Wednesday, July 7, 2021
“Set me free from the laziness that goes about disguised as activity when activity is not required of me, and from cowardice that does what is not demanded in order to escape sacrifice.” Thomas Merton, New Seeds of Contemplation (p. 47).
Countless people reminded me how lucky I was to have my first sabbatical this past spring semester.
And I acknowledge my good fortune, not only for the change of pace, but also for the break during a difficult year.
But there was something uncomfortable about this past semester. I missed the classroom. I missed my colleagues and students. I missed my office. I missed my office calendar with multiple defined events scheduled throughout the day. I even missed my commute and faculty meetings. I missed--believe it or not--busyness.
While I had an endless amount of research and childcare responsibilities last semester, I realized that this was likely the least scheduled I’ve been since early childhood. For the first time that I can remember, I wasn’t constantly thinking about the next thing on my calendar.
I have always been fairly future oriented, and I think legal training makes you even more focused on the future. Good lawyers, especially good transactional lawyers, see around the corner, predict possible problems, and address these issues in contracts. Good lawyers tend to be planners with a high capacity for time management.
Prior to my spring sabbatical, I felt like my mind was always about 15 minutes ahead of my body. I didn’t even really realize this until I slowed down some during the sabbatical. The sabbatical allowed me, for the first time in memory, to be fully present. This full presence only happened in spurts, and it was both glorious and terrifying.
In Leaving the Future Behind, an essay in The Art of Loading Brush, Wendell Berry reminds us that the present is the only time we are alive. Preoccupation with the future, fearful worries or even hopeful wishes, threaten to draw us out of the present. And the present is where both good work and good relationships exist.
Without a doubt, we must still make time for planning, but this sabbatical started teaching me to cabin that planning time and to live more in the present than in the future. In addition, making time for silence is something I hope to continue. (I spent a day of silence at a convent in Dickson, TN and became a bit more consistent with taking a few minutes of stillness in the early mornings). Regular observance of outward silence--which is quite difficult with 3 young children in the house--can help cultivate inner silence and can lead to the mental stillness needed to reside fully in the present.
Tuesday, June 8, 2021
Recently, I finished two similar books on problems with extreme meritocracy in the United States: The Tyranny of Merit by Harvard philosophy professor Michael Sandel and The Meritocracy Trap by Yale law professor Daniel Markovits. Law schools and entry level legal jobs tend to be intensely meritocratic. The more competitive entry level legal jobs rely very heavily on school rank and student class rank. Once in a private firm, billable hours seem to be the main metric for bonuses and making partner.
Sandel describes at least three problems with meritocracy: (1) people are not competing on an even playing field in the US "meritocracy" (e.g., children of top 1% in income are 77x more likely to attend an Ivy League school than children of bottom 20%); (2) even if there were an even playing field, natural talents that fit community preferences would lead to wild inequality in a pure meritocracy and those natural advantages are not “earned,” (3) a strict meritocracy leads to excessive hubris among the “winners” and shame among the “losers” who believe they deserve their place in society.
Markovits hits a lot of the same notes, but pays more attention to how the elite “exploit themselves” trying to keep themselves and their children in the shrinking upper class. While the $50,000/year competitive preschools Markovits describes are mostly limited to NYC and Silicon Valley now, the expenditures on the education and extracurriculars of children of the wealthy seems to be increasing exponentially everywhere. He also notes the lengthening work hours for the “elite” and the increasing percentage of wealth tied to labor. For example, Markovits points out that the ABA assumed that lawyers would bill 1300 hours a year in 1962 (and 1400 in 1977). As legal readers know, many firms now require 2000+ billable hours a year (which means working 2500+ hours in most cases).
Both Sandel and Markovits do a thorough job explaining the problems of meritocracy, but are fairly brief on proposed solutions. Sandel thinks meritocracy could be made more fair through elite schools eliminating SAT/ACT requirements (that tend to track family income), engaging in more aggressive class-based affirmative action, and using a lottery to admit baseline qualified students. He thinks the last suggestion would reduce the hubris of those admitted to elite schools, and acknowledge an element of luck in their selection. Sandel also suggests more government expenditures on training and retraining programs, as most economically advanced countries spend a much higher percentage of GDP on these programs (0.1% vs. 0.5% to 1.0%). He also suggests using the tax system to reward “productive labor” by, for example, “lower[ing] or even eliminat[ing] payroll taxes and rais[ing] revenue instead by taxing consumption, wealth, and financial transactions.” (218).
Markovits proposes that private schools should lose their tax-exempt status if at least half of their students do not come from the bottom two-thirds of the income distribution. Markovits also suggests promoting more mid-skill production; by, for example, reducing regulation to allow more work to be done by nurse practitioners (rather than doctors) and legal technicians (rather than lawyers.) He suggests uncapping payroll tax (so that the wealthy pay more of their share), introducing wage subsidies for middle class jobs, and raising the minimum wage.
As Ivy League professors, I think they overestimate the role of their schools in shaping the rest of the country, though they may be right about their influence among certain segments of the wealthy. And while their solutions are rather thin, I think they raise issues with meritocracy worth addressing. As Henri Nouwen acknowledged more than 50 years ago in his book Reaching Out, “people are in growing degree exposed to the contagious disease of loneliness in a world in which a competitive individualism [ a/k/a "meritocracy"] tries to reconcile itself with a culture that speaks about togetherness, unity, and community as the ideals to strive for.”
Tuesday, April 27, 2021
In a Bloomberg article about the tax perks of trillions of dollars in Environmental, Social, and Governance investing by Wall Street banks, tax specialist Bryen Alperin is quoted as saying: “ESG investing isn’t some kind of hippie-dippy movement. It’s good for business.”
This utilitarian approach to ESG, and social enterprise in general, has made me uncomfortable for a while. The whole “Doing Well by Doing Good” saying always struck me as problematic.
ESG and social enterprise are only needed when the decisions made are not likely to lead to the most financially profitable outcomes. Otherwise, it is just self-interested business.
Over my spring sabbatical, I have been reading a fair bit about spiritual disciplines and the one that is most relevant here is “Secrecy.” The discipline of secrecy is defined as “Consciously refraining from having our good deeds and qualities generally known, which, in turn, rightly disciplines our longing for recognition.” In The Spirit of the Disciplines, Dallas Willard (USC Philosophy) writes, “Secrecy at its best teaches love and humility…. and that love and humility encourages us to see our associates in the best possible light, even to the point of our hoping they will do better and appear better than us.”
As a professor with active social media accounts, the discipline of secrecy is not an easy one for me. But I do think it is a good aspiration for all of us. Not every good deed has to be kept in secret. There can be good reasons for broadcasting good deeds (for example, to encourage others.) However, regularly performing good deeds in secret can help us build selfless character.
Similarly, socially conscious businesses and investors should be focused on the broader good being done, not on the personal benefits. Granted, I don’t think investors can blindly trust the ESG funds or benefit corporations --- the screens are simply unreliable. Also, it may be difficult to determine which companies are really doing social good if they are practicing much of it in secret. But the truth has a tendency of leaking out over time and investors can focus on companies they see doing the right thing without excessive marketing.
