Tuesday, August 20, 2013

Standards I might like to have applied to me

On today's Morning Edition there was a story about the multiple fraud prosecutions facing J.P. Morgan in multiple countries.

They raised the argument that the bank is such a sprawling behemoth that it can’t be expected to be able to control everything it does. They did have a clip of Bill Black contending that “You can’t have this many scandals without a complete failure to set an ethical tone at the top.”

Far more interesting, though, was Dick Bovet’s defense. “Is J.P. Morgan a well-run bank or not? We constantly hear this statement that it’s too big to be managed. Alright, J.P. Morgan makes more money than any other bank in the world other than the four big Chinese banks. It’s also making more money than 99.99% of the companies that function in the United States.”

The reporter then continues, “Bovet says that suggest the bank is being run pretty darn well.”

Well, OK then.

It’s not as if the bank were being accused of crimes that make it lose money. Its (alleged) bribery and fraud were precisely in the service of making more money. So if you point to how much money they’re making, you could just as well be measuring the extent of their criminality as how well managed they are.

I think Shakespeare had something to say about that …

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