First, no, you are not crazy for figuring out an ethics question with questions of efficiency. Economics is tangled up in fairness/rightness judgments from square one. There is, of course, much of ethics which is outside the bounds of economics, but compensation principles? Seems pretty sensible. This is, however, not technically an externality. You had an agreement with one person. You abrogated that agreement. Ethical? Unknown. Externality? No.
There are also reputation problems to consider. I imagine that even this 'underskilled' potential CFO has a lot of contacts and clout- will you be blacklisted for screwing this guy over?
joshklein
· 5 months ago
I suppose it's not an externality in the technical sense of the word, but it is a demonstration of the way our set of business laws around "at will employment" don't quite get it right (though it could be the best we can do, who knows). Capital and labor can both terminate a working agreement at any time for any reason, but capital is far more mobile and has a broader range of options.
Shaun
· 5 months ago
You seem to have forgotten that doing what you've promised to do should be considered part of ethics. I would pick the guy who quit his job, because he was doing so on the assumption that I follow through with my promises. We should follow through with contracts (provable or unprovable -- if we know we've made them) because it's the right thing to do.
You also seem to have ignored the notion of "ownership" in your ethical analysis. Louie didn't own his stuff -- he was the king, not the god. Taking money from the government (who forcibly took it from the people) is ethically on a different field than taking money from one who earned it and owns it.
Also, the rising tide metaphor is true -- it's a basic economic fact. The countries with the most rich people also have "lower class" people who live like kings compared to other countries. It's not perfect, compared to the rich, but compared to the living standards in other countries, it's amazing.
It's about objective gain and profit -- not comparisons. I don't give a shit that you probably have a nicer computer than mine because I don't base my identity on being better or worse than you -- I base my identity on being the best I can be.
You also seem to just be assuming that redistribution -does- lead to a more fair world. We've... never seen this happen. A man who earns $15k and accepts welfare is less likely to make it to the middle and upper classes than a man who doesn't. Just... do the research.
If you still believe this, then I challenge you to reduce your income to $20,000 per year, donate your money to Charity Water, and downsize your house/apartment, car and computer. If you can't do this... well. It was a fun theoretical discussion about what to do with other people's money. =)
Sorry. It's just the economist in me that required I make the point. ;-)
joshklein
· 5 months ago
Thanks for the response, Shaun. I'm glad I finally got someone to disagree with me ;)
Simone
· 5 months ago
Hire the woman. You have an obligation to the company - its employees, shareholders and debtors. If you've been convinced that she is the better candidate hire her.
As for the candidate, give him a 4-6 month severance package and help him find another job. As a CEO , he understands somethings aren't personal. It's a simple matter of of business.
I'm sure his wife will hate you though.
The Harvard Business Review blog, Voices, held a colorful debate on the subject of ethics several months back. I participated in the debate but bailed when the moderator took on a Howard Cosell persona. The responses were interesting to say the least. You should check it out.
adchick
· 4 months ago
Great thought provoking post. Do no evil. Or at least as little as possible. You have to do what's right for the company, so take care of the guy, help him find another position. That's the honorable thing to do. Then make damned sure the woman saves your ass! "The needs of the many outweigh the needs of the few."
All Comments
There are also reputation problems to consider. I imagine that even this 'underskilled' potential CFO has a lot of contacts and clout- will you be blacklisted for screwing this guy over?
You also seem to have ignored the notion of "ownership" in your ethical analysis. Louie didn't own his stuff -- he was the king, not the god. Taking money from the government (who forcibly took it from the people) is ethically on a different field than taking money from one who earned it and owns it.
Also, the rising tide metaphor is true -- it's a basic economic fact. The countries with the most rich people also have "lower class" people who live like kings compared to other countries. It's not perfect, compared to the rich, but compared to the living standards in other countries, it's amazing.
It's about objective gain and profit -- not comparisons. I don't give a shit that you probably have a nicer computer than mine because I don't base my identity on being better or worse than you -- I base my identity on being the best I can be.
You also seem to just be assuming that redistribution -does- lead to a more fair world. We've... never seen this happen. A man who earns $15k and accepts welfare is less likely to make it to the middle and upper classes than a man who doesn't. Just... do the research.
If you still believe this, then I challenge you to reduce your income to $20,000 per year, donate your money to Charity Water, and downsize your house/apartment, car and computer. If you can't do this... well. It was a fun theoretical discussion about what to do with other people's money. =)
Sorry. It's just the economist in me that required I make the point. ;-)
As for the candidate, give him a 4-6 month severance package and help him find another job. As a CEO , he understands somethings aren't personal. It's a simple matter of of business.
I'm sure his wife will hate you though.
The Harvard Business Review blog, Voices, held a colorful debate on the subject of ethics several months back. I participated in the debate but bailed when the moderator took on a Howard Cosell persona. The responses were interesting to say the least. You should check it out.