It was a house of cards they built with these bad investments. Banks hustled up would-be homeowners — those longing for the American dream — seducing them with subprime loans. But now that the boomerangs have returned to the senders and the financial debacles are multiplying, we don’t hear too much from them except their cries for resuscitation. Even as ordinary people stand on the brink of disaster, facing phenomenal tax increases, there is succor for these “brilliant villains,” welfare disguised as rescue, from the government.
Both presidential candidates call for more regulation, stricter oversight of Wall Street, greater accountability and an uprooting of fraudulent practices. Both have received money from Wall Street for their campaigns. Their protests ring hollow.
The government is too impotent to enforce any of the regulations already on the books and now it wants to make more rules and regulations — but only after it has rushed in to save Wall Street, its favorite prodigal son.
The fundamental problem with our markets is the character of our business graduates.
We have to go to the root of the problem. A number of my acquaintances sent their kids to famous business schools — Wharton, Sloan, Stern and Stanford. These students, rabidly ambitious and pushy, are the pride and joy of their parents. They are admitted to the Ivy Leagues, not for their compassion or their probity, instead for their so-called energy, entrepreneurial spirit, aggressiveness and ability to hustle. Their parents frequently pay their entire education bills.
Students who do not soil their hands in the trenches of American lower-middle-class existence, privileged at the very outset, MBA degrees in their pockets, reach Wall Street with humongous dreams about quick wealth. Before this financial collapse, graduating from Wharton or Stanford assured them jobs with giants like Morgan Stanley or Goldman Sachs. Wooed by the best companies on Wall Street with blandishments and recruitment parties right on campus, these students are disconnected from regular people.
Many of them depersonalized and narcissistic, lacking in ethics education, their schools having failed them in this area, are the “Evil” Knievels of our market system. They gamble hard and party hard, they drink too much or use drugs, arrive by limos to their Wall Street towers, cruise the New York club scene and make creative but disastrous investments with other people’s money.
The hatcheries of these jokers, our most-celebrated business schools, need to be restructured if Wall Street is to be trusted.
Business schools should admit only service-minded students who have resumes that reveal a social consciousness and a measured financial philosophy. They need to take greater care in screening students and make sure interactive business ethics courses are mandatory. They need to keep Wall Street recruiters out — or at least ban them from pursuing the freshmen. This last may be redundant now but will be relevant when Wall Street rears its head once more.
In our own state, which overflows with MBAs, schools have a role to play in keeping fraudulent business practices at bay. The prestigious Robert H. Smith School of Business at the University of Maryland, College Park, should carry the banner for scrupulous behavior in national and international business transactions. While examining what happened on Wall Street, discussions about asset management, the need for new mathematical models for risk prediction and other such arcana should take a backseat to professors driving home simple lessons about the folly of recklessness and the price of hubris into the heads and the hearts of Maryland’s business majors.
Usha Nellore is a writer living in Bel Air. Reach her at firstname.lastname@example.org.