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opinion | Dan Payne

The scandal double standard

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We’re about to start fresh on Beacon Hill; so far, no one’s gone to jail or even been indicted. But the moment any public official steps out of line, a ton of brickbats will fall on the entire population of public officials. The news media and blogs enjoy excoriating all politicians — both locally and nationally — for the sins of a few. This promotes widespread contempt for the entire public sector.

People say, “Why can’t politicians be more like business leaders?’’ Of course, CEOs also misbehave. They get punished, fired, and imprisoned, but no one says “all these business guys are crooks,” as they do of all politicians. There’s a double standard.

Private misconduct is private. Nepotism, cronyism, and patronage are treated by the news media as capital crimes if committed by government officials; yet in business, these actions occur every day, usually without publicity. In the private sector, misbehavior is, well, private. Beating your competition, even deviously, is considered smart business. Supposedly the only ones hurt by corporate misdeeds are shareholders, employees, and competitors. Isn’t it possible that bad business behavior is also bad for the public? Judging from the reaction to Market Basket, a lot of people think so.

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Chump change. The sins of highly publicized local politicians are relatively minor. Former House Speaker Sal DiMasi took a measly $65,000; Dianne Wilkerson was vilified for accepting payments worth a paltry $23,500. These were chump change compared to other criminal politicians and CEOs. Bob McDonnell, former GOP Virginia governor, was convicted for accepting $177,000 in gifts, trips and sweetheart loans.

Businesspeople know how to steal. Bernie Madoff made off with $65 billion. Ken Lay of Enron stole $11 billion. Bernard Ebbers of World Com got 25 years for accounting fraud worth $11 billion. Tyco Tycoon Dennis Kozlowski was convicted of taking $81 million in unauthorized bonuses, buying art for $14.725 million, not to mention $6,000 shower curtains and $15,000 “dog umbrella stands.”

And then there is Dov Charney, founder of American Apparel, who allegedly imprisoned an employee in his home as a sex slave, but was allowed to remain as a consultant with the firm until recently. Global investment bank Natixis had to pay $1.5 million to a former executive who said she was sexually harassed by CEO John Hailer and fired shortly after rejecting his vulgar advances. CEO Barry Cadden made $62 million before taking a perp walk in Boston after the New England Compounding Center produced contaminated drugs that killed 64 people and gave 687 others meningitis. Are all clothing makers or bankers perverts? Are all pharmacists homicidal crooks?

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The Grimm reaper. While corporate miscreants can hang on forever, not so politicians. Congressman Michael Grimm just admitted to felonious tax fraud involving $1 million. He said he wouldn’t step down. Speaker John Boehner forced him out.

Modern Family. Nepotism in government is illegal. In business it’s normal. The Koch family, the Waltons of Arkansas, and the Johnsons of Boston, have gained vast sums of wealth through their parents’ and grandparents’ companies. Abigail Johnson, worth an estimated $14 billion, was recently named president of Fidelity Investments, succeeding her father as the head of the firm founded by her grandfather.

Why are pols vilified and CEOs aren’t? Because we know them in ways we don’t know corporate CEOs. Transparency is expected in government; in business secrecy (a.k.a. confidentiality) is protected. Moreover, state and local politicians don’t have armies of public relations people and lawyers to deflect, reject, stonewall, shift blame, or flat-out deny charges of mischief.

Governor Charlie Baker will soon discover that being the chief executive of a major insurance company is easier than governing a major state. For “saving” Harvard Pilgrim, he tripled his own salary to $1.7 million. If he closes the $1 billion state deficit, without raising taxes, (a miracle), he’ll be lucky to get a thank you.

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Related:

Scot Lehigh: Political rebounds for the scandal-inclined


Dan Payne is a Boston-based media consultant who has worked for Democratic candidates around the country and did political analysis for WBUR radio.