Wall Street Needs to be Fixed, Not Occupied

Issues of corporate ethics are too important to leave to the Occupy Wall Street gang. The principles the group is fighting for are noble ones, but the tools they employ leave much to be desired. It’s up to the rest of us to use better tools.

Those currently camped out in New York, and other cities across the US, are right to want better corporate ethics, including a big dose of accountability and transparency. And they’re right to want to live in a just and equitable society. And they’re right to want certain kinds of electoral reform: finding ways to limit the influence of corporations (without stomping on free speech) would be a very good thing. But occupying Wall St. isn’t going to do it.

Don’t get me wrong: I’m there, in spirit. Well, not there there. I’m not likely to join the sit-in anytime soon; those methods aren’t my methods. But I sympathize with the frustration manifested by the passionate, non-partisan cabal of well-intentioned folks who make up the Occupy Wall Street movement. Indeed, though our methods are radically different, I’ve dedicated my career to some of the same ideals. I’m committed to the project of figuring out the best possible standards for corporate structures and behaviours, and I hope that better understanding will lead, indirectly, to better outcomes. The folks of the “Occupy Wall Street” movement likely think my way won’t won’t have much impact. Don’t worry, I’m not taking it personally.

The Occupy Wall Street movement has substantial symbolic significance, but we all know, I think, that nothing concrete is going to come of it. To start with, the mechanism is all wrong — it’s not like corporate and political elites are going to see a sit-in, and suddenly going to smack their foreheads and say, “Oh, ok! Let’s make changes!” And then there’s the movement itself. It’s pretty clear by now that the loosely-organized movement doesn’t have much in the way of concrete goals. And its spokespeople can barely open their mouths on topics related to business and economics without saying things that are grossly mistaken. Their values are right, but the mechanisms they envision to implement those values — things like repealing corporate personhood — are deeply misguided. But then, to look for direct impact is, as others have observed, likely a mistake, and misses the real significance of the movement.

So it would be easy — too easy ‐ to dismiss Occupy Wall Street as a bunch of well-intentioned young people tilting at windmills. But that would be a mistake. The windmills they’re tilting at are important ones.

The real value of the Occupy Wall Street movement is that it ought to serve as a kick in the pants to the rest of us, an inspiration to make use of tools that will do some real good. Let’s leverage their energy into effective methods. So think. Learn about the issues. Learn about corporate governance. Advocate reform. Organize. Get out the vote. If Occupying Wall Street is to have any real impact, it won’t be by motivating a few hundred more people to camp out in the street.

16 comments so far

  1. talesoftheangrynegro on

    I think you raise an excellent question: How can the Americans (much like the ones invovled in the protest (get to individuals like yourslef who have the knowledge to make the changes that the rest of us require? I think one of the main aspects that continues to focus the protest is a feeling of disengagement with the entire system and not only a lack of knowledge, but no concept of how to get the knowledge necesarry to participate in the process.

  2. Jim Sabin on

    Hi Chris –

    From my perspective as a Yank, I think you are underestimating the importance of the Wall Street occupation. I agree that the occupation “ought to serve as a kick in the pants” and an “inspiration.” The U.S. is plagued with a deficiency of activism and reformer energy. At the same time, there’s HUGE energy and finance for the economic status quo, not to mention the Tea Party, which wants to go back to the Revolutionary War era. The occupation should be seen as a wake up call, not an intellectual manifesto. The key point the occupiers are making is that the progressive forces in U.S. society have been too passive. If, as I hope happens, the size and noise level of the occupations grow, there are plenty of reports, websites (like your blog), articles and books that provide the intellectual capital that you note as absent in the pronouncements of the occupiers. The message the occupiers are sending to progressives is – “you should be ashamed of yourselves for sitting on your rears while the country is corrupted by its financial system – get with it!”

    Best

    Jim

    • Chris MacDonald on

      Jim:

      Thanks for that. I’m trying hard not to underestimate the importance of this. It’s difficult, because what I see happening there is out of proportion with the effusive response of commentators. I like the enthusiasm — I just think we need the right perspective on what the impact will be.

      I agree about the “wake up call”. Indeed, that’s basically the point I was aiming at.

      Cheers,
      Chris.

  3. Aurélia on

    Hey,
    I was just wondering what you meant exactly by “using effective methods”? In your opinion, how can americans proceed to make corporate and political elites aware of the fact that they have to make changes?

    • Chris MacDonald on

      Aurélia:

      I’ve got my methods of contributing; others have theirs. I’m no expert on what kinds of activities are best able to promote reform. But I have a *strong* suspicion, just as an observer of such things, that sit-ins are not very effective, and and run-ins with police are actually counter-productive, because they make it easy for elites to write you off as a bunch of violent malcontents.

      Chris.

  4. JR on

    “what country can preserve its liberties if their rulers are not warned from time to time that their people preserve the spirit of resistance? Let them take arms.” — Thomas Jefferson to William Stephens Smith, 1787

    Both the Government and Corporate America needs to be reformed as it has been pointed out. Hard Working Class demands reformation and this movement of young people are demonstrating to the World and the “authorities” that WE THE PEOPLE RESIST their greediness. These people cannot work using ethics we the people have to use resistance. I wish a revolution sparks all over USA and the World. Rich people and politicians enough is enough! Enough with the abuse of power!

