President Obama and Those Fat Cats from Wall Street – 2009 Ethics a Year in Review (1 of 3)

January 1, 2010

Frankly I couldn’t believe what I heard on the news when President Obama, in an interview, called bankers into the White House to seek their help with the economy – having referred to them the day before as “Fat Cat” bankers.  Hum…the President of the United States resorting to labeling people in less than a professional manner.  Perhaps it is just his folksy style, but that type of approach seems much less than presidential.  But then I got to thinking…

Seems like in this administration there was some effort to curb the abuses that the banks have hurled at consumers when it came to credit cards.  That, for everyone but the banks, was hailed as “about time” legislation.  Ethically, the banks have played less than fair with consumers.  Personal example…my wife, who has spotless credit had a Bank of American card with a zero balance and substantial credit limit, received a letter from BofA increasing her interest rate to 22.9% from 8.9%.  She called asking why and was told it was a mistake, but one that could not be undone.  After expressing her deep dissatisfaction and then vowing (after she got off the phone not to ever use the card), she got a letter from Bank of America (just a week later) cutting her credit line by 75%.  Ethical actions by Bank of America – yea right.

According to Money Magazine senior writer – Donna Rosato – “Lawmakers gave issuers till February 2010 to fully comply with the new law. Meanwhile, issuers have rushed to raise interest rates, impose new fees and cut credit limits. The median rate on credit cards surged 13% to 23% from December 2008 to July 2009, according to a study by the Pew Charitable Trusts. Meanwhile, a bill to expedite the credit card reforms, the Credit Card Rate Freeze Act, has gone nowhere. When the new law kicks in in 2010, consumers will have more protection.”

Maybe the term “Fat Cat” Bankers was justified.

Ah…but there’s more.

Fortune Magazine states:

What Ken Lewis wanted, Ken Lewis got. During his eight-year tenure as Bank of America’s CEO, he embarked on a dizzying series of acquisitions to create the nation’s biggest financial services company.

But when his last two big buys — toxic-mortgage giant Countrywide and dead-on-its-feet bank Merrill Lynch — drew too much scrutiny from regulators and shareholders, Lewis packed up his golden parachute last October and bailed.

Maybe I should be a bit kinder in my blog.  Perhaps after squandering Bank of American funds on losing propositions, they needed the rate increase on credit cards.  Of course, that assumes that folks use those credit cards.  In our case, I think not.

BUT TO TOP IT OFF…

When the government, back in the Clinton administration, asked Fannie Mae and Freddie Mac to extend credit to many American who, otherwise, were not credit worthy – I have to ask the question – with rising deficits and massive government spending – why should anyone in the government call anyone names when the government is doing just what those Wall Street “Fat Cats” did – namely living above their means.  We have massive debt and seem to believe that living in debt is O.K.

Perhaps the ethical thing to do is say – NO to additional government debt and do what is being preached to the population – live within your means and act ethically and in a responsible manner.

WHAT DO YOU THINK?


Incarceration Rate Winner? United States – We Incarcerate 1 in 100 Citizens! Is That Something to be Proud Of

February 28, 2008

One out of every 100 U. S. adults is in jail or prison. That is a startling statistic and not something to be proud of – in fact, it’s down right embarrassing.

jail-cartoon.jpg

According to the Pew Report, cited here, (The Pew Charitable Trusts applies the power of knowledge to solve today’s most challenging problems. Pew’s Center on the States identifies and advances effective policy approaches to critical issues facing states) Three decades of growth in America’s prison population has quietly nudged the nation across a sobering threshold: for the first time, more than one in every 100 adults is now confined in an American jail or prison.

As startling as the one in one hundred statistic is – these next facts are shocking and deserve the attention of our society at large.

For some groups, the incarceration numbers are especially startling. While one in 30 men between the ages of 20 and 34 is behind bars, for black males in that age group the figure is one in nine. Gender adds another dimension to the picture. Men still are roughly 10 times more likely to be in jail or
prison, but the female population is burgeoning at a far brisker pace.

As a white collar crime speaker, and one who is part of the statistic above (as I’ve been incarcerated), I understand that every choice has a consequence. Likewise, I do believe that you reap what you sow. However, there are those whose crimes should warrant some form of alternative punishment rather than incarceration.

Prison is big business – make no mistake. In many areas the inmate population supports the governments infrastructure. In my case, I was an inmate at a minimum security facility located on an airforce base. We (the inmates) were used to perform tasks that otherwise would have either been contracted out to civilian employees or been done by airforce personnel themselves. We were effective cheap labor.

Lawmakers are learning that current prison growth is not driven primarily by a parallel increase in crime, or a corresponding surge in the population at large. Rather, it flows principally from a wave of policy choices that are sending more lawbreakers to prison and, through popular “three-strikes” measures and other sentencing enhancements, keeping them there longer.

While I do believe in punishment and deserved what I got – so I have no axe to grind here – it is true that “tough on crime” is politically popular. Can you really imagine any politician saying that prisons are overcrowded and costs each of us too much, so we need to have alternatives so that parole violators don’t go back. If that were said, they would not be elected.

There is much to be digested in the Pew report. I suggest you click on the link above ot read the entire report. Meanwhile, there will be more blog entries as the entirety of the report is covered.

Questions:

  • What would you do to reduce the inmate population in the US?
  • Since 1 in 100 Americans are incarcerated, what example can you provide in response to this report, that shows a person who should not have been incarcerated?