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"Morality And Business – What You Can Do"
A Discussion With Bill Black.
A Discussion With Bill Black.
by: Brooke Allen
William Black is an Associate Professor of Economics and Law at the University of Missouri-Kansas City. He was the Executive Director of the Institute for Fraud Prevention from 2005-07. Bill is an outspoken critic of our regulators, banking, and business leaders. You may have caught him on Bill Moyer’s Journal, or in his congressional testimony where he stressed accountability and the fact that elites refuse to accept responsibility.
I recently attended a conference on institutional decision making and group behavior. Many academics presented experimental results and mathematical models to explain how we make bad decisions. Yet, when I asked about the role morality plays in individual decision making, I was told that little research has been done and therefore there was not much that can be said about the topic.
So, I called Bill Black. I caught him at a conference run by the Gruter Institute for Law and Biology.
Brooke: You coined a term, “control fraud.” Could you tell us what that is?
Bill: Yes, control fraud is when the people that control a seemingly legitimate entity, whether it is private, non-profit, or governmental, use it as a weapon of fraud.
Brooke: There seems to be a lot of that going on now.
Bill: Yes, way too much. And the FBI just announced that property crime had fallen to yet another all-time low, because we don’t count serious white collar crime. None of the major things that cause massive losses are even counted. And, if you don’t count it, at the end of the day, it doesn’t much exist [as far as they are concerned].
Brooke: I recently sat next to a young soldier coming back from Afghanistan; a wise man at age 20. I asked him, “What have you learned?” And he said, “I have learned to make apologies, not excuses. If your gun jams because you have not maintained it, and your buddy gets killed because you can’t cover him, you have to apologize to his widow, and it is not your gun jamming that caused his death.”
He also said, “I now see my country as a nation that cannot apologize, and that is full of excuses masquerading as reasons.”
How can we be excused just because we haven’t modeled morality mathematically therefore we can’t know anything about it? This young man knows something about it.
Bill: Brigadier S. L. A. Marshall found that small unit cohesion was the absolute key. You will do astonishing acts of bravery for your little group, and you will do it for members of your group who you actually hate. And they’ll do the same thing for you.
What you see from our elites is an almost complete unwillingness to take responsibility. We even have all these flakey apologies. To take the soldier’s statement, when he apologizes, he doesn’t say, “I am sorry if you have interpreted my comments in a manner that caused you distress,” which is the standard non-apology apology that people use today that puts it on you; there must be something flawed about you that led you to take offence at your husband being shot down because my gun jammed.
Brooke: I have an MBA in Finance, and I took an ethics class, which was all about how to stay legal, and not about ethics. The strongest impact for me was in a course called Managing Organizational Behavior where we talked about the Milgram Experiments. [A series of experiments conducted by Stanley Milgram of Yale University, where he showed that most people would go so far as to give people an apparently lethal shock when instructed to do so by an authority figure.] These experiments were presented in class as things that couldn’t be repeated again. We are obligated to mention them, but don’t worry about them because we can’t repeat the experiment. But, isn’t that experiment repeated all the time? I had a hard time sleeping after that because I saw it in all our behavior. It was not Germans in Germany who did what they did in World War II, but humans, just like the rest of us, and we are all capable of that. That, combined with small unit cohesion (you fight for your buddies, not your cause) is a combination that is extremely powerful and scary, isn’t it?
Bill: It’s weird, but I had the same experience. That is the single scariest thing I have ever watched in my life, and of course, I have seen much more horrific, graphic, violent things that are real – and that was an experiment. My fear was, my god, what would I have done? I know what I hope I would have done, but after you see that film, you have to wonder. [He continued with a discussion of the Stanford Prison Experiments.] That’s why you have to have immense restrictions on abusing people you have made powerless, because it is such a human thing to abuse them.
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William Black is an Associate Professor of Economics and Law at the University of Missouri-Kansas City. He was the Executive Director of the Institute for Fraud Prevention from 2005-07. Bill is an outspoken critic of our regulators, banking, and business leaders. You may have caught him on Bill Moyer’s Journal, or in his congressional testimony where he stressed accountability and the fact that elites refuse to accept responsibility.
I recently attended a conference on institutional decision making and group behavior. Many academics presented experimental results and mathematical models to explain how we make bad decisions. Yet, when I asked about the role morality plays in individual decision making, I was told that little research has been done and therefore there was not much that can be said about the topic.
So, I called Bill Black. I caught him at a conference run by the Gruter Institute for Law and Biology.
Brooke: You coined a term, “control fraud.” Could you tell us what that is?
Bill: Yes, control fraud is when the people that control a seemingly legitimate entity, whether it is private, non-profit, or governmental, use it as a weapon of fraud.
Brooke: There seems to be a lot of that going on now.
Bill: Yes, way too much. And the FBI just announced that property crime had fallen to yet another all-time low, because we don’t count serious white collar crime. None of the major things that cause massive losses are even counted. And, if you don’t count it, at the end of the day, it doesn’t much exist [as far as they are concerned].
Brooke: I recently sat next to a young soldier coming back from Afghanistan; a wise man at age 20. I asked him, “What have you learned?” And he said, “I have learned to make apologies, not excuses. If your gun jams because you have not maintained it, and your buddy gets killed because you can’t cover him, you have to apologize to his widow, and it is not your gun jamming that caused his death.”
He also said, “I now see my country as a nation that cannot apologize, and that is full of excuses masquerading as reasons.”
How can we be excused just because we haven’t modeled morality mathematically therefore we can’t know anything about it? This young man knows something about it.
Bill: Brigadier S. L. A. Marshall found that small unit cohesion was the absolute key. You will do astonishing acts of bravery for your little group, and you will do it for members of your group who you actually hate. And they’ll do the same thing for you.
What you see from our elites is an almost complete unwillingness to take responsibility. We even have all these flakey apologies. To take the soldier’s statement, when he apologizes, he doesn’t say, “I am sorry if you have interpreted my comments in a manner that caused you distress,” which is the standard non-apology apology that people use today that puts it on you; there must be something flawed about you that led you to take offence at your husband being shot down because my gun jammed.
Brooke: I have an MBA in Finance, and I took an ethics class, which was all about how to stay legal, and not about ethics. The strongest impact for me was in a course called Managing Organizational Behavior where we talked about the Milgram Experiments. [A series of experiments conducted by Stanley Milgram of Yale University, where he showed that most people would go so far as to give people an apparently lethal shock when instructed to do so by an authority figure.] These experiments were presented in class as things that couldn’t be repeated again. We are obligated to mention them, but don’t worry about them because we can’t repeat the experiment. But, isn’t that experiment repeated all the time? I had a hard time sleeping after that because I saw it in all our behavior. It was not Germans in Germany who did what they did in World War II, but humans, just like the rest of us, and we are all capable of that. That, combined with small unit cohesion (you fight for your buddies, not your cause) is a combination that is extremely powerful and scary, isn’t it?
Bill: It’s weird, but I had the same experience. That is the single scariest thing I have ever watched in my life, and of course, I have seen much more horrific, graphic, violent things that are real – and that was an experiment. My fear was, my god, what would I have done? I know what I hope I would have done, but after you see that film, you have to wonder. [He continued with a discussion of the Stanford Prison Experiments.] That’s why you have to have immense restrictions on abusing people you have made powerless, because it is such a human thing to abuse them.
.
.
.
.
.
.
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