If you happened to watch Monday’s hearing of the House Oversight and Government Reform Committee, you saw a great example of what’s wrong with American leadership.
In a word, it’s hubris.
I’m not just talking about Richard S. Fuld Jr., the cocksure CEO of bankrupt Lehman Brothers Holdings Inc. of New York (By the way, isn’t it amazing how Mr. Fuld, who made tens of millions of dollars a year because he is such a genius and brilliant manager, couldn’t remember anything about a memo he wrote a few months ago when it was shown to him?)
Hubris also describes the House members who put on the show trial. Sure, Mr. Fuld fully deserves the public excoriation heaped upon him, but where were Rep. Henry Waxman, D-Calif., and the other Torquemadas on the panel through all the months when this mess was brewing?
House Democrats, including Mr. Waxman, refused to look into the crazy lending practices at Fannie Mae of Washington and Freddie Mac of McLean, Va.
How is it that Democrats could champion no-money-down, lie-about-your-income mortgages as great ideas for America’s poor (and receive campaign contributions from Fannie and Freddie in the process) and then turn on a dime and blame Wall Street for trading the cockamamie concoctions?
Republicans are no better.
The administration, and many GOP members of Congress, champion free enterprise and urge the government to get out of the way of business. But these shoot-from-the-mouth free marketers are first in line when it comes to feeding at the public trough or tilting it their way.
Republican-style hubris includes earmarks like bridges to nowhere and keeping federal regulations in place that raise the price of sugar in the United States to double or triple the world’s free-market price.
This Republican blind spot regarding sugar regulation, by the way, makes for sweet profits at companies owned by South Florida’s Fanjul family (big Republican supporters, coincidentally), impoverishes sugar farmers in third-world countries and destroys the ecology of the Everglades.
Our Republican and Democratic “leaders” are carried away by their own inflated sense of self while our CEOs are either such egomaniacs that they believe the hype about their own management excellence from the start or are quickly convinced of it by corporate sycophants and the media.
For once, I’d like a major political or business leader to admit that he or she doesn’t have the answer, and not with the fake humility the blowhards in Washington often display.
I’d like to see politicians and business leaders reach out to knowledgeable people from across the spectrum to work on major issues. And once a direction is set, go forward with it in a sense of modesty and with an openness to change, should circumstances warrant.
If any of the mathematical geniuses behind the now discredited derivatives were slightly less cocky, or if the Wall Street CEOs who convinced themselves they could manage any risk that came their way, were a little less arrogant or if government officials actually did their jobs, maybe this mess wouldn’t have happened.
By the same token, humility begins at home. If people earning $35,000 a year had been a little more honest about what they truly could afford, and if higher-income homebuyers hadn’t felt they deserved to live in McMansions, maybe the other overconfident characters would not have had such a field day.
Evan Cooper is deputy editor of InvestmentNews.
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