DALLAS, Texas (Feb. 21, 2009) — Accountability seems to be in short supply these days.
Last weekend, CNBC presented a one-hour documentary, House of Cards, a fascinating look at the real estate fiasco that fueled our current economic decline. Reporter/anchor David Faber interviewed key people who were involved, from former Fed Chairman Alan Greenspan and Ira Wagner, the Senior Managing Director at Morgan Stanley who created the formulas for the complex, mystifying Collateralized Debt Obligations that were at the core of the irrational transactions that doomed our largest investment banks, to a sales manager from one of the less than ethical subprime originators.
Alessandra Stanley, reviewing the documentary for The New York Times, wrote:
“Almost like the Spirit of Christmas Past, Mr. Faber visits homeowners, lenders, bankers and Wall Street dealmakers to collect a Dickensian cast of characters who explain how they were sucked into an “affluenza” bubble that seemed unbreakable. The gullible range from (Mr.) Wagner… to pizza delivery men who became loan officers, that is, salesmen, with no training, regulation or even a dim understanding of what Wall Street was doing with the mortgages they handed out like supermarket coupons.”
When Mr. Faber confronted those mostly directly involved in creating the financial havoc, no one would accept responsibility or ACCOUNTABILITY for their actions except a couple of the gullible and irresponsible homeowners who were losing everything. The most common excuse was, “Everyone was doing it.” I still vividly remember a stern tongue-lashing that I received as a youth. It came from my beloved mother when I evoked that very same defense after being caught doing something I knew was wrong.
This week President Obama will attempt to focus the nation on our other very serious financial crises – the mounting budget deficit and overcoming the staggering cash shortfalls in our entitlement programs, including Medicare, Medicaid and, to a lesser extent, Social Security. We have these cash shortfalls because, for years, our leaders have spent funds that should have gone into Medicare and Social Security trust accounts on something else, including wars, bridges and highways to nowhere, and shockingly expensive wrenches, hammers and toilet seats for military jets.
I cannot help but wonder if our congressional leaders and the new executive team at the White House will have the political courage to address these extremely critical problems now, or will they hide behind the unwashed mob of special interests, evoking the now infamous “Everyone Was Doing It” defense.
The definition that a good leader is a work of art, and that a bad leader is a tragedy, ideally frames our current woeful mess. Leadership without accountability is fast becoming a business and government contagion that WILL end badly for us all.
I welcome your thoughts.
John G. Self, Chairman and Founder of JohnMarch Partners, is the Firm’s senior client advisor. A 32-year veteran of the healthcare industry, he is a former investigative reporter and crime writer for a major daily newspaper. Candidates and clients say he is one of the most thorough executive recruiters working in the healthcare industry.