Meltdown MBAs: The business schools that failed the economy
Mar 5th 2009 10:00AM
Updated Mar 5th 2009 8:02AM
With so many Americans out of work, it's hardly surprising that universities are reporting a surge in applications. What's odd is that the nation's elite business schools continue to be as popular as ever among Wall Street wannabes.
After all, it's these schools that produced the likes of John Thain, Dick Fuld, Kathleen Corbet and other former corporate chiefs that many now finger for causing the biggest economic crisis since the Great Depression. Together, they ran the financial market into the ground and sparked a global epidemic of dashed fortunes and crushing unemployment the likes of which hasn't been seen for generations - possibly ever. Their Alma Maters most be proud.
At wowOwow, we wanted to know which schools cranked out the meltdown's most widely acknowledged perps. By our count, Harvard Business School takes top honors, followed by New York University's Stern School of Business and Cornell.
Here's our dishonor roll of schools that failed the economy by unleashing their best and brightest on the rest of us:
Harvard - 9 Stars
Stanley O'Neal, Harvard MBA: The ousted CEO of Merrill Lynch who posted $8 billion in losses over the sub-prime crisis, but left with a $161 million serverance package.
John Thain, Harvard MBA: Hired to succeed O'Neal at Merrill Lynch, he eventually sold it to Bank of America. But not before spending $1.3 million to decorate his office.
Christopher Cox, Harvard MBA: Under his leadership the SEC was known for lax enforcement, missing Bernie Madoff's massive Ponzi Scheme despite numerous red flags.
Henry Paulson, Harvard MBA: As secretary of the Treasury under President Bush, he spoke ardently against government regulation of Wall Street, later overseeing the biggest banking bailout in U.S. history.
Lawrence Summers, Harvard PhD, Economics: Harvard's former president and the current head of President Obama's National Economic Council, Summers was the deputy secretary of the Treasury under Bill Clinton who helped prevent government oversight of derivatives, the toxic investments at the root of the crisis.
Franklin Raines, Harvard Law: As the CEO of Fannie Mae, he took "early retirement" amid a looming investigation of the company's accounting practices.
Daniel Mudd, MPA, Harvard JFK School of Government: He took over Fannie Mae from Raines, and increased the number of sub-prime mortgages it guaranteed, until the Feds were forced to take over the company.
George W. Bush, Harvard MBA: Rode herd over the biggest financial meltdown since the Great Depression.
New York University - 3 Stars
Alan Greenspan, MA, Economics, NYU: As the former Federal Reserve chairman, he kept Wall Street unregulated and the lending rate low, allowing the mortgage bubble to grow and eventually burst.
Dick Fuld, NYU/Stern MBA: Under his leadership, Lehman Brothers had to file for bankrutpcy after 158 years as a successful investment bank.
Kathleen Corbet, NYU/Stern MBA: She was the Standard & Poor's boss who slapped Triple-A ratings on risky pools of loans, luring investors all over the world into buying now-worthless CDOs.
Cornell University - 2 Stars
Sandy Weill, Cornell BA, Government: As the former CEO of Citibank, he put commercial and investment banking under one roof for the first time since the 1930s by successfully lobbying for the repeal of Depression-era regulations.
Richard Marin, Cornell MBA: The former CEO of Bear Stearns Asset Management who ran two highly leveraged hedge funds that blew up in the summer of 2007 and ruined the company.
London School of Economics
Robert Rubin: As the former Treasury Secretary under Clinton, he strongly opposed government regulation of derivatives.
University of Southern California
Chuck Prince, USC Law: He replaced Sandy Weill as CEO of Citibank until he was sacked over the firm's poor risk management record.
University of Georgia
Phil Gramm, U of Georgia Ph.D., Economics: The former Republican senator who co-authored the infamous 1999 repeal of the Depression-era Glass-Steagall Act, which regulated the banking industry and kept the economy depression-free for 66 years.
Bill Clinton, Yale Law: As president of the United States, he signed the Gramm-Leach-Bliley Act dissolving the depression-preventing Glass-Steagall Act into law.
University of Virginia
David Lereah, UVA Ph.D., Economics: The chief economist of the National Association of Realtors, his rosy forecasts helped fuel the home-buying, mortgage-lending frenzy of the mid-2000s.