    Finally, the arrests are merely a symbol for authorities and NYPD to demonstrate that they hold the power. The movement has been pacific but tenacious in the way that they have been doing their protest. What is portrayed on TV is an exaggeration of reality.

  5. Hauke on

    You say in your post that “the Occupy Wall Street movement has substantial symbolic significance, but we all know, I think, that nothing concrete is going to come of it”, whereas Crane and Matten, who also posted about this issue state that “big business, and big finance in particular, needs to take this seriously”, which is quite oppositional to your statement.

    They argue that it should be taken serious partly because it might have political results, when having elections soon. What do you think about this? Would you revise your statement or do you still think it’s true?

    • Chris MacDonald on

      Andy and Dirk are smart guys, so I don’t take their opinion lightly. And it’s entirely possible that OWS could have some impact through electoral politics. But politicians are mostly elected locally. My guess is that they’ll be more concerned to know what registered voters in their own districts think, than what effectively-anonymous people in a demonstration think.

      I think the best hope OWS has may be to evolve into a “get out the vote” movement.

  6. RE on

    Hi Chris,
    I am wondering how you feel about the world tagging along on this demonstration and even doing occupations in other countries?

    • Chris MacDonald on

      I don’t see any objection — except that some of the complaints of American protestors may not apply well in other countries.

  7. Sebastian Andersen on

    Hello Chris,
    I have been following the protests on Wall Street briefly the past couple of weeks. I heard that Ben&Jerry’s (The ice cream company) now is supporting Occupy Wall Street. I have mixed opinions whether Ben&Jerry’s really do care about the protesters or if they do it to strengthen their brand reputation.
    What do you think? Is it ethically correct for a huge corporation like Ben & Jerry’s to support these kinds of activities, because Occupy Wall Street is protesting against precisely this type of corporations, or? What do you think is the intention from Ben & Jerry’s?

  8. Nalliah Thayabharan on

    We essentially have had modern-day bank robbers — except that they wore gray suits and not masks — and there’s been no accountability for it Every day we see energy speculators, war profiteers, managed health-care providers, media propagandists, and/or financiers of Wall Street given some unfair advantage over the average consumers and taxpayers, and the cumulative effect of the American people watching selfishness prevail over the public interest has been an undermining of the public’s trust in government. There’s no question the system is rigged against the little guy. The Wall Street interests have a lot more information. They jerry-rig the system so that they always win. Oligarchy is political power based on economic power. And it’s the rise of the Wall Street in economic terms, that it’d turn into political power. And Wall Street then feed that back into more deregulation, more opportunities to go out and take reckless risks and– and capture huge amounts of money. The American democracy was not given to us on a platter. It is not ours for all time, irrespective of our efforts. Either people organize and they find political leadership to take this on, or we are going to be in big trouble. That’s absolutely the heart of the problem. I would also say and tell you, and emphasize, these Wall Street people will not come out and debate with us. The heads of Wall Street or their representatives, they will not come out. They’re afraid. They don’t have the substance. They don’t have the arguments. We have the evidence. They have the lobbyists. And that’s all they have. Wall Street Corporations don’t make anything. They don’t produce anything. They gamble and bet and speculate. And when they lose vast sums they raid the U.S. Treasury so they can go back and do it again. Never mind that $50 trillion in global wealth was erased between September 2007 and March 2009, including $7 trillion in the U.S. stock market and $6 trillion in the housing market. Never mind that the total amount of retirement and household wealth trashed was $7.5 trillion or that we saw $2 trillion in 401(k)s and individual retirement accounts evaporate. Never mind the $1.9 trillion in traditional defined-benefit plans and the $2.6 trillion in nonpension assets that went up in smoke. Never mind the job losses, the foreclosures and the 35 percent jump in personal and small-business bankruptcies. There are bundles of new money, taken again from us, to make deals and hand out outrageous bonuses. And when these trillions run out they will come back for more until our currency becomes junk
    —Nalliah Thayabharan

    • Chris MacDonald on

      Nalliah:

      Thanks for your impassioned comment.
      The only thing I’ll take issue with is the idea that Wall Street doesn’t produce anything. For some of them, that’s probably true. But if you look at Wall Street as a whole, I think it cannot be true. There’s a reason people and corporations pay Wall Street firms (including banks and the NY stock exchange) for their services.

      Chris.

  9. Chris MacDonald on

    For a comment on what Wall Street actually does, you could do worse than this, which is situated within an editorial that is generally critical of Wall Street:

    “Wall Street does have a reasonable tale to tell. Banking is not tobacco. Its products do not usually kill its customers. The industry messed up horribly, but people still need loans and somewhere to park their savings. Companies—you know, the things that create jobs—need investment banking to help them manage their finances and grow. Misguided regulations, written in anger, could imperil this. Wall Street needs to articulate this case firmly and often.” From: http://www.economist.com/node/21534759

  10. […] MacDonald of the University of Toronto’s Clarkson Center for Business Ethics in his article Wall Street Needs to be Fixed, Not Occupied, says: “Issues of corporate ethics are too important to leave to the Occupy Wall Street […]


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