do they feel more and more that that faith is not going to avail them anything in the current atmosphere, and so fewer act according to that belief in order to "get what they can" before the economy/country/what-have-you falls apart? In other words, could the institutional-situational evil pervade the whole of the culture, rather than just individual institutions? I ask this because I am a teacher and I've been doing alot of thinking about the problem of student/parent apathy (and even seeming belligerence) toward education/learning, and how it can be oversome. It seems an uphill battle when the culture encourages these attitudes.
By Jason | Posted on October 3, 2008, 12:33 am
my point is that the leader in the world today is America in that in terms of financial and militarily and with that comes some expectations of behaviour and if as a leader you fail in the most basic principle of moral leadership then it is certain that those that wish to seek to better themselves can not hope to do any better than the leader and what follows is a moral vacuum ,allowing for an easier answer for their behaviour and they behave in a way that is equally as immoral as our leader.
This entire financial debacle is unavoidable and consequentially we are either going down with suffering or going down with the knowledge that we could have been a more moral, socially conscience generation, we thought we were. We could have voluntarily sacraficed our selfishness and lived our lives in an altruistic way. The choice, the only free choice we can make of major consequence, was ours. So many people point fingers. The fingers of our generation should be pointing at ourselves. Our media reflects who we are, our politics reflect who we are. Our heroes reflect who we are. Who are our heroes? We don't have any on a national scene.(or international) Are we doomed? I am afraid so. The Obama "Change" platform has yet to be played out. I didn't vote for obama for many reasons. He scares me by all the promises he pretends to make, by coming from a state that is steeped in political corruption, by his preacher, by his running on the ticket of division (race) instead of inclusion, by his lack of clarity of his birth history, by his association with american terrorists. I have rarely followed the crowd for all the reasons Mr. Z ourlined in his book. (without realizing it) I don't think however, that any leader of our time has the answers or can "save" us from ourselves. We will sow what we reap is a bible quote that reverberates right now. Do I hope we can be a better people, YES, but it will require sacrifice and suffering. Is my Baby Boom generation capable of sacrifice....I really don't think so. Their children, give them any generation name you want, learned from their parents to take what you can, when you can, and the hell with everyone else. That, my fellow readers, is what we are dealing with now, and the hole we have dug for ourselves is of biblical proportions. God bless us all,,,,we will need it.
By catherine | Posted on December 15, 2008, 5:06 pm
Comment to Jason post:
Jason, several thoughts came to mind reading your post.
First, statistics regarding faith: I am reminded of Isaah 29:13, Matthew 15:8, and Luke 11:39. Sadly, many adopt the profession of Christianity as just another tool in the bag of tricks called "social skills". It has a perceived currency in gaining social acceptance, avoiding scrutiny, etc. It's as if to say "if I adopt this name, no one will look real close at me"...