In the movie, “A Few Good Men” there is a memorable scene where Tom Cruise is playing the part of a military attorney who is questioning an Army General, played by Jack Nicholson. Cruise is pushing hard for answers about a death that occurred on the General’s base and is treating Nicholson’s character as a hostile witness. The General becomes agitated over the disrespect the attorney is paying to his rank and finally displays his true character, yelling, “You want the truth? Do you really want the truth? You can’t handle the truth!”
The General’s attitude in the scene, while fictional, isn’t much of a stretch from reality. In business school the professors talk a lot about corporate culture and how the attitudes and the opinions of the corporate executives trickle down through the organization and define the company. While the US government is not a corporation and certainly doesn’t function as a business, as evidenced by trillions of dollars in debt and budgets running a deficit, none the less it has a culture that is defined by its leaders. While the Obama administration pledged that they would have transparency, their governing has been opaque. Over the last two years there have been incident after incident where either President Obama or a member of his administration has told the public one thing only to be doing another. Don’t misunderstand what I’m saying. While I use the current administration as an example I could easily refer to any presidency and provide examples. The truth is the people who run the government don’t believe we can handle the truth.
To make my point, I’d like to give you a prime example. A shopping center that my firm manages has a bank as a tenant. This bank was actively involved in residential mortgages and was hit hard, like many other banks, with the economic downturn. The leasing administrator for the bank has contacted me and informed me they are trying to sell the assets of the branch located in my shopping center. Having the knowledge that I will have a vacancy, I begin doing research into banks that operate within the local market trying to find those who are currently expanding. While doing this research on the Internet I begin to uncover the fact that almost three-quarters of the banks within the market are in financial distress and have taken money from the federal government in order to continue operations. I located agreements between bank executives and the federal government that prohibited the banks from making loans without the federal government’s approval. The first thought that occurred to me was how could the federal government manage a bank’s financial operations when it can’t manage its own. Supplied with this new information I began to understand why there has been no lending activity from banks and why the real estate market continues to struggle. In fact, this is also why the economy continues to struggle. Business aren’t able to renew or obtain lines of credit necessary to even out the cash flow of day-to-day operations, commercial and residential real estate owners and buyers can’t obtain loans to finance or re-finance their properties, and consumer loans for cars purchases continue to be difficult to obtain.
So what is the truth? Are the government’s regulations in place because of bank bail-outs designed to protect the public or are there other reasons? Does the current administration have another agenda that isn’t being disclosed? I have my own thoughts on that but I’m not going to write them here. You want the truth? You can’t handle the truth!