As for the companies themselves, I remain optimistic that there are at least a few businesspeople who truly want to benefit society for mostly selfless reasons. Combatting selfishness is not easy, but the discipline of secrecy is one way to fight it.
Wednesday, April 14, 2021
On sabbatical, so this was a pretty good semester of reading (for me). 23 books and two online courses. A good bit about contemplation and religion with some philosophy and fiction. The Remains of the Day and A River Runs Through It were probably my two favorite, though the Merton and Willard books were meaningful too.
Private Government: How Employers Rule Our Lives (and Why We Don’t Talk About it) - Elizabeth Anderson (2017) (Philosophy). Tanner Lectures on Human Values at Princeton University. Four commenting essays by different professors follow, then Professor Anderson responds. Her main claim is that Adam Smith and others envisioned a free market with large amounts of self-employment. But powerful modern employers have become “unaccountable communist dictators” who use the rhetoric of freedom, but provide very little of it within their firms. Many employees have no “dignity, standing, or autonomy” in their firms and Anderson calls for more of an employee role in governance, perhaps along the German codetermination model.
Invitation to Solitude and Silence- Ruth Haley Barton (2004) (Religion). “We are starved for quiet, to hear the sound of sheer silence that is the presence of God himself.”
The Stranger - Albert Camus (1942) (Novel). Death, relationships, crime, and the absurd. “I opened myself to the gentle indifference of the world.”
The Shallows: What the Internet Is Doing to Our Brains - Nicholas Carr (2011) (Culture). Extending Marshall McLuhan’s Understanding Media (1964) and Neil Postman’s Amusing Ourselves to Death (1985) to the Internet. Since reading Postman’s book, I’ve been curious about what he would say about the Internet, and Carr attempts to do some of that work, looking especially at our diminished attention spans.
My Name is Hope - John Mark Comer (2011) (Religion). Faith, anxiety, and depression. A bit memoir and a bit self-help. Admits that he is not a doctor or a therapist, but posits that there are root situational or historic causes under most cases of anxiety and depression. Makes calls for attention to the mind/body connections, prayer and meditation, and transparency and forgiveness.
Garden City - John Mark Comer (2015) (Religion). Faith, work, and rest. “The American Dream...has devolved over the years into a narcissistic desire to make as much money as possible, in as little time as possible, with as little effort as possible, so that we can get off work and go do something else.”
Happy Money - Elizabeth Dunn and Michael Norton (2013) (Behavioral Science). Buy experiences, not stuff. Make it a treat, not daily indulgence. Savor. Buy time; outsource dreaded time-consuming tasks. Time affluence tied to greater happiness. Stay present. The slow movement. Buy now, consume later (“delaying consumption allows spenders to reap the pleasures of anticipation without the buzzkill of reality, vacations provide the most happiness before they occur.”) Invest in others; people who donate to charity report feeling wealthier.
The Happiness Hypothesis - Jonathan Haidt (2006) (Psychology). Happiness and meaning and positive psychology through the lens of ancient wisdom. Elephant (desire) and the rider (reason). Happiness = Set Point (Meditation, Cognitive Therapy, Prosac) + Living Conditions ($70K, commute, relationships) + Voluntary Activities (gratitude, building community, being useful).
The Remains of the Day - Kazuo Ishiguro (1988) (Novel). British butler ponders duty, dignity, family, love, bantering, and tradition on a few days of countryside driving and reminiscing.
How to Be an Antiracist - Ibram X. Kendi (2019) (Race). The expectations and comments of his teachers struck me. I have known about the powerful positive potential of our words as professors, but Kendi’s work reminds me that we can do great harm as well. Kendi writes “ I internalized my academic struggles as indicative of something wrong not just with my behavior but with Black behavior as a whole, since I represented the race, both in their eyes - or what I thought I saw in their eyes-and in my own.” He noted that “Black students who have at least one Black teacher in elementary school are 29 percent less likely to drop out of school.” He did a nice job showing problems with standardized testing, but did not have much in terms of detailed proposals in changing college admissions.
The Practice of the Presence of God - Brother Lawrence (1895) (Religion). “His only thought was about doing little things for the love of God, since he was not capable of doing great things. Afterward, whatever happened to him would be according to God’s will, so he was not at all worried about it.” “Our sufferings will always be sweeter and more pleasant when we are Him, and without Him, our greatest pleasure will be but a cruel torture.” “I would like to be able to persuade you that God is often nearer to us in our times of sickness and infirmity than when we enjoy perfect health.”
Abolition of Man - C.S. Lewis (1943) (Education). Short book on education, truth, the doctrine of objective value, recognizing our flaws (Lewis did not like being around small children). justice, and valor.
Extraterrestrial: The First Signs of Intelligent Life Beyond Earth- Avi Loeb (2021) (Space). Harvard astronomy professor discusses Oumaumua, an odd interstellar object, sighted for 11 days in October of 2017 and the possibility that we are not alone in the universe. He bemoans the closed mindedness of some academic disciplines and argues for humility (even as he brags a bit about his accomplishments).
A River Runs Through It - Norman Maclean (1989) (Novel). Family and fishing. Younger brother, troubled and beautiful. Supposedly first novel published by University of Chicago Press.
No Man is an Island- Thomas Merton (1955) (Religion). OK to be ordinary. “All things are at once good and imperfect. The goodness bears witness to the goodness of God. But the imperfection of all things reminds us to leave them in order to live in hope. They are themselves insufficient. We must go beyond them to Him in Whom they have their true being.” “Everything in modern city life is calculated to keep man from entering into himself and thinking about spiritual things. Even with the best of intentions a spiritual man finds himself exhausted and deadened and debased by the constant noise of machines and loudspeakers, the dead air and the glaring lights of offices and shops, the everlasting suggestions of advertising and propaganda.” (108-09). “The cornerstone of all asceticism is humility.” (113). “A [person] who is not at peace with himself projects his interior fighting into the society of those he lives with, and spreads a contagion of conflict all around him….In order to settle down in the quiet of our own being we must learn to be detached from the results of our own activity. We must withdraw ourselves, to some extent, from effects that are beyond our control and be content with the good will and the work that are the quiet expression of our inner life...Our Christian identity is, in fact, a great one; but we cannot achieve greatness unless we lose all interest in being great.”
New Seeds of Contemplation- Thomas Merton (1964) (Religion). "There is no true peace possible for the man who still imagines that some accident of talent or grace or virtue segregates him from other men and places him above them" “Hate in any form is self-destructive, and even when it triumphs physically it triumphs in its own spiritual ruin.” “Hurry ruins saints as well as artists.” “If we were incapable of humility we would be incapable of joy, because humility alone can destroy the self-centeredness that makes joy impossible.” “A humble man can do great things with an uncommon perfection because he is no longer concerned about incidentals, like his own interests and his own reputation, and therefore he no longer needs to waste his efforts in defending them.”
In the Name of Jesus - Henri Nouwen (1989) (Religion). From Harvard to working with people with mental challenges at L’Arche. Brought Bill with him to talk to aspiring ministers in Washington D.C. - “we did it together.”
