Did Goldman sabotage BP’s blowout preventer?
Did Goldman Sachs sabotage the blowout preventer on BP’s doomed Deepwater Horizon well? Of course it didn’t. But the British oil giant’s troubles in the Gulf of Mexico have certainly handed Goldman a public relations reprieve. Similarly, the Wall Street firm’s travails following accusations of fraud took Toyota Motor’s recall woes off the front pages.
There’s no obvious link between a bank, an oil driller and a carmaker. But the reputational struggles of these three global giants suggest one lesson that won’t be lost on shrewd corporations: the court of public opinion — led by the political class and including the press — only appears capable of coping with one villain at a time.
That, at least, is the impression from a cursory news search using Factiva. In the three months leading to March 19, Toyota was cited in three times as many articles mentioning the word “scandal” as Goldman. In the month to May 19 the quantum shifted six to one in favor of Goldman. BP has now eclipsed them both.
Now this may just be a case of regulators and politicians — and perhaps reporters — failing to multitask. Even the most energized lawmaker can only hold one hearing at a time. But the impression left raises questions about the intent and seriousness of inquiry.
The objective in going after corporations should not be to score political points or even put a few executives behind bars. The broader public interest is better served by determining where the government’s regulatory apparatus — whether designed to protect investors, car buyers or brown pelicans — fell short and how to improve it.
After all, however socially responsible a corporation may be or claim to be, it is answerable to its stockholders. That’s no excuse to cut corners and undershoot the standards required by regulation and simple professionalism. But a primary concern is always going to be profits.
That’s not villainy. It’s just the way free markets work. By all means, rake BP, Toyota and Goldman over the coals when they have fallen short. But it’s also important to ask why government oversight failed so spectacularly. Attempts to answer that question shouldn’t be put on hold just because another politically opportunistic scandal comes along.