Wednesday, March 18, 2009

Should Wall Street Take Real 'Leadership' Lessons from General William Tecumseh Sherman?

'War is Hell'-William Tecumseh Sherman
It seems as if they adopted his “scorched earth” policies to pick the nation clean through their clever use of sophisticated derivative instruments and subtle, if not overt encouragement of the sub-prime loan disaster.

It has “only” cost the US taxpayer of the future at least $1 trillion in “Reconstruction-type” costs so far in terms of debt incurred. God only knows how much future inflation, currency devaluation and destabilization and less-than-optimal growth rates in standards of living have been unleashed as well.

But the Wall Streeters, and, while we are at it, the Detroit auto people, sub-prime mortgage brokers, home speculators and Fannie Mae folks, just to name a few, forgot to read the whole book about Sherman’s tactics. If they had, they would have done something so unbelievable, so startling that the American public might salute them today instead of condemning them to the 8th Circle of Dante’s Hell reserved for the “Fraudulent and Malicious”.

They would have personally promised to pay off these debts caused by these implosions and bailouts if it takes them the rest of their lives.

Sherman did that before the Civil War when the bank he was working for in San Francisco collapsed during the eerily similar Panic of 1857. Many of his army friends had trust accounts at Lucas, Turner and Company, totaling over $130,000 in exposure that the bank was not legally obligated to cover. $130,000 then would be close to $3 million in today’s dollars.

Sherman personally guaranteed that none of his men would lose any of their investments they had made because of his personal connections with them; he ‘stood some of the loss’ out of personal savings while he worked diligently to sell bank assets to make these investments whole. (a)

For that one act of duty and honor alone, he deserves at least some deference and a seat in the First Circle of Dante’s Inferno, not the deepest region as many in the South would relegate him to.

Union General William Tecumseh Sherman was the 19th century equivalent of the atomic bomb. His relentless pursuit of a ‘scorched earth’ policy of total warfare brought the Old South to its knees in a matter of months after 3 long years of fighting in the Civil War.

Sherman is known for two of the greatest quotes in history; "There is many a boy here today who looks on war as all glory, but, boys, it is all hell!” he said in an 1880 speech.

But his best quote was in 1884, when he was approached to be a Republican candidate for president, he memorably said, “If drafted, I will not run; if nominated, I will not accept; if elected, I will not serve."

Lord, let it be that there are more Shermanesque statements like that from professional American politicians in modern times!

Now he can be known also as a meticulous man of his word when it came to money matters. All without a federal bailout, a tax increase or any sort of government intervention. At all.

General Sherman could have walked away from those soldiers and left them hanging. He had no legal obligation to make things whole.

But he didn’t and for that one reason alone, he should be a model for the modern chief executive, at any level of business, government or academia.

It is just not American what has been done lately.

(a) Sherman: A Soldier’s Life—Lee B. Kennett, 2001, HarperCollins Publishers, Inc, NY

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