Magazine

It's Not Just CEOs Who Are Greedy


"How to fix corporate governance" (Cover Story, May 6) is a good summary of a failing system, but you should come right out and say it: Capitalism is greed. The principle of "never enough" is practiced by the shareholder through the CEO. We all want and take the "options."

John Polglase

Newington, Australia

Your story misses the point. A good leader is responsible for an organization and responsible to its owners. If the leaders are doing their job, then disasters like Enron could not occur. Competent leaders would not allow the topics you mention--accounting, executive pay, the board, and leadership--to be handled in a way that was not accurate, equitable, responsible, and effective. External solutions, such as changing or adding rules, will not improve the internal leadership, nor fix, in any meaningful terms, the problem.

Tom Rancich

Vineyard Haven, Mass. To call Malaysia's Internal Security Act "draconian" and to say Prime Minister Mahathir Mohamad used the ISA for his own political purposes is untrue and baseless ("Malaysia: A surprising ally in the war on terror," International Outlook, May 6). The act has been used for many decades to combat racial tensions, communism, or any act that could cause riots. This is to uphold peace and prosperity among our multiracial and multicultural people.

The Malaysian people will decide in the election if they find that Mahathir's government abused its power by exploiting the security act for political ends. There has not been a big shakeup in our government in any election since independence. The same opposition parties cite this draconian act to the voters to gain support, yet they still fail.

Rashid Saharudin

London I agree with your commentary that electoral laws in most European countries have strengthened extremists' hand by guaranteeing them a share of seats if they get 4% of the popular vote ("Le Pen's win may be just what France needs," International Business, May 6). Your readers may be unpleasantly surprised to learn that the Liberal Democrat Party, Britain's third-largest, is committed to proportional representation along European lines.

Prime Minister Tony Blair is sitting on the fence. He has courted the Liberal Democrats and given them hope that he will reform the electoral system on proportional lines. Blair has shown no leadership, because he is afraid that if he rejects the idea, his flirtation with the Liberal Democrats will be finished. After the recent experiences in so many of our neighbors' backyards, let us hope that he speaks out soon.

John White

Harrogate, North Yorkshire Genomics evolution promises to identify the causes of heretofore intractable diseases such as cancer or Alzheimer's ("No quick cure," American News, May 6). Individualized medicine will be more specific for different people and pose fewer side effects. But before we reach this stage in treatment, we will have to struggle with understanding the diseases and their causes and to apply a suite of costly biotechnologies to help us do so. Medicines of tomorrow are likely to be as or even more expensive than today's, but the reduction in health-care costs will be derived from their effectiveness and overall increase in productivity. This high price and short-term pain is necessary if we want to have a long-term painless future.

Liming Ge

Munich Robert J. Barro's critique of the Human Development Report is out of date ("The U.N. is dead wrong on poverty and inequality," Economic Viewpoint, May 6). The HDR is published annually, so it is curious that he should choose to criticize the 1999 report rather than the report from 2001, the latest available. As academic research progresses, our analysis evolves. The forthcoming HDR 2002, out in July, will present our best current analysis of global inequality.

Barro fails to realize that global inequality is not about just income. It is about education for children, access to world markets, receipt of foreign direct investment, control of technology, the marginalization of women, and so on. But the real story is that the extremes of global inequality are so grotesque: The richest 5% of the world's people have incomes 114 times those of the poorest 5%. The latest U.N. Conference on Trade & Development report shows that in the two decades since 1980, export earnings grew at nearly 8% annually in developed countries, 11% in developing countries, but only 3% in sub-Saharan African countries. Hand-wringing helps nobody. But there is no excuse for complacency.

Sakiko Fukuda-Parr

Director

Human Development Report Office

U.N. Development Program

New York

Editor's note: The writer is lead author of the Human Development Reports, 1995-2002.

Barro says that the U.N. proposes to improve governance, "by which it means an increase in the power of international organizations, especially the U.N." What the U.N. means by improving governance is improved governance by national governments, an important goal not only of the U.N. but also of the U.S. Agency for International Development and many other bilateral aid donors.

Barro's solution, to raise the rates of economic growth in Africa, is the same conclusion that the U.N. and most bilateral aid organizations reached some 8 to 10 years ago. Since then, they have redirected efforts and resources from Latin America and Asia to Africa.

Albert M. Marckwardt

Lima, Peru In "The decline of the maquiladora" (International Business, Apr. 29), Mexico's Economy Secretary has it right. Supplying cheap labor is only the first step on the economic development staircase. Such jobs are never permanent in growth economies, but some Mexican regions, mesmerized by the early prosperity, have ignored this fact--and their futures.

Other regions have taken the long view in developing human resources, deploying educational facilities, and designing alliances with foreign partners. Their goals have been to provide sophisticated products and services to world markets. Most of these regions have scarcely seen the downturn.

John Schick

Director General

Mexico Consulting Group

San Francisco "The loneliness of the high-powered woman" (Books, Apr. 29) is not exclusive to the U.S.--it is a problem across the whole Western world. Without intending any flippancy, it may be a case of faute de mieux that some women invest themselves completely in their careers, and their long hours preclude a busy social life, where they might actually find Mr. Right. Oddly enough, as Sylvia Ann Hewlett establishes in Creating A Life: Professional Women and the Quest for Children, so many more successful men in the business world are the ones who are married and have children. It's not a case of "having it all," but having the same as successful men, i.e., a normal family life.

Natalie Smith

Paris


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