Now that we're restructuring the auto industry, Wall Street, the banking world and, probably next up, the health care sector, how about a little tinkering with the professions?
I'm talking particularly of accounting and lawyering. To a large measure these occupations have been ignored as our economy crashes around us. But it seems pretty clear that accountants and lawyers should shoulder some of the blame. Had they been upholding the public interest in addition to serving their clients, we wouldn't be in this fix.
The way I see it, these professions were created in large measure to make business play by the rules. Accountants make sure that public companies are being up front with shareholders and the tax man. Civil practice lawyers advise clients about the legality of their actions and are ethically bound to protect the integrity of the legal system.
But rather than helping to keep things honest, these professionals in dozens of high-profile examples have used their education, skill and expertise to conspire with confidence men. They sold their good names for a big payout, caused widespread pain and dragged the rest of their profession through the mud.
Turn over a scandal such as Enron's book-cooking or Bernie Madoff's Ponzi scheme, and you unearth the slimy residue of accountants and lawyers who helped design it, justify it or cover it up.
So, what to do? How about we change the rules and culture of these professions.
"Is Law (Still) an Honorable Profession" is the title of a call-to-arms lecture by professor Stephen Gillers of New York University School of Law. An expert in legal ethics, Gillers says the answer is for lawyers to stop being "skilled facilitators of whatever legal goal a paying client may desire" and start saying "no" when those goals are morally bankrupt.
In his talk, presented earlier this month at the Central Synagogue in Manhattan, Gillers describes the ways that lawyers and accountants have assisted in exploiting the trust of vulnerable people in order to serve a client and enrich themselves.
The savings and loan crisis of the 1980s, which, like today's credit crisis, is an instance of bankers' unadulterated greed resulting in huge taxpayer liabilities, would have never happened were it not for the active participation or acquiescence of lawyers and auditors.
Clever lawyers for Big Tobacco deep-sixed scientific evidence that tobacco kills by "concocting a theory that laboratory results were protected by attorney-client privilege," Gillers says.
In today's economy, lawyers and accountants are an integral part of most complex commercial and financial transactions. They should ask themselves whether they are facilitating something that is not just strictly legal but also decent and honorable.
Loyalty to a client does not mean an attorney should "aid morally offensive goals, even if they are legal," Gillers says.
This admonition is not aimed at criminal defense lawyers who defend their client in a forum where the other side — the state — has a lawyer, too. Rather, Gillers is exhorting civil lawyers who operate as behind-the-scenes advisers. These lawyers often have a financial incentive to manipulate and distort the law.
Forget the money and refuse the client, Gillers says. "You don't get a pass from moral responsibility because you acted for a client."
It would be nice to think that the lawyers for all those predatory banks making subprime "liar" loans are now feeling a tenth of the pain suffered by a family ousted from their home due to foreclosure. But it isn't likely. The culture that permeates today says that securing clients and doing their bidding is all that matters.
We need a return to honor, meaning you don't scour the law trying to find some way to permit your client to harm others and then hide behind a legal opinion. And you don't use legerdemain accounting to burnish a client's financial statements in a way that will mislead.
This should go without saying. Too bad it has to be said.