Watergate, Monica Lewinsky, ABSCAM, Jack Abramoff, Iran Contra, Keating Five, Rod Blagojevich, Elliot Spitzer...Don Siegelman, Richard Scrushy, Bill Blount and Larry Langford.
Is there any question why many citizens have lost faith in the American political leadership? And that is only a glimpse of U.S. politics, unfortunately private industry and international leadership are even more scandalous.
So, why should we really care? Isn't this just good news foder for TMZ? Not if you ask anyone currently looking for a job or that is a victim of crime or simply anyone that tries to do things the right way for that matter. Furthermore, we should care because these are our leaders and they are supposed to exemplify the best we have to offer, not act like a common street thugs just looking for a score.
Empirically speaking, the results of this behavior leads to all manner of negative public effects, including but not limited to: higher transaction costs, undercut free market competition, hampered overall systemic efficiency, inefficient allocation of resources and a general sapping confidence in the political system which leads to higher risks and thus increases required potential returns for an enterprise to be viable.
Ok, so maybe it hampers the economy a bit...still so what? It's more than a bit, according to the University of Connecticut the economic impact of political corruption is significantly greater than that of the tax environment. So, we can cut taxes, provide incentives, etc., but it still won't overcome the negative impacts if our elected officials aren't following the rules.
And that is just the economic risk...Michael Spencer speaking at TED 2010 warned of the social and medical dangers caused by a lack of confidence in our leadership. (See: "The danger of science denial" Feb 2010)
If you are beginning to be convinced that ethics are important you may be asking how we begin to solve this issue and increase the likelihood that our public officials will act honorably.
If so, check back next week for Part 2.
