Oct. 28 (Bloomberg) -- Trickle down really does work. Consider these inspired words, from an online reader of USA Today, reacting last week to news that Americans were lying, cheating and law-breaking to get their hands on an $8,000 tax credit for first-time homebuyers:

“The system is scamming you, so why not scam back a little,” wrote the reader, using the name “None in 08.” “You’ve seen what crooks in Washington and on Wall Street can get away with.” So “it’s time to get yours.”

Amen, brother. What are role models for, anyway?

People who make their livings studying the business world’s ethics -- and lack thereof -- say it doesn’t take a nutburger to sense there’s some systemic unfairness at work.

“The heavy hitters, the high-rollers and the powerful have been getting away with this type of thing, so people say, ‘Why shouldn’t I get my few cents?’” says Thomas Bausch, a professor of management who teaches business ethics at Marquette University in Milwaukee.

The public is onto the fact that the casino known as the stock market operates with one set of rules for the high rollers and another for the little people, says Barbara Porco, director of program development at Fordham University’s School of Business Administration, in New York City.

The truth is the public may have a better chance gambling at a casino than on Wall Street. At a casino, Porco said, “Whether it’s the five-dollar table or the thousand-dollar table, everyone plays by the same rules. That’s not how it works in the stock market, where you have different rules for different groups.”

Cue the Looters

Regrettably, the financial market casino of late has all the ambience of looters storming the neighborhood after natural disaster has struck.

Along with news that Joe Taxpayer had listed his 4-year-old as owner of the family home in hopes of pocketing that $8,000, we also learned in recent weeks that Citigroup Inc. is selling its Phibro LLC energy-trading unit to Occidental Petroleum Corp. for $250 million. Citi, recipient of $45 billion in taxpayer money, was highly motivated to slither out of the harsh spotlight associated with the $100 million bonus it owed to Andrew Hall, star Phibro trader. Thus, a $250 million corporate transaction was set into motion to protect one guy’s payday.

There is the possibility, of course, that decadence and thievery today is no worse than at other times in history, but I couldn’t find a lot of ethics pros willing to sign on to that thesis.

Titans and Progress

During the late 19th century, industrialists such as Andrew Carnegie and John D. Rockefeller lined their pockets by taking advantage of people. As Bausch notes, at least those meanies, unlike today’s financial titans, built something that lasted and had some economic value. Where’s the historian who’s ready to congratulate the team that cooked up today’s “dark pools”?

Porco sees the shift in the morality of business and political leaders reflected in feedback from her students.

For 20 years, the Fordham professor has started each semester by going around the classroom to ask students to identify their heroes. “When I first began at the university, I’d hear names of heroes who were corporate leaders, or heroes in the media or even in government,” she says. For the past four or five years, her students without exception have defaulted to naming members of their families. The hero of business or government is a dinosaur to the next generation.

So what happened that we got to this disheartening point? Stephen B. Young, global executive director at the St. Paul, Minnesota-based Caux Round Table, a group that’s taken on the unenviable task of promoting “a moral capitalism,” says the culture of indulgence and entitlement engendered by the baby boomers was one factor.

Bad Examples

There is also the simple matter of bad examples: The more people observe bad guys getting away with it, the more they cheat, says Dan Ariely, author of “Predictably Irrational: The Hidden Forces That Shape Our Decisions.”

Ariely worries about what he calls “the Madoff effect,” a swine-flu-grade virus that causes people who witness corruption to conclude that cheating has become acceptable, and to wind up cheating, too. When Mom and Dad are putting their tots’ names on the income-tax forms to scam $8,000, Ariely says, “we’re seeing the aftershock of all this dishonesty on Wall Street.”

Fixing the problem is unlikely in an era when the saving of one guy’s bonus is of such crucial importance that it motivates a few-hundred-million-dollar corporate transaction. Averting future financial crises requires entirely new banks in which compensation runs in the hundreds of thousands, not millions, of dollars a year, says Ariely.

Old Habits

Those attending the annual meeting of the Securities Industry and Financial Markets Association yesterday got an earful from Jonathan Spector, chief executive officer of the Conference Board, about how Wall Street should reform its pay practices if it wants to win back public confidence.

Old habits die hard, though. An audience member cautioned that Wall Street employees have “voted with their feet” -- i.e., quit, for more lucrative jobs -- when firms tried in the past to enforce restrained compensation policies.

Don’t hold your breath for changes that stick. From the looks of things, there are still a lot of financial guys who think they’re worth every penny they can make.

(Susan Antilla is a Bloomberg News columnist. The opinions expressed are her own.)

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To contact the writer of this column: Susan Antilla in New York at santilla@bloomberg.net

Last Updated: October 27, 2009 21:00 EDT