A year ago, the nation watched in horror as the financial system teetered on the brink of collapse. The names of the victims are familiar to us now: Fannie Mae and Freddie Mac, Bear Stearns, Lehman Brothers and AIG.
In sheer panic, people were withdrawing funds from banks and brokerage houses, putting whatever savings remained into Treasury bonds or stashing cash under their mattresses. The stock market had begun its sickening plummet to half its all-time high.
A year later we know many of the reasons for the near-collapse: During the real estate boom, mortgage lenders had so loosened standards (in the belief that valuations would continue rising) that massive numbers of subprime mortgages were issued to borrowers of dubious credit-worthiness. These loans were then “securitized” and sold in bundles with higher-rated loans, leading lending agencies to rate the bundles as safe investments. As housing values declined, growing numbers of borrowers were unable to repay the loans and the financial system as a whole began to unravel. Bad judgment, wishful thinking and even outright deception (of self and others) played parts in the crisis.
Today we know the story of how this near-collapse occurred, but there has been little reckoning of who is accountable. A few executives have been denounced for knowingly fostering an environment of loose financial accounting, and Bernie Madoff has become the public face of fraudulent scheming – but there has been exceedingly little reflection on the broader and deeper complicity of a wide swath of American society, from lenders to borrowers, from Main Street to Wall Street and points in between.
In particular, an issue that has been studiously avoided on our campuses is serious attention to the question of how many graduates of America’s elite universities had a hand in the creation of this financial and economic debacle. How many were willing to cut corners or ignore signs that might have induced caution, in the effort to increase profits (and personal bonuses) or avoid becoming a pariah? How many showed evidence of the ethics they purportedly learned in a passing philosophy class, or the character that is supposedly a byproduct of an elite education?
On campuses around the country, panels of experts have been convened to examine the technical causes of the crisis and to suggest financial and regulatory changes. But, how many panels have been convened, how many faculty have gathered or college administrators have met, to seriously investigate our collective complicity in contributing to the Great Recession? We are constantly told that universities like Georgetown are devoted to critical thinking – but have these institutions shown evidence of self-criticism for the near-certain presence of many of our best graduates in those Wall Street offices where the seeds of the financial collapse were sown?
A number of questions might be asked. Has our implicit promotion of college as a pathway to riches and success fostered a get-rich-quick culture? Has the mad, competitive scramble for admissions fostered a win-at-any-cost mentality? Has the decline of serious curriculua in liberal arts and a corresponding rise in business and economics majors contributed to the view of higher education as a bullet point on one’s rèsumè a necessary means to a self-serving end? Has our growing reliance upon alumni donations led institutions to avoid uncomfortable examinations of this sort? How has Georgetown in particular – uniquely a Jesuit institution among the nation’s top 25 schools – distinguished itself from its elite peer institutions in this regard? Have we done better?
With clockwork regularity, the Web sites of colleges throughout the country tout the accomplishments of their students, implicitly taking credit for such achievements as Rhodes Scholarships or extraordinary acts of volunteering. Are these proud announcements the whole story or do they act as a gloss that hides a fuller portrait of our institutions – namely one deeply informed by an ethic of money-making at nearly any cost? Does full disclosure require us also to claim credit for those graduates who packaged subprime loans? Are we, their teachers, ready to face the possibility of our shortcomings – or more, our complicity?
Recently, it was reported in these pages that Georgetown College is considering the creation of a minor in business. Would this not be a good occasion to bring these questions to the surface – even to entertain an alternative possibility – that there should be a strengthening of the liberal arts for every student at Georgetown, and a corresponding de-emphasis of paths that foster destructive forms of careerism? Could our students be a leaven in a materialist culture that has shown little sign of changing a year later? Can we have the courage to stop aping our higher-ranked peers, and instead lead by a different and better example?
Patrick Deneen is an associate professor in the government department. He can be reached at deneenthehoya.com. Against the Grain appears every other Tuesday.
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