Moral Hazard


“Power tends to corrupt and absolute power corrupts absolutely.”  (April 5, 1881) John Emerich Edward Dalberg-Acton, Lord Acton in a letter to Bishop Mandell Creighton



Everybody who quotes Lord Acton seems to concentrate on the second half of his famous line; I’d like to consider the first half today: “power tends to corrupt”  – even in small doses.  Let me tell you about my experience in this regard.


First of all, don’t call the cops.  This is not big time corruption where people pay money to government officials so that they award contracts as payback; nothing that violates Federal or state laws or regulations.  No, this is about a different kind of corruption, the kind that works on your soul.  Come to think of it, that is the really big time corruption.


My move from the Flight Director office to the Space Shuttle Program happened suddenly and unexpectedly.  Flight Directors are generally well respected and command a modicum of respect, but they have no budget, they sign no contracts, they do not have direct supervisory control over anybody.  All things considered, Flight Directors have very little in the way of power and influence.


In the Space Shuttle Program office, the first thing handed to me was control of the Infrastructure Revitalization work, about $100 Million per year to be spent trying to correct years of neglect of NASA’s facilities.  The bean counters in Washington had starved the agency so that basic maintenance was not being performed.  Just before I arrived, the Shuttle Program was authorized to spend a significant amount of money doing important facilities work.  For example, the roof of the VAB was leaking, about to cave in, and putting a new roof up there costs multiple millions of dollars.  So all of a sudden, Center Directors and facility managers all around the agency became my best friend.  In my control was something they very much needed and wanted:  money and the ability to let contracts to do much needed work.  Good thing I had a competent and grounded staff that really did all the work of prioritizing and preparing the decision packages. 


That was my first whiff.  People were oh-so-nice.  And I just thought they wanted to be my friend.  Well, yes and no. 


Later on when I became Deputy Program Manager and later Program Manager, people went out of their way to be nice.  It is really intoxicating to think you are that well liked just because you are a good guy and so pleasant to be with.  Not.


Don’t get me wrong, those were tough times and I made many good and solid friendships that continue to this day.  I have many colleagues that I respect and keep in close contact.  But two years after I was relieved of the Shuttle Program Managership, it is easy to look back and see who was true and who was faux.


When Winston Churchill was voted out of office in 1945, someone told him that it was a blessing in disguise.  To that, the great man replied, ‘then it is very well disguised.’  That was certainly how I felt in early 2008.  But with the space of over two years now, I can report leaving a position of high authority which controlled so much money has turned out to be really good for me.  For two years now, I have not controlled any budget, have only one subordinate employee (my secretary), have very limited influence, and the time to think about things.


As Program Manager, I controlled a budget in the multiple billions of dollars, had thousands working under my direction.  We made contract performance awards on a regular basis which doled out millions to the primary contractors based on how I perceived their performance.  Is there any wonder that they were nice to me?


And as Program Manager, you are the ultimate “decider”.  Yes, everybody has a boss and sometimes decisions are appealed and you have to justify your decision, but those are rare occurrences and 99% of the time what the Program Manager decides is the way it is.  After a while you begin to think you are god-like in your judgment and decision making.


And since Program Managers are very senior officials in the Federal service, all kinds of little benefits come your way; all your travel arrangements are taken care of; close in parking spaces are reserved for you; a seat either at the head or near the head of the table always bears your name; there is a special IT representative to come fix your computer on a moment’s notice, and on and on.  All of this in the name of making your time more efficient, to “free” you to make the important decisions.


Everybody knows your name, and starts calling you “sir”.  The most ridiculous circus happens on military bases where they equate your civil service rank to that of a military general and full military protocol comes into play when you arrive.


It was especially bad when they announced things like “Space Shuttle Program Arriving” as if I personally embodied that huge organization.  It makes your ego think that it is really your program.  The truth is that it is the taxpayer’s program and you have been entrusted with its stewardship for a season only. 


This is not limited to Program Managers but extends to other high ranking federal officials.  I once heard an ex-head of the Astronaut office complain because he no longer had access to his T-38 and had to fly commercial and thus had to wait in line with everybody else.  Sad.


My wife is still laughing about a high school reunion that I attended during my tenure as Program Manager.  All the most popular girls in high school, the ones who wouldn’t give a nerd like me the time of day when we were 17, came clambering around me.  As one of my (divorced) classmates said:  “Wayne is a chick magnet”.  He hung close for the weekend activities trying to strike up conversations of his own.  And in other settings it has not escaped my notice that younger, attractive women, pay a lot of attention to guys who have power, authority, and money in their hands. 


Speaking of airports and high federal officials; I’ve had the interesting experience of watching a Congressman explode at the airline gate agent in National airport because a plane was delayed due to weather.  Did the airline not know who he was?  Why didn’t they just roll out another airplane to suit his schedule?  As if, like King Chanute, it were possible to change the tides. 


