I will not defend the performance of those managers, many of whom threw prudence aside in the fear of being left behind as competitors grew quicker and took on more sexy risk.
However, I am skeptical of the accusations that these executives are less ethical than a random group of other people. Some observations:
- Receiving performance bonuses is not unethcial, and they are received (happily) by people in many different industries and functions.
- Wanting and accepting high performance bonuses is not unethical, nor is awarding sky-high bonuses to an executive if you believe this is to the best of the firm.
- The crisis is a system crisis, of a scale and complexity that cannot be attributed to one of the component parts of the system. It is more plausible to blame those whose job it was to oversee the system - central banks, regulatory bodies and governments.
End note: No complex economic system has yet gone on a smooth path to bliss. Marxist communism just collapsed and never got up again, Maoist communism killed tens of millions of people with its Great Leap. Capitalism is prone to boom and bust, but it is still the "least bad" alternative.
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