How you get rich is just as important as getting rich
My rich dad said, “You can believe any lie…if you tell it to yourself enough.”
So, for instance, some people tell themselves that they’re poor because other people are conspiring against them. Rather than fight, they give up and blame others.
Other people tell themselves, “Money isn’t everything,” and use that as an excuse to not have ambition when they really mean, “I’m afraid to fail.”
Still others tell themselves, “It’s just a small fabrication. It won’t hurt anyone, and it will help me get ahead.” They believe that it’s OK to lie for financial gain.
The problem with lies is that eventually, when repeated enough, they become true lies. And when lies become true lies, they lay the foundation for even bigger lies down the road. Before you know it, you’ve lost your integrity.
And as I wrote before, integrity is the one thing that should be too big to fail.
The cost of lying
In the economies of the U.S. and around the world, we have a big problem with lying. I’ve known this for years and I wrote about it in Conspiracy of the Rich, but the depth of our problem is just now becoming clear.
David Rhode’s recent column in The Atlantic, “The Libor Scandal and Capitalism’s Moral Decay,” exposes our troubling economic true lies.
In the column, Rhode writes about the implications of the latest banking scandal. Seems Barclays in Britain (and most likely JP Morgan, Citibank, and Bank of America) manipulated the LIBOR interest rate between 2005 and 2009 to unfairly profit off of middle-class families, cities, retired seniors, and more.
For those of you who don’t know, LIBOR is an interest rate benchmark used to value some estimated $360 trillion in loans, such as student loans, credit cards, and loans to local governments.
“So,” Rhode writes, “Barclays' victims weren't just other banks and traders. They included taxpayers in dozens of communities who are believed to have paid millions more in interest than they should have at the height of the financial crisis. Teachers and other public servants may have been laid off because of bankers' pursuit of ever-higher profits.”
Barclays has tried to sweep this incident under the rug by settling with British and U.S. authorities to the sum of $453 million. But this scandal is only growing. “Lawsuits filed by the City of Baltimore and dozens of other parties against Barclays, JP Morgan, Bank of America, Citibank and Deutsche Bank have been consolidated into a single case in a New York federal court. Banks are denying any wrongdoing, and the true scope of the losses—and the role of American banks—is expected to emerge in the complex legal battles ahead.”
Who’s lying anyway?
While the details of the LIBOR scandal are shocking, they’re not surprising. For decades, the banking system has been built around squeezing as much money out of consumers’ pockets into the pockets of the ultra-rich. And unethical practices abound, such as the sub-prime lending that contributed greatly to the current financial crisis. If you’ve read Conspiracy of the Rich, you’re not surprised by this latest news. The banking industry has been telling itself true lies for a long time.
More surprising in Rhode’s article, however, are the statistics from an Ernst & Young survey of 400 Chief Financial Officers from around the world that “found that a growing number of them were willing to pay bribes and falsify their firm's financial performance to survive the financial downturn.”
According to the survey, “The number of chief financial officers who said they would engage in bribery to stay in business grew from 9 percent in 2011 to 15 percent in 2012. And the number who said they would misstate their company's financial health to get through a downturn rose from 3 percent in 2011 to 5 percent in 2012.”
In other words, more CFOs are willing to lie, cheat, and steal to profit off of suckers like you and me. What a sad statistic.
Integrity is everything
Money may not be everything, but it is important. Integrity, on the other hand, is everything. And money is a great barometer of people’s integrity. When a lot of money is on the line, people will start to do unexpected things. Money often reveals who we really are.
When it comes to knowing how money works, it’s important to have a great financial education so that you can understand the mechanics of money and how to make it work for you.
But it’s equally important to understand how money can work on you and your soul, and how, if you’re not careful, you can start telling yourself true lies just to make more money. At first, those lies may not hurt anyone but eventually they can hurt a lot of people. That’s why it’s also important to have a great moral education. Because as the Bible says, “For what will it profit a man if he gains the whole world and forfeits his soul?”
Seems more and more people seem to think moral shortcuts are now a legitimate road to wealth. I don’t believe that for a minute, and neither should you. I’d rather be rich and have a rich soul. How about you?
If you want to be rich, and have a rich soul, check out our free, financial education community here.