The New Neo

You might ask: who cares about Mrs. Madoff? After all, it’s her husband who’s the culprit.

There’s little doubt that this is true. But a rather intriguing article appeared in today’s NY Times on the subject of the involvement (or lack thereof) of Madoff’s wife Ruth in the whole scheme. It touches on a subject relevant to other spouses engaging in other acts of crime or major wrongdoing: is it possible to fool a wife or husband about so basic a character trait?

There are people quoted in the article who say Ruth Madoff must have known; a wife would know and a wife should know. There are people who say the same thing about child molesters, serial killers, adulterers, and most of the other varieties of human wrongdoing. But it is my observation that, although it is sometimes true that wrongdoers leave a clear trail and that any spouse who doesn’t intuit what’s going on is in a state of denial, sometimes the culprits are so slick and so clever, so good at dissembling, that no one would ever know.

To think otherwise is a self-protective lie we tell ourselves to reassure ourselves that we could not be taken in this way; oh no, surely not! But the evidence points to the fact that Bernard Madoff was a master at taking people in, gaining their trust, and then politely screwing them. He fooled people who would otherwise have been wary. His reputation was spotless, stellar, and lengthy.

And his wife, apparently, was part of his game, if only unwittingly. He used her charm and friendliness to woo new investors without seeming to be in need of them. The feeling people got was that they were lucky that Madoff deigned to take their money; he was doing them a favor, not the other way around.

Here’s the Times on the subject:

Was Mrs. Madoff really blindsided? In the social circles where the couple once traveled, both possibilities are unnerving ”” that Ruth Madoff was in on this, or that she wasn’t…Either way, wittingly or not, she was an essential asset to her husband, humanizing him and drawing people into his orbit.

I’m not saying that Mrs. Madoff absolutely did not know what was what with her husband and his deals. But the article points out that she would have almost had to be a skilled accountant, devoted to studying his books, to have learned the truth of what was going on. Assuming she did not do that—and why would she have, even if she had the training?—the only other clue to the existence of the Ponzi scheme would have been her husband’s suspicious demeanor. And my guess is that, until shortly before that fateful December 10, 2008, when he claims he first spilled the beans to his wife and sons, he managed to exude the same gravitas, confidence, and reliability as ever.

It’s tempting for us all to think that we would not have been fooled had we been in Ruth Madoff’s position. But I say, isn’t it pretty to think so?

Are these guys correct, and is the worst of the recession behind us?

I certainly don’t know—but neither does anyone else. It would, however, be a wonderful thing to have the answer, because we are being asked to act in drastic ways to forestall a cataclysmic event that may or may not occur without such intervention. And, unfortunately, since the proposed cures could be worse than the disease, it would be awfully good to know that the diagnosis is correct before we start the treatment.

But isn’t this always the way? For example, it’s the situation with global warming (or climate change, or whatever is the proper term de jour). The state of our analytic and predictive powers is poor, but the voices of doom cry out for immediate and sometimes drastic remedies.

It also was what faced the Bush administration in the buildup to the Iraq war—that is, unless you think the evil CheneyBushHitler manufactured everything for their/his own nefarious purposes. There was evidence that pointed in the direction of a situation that could easily go on to become a conflagration if not nipped in the bud. And yet the nipping process was painful, uncertain, and potentially dangerous in and of itself, as we have seen.

But we must always make decisions based on incomplete information, both in our lives and in politics —and even in areas of science that seem far more straightforward than climate change or economics. For example, at the end of WWII, when it came time to test the atomic weaponry developed by the Manhattan Project, there was still some uncertainty about the outcome. Despite the fact that physics is one of the more rigorous and predictable sciences, and although the men who designed the bomb were exceptionally brilliant, there remained some question about what would actually happen when an attempt was made to detonate one:

The observers [of the first atomic test] set up betting pools on the results of the test. Predictions ranged from zero (a complete dud) to 18 kilotons of TNT (predicted by physicist I. I. Rabi, who won the bet, to destruction of the state of New Mexico, to ignition of the atmosphere and incineration of the entire planet. This last result had been calculated to be almost impossible, although for a while it caused some of the scientists some anxiety.

I bet it did.

We all must live with the anxiety of not knowing the consequences of our actions, or what the alternatives would have wrought. Those of you who read this blog regularly know that one of my favorite authors, expatriate Czech author Milan Kundera, has written quite a bit about this topic—and I’ve quoted him quite a bit, too. But his words seem so apropos that I’m going to quote him again (the following is from his masterpiece The Unbearable Lightness of Being):

Several days later, [Tomas] was struck by another thought, which I record here as an addendum to the preceding chapter: Somewhere out in space there was a planet where all people would be born again. They would be fully aware of the the life they had spent on earth and of all the experience they had amassed here.

The history of the Czechs will not be repeated, nor will the history of all of Europe. The history of the Czechs and of Europe are a pair of sketches from the pen of mankind’s fateful inexperience.

Does humanity grow in experience, and therefore wisdom? Perhaps. I’m not at all sure, however—or, to extend Kundera’s thought, I’m not at all certain that the history of planet number five would go any better than that of planet number one (or to use another example, does “Groundhog Day” trump “Peggy Sue Got Married?”)

No matter how much history and knowledge we amass, we are still going forward into an unknown future, in which situations that appear to resemble each other (such as, for example, the present economic crisis and the Great Depression of the 30s) have so many differences that to try to apply the lessons learned from the errors of the first to the facts of the second is not necessarily going to lead to a better result. We also labor under the difficulty that, even if those lessons might be applicable and we would like to apply them, public opinion and/or politics may at times make it impossible to do so.

The only solution is to attempt to study history and/or science, find the course of action that seems most suitable to address the new situation, and do our best, remaining philosophical about the prospects of success. Another caveat might be to use the least drastic measures possible. But unfortunately, sometimes drastic situations require drastic interventions.