It is said that if you want to know where the moral compass
of a publication (such as the Wall Street Journal) is pointing, look at the
sort of opinion articles that its editors choose to publish. And we have two good
examples of that in the April 29, 2014 edition of the Journal.
The first article has the title: “Busting Insider Trading:
As Pointless as prohibition” and the subtitle: “Just as Americans found ways to
keep drinking, Wall Street will always look for an edge.” It was written by
Henry G. Manne who is retired dean of a law school. The second article has the
title: “Germany Turns Against the West on Russia ”
and the subtitle: “Angela Merkel meets with Obama this week and says she's on America 's
side. But some think she's being played by Vladimir Putin.” It was written by
John Vinocur.
The gist of the Manne article is that there is a kind of
equivalence between the effort to eradicate alcohol consumption and the effort
to eradicate insider trading. He says both are pointless efforts because they
are futile attempts to accomplish the impossible. And why is that? Because, in
the case of insider trading, “there is simply too much money sloshing around
waiting for an edge.”
Manne then draws the parallel between the history of
Prohibition and that of busting insider trading by giving detailed accounts of
the sort of efforts that went into both situations. The one to ban the
consumption of alcohol failed, he says, because the “massive criminalization of
a generally benign activity became too scandalous even for the pious moralists
who fueled the drive for prohibition.”
And then, with a sense of yearning which he does not
disguise, he goes on to say this: “Perhaps the same will happen with insider
trading … The imagination of wealth seekers in using valuable information will
always outpace the ability of regulators to cope.” To close, he makes this
astonishing point: “The case for outlawing insider trading is even weaker …
Insider trading not only does no harm, it can have significant social and
economic benefits.”
And so you wonder if he understands that trading in assets
is always a zero-sum game. What someone makes on the stock markets is what
someone else loses. The one that wins by cheating commits the crime of hurting
the one that does not cheat. And for the retired dean of a law school to take a
stance such as this is truly scandalous. But that's not the only thing to alarm
you because this stance is also that of the prestigious business publication,
the Wall Street Journal.
As to the Vinocur article, this author is writing about
another author named Winkler who wrote an essay in which he “expressed alarm
about a current rise in German sentiment showing understanding for Vladimir
Putin.” Vinocur writes that Winkler has written: “this trend is creating new
doubts about Germany 's
calculability.”
He tells of the upcoming meeting between German Chancellor
Angela Merkel and US
President Barack Obama regarding the situation involving Russia and Ukraine . His view of Merkel is that
she wants to be friends with everyone because it is good for business. In fact,
he mocks her with the sally: “we're in the money.” Aside from that, Vinocur
makes clear that the German Chancellor is where the German people are … on the
fence between East and West, between Russia
and America .
And this prompts Vinocur to ask the question: “Could
anything come out of the Merkel-Obama meeting?” And he answers by making a
bizarre point which he says was whispered to him by someone called Michael Naumann.
Apparently the point made is that the German people are afraid of Russia , and
Putin knows this. And so, Vinocur predicts that America
will have to face Russia
alone.
Whatever “face Russia ” means, it is obvious that
the editors of the Wall Street Journal are okay with it. So here we have a
situation in which the Journal says: let them rob each other all they want on
Wall Street. But when it comes to Germany
trading the value added of her workers against the raw materials of Russia , watch out because America will
have to face that situation with stern actions.