Unethical Business Leaders + Crooked Political System <=> Teaching Ethics

Our school is in the process of revising its General Education Curriculum. One aspect of the new proposal is Value Development. Most schools, including the big ones like Harvard and Duke have been focusing on Ethics and offering/mandating courses in this area, especially for business students.
An article in the NYT sheds some data on our business and political leaders, and leads one to question these efforts. In "Tax Break for Profits Went Awry" Mr. Norris writes"It was called the “Homeland Investment Act,” and was sold to Congress as a way to spur investment in America, building plants, increasing research and development and creating jobs. It gave international companies a large one-time tax break on overseas profits, but only if the money was used for specified investments in the United States.The law specifically said the money could not be used to raise dividends or to repurchase shares. Now the most detailed analysis of what actually happened — using confidential government data as well as corporate reports — has estimated what happened to the $299 billion companies brought back from foreign subsidiaries. About 92 percent of it went to shareholders, mostly in the form of increased share buybacks and the rest through increased dividends. There is no evidence that companies that took advantage of the tax break — which enabled them to bring home, or repatriate, overseas profits while paying a tax rate far below the normal rate — used the money as Congress expected. “Repatriations did not lead to an increase in domestic investment, employment or R.& D., even for the firms that lobbied for the tax holiday stating these intentions,” concluded the study by three economists, including a former official of the Bush administration who took part in the discussions leading to enactment of the plan in 2004..."

I had written about this act a few years ago, and how it was a straight-forward message from the Bush administration to the business leaders to cheat the tax-payers...just one of the many gifts the previous administration showered on corporations. Unfortunately all those unethical acts have resulted in a massive crisis. The authors of the study make one point that might be erroneous. They state that "“Although the H.I.A. does not appear to have spurred the domestic investment and employment of firms that used the tax holiday to repatriate earnings from abroad, it may still have benefited the U.S. economy in other ways. The tax holiday encouraged U.S. multinationals to repatriate roughly $300 billion of foreign earnings and pay most of these earnings to shareholders. Presumably these shareholders either reinvested these funds or used them for consumption. Either of these activities could have an effect on U.S. growth, investment and employment.” The problem is that part of the consumption (especially with leverage) could have contributed to the current crisis, thus having a negative effect on the long-term GDP. There is no information on how the share repurchases have actually benefitted the overall economy, neither is there information on how shareholders have used any dividends received through this HIA.