A Case Study in How an Entire Industry Becomes Corrupt: John Bogle: the Classic Leader in an Industry of Destructive Achievers;
By Chuck Kelly
Check out the following excerpt for a case study in how entire industries in the U.S. can become corrupt. It's the classic description of greed and dishonesty organizing itself to drive out principle and a commitment to ethics.
From The Wall Street Journal (not exactly a member of "the biased liberal news media"), January 7.
Bogle: The Man Who Told You So
Vanguard Founder Finds Support
For Criticism of Mutual Funds,
But Cold Shoulder From Industry
In the scandal-tossed mutual-fund industry, legal charges are flying and corporate heads are rolling. Regulators and legislators are scrambling to craft quick overhauls to stop improper trading practices and other problems. And John C. Bogle, a figure in the fund industry for more than five decades, is simply having a blast.
"Jack" Bogle, the founder and former chairman of Vanguard Group, the No. 2 fund company after Fidelity Investments, has spent decades razzing other fund executives about their overblown fees and shrunken sense of duty.
His tirades over the years earned him a cold shoulder from fund-industry colleagues, while his holier-than-thou attitude earned Mr. Bogle the derisive nickname St. Jack..
But now, at age 74, almost eight years into the "extra" time granted by a heart transplant, he is finding new support for his views as he flits from congressional hearings to speaking engagements to at-least-weekly television appearances".
One place where Mr. Bogle still stacks up as less of a hero is within the fund industry he helped create. Other fund executives long have grumbled that Mr. Bogle's lecturing is all a self-serving pitch for Vanguard's low-cost index funds, which simply match the performance of a market measure such as the Standard & Poor's 500-stock index. Former Securities and Exchange Commission Chairman Arthur Levitt, a Bogle fan, says the industry views him as "a traitor to his class."
The chill continues today. Despite Mr. Bogle's Mr. Clean status, fund-company leaders making up the Investment Company Institute trade group haven't sought out his insights or requested his participation in post-scandal task forces. Mr. Bogle, who served as the ICI's elected chairman decades ago, says he "can guarantee" the industry won't come calling: "They would rather die," he declares tartly.
Not only hasn't the ICI asked Mr. Bogle to speak at its annual gathering since 1990, but it turned aside his request to speak in 2001, his 50th anniversary in the fund business, he says".
John Bogle is almost the definition of a true leader. He's definitely the exception and not the rule. In today's corporate America, it seems that anything goes, as long as it results in the enrichment of investors and senior executives.
Bogle's opposite""the "Destructive Achiever" (DA)""is in ascendancy everywhere. Throughout our country, DAs are becoming dominant, as top executives compete with each other in doing whatever it takes""even illegal activities""to increase profits. (For a detailed discussion of DAs, check out: Proactive vs. Reactive Management.)
Remember: DAs always rise to the top if those in control (investors, boards of directors, etc.) don't make a conscious decision to select only those with moral values for leadership. Since today's only criterion for promotion, or for the selection of a Chief Executive Officer, seems to be profit""moral standards always come out second.
It's especially important to remember that voters also must take care that the ones they elect to office also have moral standards, and truly work for the interests of the general public, and not just the interests of the wealthy and powerful. This automatically means that elected leaders in government must take seriously the need for sensible regulations of corporate executive behaviors.
Chuck Kelly is at http://www.KellySite.net. He holds a Ph.D. in industrial communications from Purdue University, is now a retired management consultant, and author of the books, THE DESTRUCTIVE ACHEIVER, THE GREAT LIMBAUGH CON, and CLASS WAR IN AMERICA. This article is originally published at opednews.com. Copyright Chuck Kelly, but permission is granted for reprint in print, email, blog, or web media so long as this credit is attached