So there you have it; people surrounding you, pampering you, adoring you, wanting to be groupies, admiring your brilliant decisions.  At times you get a little tingle as something – your conscience?- reminds you that this is just not right.  But at the time it feels oh-so-good.


And it’s oh-so-bad for you.


So it is really good to get out of that situation.  To remember that you are not as smart as you think you are, nor nearly as brilliant as the sycophants lead you to believe.  Nor as attractive to young women as your libido would like. 


In fact, almost all of us are ordinary guys and gals and have to go home to cut the grass, balance the checkbook, and fix the drier.  And that is as it should be. 


And it is also very good to remember that there really are smarter people than yourself – a lot of them.  (Like the drier repairman who can really put it back together after you botched the repair attempt)>


And finally, to know that you really do have good friends that care about you whether you are rich and famous or not.


Don’t stay too long in the seat of power and authority because it will corrode your soul.

6 thoughts on “Moral Hazard”

  1. In the past, those who foolishly sought power by riding on the back of the tiger ended up inside.

    John F. Kennedy

  2. Wayne, the interesting catch-22 about those who find themselves wielding the kind of power you speak of; the ones doing the best job at it are surely the ones most uncomfortable doing it.

    I’m sorry you are no longer in such a position; I’m sure the taxpayer money and important decisions were in the right hands. But for your own sake, your current job must be a welcome change.


  3. Wayne,

    What you have written reminded me of the Roman conquerer’s parades…especially the part where a slave held a laurel wreath over the conquerer’s head, and whispered in his ear that all fame is fleeting.

    And so it has been for you, but despair not.

    As I once wrote to Mike Griffin, you were where you were at the time you were there because you were needed to make a difference. It was necessary for both of you, in fact, everyone who was there during the Return to Flight era, to be where you were.

    It’s a “big picture” thing…perhaps in a year or so I will have an opportunity to elaborate.

    Once again, two quotes from “Star Trek: Generations” come to mind…

    Kirk: Captain of the Enterprise, huh?
    Picard: That’s right.
    Kirk: Close to retirement?
    Picard: I’m not planning on it.
    Kirk: Well let me tell you something. Don’t! Don’t let them promote you. Don’t let them transfer you. Don’t let them do *anything* that takes you off the bridge of that ship, because while you’re there… you can make a difference.

    …and finally…

    Kirk: Did we make a difference?
    Picard: Oh, yes. We made a difference.

    I believe that the Great Bird would most certainly agree…

  4. Oh Wayne! How I’d like to get you “off the record” and find out what you really think.



  5. Outstanding article!!! Hope that most of Washington’s politicians are reading this, especially the administration.

    Jack Knight

  6. Excellent observations! Anyone who has ever held a position of authority (probably a more accurate description than “power”) should be able to identify with them — been there, done that, got the T-shirt and the retirement/going-away plaque, etc.

    If I might offer 2 quibbles: (1) Your referred to King “Chanute.” Is that a typo? Shouldn’t it be “Canute”?

    (2) I suspect that having your arrival announced as “Space Shuttle Program Arriving” occurred at Navy and/or Coast Guard installations, where this is traditional protocol. If so, you might clarify that point. Perhaps ironically, the intended purpose of that tradition is somewhat the *opposite* of the impression you, and other civilians unfamiliar with it, might assume. Protocol is nothing more than formalized rules of etiquette to assure one’s guest is treated politely! In the days before radio communications, when the captain of one ship visited another ship or a shore installation, the host ship or installation often didn’t know the name of the visiting captain. Announcing him by the name of his vessel was both a practical and a polite solution, meaning in effect, for example, “The captain of the Enterprise is arriving.”

    Of course, once ship-to-ship radio communication became common, it was easy to find out the name of the visiting captain. But the Navy (and many of its foreign sister services) is very, very traditional, especially about protocol. This tradition no more implies that the ship “belonged” to the captain (in anything more than a purely symbolic sense) than it implies your program “belonged” to you. The announcement does convey, though, that the visiting captain *represents* his ship and its crew, just as you *represented* your program. In that symbolic sense, you did, if fact, very much “embody” your program!

    And, contrary to the impression you got from the announcement, any Navy or Coast Guard captain worthy of his (or her) position fully realizes that the host ship or organization might not even care who he is individually. He is being accorded certain honors and polite treatment *only* by virtue of his position, and the crew he represents, *not* because he’s particularly noteworthy himself (he may well be a scoundrel!). If effect, such an announcement isn’t at all intended to be flattering to the visitor, merely formal and polite. Indeed, the wise captain knows that it’s somewhat humbling.

    Again, excellent and very thought-provoking observations.

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