(From the project Dialogues with Julian Moody: On Life, Business, Sustainability, and Other Things by Julian Moody and Brandy Walker)

BW: I’ve read that in the era leading up to the Great Depression, often called the Roaring Twenties, the predominant creed and mentality of the times was: “That which is economically right is morally right.”

JM: Right.

BW: That could be a description of the times leading up to the “Great Recession” which started in 2008.

JM: Yes, that’s true.

BW: The belief “that which is economically right is morally right,” or in more crass terms, “greed is good,” is very prevalent, if not openly discussed. You have extensive experience in business working for many companies. Is it true that greed is good or somehow justified or necessary?

JM: No. Like ego, it tends to be destructive and unstable over the long term. We need to clarify the difference between short term gain and long term growth. For example, the only concern of management of some publicly traded companies in the late 1990’s was to get the stock prices to go up using whatever means and then cashing out with no regard to the truth or long term consequences on the health of the companies. Short term gain using whatever means with no regard to the consequences leads to instability.

BW: There is a complex set of reasons that led to the recent economic meltdown, but without oversimplifying what caused it, watchdogs have argued that the practice of paying financial managers of the big banks huge salaries and bonuses on short-term profits, but not holding them accountable on long-term losses caused by their decisions, created an environment that encouraged them to take risks and make questionable decisions that eventually brought down their own companies and threatened the whole financial system. What do you think of the practice of paying financial managers on Wall Street enormous salaries and giving them extravagant benefits and bonuses, but at the same time, not holding them responsible or accountable for their decisions and mistakes?

JM: If you get me started on that, I’ll be going all night. I think it’s absolutely evil and wrong.

BW: The financial managers and even the companies they work for tend to have clever ways of rationalizing why they should be allowed to do this and be paid so much.

JM: We could say that’s an example of greed. But we could also say that’s an example of being totally mean and insensitive in terms of other people. These people took risks and threatened everyone else’s well-being to enrich themselves essentially.

BW: You mentioned that the difference between short-term gain and long-term growth needs to be clarified.

JM: In general, fast growth, based on short-term profit and gain, tends to be unstable and fleeting, and slow growth tends to be solid, deep-rooted, and stable. Unfortunately, in our culture, there is an impatient emphasis on being a huge success as soon as possible or becoming as big as possible. Something like that may not be the best thing for a particular company over the long-term, especially when the quality of the product or service is compromised. My belief is that it is better to maintain a manageable size, but the problem is, people get greedy for various reasons. They may want to “keep up with the Joneses,” prove something to other people, or they think they will die and disappear if they don’t keep growing. The fact is, there are many companies that have been around for generations and they’re doing just fine—they’re not necessarily growing or increasing in size all of the time. Growth has to be healthy and sustainable.

BW: Sustainability is a concept that’s used often in environmentalism, but just as important and necessary in business and the economy?

JM: Absolutely. You could even argue that the two are connected.

BW: Do you see economic downturns as a—I’ve heard them referred to as a cleansing process? Or a rebalancing process?

JM: I’m not sure of the correct adjective, but I do see it as a process. Created by man. I don’t think of it as cleansing. I’m not even sure what that means. The Depression from 1929 to 1941 was really devastating. Nobody has seen anything similar since then. What we have gone through from time to time economically are basically downturns, but all the things they call recessions, are not even a glimpse of the devastation of a depression. And the current economic condition of 2008 is a good example. There’s a lot of people suffering, but it’s not like the suffering of the twelve years of 1929 to 1941.

BW: Do you think we’re headed towards something like that eventually?

JM: I don’t know, but sometimes I hope so.

BW: You hope so?

JM: Yeah, because I think that people need to wake up. I think, and I’m generalizing, that millions of people have had a continuing affluence—almost all the money they need, almost everything they want to buy, or whatever they want to do, and they have been reaching a point where they believe that they are entitled to it and it will go on forever. And it creates many, many problems. And so my basic belief is that a real depression could wake people up to reality. They’re not living in reality. Not everyone of course. There’s a lot of people that I know who are really living in reality. They’re wonderful people. But here in Santa Barbara alone, you could meet many people that are super wealthy. They’ll build a magnificent home with ten thousand square feet, and then you find they’ve got a home in Florida, one in the Virgin Islands, one in France, and on and on. We admire it, romanticize it, and call it the American Dream, but that type of self-indulgent affluence is deadly. And it needs to go away. So I am hoping when it does, if it does, people are going to suffer, that is the wealthy people. They won’t know how to handle it.

