Thursday, September 17, 2015

Greed is not good

In the 1987 movie “Wall Street” Gordon Gekko, played by Michael Douglas, says in a speech, “The point is, ladies and gentleman, that greed -- for lack of a better word -- is good.” He goes on to say how greed is a key motivator in business and in life.

Sorry Gordon, greed is not good. The word “greed” implies excessive desire for money, and often the motivation to accumulate wealth by less than honest means. It implies you gain at the expense of others.

Greed has been with us since the beginning of time. When it’s mentioned in the Bible, it is usually among a list of sinful behaviors. For example, Jesus says in Mark 7:21-23:
“For from within, out of men’s hearts, come evil thoughts, sexual immorality, theft, murder, adultery, greed, malice, deceit, lewdness, envy, slander, arrogance and folly. All these evils come from inside and make a man ‘unclean.’” (NIV)

Jesus suggests we get our priorities straight in Luke 12:15:
Then [Jesus] said to them, “Watch out! Be on your guard against all kinds of greed; a man’s life does not consist in the abundance of his possessions.” (NIV)

We are seeing greed today with the increasing gap between the income of management and the income of the workers. The workers are facing increasing costs of benefits (if they even get any) with minimal (if any) increases in their income. Meanwhile, CEOs and other top management get huge bonuses (in addition to obscene salaries and perks) for saving the company money. Such a growing disparity between “rich and poor” is dangerous, meaning it could result in social unrest. Just as bad treatment of the workers led to the union movement over a century ago, there could be some sort of movement resulting from today’s situation.

I just read an article that stated that companies aren’t doing all they could to prevent data from being stolen by hackers. Why? It costs companies less to clean up after a hack than to invest in better systems and encryption. They don’t care that the costs to the public – economic and emotional – is large and somewhat preventable. Companies are too focused on the bottom line and not being responsible citizens.

Another big area where greed is at work is in the pharmaceutical industry. Recently the drug companies have been raising prices on many medicines, including ones that have been around for a while, with no apparent justification. Even the generic drug manufacturers are raising their prices. These are no small increases, but very large ones.

Cost of manufacturing hasn’t grown, so why are these companies raising prices? What is motivating them is nothing more than greed as far as I can tell. What’s infuriating is that these huge increases impact the elderly and those with chronic conditions, the most vulnerable in society. So what happens to these people as a result of the pharmaceutical industry’s greed? They do without drugs they need, the skip doses, they don’t have a good quality of life because they can’t afford decent food, housing, or entertainment.

What’s going to happen as a result of these price increases? Eventually people are going to rebel and Congress will have to act. The result might be price controls or some other government plan to bring prices more in line with reality. I would hate to see this happen, because government interference could stifle research. But what’s the alternative?

If the pharmaceutical executives are smart (which is questionable), they’ll roll back prices to more reasonable levels before the government makes them do it. These ridiculously high prices, even by generic manufacturers, are immoral, unethical, and socially unacceptable. Things must change to make them accountable for their pricing and less greedy.

This goes for other industries, governmental agencies, and quasi-governmental agencies. I’m thinking of the MTA and the Port Authority of NY & NJ (which controls the bridges and tunnels in NYC) I’m thinking of colleges and universities, whose cost increases are beyond obscene. If we want to avoid a marketplace that is loaded with governmental controls, industries had better reduce prices and look out for the benefit of their employees and their customers.