Corruption hijacks American free market
Al Qaeda's attack on the World Trade Center last September marked a depraved bruising to the symbolic heart of the American, and indeed the world's, free-market system. Coldly brutal, driven by suicidal rage, it killed thousands of innocents and dealt a blow to America's insular sense of security. Yet, the gasp for air was temporary. For nearly a whole year, in its illogical way, the suicide attack has mostly united Americans.
Now comes a more dangerous wound. This is not a punch but a dagger in the side, self-inflicted, a potential hara-kiri, the notorious Japanese suicide dictated by shame. We refer to the brazen quest for dishonest gains displayed by too many of the highest mainstream American corporate elite. Cooking books and committing fraud at the expense of their own corporate communities, employees and investors, they have been wringing the neck of the golden goose.
Too many executives at the top of the American money machine, too greedily and too brazenly this time, gobbled at the trough of high corporate wealth while way too many beneath them lost everything ? jobs, pensions, life savings. Fudging legality and clearly violating ethical and moral standards, high company executives allowed and sometimes directed accounting procedures that hid losses and falsely jacked up profit statements. As their companies faltered and then collapsed, the same executives sold their own stocks while they advised their employees to hold on to theirs and even to buy. The crooked accounting and misinformation fed to investors and company employees has exploded into scandal, generating a huge ball of distrust for the market. Now we see high company executives pleading the Fifth Amendment before congressional committees, looking as incriminated and sleazy as the organized crime figures who made famous the phrase, "I decline to answer the question on the grounds that the testimony might incriminate me."
That American free market policy can easily be led by greed into the worst of abuses is nothing new to American Indians. Broken treaties and broken promises, theft of land and resources, often at the hands of corrupt government agents working in cahoots with corrupt speculators, has characterized the history of U.S. relations with tribal nations. Only in the past quarter century has that sordid approach begun to correct itself, albeit very slowly, while the possibility (and reality) of continued injustice is ever-present.
Most prominently, the huge scandal represented by the mismanagement and loss of billions of dollars in Indian assets held in trust by the federal government for the more than 500,000 individual Indian trust beneficiaries, stands out as another example of the "miners' canary" role played by Indians throughout American history. (In the mines, as oxygen levels decline, canaries drop first, warning workers to flee the mine.) The corruption tearing at the fabric of the market this time disrupts lives across the broadest spectrum of the American population, and the trepidation always felt by Indians about the excesses of the American system, is now widespread and deeply shared.
As the stock market climbed through the 1990s, it was touted as a sort of magic, the best investment of the American Dream. Delirium set in as the top class of executives, often in and out of high political office via appointments, pushed for less-regulated market practices. Buying and selling shares was touted in trade magazines as an "economy" in itself. Agriculture, manufacturing, service industries ? all seemed secondary or immaterial to top corporate officers and market traders, many of whom made huge sums from speculation, and not a few from the illegal use of inside information. Major American companies like Enron and WorldCom, now reporting accounting fraud into the billions of dollars ? and the biggest bankruptcy in history ? have wreaked havoc on the market and on investors, big and small.
The emerging evidence of severe and reckless corruption at such high levels of American capitalism is a very hard blow to the United States, particularly at a moment in its history when it seeks to understand and respond to a serious challenge to its security. It threatens to disunify the country. Even the Republican Party, marching under a popular president, is showing signs of consternation. Senate Republicans, for instance, are supporting much stronger penalties against corrupt corporate leadership than those suggested by the White House. In matters ranging from access to low-cost generic drugs to the president's domestic security legislation, the Republican-run House has voted in opposition to White House wishes.
Considering the rising concern that many top officials in the Administration, including President George W. Bush and Vice President Dick Cheney, once played the corporate game, the public is understandably cautious about assessing the stock market at this time. The country faces an uncertain future, one that will be improved by the restoration of sensible regulation and the articulation by the President of the merits of ethical business conduct as public policy. Within the usual ebb and flow of the stock market, this time around the whole reliability of the system is being called into question. The bubble has burst before. Bear and Bull have battled across the financial pages for decades. But now more than 80 million Americans invest in the stock market and their decisions need to be founded upon accurate accounting information and reliable company profiles and broker assessments. That it is now realized that fraudulent accounting practices are conceivably widespread may have far-reaching consequences. American business could have no louder wake-up call than the recent sharp drop in the market, caused less by the underlying economy, which is fairly stable, than by the widespread sense among investors that they have been lied to.
Unfortunately, in the usual historical pattern, the policy relative to Indians may precede national reality. In the trust scandal case, some officials have called for appropriations of millions to pay for the lawyers who will defend the bureaucrats who may have knowingly destroyed tens of thousands of boxes of documents and electronic trust records over the six years that the case has been in court. It was also requested of Congress, and supported by the White House, that funds be cut for the full accounting that Judge Royce C. Lamberth has ordered. In this case, the government's malfeasance is potentially financially comparable, if not greater than, that of Enron and Worldcom.
Take heart, America. If the government's financial accounting and failed policies concerning Indian assets are any guide, the worst may be yet to come.