BW: Isn’t it the poor who usually ends up suffering?

JM: What I recall growing up in Buffalo, New York during the Depression, people in general suffered, but probably the ones who were hit the hardest were the wealthy in Buffalo. The working class people didn’t have very much to begin with. They lived in tiny cottages. They never had a decent sized home. And so during the Depression, they were still living in the same tiny cottage. Everybody suffered—many had to stand in soup lines to get food—but I think the working class people were able to cope with it better. The wealthy tend to be more psychologically dependent on money and material things for their identity and sense of self worth, that sort of thing, so something like a major economic downturn tends to have a more devastating effect on them.

BW: In fairness, looking at the recent economic downturn, a major cause was the massive real estate bubble that burst. If you take the time to examine what happened, you’ll see there was greed on every level. Greed on the part of people on Wall Street who exploited deregulation to create derivatives that removed responsibility in lending, greed on the part of banks for engaging in predatory lending made possible by derivatives, and greed and irresponsibility on the part of buyers who borrowed money to buy houses they obviously couldn’t afford. There was greed at every level. We live in a greedy culture at all levels.

JM: That’s true. No matter what level of society you are at, you have to look at it in yourself. Academics don’t quite agree on the causes of the Great Depression; I think there is a tendency to get lost in academic theory and miss the big picture or the obvious. Having lived through the Great Depression, and having lived a long time, and having worked for the corporate and business world for many years, I would say simple greed is a major player. There needs to be justice obviously, but everyone has to also look at the greed in their own heart.

BW: Have you worked with anyone who was very greedy? I realize you’ve been retired for some time now, and you worked for companies twenty, thirty, forty years ago. What they are now doesn’t necessarily reflect what they were then. A lot of people come and go.

JM: No. I was intuitively rather selective, so when I met with a new prospect, we would spend quite a bit of time together. Apparently, intuitively, I was taking stock of whether they had good values. And I think if I was picking up that the company was greedy or that the president was selfish, self-centered, and giving extravagant wages to the top people, I wouldn’t work with them.

BW: In the contemporary American mindset, doing good and doing business seem contradictory. A prevalent belief seems to be that one has to do whatever is necessary, not necessarily what is right.

JM: But doing whatever with no regard to the consequences or to make the most money, in the long run, generally doesn’t turn out well.

BW: Many of us are also mired in the mentality that a capitalist is better than someone like Mother Teresa because he actually employs people and gives them a livelihood. Or vice versa—that the capitalist or entrepreneur is exploitive and greedy, and people who are engaged in nonprofit work or mission work are “good.” Very polarized thinking.

JM: It doesn't help to think of it in terms of better than or less than. Everyone has different interests, talents, and gifts. One person may be very talented in business and have a strong interest in business so it would be better for him or her to work in the business world. Another person may be called to ministering to people, so they should choose that path.

BW: Someone in ministry can have misguided or corrupt motives, and someone in business can have pure motives, such as doing their best to create a product that is needed and selling it at a fair price, and doing their best to not pollute the environment, treat workers well, pay upper management fair salaries, and donate a portion of the profits to charity, that sort of thing.

JM: Right. And companies with good values don’t necessarily make the most money over the short-term, but they tend to last longer and survive better.

BW: Unfortunately, many people seem to want to make as much money as quickly as possible. We often just think in terms of the bottom line—am I making a big profit or not?

JM: Unfortunately, our culture does tend to always think in terms of money, profit, and the bottom line. And value is most often thought of in financial terms. Something almost has no value unless a monetary value can be attached to it.

BW: In some minds, a retired person who does volunteer work or a stay-at-home mom has no value because the work they do doesn’t figure into the GNP, the Standard and Poor’s, this or that financial index.

JM: And you can argue that work is the most important work of all. Not everything is measured in terms of money. But unfortunately our culture tends to think in terms of monetary value, the bottom line—and that mentality has entered into every aspect of our culture, in places where it really doesn’t belong. Unfortunately, we’re mired in a greedy mindset without even realizing it sometimes.