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Business Corruption

Certain enterprises would seem more inclined to take a higher moral ground when it comes to money. Sectors like government, education, healthcare and religion. However, as we are all too painfully aware this is just not the case.Here are some examples:

–Recently, we’ve heard of politicians who cheat, are influenced by lobbyist “donations,” and help their political and business friends make big bucks. They’ll put their friends on the payroll, give publicly financed scholarships to their families, violate ethics rules, steer money to certain industries, and not behave in the public interest. They will compensate themselves generously and look out more for government workers than the public at large.

–We have seen “for profit” education placing profit above education. Recently we’ve heard about major corporate educational institutions duping applicants, falsifying job placement reports, saddling students with unconscionable student loan debt, misleading students and graduates about the value of their educations, and generally fleecing the taxpayer.

–There have been instances of healthcare providers charging outrageous fees which are then billed to Medicare, Medicaid, private insurers or the patients. Recent scandals identify providers charging for services that haven’t even been delivered, or are redundant or unnecessary procedures. The government’s practice of paying claims without prior verification has come under scrutiny.

–Scandals among religious leaders and their organizations are rife. We provide generous tax exemptions to these organizations and they collect donations from their members, but many are so greedy that even this isn’t enough. They financially fleece their flocks and spend lavishly on themselves and their cronies.

Of course these are just illustrations. There are many ethical, honest, fair, moral businessmen, politicians, and religious leaders. Unfortunately, far too many do not consistently evidence these attributes and our perceptions are influenced accordingly.

A Cheatin’ Nation

A lyric in a popular country song by Hank Williams says “your cheatin’ heart will tell on you…” (Your Cheatin’ Heart, 1952). Well, it seems we’ve become a nation of cheaters. But do these cheaters have a heart? And, will it tell on the perpetrators? Or, will we have to rely on watchdog agencies, audits, regulatory bodies, media reporters, whistleblowers, public outrage, and the like?

I’m not a moral purist or absolutist, and, I completely understand that the profit motive has spurred progress, development, and incentivized business. However, I also believe that trust is important for the efficient conduct of business, and that cheating will lead to inefficiencies, cost and price distortions and loss of faith in essential private, governmental and societal entities. We all pay a price for dishonesty and deception.

How Corrupt are We?

A report issued by Transparency International, the “Corruption Perceptions Index,” (New York Times, October 26, 2010) is cause for concern. The Berlin-based organization defines corruption as “the abuse of entrusted power for private gain.” It incorporates such problems as illegal Wall Street practices, kickbacks, private money and influence in the political process, unethical corporate behaviors, etc.

The report reveals that while we’re still perceived as more honest than most countries, the perception of our overall integrity continues to erode. In 2010 the United States is ranked number twenty-two out of 178 nations. (We are no longer in the top twenty least corrupt nations.) The U.S. ranks below countries such as: Britain, Canada, Barbados, Qatar, New Zealand, Denmark, Singapore, Germany, Norway, Hong Kong, and Chile. However, we’re still well above Russia, Iraq, the Congo, Angola, Sudan, Afghanistan and Somalia. We still rank in the top 20%, but as the survey reports nearly three-quarters of the countries in the index have “serious corruption problems.”