Steven Waldman

Steven Waldman

Religion, Greed & Wall Street

The one thing everyone from Jim Wallis to John McCain seem to agree on is that rampant greed is a main cause of the financial collapse.
I don’t buy it. I’m not saying greed is good, just that greed is. It’s a constant. It’s part of human character and I find no evidence that the intensity of this basic human instinct suddenly increased in the last ten years.
What’s changed is that the checks on greed have dissipated.
Yes, that partly means government regulation. One of the things that pure free marketers rarely understand is that government regulation enables capitalists to be whole-heartedly greedy. If the regulators are watching, business people can push the envelope to make more money – and that often is a source of great economic creativity. We don’t want a system in which we’re relying on the internal ethical code of investment bank presidents to balance growth with national interest. The government should say: you go ahead and be greedy. We’ll make sure that your greed helps, not hurts, the rest of us.
But it goes beyond government regulation. Another traditional check on greed is the belief that if you go too far, you’ll get burned. Why didn’t that happen this time? As I understand it, these new financial products like derivatives chopped up the risk and spread it around. Investors no longer had a clear sense how much risk they were taking on. Fear no longer restrained greed.
Most important, this crisis results from a failure of memory. On my office wall, I have some cover stories I wrote for Newsweek in 1990: one called “Bonfire of the S&Ls” and the other called “The Real Estate Bust.” Sound familiar? Business schools should spend less time on business ethics and more on business history.
And it’s not just big-shots who do this: everyone who took out a sub-prime mortgage was making a bet that real estate and their incomes would keep appreciating.
Which brings me to religion. When I asked Dilshad Ali, one of our editors who is Muslim, how her faith affects her finances, she said that because of Islam’s strong cautions against debt and usury, “we try so hard to pay credit cards on time, not take loans, etc — it’s a challenge, but it also keeps us financially stable and on our toes.”
But isn’t Dilshad the exception? Historically, all of the faiths have warned against greed. Greed was not only listed as one of the seven deadly sins, it’s often thought of the mother of all of the others. But combating greed is hardly a focus of American spirituality these days. You have The Secret, whose message that if you visualize that house you can get it (never mind whether you should get it.) Prosperity Gospel ministers teach that if you’re rich, it’s because God is favoring you. At a minimum, pastors are focused on other things. Do a search at for sermons about sex you’ll get 252 results. On greed? 37 results.
Greed is not worse than ever. The problem is that we’ve surrendered our best anti-greed weapons.

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posted September 19, 2008 at 1:50 pm

I’ve said it before and I’ll say it again, what scares folks most is sex, death, and money. We go to great lengths to hide our connections to all three. It is as if there is something pornographic about financial reports! In fact I think some fine leaders of the church might rather be caught with a “Hustler” in their desk than the annual report from a Fortune 500 company.
It is easier to invoke the shame of easy sex than it is of easy money. It is almost fanciful to talk about salvation and eternal life. But GREED is a here and now kind of sin, one most folks would rather enjoy that decry. We all know it stinks to be poor.
But how could you not quote Gordon Gecko’s soliloquy from the movie “Wall Street” (though you veered toward it)
And on Talk Like a Pirate Day, one would do well to watch again “Hook”, as Wendy protests that Peter (Robin Williams) has turned into a pirate after all.

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posted September 19, 2008 at 1:59 pm

OK, I’ll give it to you, COurtesy of, here is the text of Gecko’s famous speech(as delivered by Michael Douglas) from Oliver Stone’s “Wall Street”
Gordon Gekko: [at the Teldar Paper stockholder’s meeting] “Well, I appreciate the opportunity you’re giving me Mr. Cromwell as the single largest shareholder in Teldar Paper, to speak. Well, ladies and gentlemen we’re not here to indulge in fantasy but in political and economic reality. America, America has become a second-rate power. Its trade deficit and its fiscal deficit are at nightmare proportions. Now, in the days of the free market when our country was a top industrial power, there was accountability to the stockholder. The Carnegies, the Mellons, the men that built this great industrial empire, made sure of it because it was their money at stake. Today, management has no stake in the company! All together, these men sitting up here own less than three percent of the company. And where does Mr. Cromwell put his million-dollar salary? Not in Teldar stock; he owns less than one percent. You own the company. That’s right, you, the stockholder. And you are all being royally scr*w*d over by these, these bureaucrats, with their luncheons, their hunting and fishing trips, their corporate jets and golden parachutes.
Cromwell: This is an outrage! You’re out of line Gekko!
Gordon Gekko: Teldar Paper, Mr. Cromwell, Teldar Paper has 33 different vice presidents each earning over 200 thousand dollars a year. Now, I have spent the last two months analyzing what all these guys do, and I still can’t figure it out. One thing I do know is that our paper company lost 110 million dollars last year, and I’ll bet that half of that was spent in all the paperwork going back and forth between all these vice presidents. The new law of evolution in corporate America seems to be survival of the unfittest. Well, in my book you either do it right or you get eliminated. In the last seven deals that I’ve been involved with, there were 2.5 million stockholders who have made a pretax profit of 12 billion dollars. Thank you.
I am not a destroyer of companies. I am a liberator of them! The point is, ladies and gentleman, that greed, for lack of a better word, is good. Greed is right, greed works. Greed clarifies, cuts through, and captures the essence of the evolutionary spirit. Greed, in all of its forms; greed for life, for money, for love, knowledge has marked the upward surge of mankind. And greed, you mark my words, will not only save Teldar Paper, but that other malfunctioning corporation called the USA. Thank you very much.”
This is as good a sermon against the prevailing winds of the market today.

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posted September 19, 2008 at 8:34 pm

You should write a book on this subject. With your previous journalistic experience, you are uniquely qualified to do this.
Intoning against greed seems to be taken as anti-capitalist.
Among libertarians, I’ve noticed an aversion to speak about values, which I attribute to the view that if they do people will want to legislate about it.
I intend to write more on the libertarian evasion of moral and spiritual speech, which I don’t agree with. It is important to discuss values, even if the government doesn’t legislate against them.

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