(Host) Commentator Allen Gilbert thinks that the real news story of the summer is not the court case over the Pledge of Allegiance. It’s the loss of respect abroad for corporate America.
(Gilbert) Newspapers have carried lots of letters about the court decision concerning the Pledge of Allegiance. Broadcast commentators have sparred over the significance of the Cleveland voucher decision. President George Bush is no doubt thankful that these items have been in the news. They’ve been diversions from other issues – issues such as the one that I read about on the fifth page of the fifth section of a Sunday paper at the end of June.
The headline said, “U.S. No Longer Seen as Best Investment.” The story was by New York Times reporter Edmund Andrews. Andrews wrote from Germany: “After years of pumping billions of dollars into the United States because it seemed the land of opportunity, foreign investors are pulling back on every front . For decades, people around the world have looked to the U.S. as the model for openness and accountability in business but they’ve been sorely disillusioned by the mounting waves of scandal.”
The chief investment officer for global equities at Dresdner Bank told Andrews bluntly, “There is unanimous agreement that the U.S. is not the best place to invest anymore.”
We can shrug this off as just another case of European “Schadenfreude” – taking pleasure from others’ pain. But the misdeeds – alleged or admitted – of Enron, WorldCom, ImClone, Global Crossing, Tyco, Adelphia, Rite Aid, Xerox, and Arthur Anderson – have resulted in a sort of financial terrorism. Increasingly, said a business ethics profession, people aren’t buying the White House line that the problem is just a few bad apples in the corporate barrel. People are worried that the barrel itself might be rotten. This angst has shown up in international markets. The dollar is down. Here at home, the stock market is lumbering like a wounded bear.
This affects us all. Many people must now handle their own retirement accounts, and much of that money is invested in the stock market. But even if you don’t have that worry, as a citizen you have a stake in the value of public pension funds. Under most pension plans, we’re obligated to pay what public employees will collect in retirement. Public pension funds have lost more than one billion from WorldCom alone. California, which has the nation’s largest system, lost $565 million, New York $300 million.
Business scandals are not new. What’s troubling about this latest round, observers say, is that the problems are squarely with top management – yet executives are not being held accountable for their actions. “What is lacking in the U.S. is a culture of shame,” said an Italian business executive. “No CEO in the U.S. is considered a thief if he does something wrong. It is a kind of moral cancer.”
This is the worst time for our economic system to be ill. We are fighting a war on terrorism. We hope to win not just by having bigger guns but by offering a better example of nation-building. We want to be a beacon of hope, much as we did following World War II. So far, we’re losing that part of the war. No wonder George Bush is happy we’re squabbling over the Pledge of Allegiance.
This is Allen Gilbert.
Allen Gilbert of Worcester is a writer an parent who is active in education issues.