Bill Black: We Send Teachers to Prison for Rigging the Numbers, Why Not Bankers? – New Economic Perspectives

Teachers in prison won’t be able to organize and educate when they realize their pension funds are depleted by Wall Street unregulated securitization and rehypothecation gambling.

Alina's Blog

A more general point is in order.  Atlanta is the culmination of destructive national trends and failing to mention Houston in the story was unfortunate.  First, the “reinventing government” movement decided the public sector was bad and the private sector was magnificent and said that the public sector should adopt private sector approaches including quite specifically “performance pay” based on quantitative measures.  This brought to the public sector the perverse incentives that were ruining the private sector and about to bring on Enron-era fraud epidemic and then the most recent three fraud epidemics.  Second, we were assured by proponents of the change that a concern for “reputation” would trump any perverse incentives.  What the proponents failed to see, of course, was that in both the private and public sectors the way to create a superb reputation was to report inflated data.  Reputation, instead of the “trump” ensuring good conduct, was…

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