Economic Best Interest

Background: A recent piece on NPR reported about a woman near Washington, DC, who has decided to walk away from her mortgage in spite of the fact that she was financially capable of continuing payments. Her decision was made, as the piece expressed it, on “business considerations”, on her economic best interests. As you might imagine, some of the commenters excoriated her for this decision. In nearly every case, either explicitly or implicitly, the morality of this decision was given as the reason for this treatment. Ha! Seriously?

Haven’t you people been paying attention?!? For decades now, corporations and their executive elite have been handsomely, handsomely rewarded specifically for exercising an unending litany of immoral actions and breach of contractual obligations, not the least of which is the social contract: socializing risk and privatizing profits, gutting functioning companies for quick profits in leveraged buyouts, creating and selling securities while betting against them, extorting tax breaks, charging usurious interest and fees, engaging in environmental destruction, monopolizing markets, externalizing costs, delaying resolution of judgements against them through endless litigation, creating a casino economy, seeking the cheapest labor at any price, undermining taxpayer and citizen interests through lobbying and funding of transparently mouthpiece “think-tanks” and political organizations, offshoring profits in tax havens, mismanaging and abandoning contractual obligations for worker retirement, and on and on and on, ad nauseum, ad infinitum not to mention plain old walking out on their obligations bankruptcy.

In every case, we’re told of the path of destruction they leave behind: “don’t take it personally, it’s just a business decision, it’s just in the best economic interest of the company.” And yet some of those NPR commenters expect me to be horrified that one middle-class American has learned and is going to apply this all-American ultimate-Randian economic rationale to her own situation? Fergawdsake people, this is what all those Greenspan freemarketeers are always whispering into your ear: “when people act exclusively on the basis of their own economic interest, that provides the best outcome for society.” They are telling her to do this, virtually writing out an instruction manual – to act in her own economic interest. After all, it’s what gave us those wonderful outcomes of Enron traders chortling at their screwing over of granny on her utility bills, and financial executives slopping at the public money trough like so many hogs after being complicit in nearly bringing down the world economy, and the exporting of millions upon millions of manufacturing jobs to China including some under conditions consistent with slave labor, and the willful ignorance of the auto industry to the reality that their business model was unsustainable, and a decade of explosive growth in the incomes of the highest compensated one percent of the population while compensation for the poor and middle class has been stagnant or worse, and, of course, obscene compensation for executives at the companies who engineered the debacle of millions of homeowners in underwater mortgages. I could, of course, go on with examples, but I’ll spare you the gory details.

What could corporations want more – what could warm the greedy little cockles of their hearts more – than for people to listen to and live by the creed of these morality commenters? What could be better for corporations then the asymmetric warfare of consumers following a deep, unshakeable, moral and ethical code of financial responsibility, completely independent of considering what’s in their own best interests, in their interactions with sociopathic, greed-is-good, what’s-in-it-for-me, institutions? It seems pretty clear who will come out on top in that match-up every damned time.

The sad thing, the truly disturbing thing in this story is that this woman is actually likely to suffer more severe consequences than any of the obscene financial “wizards” who engineered the near implosion of the world economy many of whom are currently milking their taxpayer funded TARP bailouts to extract huge bonuses. I’ll take your offense at her actions seriously when you begin to express some real outrage at the sociopathic executives and corporations who have have vaporized tens of trillions (that’s trillions with a T) of dollars and truly undermined the long-term prospects of the nation and the world through their immoral behavior. Until then, meh.