Rod Blagojevich, Bernard Madoff, Dreier L.L.P and Iraq

I have been busy with scientific work over the last week or so, but yesterday I looked at some news items and came across these:

Rod Blagojevich, the governor of Illinois, indicted for trying to sell Obama’s Senate seat for personal gain, Bernard Madoff, the US financial guru and former Nasdaq chairman, released on bail after having been arrested earlier for decades-long fraud leading to the disappearance of nobody knows how much but estimated at around US$50 billion, US$120 billion spent for reconstruction  in Iraq without much success, and – such a small item that it is hardly worth mentioning – fraudulent loss of at least US$35 million by Dreier L.L.P.

In this context, the following excerpts from the autobiography of Alan Greenspan, the former Chairman of the Federal Reserve: “The Age of Turbulence” 2007, page 431, may be of interest. He writes: “Indeed, very few regulators of my acquaintance can give me examples of fraud and embezzlement unearthed by anyone other than a whistleblower.” …… “But in truth, there is no way for an audit committee, new or old, to uncover wrongdoing short of deploying a vast army of investigators who would smother the firm with costly oversight that would likely stifle corporate risk taking and ultimately threaten the viability of the company.”

So, risk taking should not be stifled! We are just experiencing the consequences of excessive risk taking. I wonder whether Greenspan would have written this now, after the big crash has occurred and is occurring.

I recommend to read  E.F. Schumacher’s (1973) classic : “Small is Beautiful. A Study of Economics as if People Mattered”. He traces many of our present problems (in 1973 bad enough, but much worse now, because nobody listened) to our “materialistic” philosophy of life, leading to an over-emphasis on large size and simply greed. Among other things, he suggests that personal ownership of means of production is really justified only if the owner actively participates in the production process, and should be restricted to relatively small enterprises (a few 100 people).

If you want evidence for greed and the disastrous effects, consider the present financial crisis with millions losing their jobs, and look at the  smallest fish of the few examples mentioned above, Dreier:

according to the N. Y. Times 14.12.08: “Their health insurance is in default and the firm will not be able to make its $2.6 million payroll on Monday, lawyers there say.” However, “Mr. Dreier’s lifestyle includes a waterfront home in the Hamptons, a Manhattan triplex and a place on Ocean Avenue in Santa Monica, Calif. He kept a Mercedes 500 in New York, an Aston Martin in California, and a 121-foot blue and white Heesen motor yacht with a Jacuzzi and a crew of 10 docked in Manhattan or St. Maarten. Associates said the boat, the Seascape, was the site of late-night parties at which Mr. Dreier, who is divorced, was often joined by an attractive young crowd.The law offices themselves at 499 Park Avenue were like modern art galleries. In court papers filed this week, the comptroller for the law firm reported that $30 million to $40 million of the firm’s assets had been spent on art. Among Mr. Dreier’s holdings were works by Picasso and a Warhol depiction of Jacqueline Kennedy Onassis.””

Deutsche Weisheit, Deutsche Dummheit VI. Deutsche Weisheit: Deserteure sind keine Verbrecher

Hier sind Auszüge (Übersetzung) aus der International Herald Tribune vom 25.1.08.


“YPRES, Belgien.Denkmäler für die Gefallenen des Krieges sind wie Pilze aus der Erde geschossen, aber es hat fast 85 Jahre gedauert, bis ein Denkmal für eine andere Gruppe der Toten errichtet wurde: Soldaten, die von ihrer eigenen Seite hingerichtet wurden, weil sie sich geweigert hatten, weiterzukämpfen.

“Kommandeure begannen, Deserteure und meuternde Truppen an Pfähle zu fesseln, wo sie durch Exekutionskommandos erschossen wurden. Die Briten erschossen 320, und die Franzosen so viele wie 700. Die Deutschen, im allgemeinen, erschossen keine Deserteure.”

“Abgesehen von der Ungerechtigkeit, die meisten wurden erschossen, um ein Beispiel zu konstatieren.¦.. Es war eine Art der geistigen Nötigung”

Den Erschossenen wurde von Präsident Sarkozi keine posthume Amnestie gewährt.

Deutsche Weisheit, Deutsche Dummheit hier:

The Theoretical Foundations of Ecology and Economics

This is an invitation to contribute to a discussion (by writing comments) about the theoretical foundations of ecology and economics on my knols:

“Free Trade and Free Markets, Ecology and Economics”


“A Limit to Globalization? Fuzzy Chaos Modelling in Ecology and Economics”