Monday, January 19, 2009

Who made off with what where?

Back tot he Wedgewood story. £415 millions of debt. I don't know how companies could be allowed to run on such a level of debt. To my simple mind (dare I stress), it is not ethical. Because if the company goes under -- as Wedgewood has -- then the employees are the ones who suffer.

Not too many years ago I remember fuming in the same way when a particular manufacturing company in Singapore laid off hundreds of workers -- mainly women, mothers wanting to improve their children's lives -- because their orders were down.

This same company, as I remember, went all out to recruit these women when the going was good. As soon as there was a downturn, the women were laid off. Few benefits to talk about. In fact it was such 'flexibility' with hiring and firing that attracted such 'investors' into Singapore then.

Such employers do not realize, or worse, do not care, that mothers make a lot of sacrifices to work in factories like that. Yes, they gain in earning some wages, but the trade-offs are many, too. They need to make many arrangements for childcare in order to work, to earn a pittance.

But of course there are no rules to prevent corporations from trading on a deficit. To many people, this is good accounting: you make profit on borrowed money. IF you made a profit, that is.

We have seen in the last decade or so it has been much easier for corporations to borrow because credit was so readily available instead of improving their cash flow. Once the credit rug was pulled away we see companies tripping over, collapsing everywhere.

And the employees and their families are the ones who suffer the most.

Then we have the likes of Bernard Madoff. $50 BILLION fraud. How many mountains would this amount of money make in cash? I wonder.

Where has this money gone?

What drives such a person to commit a crime like that?

Why aren't rich people able to say 'enough'?

My husband holds the view that money was not the incentive; it was the thrill of getting away with it.

We have been borrowing (sheet) music from the local library because my son wants to play certain tunes (first 'Stranger on the Shore' and his current favourite is 'Chariots of Fire'). The music clearly states: DO NOT PHOTOCOPY.

So we do not photocopy.

He asks why we should not be allowed to photocopy. So it was a lesson on copyright, royalties and intellectual property.

"If one day you wrote a fabulous piece of music, would you like people to photocopy your music instead of paying you the royalty for every copy sold?"

As he is likely to write a great piece of music (ahem, so says proud mother), my son understood immediately the ethics of 'doing to others ....'.

Would business and industry be a much more ethical place if only the likes of Madoff were to consider the real impact on real people in the event of a real financial disaster? Profits to some people might be just the colour of ink on the bottomline. To the people who actually prop up the system, it is a livelihood. their liveliood.

What is so difficult about real people that such people in their plush offices find so difficult to comprehend?

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