For the week of July 3 - 9, 2002

America’s homegrown economic ‘terrorists’

Commentary by PAT MURPHY

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Remember the principal objective in Osama bin Laden’s Al Qaeda terrorism manifesto?

He said he would inflict economic havoc on the United States.

He did his devastating best with airborne attacks on New York and Washington nine and a half months ago. Preliminary costs already are in the hundreds of billions of dollars — rebuilding New York City’s World Trade Center; compensating victims’ families; lost business in the travel and lodging industry; stepped up homeland security safeguards; investigations, detentions and prosecutions; combined military operations in Afghanistan and elsewhere overseas.

But there also are homegrown economic "terrorists" in our midst who’re wreaking their own havoc — red-blooded, all-American, flag-waving, God-fearing, free enterprise-loving business CEOs who’ve rigged books of major corporations to fraudulently enrich themselves while robbing millions of American families who trusted them of their security and well being.

Last week’s crash of just one firm, WorldCom, second only to AT&T in the long-distance field, had a devastating impact on employee pension funds in the states of New York and California.

New York’s investment in WorldCom was more than $300 million. California was in for more than $500 million. That’s nearly one billion dollars invested in just one company from two state pension funds.

The bad news will get worse as other pensions funds report their losses.

Add to WorldCom’s crash the collapses of other major corporations (Tyco, Global Crossing, Enron, auditing giant Arthur Andersen, etc.), newly announced accounting irregularities at staid and generally respected Xerox, and an assortment of frauds, such as the $240 million fleecing of 13,000 investors in the Baptist Foundation of Arizona (another Arthur Andersen client).

Losses to investors, to tens of thousands of employees thrown out of work and their families and to pension funds are staggering— and together create a case study of economic havoc.

And the worst long range effect is immeasurable — lost confidence in Wall Street, cynicism about investment analysts, shaken faith in America’s business executive class, lost trust in auditing firms, and distrust of government’s oversight and enforcement organizations.

Through and through, men and women of raw avarice placed their personal greed for wealth above codes of honesty and loyalty to clients and employees and the nation.

But there’s more.

The economic chaos continues, in Washington, where President Bush and Democrats and Republicans in Congress in the space of a year have wiped out a robust budget surplus that could’ve covered the cost of the war on terrorism, plunged the nation back into deficit spending and been forced to raise the debt limit just to pay bills.

Washington’s political class seems to yawn at rampant marketplace fraud, theft, deceit and criminal conspiracies that make newspaper business pages read like police blotters, and dismiss higher government debt and plundering of the surplus.

Meanwhile, hundreds of them with an eye for cheap photo ops demonstrated mock outrage by gathering on Washington’s Capitol steps, trivializing a federal court’s adverse ruling with a mass recitation of the Pledge of Allegiance "under God."

Pathetic. They should be demonstrating for the scalps of corrupt CEOs pillaging the futures of tens of millions of Americans with callous, cruel, criminal conspiracies that surely resemble Osama bin Laden’s evil aims for economic sabotage.

 

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