Can You Drink the Cup? - Henri Nouwen (1996) (Religion). “Joys are hidden in sorrow.” "We want to drink our cup together and thus celebrate the truth that the wounds of our individual lives, which seem intolerable when lived alone, become sources of healing when we live them as part of a fellowship of mutual care.”
The Tyranny of Merit - Michael Sandel (2020) (Philosophy). Even if we had a level playing field, the talented would win and talent is not deserved or earned. A bit short on solutions, but suggests a lower bar for elite college admissions and then lottery to select who goes. Thinks this would inject a bit of humility into the process and dispel that elite college admissions is earned by the individual.
The Ethics of Authenticity - Charles Taylor (1991) (Philosophy). Searches for a nuanced view of authenticity--exploring subjectivism, narcissism, apathy, horizons of significance, dialogue, and social traditions. (Lectures entitled “Malaise of Modernity”)
The Spirit of the Disciplines - Dallas Willard (1988) (Religion). Disciplines of Abstinence (solitude, silence, fasting, frugality, chastity, secrecy, sacrifice). Disciplines of Engagement (study, worship, celebration, service, prayer, fellowship, confession, submission).
The Great Omission - Dallas Willard (2014) (Religion). The great commission is not just about conversions, but about making *disciples* of all kinds of people.
Called to Business - Dallas Willard (2019) (Religion) Extremely short book. A few articles on faith and work; serving others while making a living.
The Promise Podcast (2020) - ~5 hours. Season 2. East Nashville public schools, diversity, wealth, and school choice.
Sunday, December 20, 2020
In my first post on the "Study on Directors' Duties and Sustainable Corporate Governance" ("Study on Directors' Duties") prepared by Ernst & Young for the European Commission, I said that corporate boards are free to apply a purposive approach to profit generation. I added that:
[a]pplying such a purposive approach will depend on moral leadership, CEOs' and corporate boards' long-term vision, clear measurement of the companies' interests and communication of those interests to shareholders, and rethinking executive compensation to encourage board members to take on other priorities than shareholder value maximization. Corporate governance has a significant transformative role to play in this context.
This week, I focus on corporate governance’s enabling power. Therefore, “T” is for transformative corporate governance. Market-led developments can and do precede and inspire legal rules. Corporate governance rules are not an exception in this regard. To illustrate these rules’ transformative potential, I dwell on the ongoing debate around stakeholder capitalism.
First question. What is stakeholder capitalism? In a recent debate with Lucian Bebchuk about the topic, Alex Edmans explained that “stakeholder capitalism seeks to create shareholder welfare only through creating stakeholder welfare.” The definition suggests that the way to create value for both shareholders and stakeholders alike is by increasing the size of the pie.
In his book, Strategic Management: A Stakeholder Approach, R. Edward Freeman defines “stakeholder” as “any group or individual who can affect or is affected by the achievement of the organisation’s objectives.” (1984: p. 46). The Study on Directors’ Duties is concerned with the negative impact of corporate short-termism on stakeholders such as the environment, the society, the economy, and the extent to which corporate short-termism may impair the protection of human rights and the attainment of the sustainable development goals (SDGs). I am not going to discuss whether there is a causal link between short-termism and sustainability. In my previous post, I say that we need to take a step back to determine short-termism and whether it is as harmful as it sounds. Instead, I am interested in finding an answer to the following question. Has stakeholder capitalism practical value?
Edmans points out that “in a world of uncertainty, stakeholder capitalism is practically more useful.” It is more challenging to put a tag on various things in a world of uncertainty, and the market misvalues intangibles. Therefore, in this context, stakeholder capitalism would be a better decisional tool that improves shareholder value and profitability and shareholders' welfare.
Still, how do we measure CEO’s and directors’ accountability toward shareholders and the corporation for the choices they make? Can CEOs and directors be blamed for not caring about social causes? Is stakeholder capitalism, or as Lucian Bebchuk calls it “stakeholderism,” the right way to force managers to make the right decisions for the shareholders and the corporation?
While Edmans stays firmly behind stakeholder capitalism because he considers it has practical value in increasing shareholder wealth while increasing shareholders’ welfare, Bebchuk maintains that “stakeholderism” is “illusory” and costly both for shareholders and stakeholders. Clearly, they disagree.
However, both Edmans and Bebchuk agree on this – we need a normative framework that goes beyond private ordering and prevents companies from subjecting stakeholders to externalities such as climate change, inequality, poverty, and other adverse economic effects.
Corporate managers respond to incentives such as executive compensation, financial reporting, and shareholders' ownership. The challenge is to understand what type of corporate governance rules are more likely to nudge CEOs and managers to value other interests than shareholder wealth maximization. Would a set of principles suffice, or do we need a regulatory framework?
Freeman's definition of a stakeholder is telling because it allows us to think of corporations and governments as stakeholders for sustainable development. I am also inspired by the distinction that Yves Fassin makes in his article The Stakeholder Model Refined, between stakeholders (e.g., consumers), stakewatchers (e.g., non-governmental organizations) and stakekeepers (e.g., regulators). I suggest that the way to ensure stakeholder capitalism’s practical value is to create corporate governance rules based on appropriate standards. The SDGs afford the propriety of those standards.
Within this regulatory setting, corporate governance will fulfill its transformative potential by enabling, for example, the representation and protection of stakeholders, the representation of “stakewatchers” through the attribution of voting and veto rights and nomination to the management board (similar to German co-determination by which stakeholders like employees are appointed to the supervisory board). Corporate governance will show its transformative potential by enabling the expansion of directors' fiduciary duties to include the protection of stakeholders’ interests, accountability of corporate managers, consultation rights, and additional disclosure requirements.
The authors Onyeka K. Osuji and Ugochi C. Amajuoyi contributed an interesting piece, titled Sustainable Consumption, Consumer Protection and Sustainable Development: Unbundling Institutional Septet for Developing Economies to the book Corporate Social Responsibility in Developing and Emerging Markets: Institutions, Actors and Sustainable Development. The book was edited by Onyeka K. Osuji, Franklin N. Ngwu, and Dima Jamali. The piece addresses the stakeholder model from the emerging economies perspective. It goes to show how interconnected we are.
Monday, November 16, 2020
Despite a pretty busy and different semester, I managed to read a decent bit. Some of this is because of our neighborhood book club and some is from an emerging habit of reading a bit before bed.
Kwame Anthony Appiah - Cosmopolitanism: Ethics in a World of Strangers (2006) (Philosophy). Author in philosophy professor at NYU. Mother is English; father from Ghana. Tolerance and plurality. “Citizens of the World.”
Compassion (&) Conviction - Chris Butler, Justin Giboney, and Michael Wear (2020) (Religion, Politics). Advocates for Christian engagement with politics that transcends party.
