All of the yelling about the AIG bonuses, and the multiple abuses of the system by executives at that company and dozens of other companies (can you say "O-I-L"?) in recent years won't die down any time soon, and with good reason: the American people "have had it up to here" with rewarding bad behavior, one of the more dubious hallmarks of the past eight years. Time was, if you did something wrong, you bore the consequences of your actions. Lately, if you were crafty enough, rich enough, and had the right friends in the right places, you could get away with almost anything. Finally, the people in this country are standing up and saying "ENOUGH!"
It's about time.
Once upon a time in America, when you screwed up and did a lousy job, you paid the price (whatever the price was) for your failure: if you owned a business, and times got tough for the business, you, as the business owner, took a hit. Employees were generally spared, and at least kept their jobs, albeit stagnantly, and the boss went home at the end of the week with a lighter envelope. Gradually, it has become the norm that the lowest level workers are the ones to pay the price for any economic calamities, which those at the top continue to collect their princely sums unabated.
Part of this problem is the rise of the corporation as a legal entity: not only did the creation of corporations serve to distribute risk and expand investment, it also waived away liability of individuals -- real people -- and put responsibility on the amorphous corporation. Then, the corporation is punished for wrongdoing, but the punishment meted out is usually monetary in some fashion, and the real wrongdoers -- the real people running the corporation -- are left unscathed, and eventually, their malfeasance and misfeasance is repeated because the punishment did not fall on them. They learned nothing. When a small child ignores warnings and touches a hot stove, learning immediately takes place. Most executives in corporate America could sit on a hot stove and come away with nothing but scorched trousers.
Since we are on a warpath here, calling for reform, here's an idea: Maybe we ought to abolish the corporation. Eliminate it, and return to personal responsibility and individual liability.
It works with hot stoves.
March 26, 2009.
Copyright © 2009, Ricky A. Pursley. All rights reserved.