Recently, in my article Over-the-top Overdraft Fees, I addressed the matter of how banks are engaging in blatant predation through the specific practice of attaching rampant overdraft fees. This article is really the continuation of that one, so I hope you'll read that one as well. But here I want to step up a level to what I perceive as the meta-problem that creates situations like this.
The matter takes me back to earlier this year when I wrote my article Fiduciary Duty vs The Three Laws of Robotics. In it, I made the allegation that it is reasonable and appropriate to model some corporate behavior as sociopathic. I am here again today struck by the usefulness of this metaphor.
The World Health Organization maintains a formal description of dissocial personality disorder, and I would refer you there if you're looking for a properly accurate medical description. But while browsing the web researching this article, I found a more informal description that I thought was interesting because of how well it overlapped with the discussion of overdraft fees above. It begins:
The list goes on. Later elements include items that one might think are more peculiar to people than organizations—“Early Behavior Problems,” for example. However, even these have some analog in the financial industry. Problems such as the recent surge of predatory practices in banking start with smaller indiscretions. Rather than call companies out on them, we look the other way and say, “well, it's not that egregious.” This in turn leaves companies to engage in a kind of variation of the Peter Principle, where every time they do something that isn't quite bad enough, they get promoted, and eventually they rise not to a level of incompetence but instead to a level of ultimate insufferability, at which point we finally find ourselves, like Captain Renault in the classic movie Casa Blanca, “shocked, shocked to find” that something untoward has been afoot. Shame on us as a society for tolerating such things.
In Over-the-top Overdraft Fees, I pointed out The FAIR Overdraft Coverage Act (S.1799) as pending legislation which shows promise in this area. But at the same time, it's highly specific to this one situation. Going beyond the mere isolated Whac-A-Mole approach to Congressional oversight, I find myself in the sad position of saying that what we really need is some good old-fashioned morality.
Mishima666 summed this up aptly in this way:
I'm not religious, but I don't have to be in order to agree he has a very decent point here. No matter what the source of our respective morality, which itself is a highly personal choice, the point is that we need to acknowledge that having some degree of morality and decency in the world should matter. The precise nature of our respective notions of morality and decency may even differ, but I would hope we can all agree that no matter what compass we use, we've drifted way off course in this particular matter. When we give up that belief and come to think instead that issues of morality and simple human decency have no place in the commercial world, we make a mess of things.
Sadly, Republican party leaders have turned religion into a partisan issue, veritably trying to position itself as the party of morality. And, ironically, it's that party's Laissez-faire policies, not those of the Democrats, that have brought us this kind of ridiculous unregulated world in which we are asked to believe the fiction that anything that isn't outright definitively illegal is perfectly okay. So perhaps that means we either need to seriously rethink what morality even means in the modern world, or at least to rethink who we allow to claim the moral high ground in our political discussions.
Morality is not a matter of party positioning. It is, as Mishima suggests, something that must really underly the fabric of what we do as a people. This issue comes through in the health care debate as well, where those opposing a “public option” for health insurance, again many who would happily publicly pronounce their moral superiority, seem unusually comfortable saying that it's inappropriate to take care of their fellow man.
And so, yes, legislation like S.1799 has its place. But what I sometimes think I'd really like might be legislation that hit closer to the root problem, that of intent. I'd like to see less time spent at cleverness in product design and more time spent on coming up with products that really do serve the public. And so I'd like people who want to design products that push the edge to have just a little fear that it might not end well for them. This that follows probably isn't precisely what I'd like to see, but it might give you an idea:
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