Gooseberries - Anton Chekhov (1898) (Fiction, Short Story). “Think of the people who go to the market for food: during the day they eat; at night they sleep, talk nonsense, marry, grow old, piously follow their dead to the cemetery; one never sees or hears those who suffer, and all the horror of life goes on somewhere behind the scenes. Everything is quiet, peaceful, and against it all there is only the silent protest of statistics; so many go mad, so many gallons are drunk, so many children die of starvation. . . . And such a state of things is obviously what we want; apparently a happy man only feels so because the unhappy bear their burden in silence, but for which happiness would be impossible. It is a general hypnosis. Every happy man should have some one with a little hammer at his door to knock and remind him that there are unhappy people, and that, however happy he may be, life will sooner or later show its claws, and some misfortune will befall him illness, poverty, loss, and then no one will see or hear him, just as he now neither sees nor hears others. But there is no man with a hammer, and the happy go on living, just a little fluttered with the petty cares of every day, like an aspen tree in the wind and everything is all right.” Some thoughts on this story and conceptions of happiness by George Saunders. (Both recommended to me by my youngest sister.)
Your Money Made Simple - Russ Crosson (Finance) (2019). Financial planning from a Christian perspective. “Spend less than you make and do it for a long time” -- reminds me of the classic Steve Martin skit “Don’t Buy Stuff”. Liked the formula to work backwards to minimum income needs. ((Living Expenses+Debt)/(1-(Giving %+Effective Tax Rate)). Budgeting non-monthly expenses has always been tough for us, but there are some nice rules of thumb here, like 1.5-2% of home value per year for home repair and maintenance. The suggestion to make gifts is one I want to take up (though I need to develop talent first!). Challenges the retirement savings first mentality and emphasis on giving.
Siddhartha - Hermann Hesse (Novel) (1992). Journey to find true self. Metaphor of the river. Learn from vastly different circumstances. Poverty and wealth. Another of our book club books.
Living an Examined Life - James Hollis (Psychology/Self-Help) (2018). Weak book. Read for our book club; we alternate choosing books. My objections include: (1) his condescending tone throughout (“all thoughtful people think….”), (2) the odd genre of the book (it was a flawed mix of self-help and academic psychology. Hollis somehow managed to get the weaknesses of both forms without the strengths); (3) his stereotypes of religion (Christians as either fundamentalists or prosperity gospel peddlers. In reality, there are huge groups that are neither); (4) his incomplete suggestions (confronting your interior self is a fine thing to do, but to what end?); (5) his lack of discussion of community as important (the focus was on the individual and discovering who you are; seemed narcissistic).
All the Pretty Horses - Cormac McCarthy (Novel) (1992). Coming of age story. Beautifully rendered.
1984 - George Orwell (Novel) (1949). Dystopia. Big Brother is watching. Re-read for book club.
Let Your Life Speak: Listening for the Voice of Vocation - Parker Palmer (2000) (Psychology/Self-Help). Hits similar notes to Dr. Hollis above, but Palmer displays endearing humility. Also for book club.
What Money Can’t Buy: The Moral Limits of Markets - Michael Sandel (Moral Philosophy) (2012). Can’t buy friendship, love, virtue, rights. Markets actually degrade these things.
One World: The Ethics of Globalization - Peter Singer (Moral Philosophy) (2002). Moral considerations and obligations in a shrinking world. Spends significant time of climate change, foreign aid, trade, and human rights.
The Life You Can Save - Peter Singer (Moral Philosophy) (2009). Available for free at the link. “Most of us are absolutely certain that we wouldn’t hesitate to save a drowning child, and that we would do it at considerable cost to ourselves. Yet while thousands of children die each day, we spend money on things we take for granted and would hardly notice if they were not there.” (12) Reflection here. Survive v. thrive.
The Death of Ivan Ilyich - Leo Tolstoy (Short Story) (1886). A reflection on dying, and its implications for life. Materialism and self-centeredness. Emptiness in de-prioritizing selfless relationships.
Wednesday, September 30, 2020
This Friday, Professor Art Wilmarth’s new book, Taming the Megabanks: Why We Need a New Glass-Steagall Act (Cambridge University Press), will be released. Wilmarth recently published an overview of his work on Duke Law School’s FinReg Blog, a paragraph of which is below:
Taming the Megabanks contends that we must adopt a new Glass-Steagall Act to separate banks from securities markets. A new Glass-Steagall Act would restore financial stability and ensure that our financial system serves Main Street business firms and consumers instead of Wall Street speculators. Universal banks would be broken up and would no longer dominate our financial system. Shadow banks would shrink substantially because they could no longer fund their activities by offering short-term financial instruments that function as substitutes for deposits. A more decentralized and competitive financial system would provide better services to commerce, industry, and society.
I’m really looking forward to receiving my copy, purchased for a very reasonable $34.95! I’ve read many of Wilmarth’s articles, and I’ve always learned a lot from each one. A LOT!
Monday, August 10, 2020
Decent amount of reading for a summer than seemed quite chaotic. Fairly eclectic . Always open to suggestions.
God and Money - John Cortines and Gregory Baumer (2016) (Personal Finance). Two recent Harvard Business School graduates discuss thoughts on faith, finances, and giving. Less than 3% of American adults give away 10% or more of their income. Advocates for setting a floor of giving away at least 10% of gross income. In addition, the authors suggest setting an income and net worth cap and giving away the remainder. Reflection here (near the end of the post).
How to get Filthy Rich in Rising Asia - Mohsin Hamid (2013) (Novel). Family, love, business, morality, and violence. Novel claims to be written in a self-help style (though it didn’t really capture the self-help voice, in my opinion). I greatly preferred Hamid’s The Reluctant Fundamentalist (2008) to this one, but still think Hamid is talented and worth reading. As a father and a son, I liked this quote near the end - “You feel a love [toward your son] you know you will never be able to adequately explain or express to him, a love that flows one way, down the generations, not in reverse, and is understood and reciprocated only when time has made a younger generation of an older one.” (222).
When Breath Becomes Air - Paul Kalanithi (2016) (Memoir). Dr. Paul Kalanithi is diagnosed with metastatic lung cancer as a 35-year old nonsmoker. Paul’s diagnosis came just as he was finishing his training as a neurosurgeon at Stanford. Faith, family (including a newborn daughter), and work all provide purpose. Reflection here.
The Coddling of the American Mind - Greg Lukianoff and Jonathan Haidt (2018) (Social Psychology and Culture). Argues that privileged, upper/middle class children and students are overprotected. Children need more free play. Students need more exposure to differing viewpoints, learning civil discourse, and building well-supported arguments.
Let Your Mind Run - Deena Kastor (2018) (Memoir). History of a top professional runner and the role of positive thinking.
Love in the Ruins - Walker Percy (1999) (Novel). Satire, politics, religion, relationships, and the end of the world.
Amusing Ourselves to Death - Neil Postman (1985) (Cultural Commentary). Thesis - “Orewell warns that we will be overcome by an externally imposed oppression. But in Huxley’s vision, no Big Brother is required to deprive people of their autonomy, maturity, and history. As he saw it, people will come to love their oppression, to adore the technologies that undo their capacities to think.” (Preface).
