Our own private oath is the latest hit on Wall Street

By MICHAEL LEWIS
10 June 2010

A few weeks ago Bloomberg News reported that, in just the past year, hundreds of students at the Harvard Business School have taken something called the MBA Oath.

Endorsed by Harvard’s dean, and replicated by other business schools, the oath comes in two sizes: an important sounding long version, and a punchy executive summary, consisting of seven crisp bullet points. (Sample bullet point: ‘I will refrain from corruption, unfair competition, or business practices harmful to society.’)

The gist of even the short version can be reduced further, to a single sentence: ‘Wherever I face a choice between my self-interest, and the interests of the wider world, I pledge to act in the interests of the wider world.’

News of the oath naturally aroused the interest of cynics everywhere, and led them to raise hard questions: Isn’t the underlying premise of free-market capitalism, and the typical business school education, that by doing well for oneself one is also doing well for the wider world? Is the typical business school graduate actually capable of seeing any difference between his own interest and the world’s? Does this sort of mushy, vague-sounding oath serve society or the oath taker, who hopes that society will be duped into thinking that he is acting in its interests rather than his own? And anyway, if they are so keen to serve society instead of themselves, why do so many of these oath-takers wind up working on Wall Street, and, more specifically, for Goldman Sachs – a company whose CEO has been singled out by one of the oath’s creators for its blindness to the social consequences of his firm’s actions?

Lost in this orgy of nay-saying was the mounting evidence that the MBA Oath already has had one clear practical consequence. In the past year graduates of the Harvard Business School have flooded Wall Street, as graduates of Harvard Business School tend to do, and brought with them their new passion for oaths.

It’s too early to say if oath-taking has attained a permanent new high, or we are living through some kind of ‘oath bubble’. What is clear is that many Wall Street firms, and Wall Street people, have found the need to have their own private oaths. In recent weeks several of these have leaked to Bloomberg News.

We report them without further comment:

The Goldman Sachs Oath: We pledge not to call what we do ‘God’s work’, even though it is. We pledge to meet and even get to know ordinary people who do not work for Goldman Sachs, so that we might better understand their irrational behaviour, and exploit it only when necessary. We pledge to create Wall Street’s best-in-class oath.

The Morgan Stanley Oath: We pledge to stop trying to do whatever Goldman Sachs is doing. We, too, pledge to create Wall Street’s best-in-class oath.

The Merrill Lynch Oath: We’re just grateful to be asked if we have an oath. We do! We pledge to help the approximately 74,322 American dentists forget that we sold them auction-rate securities and equity tranches of sub-prime backed CDOs. We also pledge that, the next time Wall Street plays crack the whip, we will decline Goldman Sachs’s offer to play the role of the little fat kid who gets catapulted through the second-story window of the house across the street.

The Citigroup Oath: In our continued quest to make peace with the US taxpayer, we pledge to sell our oath to the highest foreign bidder, the minute we decide what that oath should be.

The Oath of Hedge Fund Man: I pledge to short the credit spreads of only those public corporations and great nations that truly are doomed. I thus pledge to accelerate Darwinian forces that elevate the strong and destroy the weak. And even though that should be enough goodness for one lifetime, I pledge to bid generously for the sexier items at the next Robin Hood auction.

The Warren Buffett Oath: I pledge, even in the privacy of my own bedroom, to seem nothing like the abovementioned hedge fund manager. I pledge to remain the go-to moral compass of the American money culture. To that end I pledge to learn less than I typically do about the Wall Street businesses in which I invest, so that, after they are discovered to have lied, cheated or stolen, I can plausibly claim to have known nothing about it. Specifically, I pledge to remain unable to find the corporate headquarters of Moody’s Inc on a New York City map. (Really, I have no idea where the place is!)

The Moody’s Oath: We pledge to do whatever we must to persuade Warren Buffett to hold on to at least some of his shares in our company. Failing that, we pledge to just shoot ourselves.

The S&P Oath: We pledge to do whatever Moody’s does, without the pretension of being somehow ‘upper crust’.

The AIG Oath: Our deal to sell our oath to some Asian people having hit a snag, we pledge to continue to manage our oath to maximise its returns, assuming, of course, that our contracts are honoured, and our bonuses are paid.

The SEC Oath: We pledge to figure out who on Wall Street the American people most hate, and to sue them, even if we are sure to lose.

The Oath of the Financial Crisis Inquiry Commission: We pledge to find out, by the year 2050, what exactly happened on Wall Street in the early part of this century. We pledge to reform Wall Street. Or, failing that, to be taken seriously. Or, at a bare minimum, to attract a bit of media.

The Oath of the US Treasury: We pledge to appear as if we have everything under control even when we actually have no idea what we are doing. We pledge to dissuade newspaper reporters and magazine writers from describing our leader as ‘elfin’. We pledge, when he is arguing with foreign rulers, or Wall Street CEOs, that he will strive to seem a bit more powerful, perhaps even physically intimidating. At any rate, less of a wuss.

The Oath of the Federal Reserve: We pledge to regulate these oaths to prevent others from doing so. — Bloomberg

The writer, most recently author of the best-selling ‘The Big Short’, is a columnist for Bloomberg News.

The opinions expressed are his own.

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