Former WorldCom CEO Bernie Ebbers was sentenced today for his leadership of an accounting scandal that involved $11 billion.
Read the timeline of the WorldCom bankruptcy, the largest in the history of American business.
Just for fun, here is the mugshot of Bernie Ebbers when he was arrested in 2003.
This news came as a great relief to me as a lover of freedom and justice and a sometimes apologist for the idea of a capitalist system. Ebbers got exactly what he deserves and I daresay that he should be responsible for every penny of the $2.2 billion that he cost investors with his lies and high-flying lifestyle.
But wait, Will, you said that you are a capitalist? Isn't this sort of thing part of the corrupt capitalist system and further proof of the questionable value of our economic system?
No, not really. The case of Ebbers shows that fraud and deception have no place in the market and furthermore why there is a role for government.
Allow me to explain. The economy should be free, open and clear; it should be a space where individuals and their organizations compete for the best prices and the best quality so that all may benefit. This is how it should normally work. When the dishonest enter the market, such as Bernie Ebbers, and desires to countermand the orderly functioning of the market, the whole system is in jeopardy. This is when other participants must appeal to another body for redress of their grievances and losses.
These dishonest people desire to coerce and force others with their false information and lies into bad decisions and misinformed actions. Ebbers and his ilk have no place in an honest and open system of economic competition. Fraud dissolves confidence in the system and the WorldCom situation is a prime example of this.
Can people ever be confident again? With information and measured risk, I think so. All must be careful as there are risks in all behavior, especially the market.
No risk no return...true, but people must be assured that these risks are reasonable and not based on fraud and lies.
"Check the Box Sunday"
5 weeks ago