Sunday, August 2, 2020
(A bit of the harvest picked from my parent's garden in north Georgia yesterday)
Last Thursday my neighborhood book club discussed work by poet David Whyte. This book club has been especially life-giving during the pandemic. I have deep admiration for every member of the group and always learn from our meetings. In March and April, we briefly moved to Zoom, but were unable to capture the same energy. We then decided to meet in person, bringing chairs to a member’s spacious driveway that backs up to common green space.
The work we discussed last week was not actually a book, but rather a few hours of David Whyte’s musings, only available in audio form. Much of the talk involves Whyte reading poetry – primarily his own, Rainer Maria Rilke’s and Mary Oliver’s – and relating that poetry to questions many of us ponder in midlife.
While I can’t locate the exact quote in the long recording, Whyte used a harvesting metaphor effectively. Whyte suggests that if we don’t slow down to be present for the harvest times in our lives, the fruit will rot on the vine. He reminds us, for example, that our child will only be five years old for a relatively short season. By being present for the harvest, I think Whyte means celebrate (among other things).
The practice of law, at least as it appears to be carried out by most major firms, leaves precious little time for celebration. In fact, during my handful of years at two major law firms, I can only recall a single occasion of truly pausing to celebrate the harvest.
This occasion involved a closing dinner. A celebratory dinner after closing a deal to buy or sell a company is relatively common in M&A practice. In my somewhat limited experience, however, law firms often organized these dinners to impress clients and tee up future deals. Networking, not savoring, is the focus. Often only the partners and clients attend closing dinners. The associates (or at least the junior associates) are usually back in the office working on the next matter.
This dinner was different. King & Spalding partner Russ Richards had just closed two relatively large deals in the same week with the assistance of same four associate attorneys. While the hours had been grueling, even by BigLaw standards, I didn’t expect to be invited to a closing dinner. Surprisingly, Russ not only invited the other three associates and me, but also encouraged us to bring a dates. Moreover, this was not a dinner to impress the clients; no clients were invited. We did not spend much time, if any, setting up future deals. We just celebrated work well done with wonderful wine, food, and company.
If there were more of this sort of unadulterated celebration of the harvest in BigLaw, I imagine the turnover would be much lower. And maybe one of the reasons Russ Richards excelled in a 45+ year career with the same firm is because he created moments of celebration and reflection like these. As I have argued before, I think one of the ways to make BigLaw more humane is to work in some time for celebration and rejuvenation, perhaps in the form of sabbaticals. A formal promotion to “senior associate” around the four-year mark, followed by a brief sabbatical (even as short as one month) would do wonders for the profession. Even longer sabbaticals, perhaps tied to a project improving the community, could be worthwhile as well.
Of course life is not, and probably should not be, constant celebration. To stretch Whyte’s metaphor further—as anyone who has tried their hand at farming knows—fruit that is the product of a season of sweat tastes sweeter than fruit obtained from a grocery deliver service. The gritty, difficult, back-spasm-inducing times are an important part of the process. That said, especially for those of us bent more in the direction of overwork, making some space to celebrate the harvest is essential.
Finally, and importantly, we should make a point to notice and celebrate the achievements of others. Whyte seems to focus on being present for the fruition of our own work, but I am convinced that pausing to celebrate the accomplishments of others can be even more worthwhile.
Monday, July 13, 2020
U.S. Securities Crowdfunding: A Way to Economic Inclusion for Low-Income Entrepreneurs in the Wake of COVID-19?
Earlier today, I submitted a book chapter with the same title as this blog post. The chapter, written for an international management resource on Digital Entrepreneurship and the Sharing Economy, represents part of a project on crowdfunding and poverty that I have been researching and thinking through for a bit over two years now. My chapter abstract follows:
The COVID-19 pandemic has exacerbated and created economic hardship all over the world. The United States is no exception. Among other things, the economic effects of the COVID-19 crisis deepen pre-existing concerns about financing U.S. businesses formed and promoted by entrepreneurs of modest means.
In May 2016, a U.S. federal registration exemption for crowdfunded securities offerings came into existence (under the CROWDFUND Act) as a means of helping start-ups and small businesses obtain funding. In theory, this regime was an attempt to fill gaps in U.S. securities law that handicapped entrepreneurs and their promoters from obtaining equity, debt, and other financing through the sale of financial investment instruments over the Internet. The use of the Internet for business finance is particularly important to U.S. entrepreneurs who may not have access to funding because of their own limited financial and economic positions.
As the pandemic continues and the fifth year of effectiveness of the CROWDFUND Act progresses, observations can be made about the role securities crowdfunding has played and may play in sustaining and improving prospects for those limited means entrepreneurs. A preliminary examination indicates that, under current legal rules, securities crowdfunding is a promising, yet less-than-optimal, financing vehicle for these entrepreneurs. Nevertheless, there are ways in which U.S. securities crowdfunding may be used or modified to play a more positive role in promoting economic inclusion through capital raising for the innovative ventures of financially disadvantaged entrepreneurs and promoters.
I value the opportunity to contribute to this book with scholars from a number of research disciplines and countries. I have been looking for ways to concretize some of my ideas from this project in a series of shorter publications, and this project seems like a good fit. Nevertheless, I admit that I have been finding it challenging to segment out and organize my ideas about how securities crowdfunding may better serve entrepreneurs and investors, especially in the current economic downturn. As always, your ideas are welcomed.
Sunday, July 12, 2020
A few months ago, I mentioned taking the free Yale University online course The Science of Well Being taught by Professor Laurie Santos.
Before jumping into the substance of the course, I wanted to talk a bit about the format. The course was likely filmed with better equipment than most of us will have in the fall. The videos were mostly under 15 minutes each, and the videos usually had quiz questions to keep you engaged. Then there were longer quizzes at the end of sections and discussion boards.
Even though this was a Yale course, on an interesting subject, with a gifted professor, I probably would not have paid even $1 for this course. The material was surely worth more than $1, but there is simply too much good free information online, in this format, for me to pay anything for it. This fact is sobering to me as a professor, given that at least some of my students will be online-only this fall. The real value, I think, springs from interaction – between professor and student, and between the students themselves. As such, I need to plan my courses with a fair bit of this interaction.
Moving to the substance, Professor Santos noted eight things that the science shows improves well-being:
- Social Interaction
- Meaningful Goals
Professor Santos' ReWi application helps you track these things.
Think all of us know that those eight things are good for us, even if we do not always prioritize them.
Most helpful for me was the discussion of savoring. Previously, I simply had not paused long enough to dwell on the many good things in life. In The Plague, Dr. Rieux and his friend Tarrou savor nature before swimming during a brief break fighting disease. Camus describes it as follows:
Once they were on the pier they saw the sea spread out before them, a gently heaving expanse of deep-piled velvet, supple and sleek as a creature of the wild. They sat down on a boulder facing the open. Slowly the waters rose and sank, and with their tranquil breathing sudden oily glints formed and flickered over the surface in a haze of broken lights. Before them the darkness stretched out into infinity. Rieux could feel under his hand the gnarled, weather-worn visage of the rocks, and a strange happiness possessed him. (256)
Pausing long enough to watch the sea and feel the rocks on his hand is what Professor Santos is talking about when she describes savoring. Think we could all benefit by stopping, noticing, and savoring more I am committed to doing so
(Photo taken savoring the scene at Bass Lake in Blowing Rock, North Carolina)
Monday, June 15, 2020
Recently, I listened to the NPR Hidden Brain’s podcast titled “Playing Favorites: When Kindness Toward Some Means Callousness Toward Others.”
