12/13/2009 10:23 am ET | Updated May 25, 2011

To serve the public, face essential truths

It's easy to poke holes in the work of elected officials and other policy makers. But all these folks will tell you that governing is exponentially harder than commenting, or campaigning - even the ones who complained most loudly about their predecessors. One principle that I believe will always make governing and policy making better (and in the long run, easier)is accepting the cold, hard, essential truth, from the start of tackling any policy problem.

President Obama's outstanding Nobel Peace Prize acceptance speech in Oslo reflected this approach. President Obama declared simply:

"We must begin by acknowledging the hard truth that we will not eradicate violent conflict in our lifetimes. There will be times when nations - acting individually or in concert - will find the use of force not only necessary but justified."

I agree fully with the President. I also agree with the poets, philosophers and regular folks who think that truth is beauty, as hard as it may be to face sometimes. The other side of the coin, of course, is ugliness that comes from falsehood. This is as true in public policy as it is across any other dimension of life.

Unfortunately, policy makers can make life really ugly for citizens when they don't face essential truths. Some of the ugliest things going on in this economy reflect a failure to acknowledge essential truths about banks. A bank's essence is clear - and that essence is about making as much money as possible. I express this truth without any judgment about whether this is good or bad, and acknowledge the very strong arguments on either side of judging what the essence of a bank means for society.

Policy makers engaged in wishful thinking when designing the Making Home Affordable program, which has failed up until now. To be successful, the program relied on banks choosing to make less money than they could by not authentically participating.

The excellent Peter S. Goodman of the New York Times wrote a great piece on this. CNN also reported on the paltry numbers of mortgage adjustments made as part of the Making Home Affordable program.

The good news is that Treasury has learned from its mistakes. Goodman's article reflects a new path which reflects an another important part of a bank's essence: banks don't enjoy being shamed, and it can hurt their bottom lines. I suspect that this real-world approach will yield more favorable results.

Another policy effort that always made me laugh, and reflects a failure to face the truth, was Nancy's Reagan's "Say No to Drugs" campaign. I'm guessing it inspired millions of teenagers nationwide to croak this slogan immediately after taking bong hits, sending their glassy-eyed pals into fits of hysterical laughter.

All of this reminds me of the parable about the frog and scorpion. The condensed version goes something like this: a nervous frog and a stranded scorpion find themselves on the same side of a creek. Being a dry-land creature, the scorpion realizes that the only way across the water is a ride on the back of the frog. Understanding full well the scorpion's reputation and seeing that stinger up close, the frog politely declines, asking "how do I know you won't sting me as we cross?" The scorpion convinces the frog to provide the ride despite this concern, explaining that they'd both die if he did indeed sting the frog. Sure enough, midway through the water, the scorpion stings the frog, sending them both to their deaths.

"But, why?" asks the doomed frog.
"Because, it's my nature" answers the scorpion.

I accept the fact that we humans are animals. Sometimes we act like the scorpion in the parable summarized above. But I strongly believe we can be better than we are now. While it is a mistake to be naive about challenges we face today, human beings have an amazing capacity for advancement that will help us gradually redefine some of the essential truths that make the world such a hard a place. To me, that's real beauty.