Have you ever heard of Nicholas (“Nicky”) Winton? Me neither. That was before I attended a screening of Nicky’s Family, at the UJA Federation in New York on July 16th. The movie is about Nicky, and why he is otherwise known as the English Oskar Schindler. Like Schindler, Nicky saved lives — that of 669 Czech and Slovak children just before and during World War II. Seeing that movie made me realize we all are, in some sense, in Nicky’s family. So what? Well, maybe his story will cast doubt on the selfish gene theory that many economists rely on in their rational choice models. At least that’s what I thought when I saw the movie.
Before the war, Nicky, now 104 years old, was a successful stockbroker in London. He traveled when he wanted. He ate what we wanted. He didn’t really have a concern in the world. So he was the perfect character in a story who would have had an interest in doing nothing at the sight of other people’s suffering.
After learning about the pending doom that Jewish Czech and Slovak children would face under German rule when he took a ski trip to Europe, Nicky started a campaign to have English families adopt Jewish children. When some Rabbis in England complained to Nicky that the children would be going to non-Jewish families, his response: “that’s your problem!”
The screening of the movie, which was chaired by Sanders/Long partner Adam R. Sanders, made me question the self-interested rational choice models that so many economists use. Nicky had everything to lose by helping the children. His only gain was the feeling of seeing that he had an impact on each child in need. And that he did. The movie shows that some 200 of the saved children have been found, and shows their grandchildren, too. Not only that, but Nicky has motivated a whole new generation of people who are trying to make an impact on the world — one child at a time.
Nicky Winton — arriving just in the Nick of time.
Recently, Mr. Raj Rajaratnam was found guilty of violating insider trading laws, which seek to ensure that all members of the trading public, regardless if they are large or small, rich or poor, receive exactly the same information. The goal is worthy, but is it realistic? Whether we like it or not, connected people get better information, just as super connected legacy children get into Harvard. At the very least, the government should make insider trading rules less ambiguous so as to not make every aggressive trader, like Mr. Rajaratnam, into a potential poster child of the new Gordon Gekko.
Various scholars, including Yale Law School’s Jonathan Macey in Deconstructing the Galleon Insider Trading Case, point out that the Securities Exchange Commission (“SEC”) has a more expansive and ambiguous view of insider trading than the U.S. Supreme Court. On the one hand, the SEC takes the view that everyone in the marketplace should have access to the same information, regardless of the effort they take to obtain it. As a result, non-public information should never be traded upon, regardless of how you get. On the other hand, the Supreme Court says having special access to non-public information is legal so long as you didn’t commit a crime to get it, such as when your lawyer steals your confidential information and trades on it. The SEC’s ambiguous insider trading rules have given it more unfettered discretion as to when to lower the gauntlet, and on whom. This is dangerous. As Mr. Macey points out in his article, much of what companies disclose in their filings is so watered down because of regulatory concerns that they leave you wanting to know the “real story” via other means. Like a good reporter, you may be able to get your hands on the scoop by interviews, or otherwise, whereas others are not. While the efficient market hypothesis posits market prices reflect all available material information, we all know this is not reality. Until that happens, which may be never, the SEC should develop a bright line rule more in accordance with the Court’s rulings so that folks can be aggressive in making good connections for much needed information without ending up in jail.