WASHINGTON — “The new law of evolution in corporate America seems to be the survival of the un-fittest,” the fictitious shareholders of the phony corporation Teldar Paper are told.

Then Gordon Gekko, the ruthless takeover artist depicted in the 1987 movie “Wall Street,” goes on to deliver a memorable soliloquy: “The point is, ladies and gentlemen, that greed — for lack of a better word — is good. Greed is right. Greed works. Greed clarifies, cuts through and captures the essence of the evolutionary spirit. … And greed, you mark my words, will not only save Teldar Paper, but that other malfunctioning corporation called the USA.”

That malfunctioning corporation called the USA is still malfunctioning. At the moment, the cause is a surfeit of greed not seen since the 1980s if, in fact, it ever went away. Our corporate culture has been transformed from one based, legitimately, on the profit motive to one that is based, illegitimately, on elaborate paper-pushing. At its essence, this is a practice of making money from transacting and not from transforming a commodity into a product, or a brilliant idea into something so useful that millions rush to buy it.

And when these greedy transactions go bad — as they have in the incomprehensible subprime mortgage mess and, specifically, in the unfolding Bear Stearns imbroglio, greed again carries the day. If the Bear Stearns catastrophe is opaque to most Americans, it is because the business the giant investment bank was conducting was designed that way. The shortest, most oversimplified version of the story is that Bear is neck-high in perilous assets stemming from its role in the sketchy mortgage market and appears unable to meet its own creditors’ demands. So the Federal Reserve engineered what amounts to a public bailout, a transaction smoothed by J.P. Morgan Chase, originally with an offer of about $2 per share to take over Bear Stearns and save it from bankruptcy.

You would think such a gesture would be welcomed by the very managers and shareholders who’d driven Bear into the tank. But they balked at the $2 price: “Derisory” is what Joseph Lewis, a billionaire investor, called it, according to Bloomberg News. And so these sharp investors who could not, for the life of them, see that they’d made a lousy investment threatened to block the takeover by finding another suitor or — what else? — by suing to stop it. Now they’ve gotten J.P. Morgan to up its offer to about $10 per share.

Greed is still good.

Consider those on the other end of the subprime mortgage meltdown, the homeowners — some, by now, former homeowners — who were locked into loans they could not afford, either because of their own misguided financial choices or because these loans were presented to them with predatory and deceptive practices. Those who have not yet been foreclosed have been offered no real way to hold on to the roofs over their heads. They have not had their government bail them out of their bad choices. Indeed, the Bush administration has repeatedly said it will not engineer such a rescue, though in the end it may have to if we are to avoid a Depression-like contagion.

We are presented with an ugly portrait of ourselves. The misguided investments of billionaires who kept buying stock in Bear Stearns are given a hand up by the Federal Reserve. Then they demand more, and get it. The misguided homeowners are told to pack up and move.

If this picture were just a snapshot of the mortgage implosion, it would be repulsive enough. But it is the same movie we see again and again, as corporate chieftains in search of the cheapest labor move jobs overseas, freeze or eliminate pensions at home and often discard workers who have given their lives to a company. Then the managers, having delivered to shareholders the additional “value” they seek, are rewarded with compensation packages that, in and of themselves, could fund the pensions or the health insurance of more than a few displaced workers.

It is no longer enough to blame lax regulation and a political system that has nurtured it. It is no longer enough to blame “globalization,” as if this were some force that we are powerless to tame. We’ve chosen to do nothing to tame it.

The malfunctioning corporation called the USA is just as Gordon Gekko saw it. But it is a corporation that cannot be saved by greed. It is greed run amok that is bringing it to its knees.

Marie Cocco’s e-mail address is mariecocco(at)washpost.com.

© 2008, Washington Post Writers Group

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