Charles Pfeffer

Executive Coaching & Leadership Consulting

The Problem of Corruption (1)

In the past few days there have been two announcements of outrageous abuse of trust, one political, the other financial. Illinois Governor, Rod Blagojevich was arrested on charges of corruption for allegedly attempting to sell the appointment to the Senate seat being vacated by President elect Obama. If true, this is a mind-bogglingly cynical violation of the basic assumptions of representative government. The problem is that this cynical act follows a series of violations (most recently the conviction of Alaska Senator Ted Stevens for taking bribes) that seem to have stunted our sense of outrage!

The second announcement of the week was that the investment manager and former head of NASDAQ, Bernard Madoff bilked investors out of a total $50 billion in a ponzi scheme. Following on the broad financial collapse caused by the sub-prime mortgage crisis, the public again seems to be numb to outrage.

The New York Times columnist and former talk show host, Dick Cavett referred to Blogojevich as a “sociopath” and cited psychological research indicating how difficult it can be to identify such a personality in advance a crime that makes it obvious. This may explain how the Illinois electorate came to vote in such a character, but does it explain Stevens? What about Abramoff? Tom Delay? Scooter Libby? Charlie Rangel? The list goes on and on! Are these all sociopaths?

Corruption is at the center of the sub-prime meltdown,which is at the heart of the current financial crisis that our Treasury Department and Federal Reserve are attempting to remedy with vast amounts taxpayer dollars. The cost is enormous and multigenerational.

We are talking about more than just a few bad apples. Bernie Ebbers of MCI, Dennis Kozlowski of Tyco, Jeff Skilling of Enron: these are three of the poster boys of corporate scandal whose crimes cost shareholders, employees and communities billions.

Here’s the thing. We can focus on the scoundrels, but this takes attention away from the fact the people elected Blagojevich, Stevens, DeLay. Boards hired Ebbers and Skilling. Managers and staffers worked for these men. In other words, people were complicit in the hiring, election, promotion and ongoing enablement of these corrupt individuals. It is important to recognize this or else we are likely to buy the notion that we are innocent victims of smooth talking charlatans. A more empowering notion is that we have been complacently turning over responsibility for important leadership roles to people who do not deserve our trust. We’d better indict ourselves if we want to have any hope of regaining control of our political process and the governance of our major institutions. How? Speak up!! Anyone who sees activity that is dishonest, self dealing or otherwise corrupt has a responsibility as a citizen, as an employee, a coworker, a fellow human being, to point it out. The cost of not doing so as we have all seen, can be astronomical!!

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