You've heard about risk and reward, right? If you want to make big
gains, you have to take corresponding risk. Of course, that sort of
thing is for the little people. If you manage to worm your way to the
top you'll find capitalism is a one-way game: you take the rewards, let
the little people take the risk.
Today's case in point is Bernie Ebbers, CEO of WorldCom, the failing
telecom behemoth. Ebbers made a big bet, on his personal account, that
his company's stock would rise; he bought some great big chunks of
WorldCom stock. But Ebbers is not only a failure as a telecom CEO, he's
also not much of a speculator - the stock tanked, thanks in large part
to his management skills, or lack thereof.
But here's why the rich really are different from you and me; if we make
a bad stock bet - and who hasn't - we feel the pain. But not Bernie;
like most of the arrogant men who have schemed their way to the top,
Bernie was glad to take the gain if the bet had gone his way but, since
it didn't, he just shifted the loss to his company - and to the poor
fools who own WorldCom shares. In fact, WorldCom has "lent" Ebbers
$339.7 million to repay the loans that he used to purchase the stock.
And since Ebbers is, in fact, bankrupt, the "loan" is, in effect, simply
a transfer of wealth from WorldCom's shareholders to Bernie.
Meanwhile, while Bernie is busy bilking the shareholders, he's cut out
the free coffee for WorldCom's 59,000 employees. The company will save
$4 million by eliminating the employee coffee service - and hey, after
covering the CEO's bad bets, they certainly need to save a few bucks.
