The proverb isn’t about crows. Crows are a metaphor for bad guys. And
the upshot is this: we may judge different cultures for their failings,
but we have failings too. We all have our crows. Everywhere they are
black.
This idea of equanimity in how we are all flawed came to mind as the
scandal escalates over banks hiring people connected to China’s
political and powerful elite. We tend to look at these transgressions —
if they can be called that — and pass judgment. Perhaps we say “look at
the awful Chinese political system,” or “look at the terrible behavior
of U.S. banks.”
In case you missed it, or are a little fuzzy on the details, several
foreign banks are being investigated for hiring well-connected Chinese,
or “princelings.” They may be the son, daughter cousin of an official or
the official him- or herself.
On Monday, UBS AG suspended
two executives, including its top IPO banker in Asia, in an internal
probe into the hiring of an employee related to the head of a Chinese
listing hopeful, according to the Wall Street Journal, which cited
anonymous sources. UBS declined comment.
And the same day came revelations that the family friend of an important
Chinese regulator — who had say over the bank’s ability to pursue
insurance business in the country — was given an audience
with J.P. Morgan Chase & Co.
CEO Jamie Dimon in June 2012. The friend reportedly received a special
internship with the bank and then became a full-time employee.
“Our CEO played no role in the hiring decision, did not weigh in, and
did not follow up,” Joseph Evangelisti, a bank spokesman, said in a
statement. “It is his normal practice to pass on referrals without
advice to those involved in hiring.”
The dust-ups at UBS and J.P. Morgan were just the latest in the saga
where U.S. financial firms may or may not have used hiring friends or
relatives of powerful officials as a way of influencing business
decisions in the banks favor.
OK. Let’s assume they did. So what? This is how business is done in China. And it’s not that different from
how it’s done here, even though many of us believe our way is the
superior way.
China is struggling with corruption. It ranks 80th out of 178 countries in Transparency International’s Corruptions Perceptions Index
. It is, perhaps, the country’s most pressing problem as it seeks to become the leading global economic power.
In the same index the U.S. rank is 19th. Maybe it shouldn’t be. After all, this is a perception index. People
think the US is more on the up and up.
In the United States, financial firms use an equally questionable
practice of hiring regulators or losing top executives to regulatory
roles.
Consider also that 127 current or former members of the health,
education and labor committees in Congress either have worked, or are
now working, in the industries they were overseeing as lawmakers,
according to
OpenSecrets.org.
The SEC and Congress aren’t the only places where the revolving door
swings. Robert Rubin, the former U.S. Treasury Secretary, joined Citigroup Inc. in 2000 and collected $115 million as the bank took $45 billion in
taxpayer-funded bailouts and $300 billion in guarantees on assets. The
most recent former Treasury secretary, Timothy Geithner, left to join the private equity firm Warburg Pincus. as new rules were being crafted
on the industry.
At least China and Europe are doing something about their issues. A report
in 2010 by the Anti-Corruption and Governance Research Center at
Tsinghua University found that in just 11 months of that year the
government’s anti-corruption division investigated 119,000 graft cases,
resulting in 113,000 people being punished.
Recently the EU Commission came out with an "Anti-Corruption Report", which showed that corruption is widespread in the EU and costs the taxpayer there around
120 billion euros ($160 billion) per year.
Just because US crows are ours, doesn’t mean they’re not black, just as they are all around the world.
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