We talk about moral hazard for individuals. We say that if their decisions have no consequences, they will make decisions that hurt society. Why don’t we apply that to business?
Blackstone defaulted on their debt and they aren’t alone. In 2023 80% increase of company defaults. In 2024 they are projected to grow even more. Now what can we learn from this?
We have double standards in this country. We ask the average poor person to pay all their debts and if they don’t, they are a bad person and deserve to be punished for 7 years on their credit. For businesses? Eh, just another Tuesday.
Now the other part of this is someone could say, that having them go in the courts and litigate this financial problem would cost even more money and solve nothing. That is true. So why not have this option for the common man? Doesn’t it seem more than a little ridiculous that we allow a company that still has money to escape a contract without consequences? If we truly believe that no one is above the law, then why don’t we act like it?
We say we believe in certain things but we don’t. Once someone gets money, morality is thrown out the window. Or perhaps they threw morality out the window to get that money first. As citizens and individuals, we need to consider if we are contributing to a world in which justice happens, or in which the rich and powerful continue to grow richer and more powerful.
I have seen throughout history that the rich and powerful just continue to become more so. If this is what we want, then let’s be honest. A YouTube Vice video showed a conversation with people who steal from illegal games. The gentleman said, “I will kill Jesus Christ for money.” Where did we go so wrong?