What “Wall Street” has done to the American people is simply wrong, so the story goes, and should never be condoned. But is the current financial meltdown a severe cost … or a severe moral wrong … and what does the answer tell us about what the reaction of our elected officials might be?
Most of the rhetoric is that what is happening is morally wrong, and like all moral wrongs should never be condoned. But is it true that moral wrongs are never condoned in society? I think all of us would agree that the random robbery of little old ladies is morally wrong. We, as society, could reduce the number of robberies that little old ladies sufferto any amount we choose if we were willing to pay for a sufficient number of police officers or private protection agents.
More than one little old lady is robbed every single year right now. Why? Can’t we prevent this injustice? No! We implicitly accept a certain amount of little old lady robberies every single year because it would be prohibitively costly to provide every little old lady with protection 24 hours a day.
Does that mean we are “condoning” the robbery of little old ladies? While we are accepting a certain number of these regrettable actions, we certainly are not condoning the actions of any single robbery. Have we provided a “right to rob” to those thugs that are ultimately successful? No … we simply cannot prevent some robberies because the cost of doing so is too high.
We, as a society, could certainly do things to insure that we have fewer financial problems – we can have a government bureaucrat accompany us through every single financial transaction we enter into, and to verify that it is safe and sensible. Barring the ethical problems and knowledge problems with such a proposal, it is simply too costly to do such a thing. And once policymakers realize this simple little fact, the question they should be asking themselves is what exactly has been the benefits of the things that Wall Street has been doing, and what exactly are the real costs, and what levels of benefits and costs are acceptable. Sadly, the rhetoric, and likely policy response, will be something akin to demanding that NO cost is acceptable, certainly not for the American public and MOST certainly not for the wealthy bankers who seem to be the 21st century’s version of the Teflon Dons.