Money, Power and Education.

Catching up with the daily news and its portrayals of violence, revealed terrorist plots, drug wars, family wars and the blatant corruption within some sectors of the corporate world, in particular the banking sector, is akin to reading an updated publication of Sebastian Falk’s 2009 novel A Week in December.  Art really does imitate life-or is it the other way around? May be it’s all about self-fulfilling prophecies? Anyway, to use a Falkism, Goldbag have been at it again!  In April of 2010 the US Securities and Exchange Commission filed charges against the Investment Bank, Goldman Sachs, alleging that Bags full of Gold defrauded investors by misstating and omitting key facts about a financial product tied to subprime mortgages as the U.S. housing market was collapsing. Serious charges given what the sub-prime mortgage crisis did to average working Americans and by extension to a global population of workers who have simply become an extension of global capital in the form of tradable cultural capital, inter-dependent on a new order of financial deregulation and globalization.

This isn’t the first time Goldbag (and not the last?) have been caught out for their double standards and corrupt business dealings. In 2003 the United States Securities and Exchange Commission found that the Goldman Sachs Group had been complicit in corrupt business practices which had enabled the organization to benefit from its own research analyst’s inside information on currencies and securities trading, and investment banking. Goldman Sach’s consented to the findings of the SEC without admitting or denying the allegations. They also consented to a final judgment which cost the organization in excess of US 100 million dollars.

On August 9th 2012 the SEC announced that Goldbag would not be prosecuted for its unethical business practices which significantly contributed to the 2008 world-wide financial crisis. Surprised? Not really. Others have argued elsewhere about cronyism in the age of advanced capitalism. Hope for change? It looks bleak I’m afraid. Why? Well Goldman Sachs has a philanthropic wing-a foundation funded through the Goldman Sachs Group. The charitable wing was inaugurated in 1999 with a funding grant from the parent company of 200 million dollars (US). Since its inception the foundation has donated generously to the educational needs of young people in selected countries throughout the world. It argues that its ‘mission’ is to “promote excellence in education worldwide…and to enhance the academic performance and prospects for achievement at secondary level, and to develop the abilities of promising high potential youth worldwide, and to support high quality education for young people in business and entrepreneurship.”[1]

These goals are not dissimilar to any primary or secondary school’s mission statement and values insofar as they argue that the foundation’s aim is for the betterment of youth through educational programmes. But this would be as far as one could go in drawing any kind of comparative ideal and vision between the Goldman Sach’s Foundation and any school’s value system.

Fundamental to the Goldman Sachs group are its fourteen business principles worth quoting in full here:

  • “Our clients’ interests always come first. Our experience shows that if we serve our clients well, our own success will follow.
  • Our assets are our people, capital and reputation. If any of these is ever diminished, the last is the most difficult to restore. We are dedicated to complying fully with the letter and spirit of the laws, rules and ethical principles that govern us. Our continued success depends upon unswerving adherence to this standard.
  • Our goal is to provide superior returns to our shareholders. Profitability is critical to achieving superior returns, building our capital, and attracting and keeping our best people. Significant employee stock ownership aligns the interests of our employees and our shareholders
  • We take great pride in the professional quality of our work. We have an uncompromising determination to achieve excellence in everything we undertake. Though we may be involved in a wide variety and heavy volume of activity, we would, if it came to a choice, rather be best than biggest.
  • We stress creativity and imagination in everything we do. While recognizing that the old way may still be the best way, we constantly strive to find a better solution to a client’s problems. We pride ourselves on having pioneered many of the practices and techniques that have become standard in the industry.
  • We make an unusual effort to identify and recruit the very best person for every job. Although our activities are measured in billions of dollars, we select our people one by one. In a service business, we know that without the best people, we cannot be the best firm.
  • We offer our people the opportunity to move ahead more rapidly than is possible at most other places. Advancement depends on merit and we have yet to find the limits to the responsibility our best people are able to assume. For us to be successful, our men and women must reflect the diversity of the communities and cultures in which we operate. That means we must attract, retain and motivate people from many backgrounds and perspectives. Being diverse is not optional; it is what we must be.
  • We stress teamwork in everything we do. While individual creativity is always encouraged, we have found that team effort often produces the best results. We have no room for those who put their personal interests ahead of the interests of the firm and its clients.
  • The dedication of our people to the firm and the intense effort they give their jobs are greater than one finds in most other organizations. We think that this is an important part of our success.
  • We consider our size an asset that we try hard to preserve. We want to be big enough to undertake the largest project that any of our clients could contemplate, yet small enough to maintain the loyalty, the intimacy and the esprit de corps that we all treasure and that contribute greatly to our success.
  • We constantly strive to anticipate the rapidly changing needs of our clients and to develop new services to meet those needs. We know that the world of finance will not stand still and that complacency can lead to extinction.
  • We regularly receive confidential information as part of our normal client relationships. To breach a confidence or to use confidential information improperly or carelessly would be unthinkable.
  • Our business is highly competitive, and we aggressively seek to expand our client relationships. However, we must always be fair competitors and must never denigrate other firms.
  • Integrity and honesty are at the heart of our business. We expect our people to maintain high ethical standards in everything they do, both in their work for the firm and in their personal lives” [2]

When compared to the ethics inherent in the modernist educational system these 14 business principles share very little with a culturally interdependent worldview promoted through our general education in primary and secondary schools, and for that matter reputable Colleges and Universities, where the virtues of care and compassion together with ideals valuing inquiring, knowledgeable and caring young people are considered central to the advancement of humankind.

Values inherent within General Education Goldman Sachs Group Core Values based on 14 Business Principles
  • Character Formation of Youth
  • Inquisitive, Knowledgeable Caring Youth
  • Create a better , peaceful World
  • Intercultural understanding and respect
  • Compassionate Learners
  • Unity through diversity

 

  • Service through self interest
  • People are assets
  • Profit over people
  • Uncompromising corporate ethic
  • Unchanging and inflexible “the old way may be the better way”
  • Meritocracy and Group ‘think’ ethos
  • Individuality is spurned
  • Loyalty to corporate culture
  • Limited vision: Finance is the world
  • Conflicting ethics : aggressive integrity and honesty
  • Integrate corporate values into personal life

 

When the inherent assumptions and values of the banking sector, which seem to include corrupt, and questionable (some would argue illegal) business practices, aggressive competitiveness, corporate conformity and youth as cultural capital, are juxtaposed with the values and principles of a sound rational primary and secondary education, one begins to see how these ideals and values are able to be corrupted, compromised and undermined at the end of a young person’s formative years in the educational system.

In taking the moral high ground in their mission statement and set of business principles, Goldman Sachs may well claim that such actions of which they have been accused of several times in the past 15 years, are “unthinkable”; yet clearly in the exceedingly competitive world of corporate power and commercial finance, are permissible if you don’t get caught. The recent SEC findings confirm this viewpoint. While this may sound harsh and somewhat judgmental, one needs to consider that Goldman Sachs, along with the majority of the banking sector are corporate organizations which on the one hand deal in the high risk, high stakes financial trading, where values of vociferous competitiveness, absolute corporate power, unbridled wealth and success at what ever cost, outweighing any values of cooperation, compassion, justice and the equitable sharing of our material resources. Cleverly, Goldman Sachs corporate actions are masked by their philanthropic wing which is seen through the public gaze as promoting and even fostering values associated with excellence in education and a successful career at the end of a college and/or University education. I would assert that it is only in a system of schooling, and a world of work where our lives are able to be compartmentalized, that such pathways to success can be validated morally, socially and politically. There seems little hope for positive, ethical change in the long term.

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