Slap on the wrist?

Reader question:

Please explain this headline: Mortgage Lenders Get A Slap On The Wrist (Forbes.com, April 13, 2011).

My comments:

It means mortgage lenders got off the hook one more time.

Slap on the wrist is a form of punishment, but it is a light punishment (no-one gets seriously hurt from a slap on the wrist), suggesting that mortgage lenders were not punished as severely as they should.

That’s not surprising. They, the regulators who oversee the industry, represent the interests of the mortgage lenders and other banks more than they represent the average citizen, i.e. you and I, the rest of the population. Otherwise, there’d be no economic crisis in America and there’d be no such movement as Occupy Wall Street.

That’s a simplification to be sure. But that’s, in fact, what I read from the headline. “Mortgage lenders get a slap on the wrist” simply means mortgage banks are not getting punished. That’s because mortgage banks and the regulators who are supposed to govern them are essentially of the same people.

The latter point takes time and space to explain, of course, and so let’s stick with the first. That is, “getting a slap on the wrist” means getting off the hook easily.

“Getting a slap on the wrist” is an American idiom, originating from the dining table, I’m sure. I am not quite sure actually but I’m not surprised if it did originate from the dining table. Every child, you see, must have had the same experience of getting slapped on the wrist when they tried to get their fingers on their favorite food.

You know, dinner time, all family members are getting round the table to eat. The child, seeing, say, the chicken wings, cannot wait to get them. So, without even sitting down in his chair, the child goes straight to get them, leaning over the table in reaching for one of them, only to feel a sharp slap on the hand just before he/she could get to it. The slap on the hand is administered by the mother, who simply wants to help him/her have some table manners. “Wait,” she says, “till grandpa (and everyone else) is seated, and after you say your prayers.”

In China, the child is sometimes advised to eat last, i.e. after grandpa and everyone else senior have all moved their chopsticks, which is all the more reason why children here are tempted to steal a first bite at their favorite food and run a greater risk of getting slapped on the wrist.

Anyways, you get the picture. A slap on the wrist is an attempt to stop you from doing something wrong, but it’s a slight punishment because, well, no-one gets seriously hurt.

Hence, figuratively speaking, to give/get a slap on the wrist is to give/get a slight punishment – and let go of the matter thereafter.

Here are two more media examples:

1. The Army has reversed a decision to punish three officers for command failures that led to one of the deadliest firefights for U.S. forces since the Afghanistan war began nearly a decade ago.

Families of the soldiers killed during the battle said they were briefed Wednesday by Army officials on their call not to reprimand the officers for dereliction of duty. They were told punishing the three would have a chilling effect on other battlefield commanders who have to make crucial decisions.

David Brostrom, whose son Jonathan was killed during the attack, said he and members of other families walked out of the briefing before it was over because they were so upset.

“I’ve never seen anything like it,” said Brostrom, a former Army colonel who retired from military service in 2004. “The Army has reinforced leadership failure.”

The attack at the small village of Wanat near the Pakistan border left nine American soldiers dead and 27 wounded. Their platoon-size unit was attacked by as many as 200 insurgents during the early morning hours of July 13, 2008….

Carlene Cross, whose son Jason Bogar was killed at Wanat, said the families first were informed of Natonski’s findings, which she said were endorsed by Gen. David Petraeus, the Central Command chief just appointed top U.S. commander in Afghanistan.

“Then Gen. Campbell gets up and says they’re not going to do anything to them,” Cross said.

“They’ve completely revoked all of the dereliction findings and basically they won’t even get a slap on the wrist,” she said. “We were just furious.”

- Army Reverses Punishment For Officers Found Responsible For Deadly Afghanistan Firefight, HuffingtonPost.com, June 23, 2010.

2. Do corporations have a social responsibility to be decent, upstanding citizens? Is there a moral imperative that the likes of Bank of America, General Electric and Apple should boost employment, refrain from contributing to inequality, or restrain themselves from despoiling the environment, simply because those are the right things to do?

If you spend even a cursory amount of time investigating this question, you will speedily find yourself reckoning with the answer delivered four decades ago by the economist Milton Friedman: A most emphatic no.

In “The Social Responsibility of Business Is to Increase Its Profits,” originally published in the New York Times Sunday Magazine in 1970, Friedman, the arch-deacon of free market economics, declared that any businessman who thinks a corporation should take “seriously its responsibilities for providing em­ployment, eliminating discrimination, avoid­ing pollution and whatever else” was “preach­ing pure and unadulterated socialism.”

Businessmen who talk this way are unwitting puppets of the intellectual forces that have been undermining the basis of a free society these past decades … In a free-enterprise, private-property system, a corporate executive is an employee of the owners of the business. He has direct re­sponsibility to his employers. That responsibility is to conduct the business in accordance with their desires, which generally will be to make as much money as possible while conforming to the basic rules of the society, both those embodied in law and those embodied in ethical custom.

The great irony of Friedman’s hard line is that in 1970, his words probably sounded much more extreme than they do today. Despite decades of lip service to the idea of “corporate social responsibility,” the notions that corporations do best when most untrammeled by regulatory constraint or that they should only be guided by a desire to generate the maximum return on investment for their shareholders are now bedrock ideological fixations of the contemporary Republican Party.

In fact, one could well argue that we are currently closer to Friedman’s utopia than during any other period in living memory. The Supreme Court has vastly loosened restrictions on corporate spending on the political process, trade policy has supported a decades-long trend toward foreign investment, offshoring and outsourcing, corporate taxes are at a historic low, and even the worst financial crisis in decades has hardly resulted in more than a slap on the regulatory wrist for the guilty parties.

But one wonders what even Milton Friedman might think if he could survey today’s wreckage. Would he have any remorse at the sight of bailed-out banks generating huge profits while ordinary Americans struggled to find and keep jobs and millions more faced foreclosure? Would he feel any necessity to reexamine his own argument, in particular that line that states that businessmen should conform “to the basic rules of the society, both those embodied in law and those embodied in ethical custom”?

Because the huge loophole gaping wide open there is hard to miss. It has two parts:

First, what does it mean to play by the rules when you are writing the rules in your own favor? It is obviously in the interest of corporations to lobby Congress for laws that help them to increase their profits. But it is by no means clear that such a practice is in the best interest of society as a whole.

Second, there is the matter of just what precisely is defined as “embodied in ethical custom.” What do Americans believe, what values do we share that should, perhaps, also be shared by our corporations? Inadvertently or not, by throwing “custom” a bone, Friedman opened up a huge can of worms. Maybe, as a society, we do believe that corporations have an obligation to boost employment at home rather than abroad, or pay their fair share of taxes. Maybe, as a society, we think it is repugnant that Fortune 500 CEOs make 400 times as much as their average worker. Maybe, in general, we support the clean air and water regulations that corporate lobbyists are so eager to castrate?

And maybe, just maybe, we believe that corporations that are bailed out with taxpayer funds have an extra responsibility to behave as responsible citizens, and not merely as amoral profit-generating automatons.

- Are U.S. corporations good citizens? Salon.com, November 22, 2011.

About the author:

Zhang Xin is Trainer at chinadaily.com.cn. He has been with China Daily since 1988, when he graduated from Beijing Foreign Studies University. Write him at: zhangxin@chinadaily.com.cn, or raise a question for potential use in a future column.