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Big investment bankers have no shame 

A few years ago, author/professor Max Childers and I were talking and bemoaning the state of the world, when he said, "There's just no sense of shame in this country anymore." What did he mean exactly, I asked. "Well, just taking responsibility, and when you do something bad and realize it, you feel bad about it — maybe even try to make up for it. Now, though, you're lucky if somebody who's done something terrible even admits they did anything, much less feel ashamed."

That conversation has run through my mind a few times in the past year or so, mostly in connection with Charlotte and big banks. Max's view, after all, covers those who bring misfortune to those who've trusted their judgment. An example would be, oh, say, investment bankers piling misfortunes onto the heads of Americans nationwide.

This city, along with the rest of the nation, is hurting, really hurting -- I don't have to tell you. "Hurt" seems too mild a word in these circumstances, but that hurt -- in the form of a nearly collapsed economy, dried up credit, the vanishing, overnight, of an amount of money equal to an entire year's Gross Domestic Product, and, of course, the resultant loss of jobs and homes -- is largely the result of an inconceivable, mind-numbing level of irresponsibility and greed on the part of big banks. In other words, the culprit most deserving of blame for the mess we're in happens to be the very industry that, for decades, has been Charlotte's bread and butter and, to many, its pride and joy.

Somehow, though, we're not hearing anything resembling a public apology from the high-flyers Uptown. Oh, there's the occasional admission of "mistakes" and there's the shuffling of suits from one office to the next, or even out the door. And there's the pocket change thrown toward the charities that are now left to pick up the bankers' big fat mess. But there's no real sense that the big banks' honchos think they owe the city and its inhabitants anything more.

The idea that Bank of America or the little part of Wells Fargo formerly known as Wachovia should evince shame and even ask for forgiveness no doubt sounds odd in a corporate stronghold such as Charlotte, but in some cultures, public remorse is a tradition. For example, in Japan, admitting to a shameful act is a necessary first step toward reconciliation; it's called having a sense of common, shared responsibility. Just think of the CEO of Toyota, who has recently apologized and groveled so profusely for his company's problems, he seemed ready at times to commit hara-kiri on camera. Granted, America is a completely different culture, but the likes of Ken Lewis & Co. should take a page out of Japan's book. After all, they have a lot to be ashamed of.

There's no interest in remorse in the big banks' boardrooms, however. In fact, these guys are still at it. In Europe, Goldman Sachs is at the center of the Greek economic debacle, in which the bank helped Greece hide the real depths of its debt (and seriously weaken the continent's overall economy) via cross currency swaps -- similar to some of the "complex financial deals" that blew up in Wall Street's face and put America in the economic toilet. In the U.S., taxpayers bailed out the banking pirates, who thanked us by jacking up interest rates and fees for their credit card customers. Gotta make up for that lost revenue somehow, right? On top of that, now that they've had their butts pulled out of the fire by you and me, some big investment concerns are going back to the same kind of "bundling" and unfathomably complex "derivatives" that triggered the mess we're in. Like I said, these guys have a lot to feel shame about, if they were only capable of it.

Regular Charlotteans don't have anything to be ashamed of in all this, and that goes for those who worked for Wachovia and Bank of America but were unconnected to the high-risk deals made by others. We should, though, all probably feel foolish to have fallen for the "good corporate citizen" image the city's two big banks once projected. In the 1990s, while BofA, under Hugh McColl's leadership, was helping revitalize the city's Uptown, the bank CEO, along with other big-bank cohorts, was also lobbying Congress to repeal part of the Glass-Steagall Act of 1933. Hugh and friends were successful, which meant that commercial banks -- the ones who actually helped build this city -- could now also operate as investment banks (or insurance companies, if they feel like it). Within nine years, they'd wrecked their own playhouses.

So, back to shame. It's an old-fashioned concept, I know, but one that's ripe for revival, starting with the financial industry. Will it ever happen? I really doubt it. Look into the eyes of folks like Ken Lewis or former Merrill Lynch CEO John Thain, and it's hard to see how a little shame could fit into such big piles of hubris. And considering how long it's been since we woke up in September '08 to find the floor moving under us, who knows how many people would even believe their apologies anyway?

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