This podcast hit on topics that I have been thinking about a good bit lately---namely selfishness, giving, poverty, family, favoritism, and a culture of “us against them.” This post only has the slightest connection to business, so I will include the rest of the post under the break.
Friday, June 12, 2020
Padfield on "the Omnipresent Specter of Political Bias" in Corporate Decision-Making (and 3 other papers)
I've finally gotten around to updating my SSRN page. I would love to hear any comments you might have.
June 12, 2020 in Behavioral Economics, Books, Constitutional Law, Corporate Governance, Corporate Personality, Corporations, CSR, Human Rights, Law and Economics, Stefan J. Padfield | Permalink | Comments (0)
Tuesday, June 2, 2020
would train runners from all the schools in the region over the summer, then relentlessly compete against them in the fall, then bring them back together to train in the winter. His world was the runner’s world, in which your rival is your greatest friend.
At the time, I did not really care much for training; I just liked winning. Van was easily the most knowledgeable coach in our region, and I remember being somewhat frustrated that he would share his expertise with our competitors.
With winning races as my ultimate goal, any assistance to other runners was counterproductive. For me, competition was zero-sum; if someone else won, I lost. Van saw competition differently. Van saw competition not as the end, but as a means to the greater ends of self-discipline, community, and true excellence.
Cormac McCarthy, in his 2007 Pulitzer Prize winning novel The Road, explores these competing views of competition. In this post-apocalyptic novel, an unnamed man and his son travel south over an ash-covered road, trying to outrun the harsh winter. Resources are scarce and many of the survivors have resorted to cannibalism.
The man reassures his son that they are two of the “good guys” because they do not eat fellow humans. Nevertheless, the man resists most of his son’s pleas to help others they encounter on the road, embracing a scarcity view of competition. The man admirably protects and shares with his son, but the man treats nearly everyone else with suspicion and violence. The father reminds his son to “always be on the lookout” and even after finding a cellar full of provisions, the father quickly turns his attention to trying to find another gun. His gun is down to its final bullet, so his power to fight off others is tenuous.
The man clearly loves his son, and the man appears well-intentioned in his attempts to do what is best for his son. But by trying to protect his son through selfishness, the man contributes to the cruel world that his son will inherit. The man tends to assume the worst of those they encounter on the road and, as a result, none of his compassion for his son spills over into the world at large. Selfishness, ruthless competition, and distrust leaves the world bleak and drains life of its meaning.
At the end of the novel, shortly after the boy’s father dies, the boy encounters another man. Following his father’s example, the boy points his pistol at the stranger. After a bit of conversation, the boy begins to let down his guard. But the boy remains a bit unsure, asking: “How do I know you are one of the good guys?” The stranger admits “You don’t. You’ll have to take your shot.” Unlike his father, the boy does not continue in distrust, and the boy does not resort to violence. The boy goes with the stranger.
The stranger rewards the boy’s trust by leaving a blanket—that they could use to help them survive—to wrap the boy’s dead “papa.” In a freezing world where survival is uncertain, this is an extreme act of kindness that strikes against cold utilitarianism. Even in a land of very limited resources, life means much more than simply using power to survive.
The boy and the stranger were both armed. The more powerful one could have killed the other and stolen his supplies. In a sense, the more powerful person would have “won” the competition, but he would have only secured a bit more time in a decidedly ugly world. In the novel, however, both the stranger and the boy risked a shortened life, but they seemed to gain beautiful friendship and the priceless experience of shared sacrifice.
Competition is not altogether evil. As Coach Van Townsend knew, healthy competition can be used to inspire and it can even help build community out of shared striving and respect. But when “winning” becomes the ultimate goal, and virtue is trampled, the world can quickly turn cruelly cold.
(Note: Anything insightful I have written was likely drawn from conversations with my brilliant literature professor brother. Anything foolish is of my own making.)
Friday, May 8, 2020
After finishing Aldous Huxley’s Brave New World, I devoured Neil Postman’s Amusing Ourselves to Death. Published in 1985, Postman’s thesis is that Huxley in Brave New World, not George Orwell in his dystopian novel 1984, more accurately predicted life in the modern United States. In the forward to his book, Postman writes:
Contrary to common belief even among the educated, Huxley and Orwell did not prophesy the same thing. Orwell warns that we will be overcome by an externally imposed oppression. But in Huxley’s vision, no Big Brother is required to deprive people of their autonomy, maturity and history, As he saw it, people will come to love their oppression, to adore the technologies that undo their capacities to think.
What Orwell feared were those who would ban books. What Huxley feared was that there would be no reason to ban a book for there would be no one who wanted to read one. Orwell feared those who would deprive us of information. Huxley feared those who would give us so much that we would be reduced to passivity and egoism. Orwell feared that the truth would be concealed from us. Huxley feared the truth would be drowned in a sea of irrelevance. Orwell feared we would become a captive culture. Huxley feared we would become a trivial culture. (xix).
Postman argues that we have moved from an Age of Exposition--where print-based works encouraged logic, order, relevant criticism, and deep learning--to an Age of Show Business, dominated by "the language of headlines--sensational, fragmented, impersonal.” (55-70). This shift, according to Postman, has led to a focus on applause over reflection, a focus on image instead of ideas. He compares a 7-hour Lincoln-Douglas debate in the Age of Exposition (44-45) to the 1984 Age of Show Business presidential debates with 5-minute addresses and 1-minute rebuttals (97). Given the biases of the medium of television influencing the 1984 “debates,” Postman argues that:
in such circumstances, complexity, documentation, and logic can play no role, and, indeed, on several occasions syntax itself was abandoned entirely. It is no matter. The men were less concerned with giving arguments than with “giving off” impressions, which is what television does best. Post-debate commentary largely avoided any evaluation of the candidates’ ideas, since there were none to evaluate. Instead, the debates were conceived as boxing matches, the relevant question being, Who KO’d whom? The answer determined by the “style” of the men--how they looked, fixed their gaze, smiled, and delivered one-liners. (97)
Having watched a number of political “debates,” I must say Postman nails it here, though 5-minute addresses may have shrunk to 2-minutes by 2020! In contrast, on October 16, 1854, Douglas received 180 uninterrupted minutes before Lincoln was given a chance to respond. In a shorter debate on August 21 1858, Douglas received 60 minutes to speak, followed by a 90 minute reply from Lincoln, and concluding with a 30 minute rebuttal by Douglas. Unfortunately, in the modern United States, Postman convincingly argues that “the fundamental metaphor for political discourse is the television commercial….on television commercials, propositions are as scarce as unattractive people...the commercial disdains exposition, for that takes time and invites argument.” (126-31)
Those who run television do not limit our access to information, but in fact widen it. Our Ministry of Culture is Huxleyan, not Orwellian. It does everything possible to encourage us to watch continuously. But what we watch is a medium which presents information in a form that renders it simplistic, nonsubstantive, nonhistorical, and noncontextual: that is to say, information packaged as entertainment. In America, we are never denied the opportunity to amuse ourselves. (141)
According to Postman, the Age of Show Business influences everything from how modern books are written to how our education is shaped. His tenth chapter is entitled “Teaching as an Amusing Activity” and starts with intense criticism of Sesame Street. Postman claims, “[w]e now know that ‘Sesame Street’ encourages children to love school only if school is like ‘Sesame Street.’ Which is to say, we now know that ‘Sesame Street’ undermines what the traditional idea of schooling represents.” (143). Postman cites no evidence to support this claim and the research on Sesame Street’s impact seems varied. Nevertheless, Postman argues that the material in the Sesame Street shows is not nearly as important as the way it is taught. Postman writes “the most important thing one learns is always something about how one learns," not the content of the lesson. (144). In responding to television's increasing influence, Postman argues that teachers are increasing visual stimulation in the classroom and “are reducing the amount of exposition their students must cope with; are relying less on reading and writing assignments; and are reluctantly concluding that the principal means by which student interest may be engaged is entertainment.” (148-49).
