Three Words

Good Morning America Weekend has a little bit they do, where people are invited to send in short videos or pictures with just three words.  Lost My Tooth, Finally Got Married,  Love Our Troops, First Time Voter, New Little Sister, Kicked Him Out, Got New Car.......things like that.

My three words, after watching over 12 hours of history unfolding in Washington, DC is -

Era of Responsibility.

That said - if you're reading this you have internet access, thereby negating any excuse for not knowing, clearly, without any shadow of prejudice by news services or special interest groups, what is happening in your government.  Bookmark this and look at it regularly - 

www.whitehouse.gov   

Pretty much sums it up for me.  God bless us all.

Another sign

Consider the true story of a young man, single, mid-30's, with a good paying job.   He was promoted a few years back with much better salary, so he joined the housing craze, and bought a nice place on 100% financing.  He's survived several rounds of layoffs, but knows the axe could fall at anytime.

Back in early December he learned the value of his home had fallen over 60%.  Like so many others, he owes more on the home than it was worth - way more.   He thought about it - thought about if it made sense to continue to pay that huge mortgage, mostly interest payments on such a young mortgage, knowing he'll eventually pay way more than he could ever get out of the house.

He got a lawyer, carefully planned it out and declared bankruptcy.   Told the bank - you can have the house.  Lives comfortably in a rented apartment now.   Only bump in the road for him is a few years without credit cards - and issues with buying stuff online (at online discount) without a credit card.  That problem is solved by tapping friends with credit cards to help him out, and paying them back in cash.  It's hard to do alot of things "cash," but with friends he can get by.

Here's the thing - it was a very smart financial move for him to declare bankruptcy and he - typical of his generation - as a rule - doesn't worry about the stigma that used to be attached to being bankrupt.   Actually, he looks good for protecting himself.   He figures it's no big deal, he's young, to go without credit cards for a few years.  In fact, no credit cards will be a big help in limiting his spending.  But like a basic law of physics (every action results in an equal and opposite reaction) - as more people do what's "smart" for them, what will be the longer term consequences?  

How many people will have no credit rating for five or more years due to bankruptcy?  Will that stop them from consuming?  Will it affect how credit ratings are figured?  Will anyone care about credit ratings for the next five years, and beyond?  What will happen when those of us from a different generation that keep paying our mortgage because we see it as our responsibility to fulfill no matter what, ends up with homes we've paid dearly for?  How many others have - or will - make this same decision to declare bankruptcy?  Couldn't those numbers be staggering, and dramatically effect/delay a turn-around in our economy?  Will bankruptcy rules be changed?  Do they need to be changed?

Food for thought.

  

What happened to accountability?

It struck me this morning, as an early Sunday morning news program reviewed the week's news of yet more layoffs, Chapter 7's and Chapter 11's, that the lack of accountability for the top-level managers of companies declaring failure and bankruptcy, is - well - appalling.  Seriously appalling.

What if, as part of any bankruptcy process, every board member and top-level managers were automatically subjected to a grand jury type of hearing?  In this hearing, the reasons for the failing of the company - really the failing of the leadership of said company - would be clearly stated and unprejudiciously reviewed.  If those reasons were found to be wanting, these individuals would be charged and tried in an open court of their peers.   If found guilty of mismanagement, they would be punished -- and I'm not talking about "three Hail Mary's, two Our Father's, and a sincere "I'm sorry" as they fly off to hide-out (lay low) in their second home in Malibu.  

I'm talking about immediate seizure of all personal assets, community service time, even jail time - perhaps flogging (not really flogging, but a civil form of flogging maybe).    Yes, their reputation will be hurt, their resumes permanently marked, and they will have difficulty getting hired as  a CEO again, but that seems fair when a well-trained, hardworking, loyal-to-the-company IT tech loses his job in bankruptcy and ends up stocking produce at the local grocer's.  (I'm not disparaging that job, just sad over the loss of trained ability being put to best use.)  It seems only right that the proven failed manager not be hired again in a position to once again mismanage, misdirect, and ruin, once again, more lives. It's a shame that CEO's family would suffer, but it's seems fair when the 30,000 employees who lost their jobs take their kids out of college or go without health care or lose their homes not to mention the future security of a well-deserved retirement. 

This is not about a feeling that "somebody needs to pay."   It's about accountability, and punishing those responsible when it's clearly shown the legacy they were paid (well-paid) to bear, the success of the company and therefore the lives of it's employees (not to mention the economy of our country) was not as heavy a burden to them as it appeared to have been.   I've never been a top 5, but I can tell you this - in every job I've held, it was very clear I was accountable every time I was reviewed for my performance.  And the consequence of determination of less-than-satisfactory performance was the loss of my bonus, my promotion, and/or even my job.  Why shouldn't it be the same for top leaders in a failed company?  If a teacher in an inner-city school where most of her over-crowded classroom students live in dysfunctional, unsupportive home situations, doesn't make sure a percentage of her student's make a certain grade on a standardized reading test, lives under the guillotine of losing his/her job, why not the same for the Chairman of the Board of a failed company?

Do you think such a "grand jury of accountability" might give every company leader, every board director, a moment's pause, to make them think they will go down just as hard with the rest of the ship, that they and their family will suffer just as much if not more as the rest of the ship's crew, that making more money is not the end-all, be-all of our short existence on this planet as much as stability, health and happiness? 

I do.  I most certainly do.