We all know that one of the Ten Commandments is “Don’t steal.” But it’s also hard for us to imagine Bernie Madoff or Jeffrey Skilling in a hooded sweatshirt in a darkened alley mugging a little old lady. And yet clearly, Madoff and Skilling violated that two-word, easy-to-understand commandment. So we have to ask: how in the world were they able to justify it?
A large part of that justification is because different forms of stealing have different “feels” to them. Physically taking money from another person feels more violent, more immediate, and less justifiable of an action. “Cooking the books,” however, can easily feel explainable by the perpetrator. It’s pretty easy to follow the commandment “Don’t steal” if it simply means, “Don’t go around robbing people in the middle of the night.” But Skilling and Madoff did steal – and stole significantly more money than all the armed robbers in America combined.
In fact, when people don’t deal in cash directly, they actually are able to rationalize their actions, and thus end up stealing significantly more money from people.
Cash Keeps Us (More) Honest
al economist Dan Ariely ran a fascinating study in the MIT dorm rooms to examine what might allow people to steal without feeling all that guilty about it. At first, he put six Coke cans in a communal refrigerator. Within three days, all six cans were gone. No doubt, people thought, “No one will notice, and hey – free Coke!”
Why? As Ariely explains:
When we look at the world around us, much of the dishonesty we see involves cheating that is one step removed from cash. Companies cheat with their accounting practices; executives cheat by using backdated stock options; lobbyists cheat by underwriting parties for politicians; drug companies cheat by sending doctors and their wives off on posh vacations. To be sure, these people don’t cheat with cold, hard cash (except occasionally). And that’s my point: cheating is a lot easier when it’s a step removed from money. (Ariely, Predictably Irrational, 218-219)