BUSTED :

WorldCom Says Its Books Are Off By $3.8 Billion : U.S. Criminal Probe Reported (Yuki Noguchi and Renae Merle, June 26, 2002, Washington Post)

WorldCom Inc. said last night it had improperly accounted for $3.8 billion in expenses and would restate its financial results for the last five quarters. The company fired a top financial officer and accepted the resignation of another, and sources said the Justice Department had begun a criminal investigation.

Despite all the shock, this is how booms always end. You get all that money sloshing around and it's best to assume folks are diddling around with it. Here's a helpful hint : when things look too good to be true, they aren't true.

One interesting thing about this current cycle of scandal is that the Right always has a blind spot about business. They think spending programs are all evil, but tax breaks are all great. They rage against any concentration of government power but think monopolies are swell. They want to send welfare cheats to prison, but think Mike Millken is some kind of hero. Usually though you can count on the Left to counteract this tendency somewhat.

Will today's Democrat Party, which is so firmly entrenched in the pockets of business that you can barely see Dick Gephardt's carrot top sticking out, be able to play the role of enforcer on this one? Or are they so compromised that the abuses we're finding will go unrepaired? Has the party of Eleanor Roosevelt become so completely the party of Martha Stewart that they'll be shamed into silence?

These are the kinds of problems we confront now that liberalism has ceased to function as a counterweight to conservatism. The Clintonification of the Democrats served no one but him well.

UPDATE :
A Corporate Crisis? No, Just Business As Usual (John Micklethwait and Adrian Wooldridge, June 23, 2002, washingtonpost.com)

As we try to make sense of the current corporate meltdown, history suggests three important lessons. First, many of the previous scandals have, by most measures, been rather more serious than today's fuss. Second, the longer-term significance of the scandals is not the wrong-doing of the villains but the remedy society applies. For instance, Tarbell's muckraking journalism helped pave the way for modern antitrust law, and eventually, the dismemberment of Standard Oil in 1907; Insull was often cited as a reason for the regulation of the 1930s. Third, the backlash against corporatemalfeasance can sometimes do more damage than the malfeasance itself.

Posted by Orrin Judd at June 26, 2002 6:32 PM