Postman admits that he doesn’t have strong solutions for the shriveling cultural spirit that he observes (155-63). He is not optimistic about Americans abandoning television nor about attempts to improve the programming. The only hope he sees is education, though he admits that even education may be powerless. Interestingly, Postman (in 1985) claims that he “believe[s] the computer to be a vastly overrated technology.” (161). More accurately he predicted:
[Americans will give computers] their customary mindless inattention, which means they will use it as they are told, without a whimper. Thus a central thesis of computer technology--that the principal difficulty we have in solving problems stems from insufficient data--will go unexamined. Until, years from now, when it will be noticed that the massive collection and speed-of-light retrieval of data have been of great value to large-scale organizations but have solved very little of importance to most people and have created at least as many problems for them as they may have solved. (161)
I need to do a lot more thinking about this book. Postman makes a compelling case for the shallowness of the Age of Show Business, but I am more hopeful than Postman that students, with the help of professors, can see this shallowness and work in more meaningful directions. While many of us have been immersed in the Age of Show Business for our entire lives, we professors should aspire to much more than mere amusement in education. There is great value in working through dense, difficult material over long periods of time. This difficult work may not be enjoyable in the short-term for students, but it is indispensable for deep work and growth to maturity. Sadly, the pull of the Age of Show Business is quite strong, and maybe the amusing Matt Damon will be cast for the role of professor in future classes. For all our sake, let's hope not.
Wednesday, April 29, 2020
I would have thought that eliminating my commute during the pandemic would have meant more time to read, but those of us with young children seem to have significantly less free time during all of this. Nevertheless, my neighborhood book club prompted some reading, and I squeezed in a few others. Always open to suggestions.
Atomic Habits - James Clear (2018) (Self-Help). Didn't think there was much novel here, but I did like his suggestion to start small with habits (create some 2-minute habits and build from there). This podcast with Donald Miller on writing and exercise habits prompted me to read the book.
The Ruthless Elimination of Hurry - John Mark Comer (2019) (Religion). "The modern world is a virtual conspiracy against the interior life."
A Lesson Before Dying - Ernest Gaines (1993) (Novel/Historical Fiction). Story of family, humanity, race, teaching, and belief.
Talking to Strangers - Malcom Gladwell (2019) (Pop Psychology). Book club (and he spoke at Belmont on this book). Basically, Blink Part II. Challenges our judgment of others, especially those we do not know well. Liked this note of humility and willingness to be corrected at the end of the book. “Instances where I am plainly in error, please contact me at email@example.com and I will be happy to correct the record.”
Endure - Alex Hutchinson (2018) (Fitness). More story and less sports psychology than I was hoping for, but confirmed the power of belief and explored the limits of human endurance in sport.
An American Marriage - Tayari Jones (2018) (Novel). Book club. A novel about marriage, family, friendship, betrayal, race, class, and injustice. Written mostly in the forms of letters to and from a husband/son who is supposedly wrongfully imprisoned.
Race Matters - Cornel West (1993) (Social Science). A few quotes that leapt out -- “Today, eighty-six percent of white suburban Americans live in neighborhoods that are less than 1 percent black.” (4). “American mass culture presented models of the good life principally in terms of conspicuous consumption and hedonistic indulgence.” (36) “Humility is the fruit of inner security and wise maturity. To be humble is to be so sure of one’s self and one’s mission that one can forgo calling excessive attention to one’s self and status.” (38)
Sunday, April 19, 2020
In a reflection on the meaning of career success, a majority of my business ethics students mentioned happiness as a barometer.
“Happiness,” however, is an incredibly imprecise term. For example, here is over seventy-five minutes of Jennifer Frey (University of South Carolina, Philosophy) and Jonathan Masur (University of Chicago, Law) discussing happiness under two different definitions.
Frey, in the tradition of Aristotle and Aquinas, considers happiness not as a private good, but rather as the highest common good. Happiness is enjoyed in community. True happiness according to Frey, is bound up in the cultivation of virtue and human excellence. Under Frey’s definition, happiness makes room for sacrifice and suffering as beautiful and awe-inspiring.
Masur, a self-described hedonist, seems to have a more psychological, subjective view of happiness. Masur defines happiness as positive feelings, and unhappiness as negative feelings. Masur acknowledges that happiness--maybe even the deepest happiness--can arise from relationships and altruistic behavior. Unlike Frey, however, Masur includes positive feelings that are artificially produced or arising from unvirtuous behavior as part of “happiness.” Masur sees happiness and living a good, moral life as often overlapping, but as not necessarily intertwined.
These are two different conceptions of happiness. I think we need seperate words for the different conceptions--perhaps joy and pleasure--though I do not think any two English words fully capture the differences.
Somewhat relatedly, this month, my neighborhood book club is reading Aldous Huxley’s Brave New World. Throughout the book, Huxley explores a future devoted to pleasure. In this world, a drug called soma, a sport called obstacle golf, and touch-engaging films called the "feelies" combine to drown out negative emotions. While the elimination of virtually all infectious diseases seems enviable in this moment, there is very little I admire in the brave new world---it seems incredibly shallow. Some of Aristotle’s virtues are largely missing. Courage, temperance, and liberality are only seen in the outcasts of this world. Self-denial and committed relationships are strongly discouraged.
Ross Douthat, in The New York Times, hits some similar notes below:
- In effect, both Huxley and [C. S.] Lewis looked at the utilitarian's paradise--a world where all material needs are met, pleasure is maximized, and pain is eliminated--and pointed out what we might be giving up to get there: the entire vertical dimension in human life, the quest for the sublime and the transcendent, for romance and honor, beauty and truth.
But even John Stuart Mill, the utilitarian, seemed to realize that there can be a depth to happiness that extends beyond pure pleasure. Mill wrote:
- It is better to be a human dissatisfied than a pig satisfied; better to be Socrates dissatisfied than a fool satisfied. And if the fool, or the pig, are of a different opinion, it is because they only know their own side of the question. The other party to the comparison knows both sides.
