Strip The Stewards
To absolutely no one’s surprise, the “takers” on Wall St. seem to be at it again. It’s funny how capitalism abhors “takers“, yet the biggest schleppers of your money dwell at the celebrated heart of unbridled capitalism – Wall St.
Capitalism is the worst “ism”, except for all the other “isms” – Unknown?
While government gets reviled for catering to average Joe Schmoe welfare “takers“, the hulking buttheads on Wall St. not only get off with a token monetary fine and a promise to “behave honorably” in the future, they get to set their own definition of “honorably“. As long as they’re too big to fail or jail, these psycho banks and the “innocents” who run them will continue to do as they please, knowing full well that small potatoes “takers” like you and me will bail them out when their wreckless, self-serving behavior triggers the next global crisis.
In “Prosecutors Suspect Repeat Offenses on Wall Street”, the NY Times states:
Just two years after avoiding prosecution for a variety of crimes, some of the world’s biggest banks are suspected of having broken their promises to behave. Typically, when banks have repeatedly run afoul of the law, they have returned to business as usual with little or no additional penalty — a stark contrast to how prosecutors mete out justice for the average criminal.
So, now that prosecutors are hot on the tail of some repeat big bank offenders, what do you suppose will happen to the guilty? The same old, same old:
Even now that prosecutors are examining repeat offenses on Wall Street, they are likely to seek punishments more symbolic than sweeping. Top executives are not expected to land in prison, nor are any problem banks in jeopardy of shutting down.
I think that the only way to medicate the psycho-orgs in our midst is to hit their stewards, the real people hiding behind the abstract corpo Hannibal Lectors among us, where it hurts – right in the pocketbook. Make it unambiguously transparent that the top tier(s) of executive management will be stripped of all their personal wealth if the narcissist monsters they run are found guilty of wiping out the IRA’s of thousands of the little people.
We don’t even have to jail them or demand their resignations. Simply treat them as big time drug dealers by confiscating all their property and making them start over again at step one. No more unconditional yearly bonuses and “but, I didn’t know” defense strategies. Put some teeth into “the buck stops here” and force them to, as Nassim Taleb suggests, place some “skin in the game“.
As the figure below illustrates, a “strip the stewards” punishment policy may not inhibit future normal-to-criminal behavior transitions after a reset to normal behavior, but it has a better chance of doing so than the current slap-on-the-wrist policy. What do you think can work?