Tuesday, June 08, 2004

A note on two items which have been circulating a lot in the lefty blogsphere over the past few days.

The first is the DOD torture memo that the Wall Street Journal floated yesterday, the one containing the much-remarked advice that

To protect subordinates should they be charged with torture, the memo advised that Mr. Bush issue a "presidential directive or other writing" that could serve as evidence, since authority to set aside the laws is "inherent in the president."

Which is to say that if torture is used, Dubya should authorize it explicitly, since activities he chooses to authorize are above the law. But relax, folks -- they surely don't mean to authorize anything; in practice, this will surely be limited to the activities of Republicans. The memo is also noteworthy for its invocation of the Nuremberg "just following orders" defense (so called, as Billmon notes, because it was rejected at Nuremberg).

But beyond the individual howlers (though should one really look beyond an assertion that Dubya is allowed to authorize anything?) is the general tone, described in Phil Carter's much-quoted analysis that Dubya's administration is less focused on doing the right thing than on getting away with the wrong thing. How did we arrive at standards of conduct where this is considered proper?

Another item making the rounds is a Hannity and Colmes segment on George Soros, featuring charming little tidbits like this:

BLANKLEY: [Soros] said that he has no moral responsibility for the consequences of his financial actions. He is a self-admitted atheist. He was a Jew who figured out a way to survive the holocaust. ...

BLANKLEY: When a man with this kind -- when a man is with this kind of money, and he's spending it on trying to influence the American public in an election -- trying to buy the election; he is not going to -- we have a right to know what kind of an unscrupulous man he is.

Now, allusions to anti-Semitic tropes are all over this thing, and I don't mean to discount them. (Exactly how is it supposed to be a sign of his "unscrupulous" nature that he "figured out a way to survive the holocaust"? And that's far from the worst that Soros's critics have dished out lately.) But lost in that is that one of Tony Blankley's charges is in fact true: Soros's book, "Open Society" does make the claim, and defend it at length, that neither Soros nor any other participant in financial markets is morally accountable for their actions:

I insist that there is no point in applying moral judgments to decisions that have no outcome -- and that is the case regarding the social effects of individual investment decisions. Those decisions affect only the profits of the individual, not the prices prevailing in the market. That is what I mean when I say that markets are amoral: The anonymous participant need not be concerned with the social consequences of her decisions. By contrast, political actions, such as voting or lobbying or even arguing, do have social consequences. ...

I arrived at this precept when I was an anonymous market participant. That covers my career in finance up to and including the devalutaion of sterling in 1992. I blew my cover when I allowed myself to be identified as "the man who broke the Bank of England." Since then, ... I have become a public person whose utterances can influence the outcome. I can no longer escape having to make moral judgments. This has made it practically impossible for me to function as a market participant.

This is an odd argument -- there are many markets where individual participants hold positions big enough to influence prices without that fact, or their actions, attracting public notice. (Think Cargill in grain, for example). And Soros does go on to claim that moral accountability is on society at large for setting up the market mechanism in the first place, and goes on to inveigh against arguments for the primacy of markets as a social decision making mechanism, for exactly that reason:

Financial markets are amoral, and that is why they are so effective in aggregating the views of the participants. Exactly because of that quality, they cannot be left in charge of deciding the future.

But the bottom line is still that Soros does claim that his financial transactions -- so long as they follow market rules -- are subject to no moral standards beyond that.

But even so, it's still very strange for Blankley to cite it in a bill of particulars against Soros -- because Soros's views on the point are not really exceptional. It's a truism in financial circles these days that the sole responsibility of the management of not just, say, a hedge fund, but of any corporation, is fiduciary duty to the shareholders -- conceived quite narrowly as maximizing their financial return. All other considerations are supposed to be set aside. What makes Soros exceptional is not his willingness to live by this, but that he's bothered enough to try to rationalize it.

The upshot of this is that we, as a society, have a stratum of powerful decision makers who believe it is not just their right, but their duty, to set moral considerations aside in their professional activities. At best they're supposed to live within the bounds of the law; pushing those bounds -- relocating corporate HQs to Bermuda, for instance, to avoid paying their fair share of taxes -- is seen as innovative and praiseworthy, at least in some circles. Should it be such a surprise that, confronted with legal barriers of a slightly different sort, the administration of an "MBA President" acts the same way?

More: Here's a New York Times Magazine piece by Michael Lewis on the strained quality of modern business ethics in America:

When you are honest only because honesty pays, says Birkenstock's C.E.O., you risk forgetting the meaning of honesty. When you are socially responsible only because social responsibility pays, you lose any real sense of what responsibility means.

via Rafe Colburn...

Besides which, embarassing examples of the same ethic at work are easily found far closer to Dubya -- Dick Cheney, whose Halliburton funneled drilling equipment to Saddam through a French subsidiary; his various brothers and friends who have been in trouble with bank regulators over the past few years. And who could forget Ken Lay?


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