Near the conclusion of Brave New World, the Savage (John) has an illuminating verbal spat with the Controller Mustapha Mond:
- Savage: "But I like the inconveniences [of life.]"
- "We don't," said the Controller. "We prefer to do things comfortably."
- "But I don't want comfort. I want God, I want poetry, I want want freedom, I want goodness. I want sin."
- "In fact," said Mustapha Mond, "you're claiming the right to be unhappy."
- "All right then," said the Savage defiantly, "I am claiming the right to be unhappy."
The Savage meets a tragic end (in part because he gets cut off from supportive community and has not grasped the concept of forgiveness), but I am still more drawn to his life--of pain and love, desire and disappointment, art and decay, principle and struggle--than to a life plugged into the pleasure producing experience machine.
Even though Frey and Masur disagree on the breadth of the term “happiness,” both seem to agree that devoted relationships, selflessness, and self-transcendence often lead to durable, deep happiness. While many of my business ethics students did not define “happiness” in their reflections, I hope they increasingly realize the fulfillment that can come from cultivating virtue in the midst of difficulty.
Sunday, February 16, 2020
What’s the #1 new release in Banking Law on Amazon? I’m glad you asked! It’s Professor David Zaring’s first book, The Globalized Governance of Finance (Cambridge University Press). In 2008, Zaring joined Wharton's Legal Studies and Business Ethics Department as an assistant professor. At the time, I was a PhD student in the Department and also focused on banking law. So, it was really exciting for me to have a banking law scholar join us and I’m thrilled to now have a chance to highlight his new book. My copy is on its way from Amazon, so for now, I’ll share Zaring’s description of his book and my own thoughts with BLPB readers soon!
The book pulls together work I’ve done on the regulatory networks – the Basel Committee, IOSCO, IAIS, e.g., – that have become the global taste for harmonizing financial regulation. I think the regimes, and their relative bindingness (especially Basel), are interesting in their own right, and they are also an interesting way of doing global governance, where the sine qua non is often thought to be a treaty enforced by a tribunal, a la the World Trade Organization.
But in finance, you see neither of those things, and still robust oversight that American regulators, regardless of administration, seem to embrace. Even as the Trump administration has pushed for changes in trade law, Randal Quarles of the Fed has been installed as chair of the Financial Stability Board, the network of networks that keeps everything moving. The Obama administration tried to get a Basel-like process into its trade deals, and issued an executive order encouraging agencies to harmonize regulations.
Moreover, since the financial crisis, regulators have doubled down on these networks, adding political oversight from the G-20, a middle manager in the FSB, and standardizing notice and comment rulemaking at the network level. That, I think, makes the whole scheme look increasingly like a cross-border bureaucracy. After all, American agencies make policy through notice and comment rulemaking overseen by career regulators overseen by political leaders. So too Basel, IOSCO, IAIS, and the other networks.
Tuesday, January 28, 2020
I promised to check back in after negotiating The House on Elm Street (here). I’m checking in! We negotiated this exercise – which contains both legal and ethical issues – in my MBA Business Ethics/Legal course this evening. It proved to be a great learning experience. My previous post mentioned that Professor Siedel had made its use easy by creating thorough teaching notes. And as I suspected, while it might be ideal to have students read a negotiation text or have a full 75 minutes to debrief the exercise, neither proved essential to a valuable learning experience. It also provided a great segue into agency law, another of tonight’s topics.
During our discussion of ethical issues, I mentioned Professor Clayton M. Christensen's How Will You Measure Your Life? This past week, this question became particularly poignant. Christensen, one of Harvard Business School’s leading lights, passed away at the age of 67. Several years ago, BYU Law School Dean Professor Gordon Smith and I started “The Business Ethics Book Club for Law Professors.” The wonders of technology enabled several of us business law professors from all over the country to gather virtually about once a semester for a few years to read books on ethics, including Christensen’s book, which were generally written by business school professors. It’s a short, but powerful read. I highly recommend it to all BLPB readers. My recollection is that it was a popular book club selection too!
In this book, Christensen (and coauthors) seek to answer three simple questions: “How can I be sure that”: 1) “I will be successful and happy in my career?”, 2) “My relationships with my spouse, my children, and my extended family and close friends become an enduring source of happiness?,” and 3) “I live a life of integrity – and stay out of jail?” (p.6) Christensen wasn’t a business ethics professor. Rather, the book’s prologue explains that one of Christensen’s courses was Building and Sustaining a Successful Enterprise, in which “we study theories regarding the various dimensions of the job of general managers. These theories are statements of what cause things to happen – and why.” (5) On the last day of the course, instead of using these theories to examine organizations, the class used these theories to study themselves: “We are there to explore not what we hope will happen to us but rather what the theories predict will happen to us, as a result of different decisions and actions…Year after year I have been stunned at how the theories of the course illuminate issues in our personal lives as they do in the companies we’ve studied” (p.6) According to Amazon, this is “the only business book that Apple’s Steve Jobs said “deeply influenced” him.” And it’s not the only time Christensen’s work has been widely praised. His breakout work, The Innovator’s Dilemma: When New Technologies Cause Great Firms to Fail, was heralded by some as "one of the six most important business books ever written." Without doubt, both books are great, worthwhile reads.
Monday, December 30, 2019
This fall semester flew by. Hoping to make time to read and listen to more good content next semester. Always open to suggestions, especially podcasts because my commute is now about 30 minutes each way.
A Guide to the Good Life: The Ancient Art of Stoic Joy - William B. Irvine (Philosophy) (2009). Review of stoicism and an attempt at modern application. “Unlike Cynicism, Stoicism does not require its adherents to adopt an ascetic lifestyle. To the contrary , the Stoics thought that there was nothing wrong with enjoying the good things life has to offer, as long as we are careful in the manner we enjoy them. In particular, we must be ready to give up the good things without regret if our circumstances should change.” (46).
Utilitarianism - John Stuart Mill (Philosophy) (1863). Reread before my spring business ethics class. “It is better to be a human being dissatisfied than a pig satisfied; better to be Socrates dissatisfied than a fool satisfied. And if the fool or the pig think otherwise, that is because they know only their own side of the question. The other party to the comparison knows both sides.” (7). “Next to selfishness, the principal cause that makes life unsatisfactory is a lack of mental cultivation.” (10).
Just Mercy - Bryan Stevenson (Non-fiction, Law) (2014). Stories of injustice in our criminal legal system. Reread in advance of our SEALSB Conference in Montgomery, AL. Stevenson founded the Equal Justice Institute (EJI) in Montgomery. The EJI’s museum and memorial are well worth your time; like the book, they are quite moving.
The Dream - an investigation of multi-level marketing companies (MLM).
Road to the Olympic Trials - Peter Bromka ran just two seconds shy of the standard; he will take another shot at the Houston Marathon in January.
Elizabeth Anscombe on Living the Truth (Jennifer Frey - University of South Carolina, Philosophy). Focuses on Anscombe’s theory of intentionality of action.
Ipse Dixit Legal Scholarship Podcasts (hosted by Brian Frye - University of Kentucky, Law)