Ethics Sage

The “Ethical and Right Way” of Raising Children

The Motivation behind being a ‘Tiger Mom,’ a blog by Cam Tran

My ethics students at Cal Poly San Luis Obispo are required to write a blog on a topic of deep interest illustrating their knowledge of ethical reasoning. The following is a blog by Cam Tran, one of the best blogs I received this term.

I was first introduced to the article “Why Chinese Mothers are Superior” published in the Wall Street Journal, an excerpt of the Battle Hymn of the Tiger Mother by Amy Chua, in my senior year of high school in 2011. While reading this article, there was no surprise that I related to it as it reflected much of my Vietnamese background and how my mother has raised me or having known someone who was raised that way. This feeling was mutual with the other students that were raised by Eastern or Asian parents, however, the students that were raised by Western parents were outraged that a parent could be so harsh and cold to their own child, claiming that they were essentially torturing and making the child suffer, as parents are supposed to be loving and support their child.

While the students raised by Asian parents tried to explain that Asian parents are essentially showing their love and support by pushing their children so hard, the other students remained unconvinced and continued to be in shock and disbelief that parents could be so heartless to their children. I was taken aback by all the negative reaction and even slightly offended that others would think that my mother did not love me. Because I have only known this way of my mother raising me, I suppose I had naturally assumed that the Asian culture of raising children or “tiger moms” was well known to most people. But much to my error, not only was there backlash in my situation but across the nation, there was shock and criticism against the author Amy Chua, making me question which is the best and most ethical way to raise a child?

For an ethical perspective of child-rearing in the Asian culture, we can look to the ancient Greeks who believed that the quickest way to the pursuit of happiness is by living a life of virtue. For a tiger mom to be virtuous, she must serve her purpose in life, which is pushing her child to be the best that he or she can be. Essentially, as a tiger mom, she has an obligation to enforce a strong work ethic in her child to help him or her on the path of achievement. Likewise, for the child to be virtuous, he or she must fulfill the obligation by working hard to meet the expectations the parents have set. Conversely, for Western parents to be virtuous, they have the obligation of letting their child pursue passions and follow dreams, and therefore, instilling less of a work ethic.

To an outsider, it might seem that Asian parenting may lack moral motivation as the parents place a slightly higher emphasis of non-ethical values that relate to self-interest, such as wealth and power, over ethical values, such as integrity and honesty. However, Asian parents actually use the ethical values as a vehicle to get to the non-ethical values because they want their child to be happy and not lead a life of suffering. Asian parents’ primary goal is their child’s happiness but they believe that a focus on achievement is the best way to achieve this happiness. It is paramount through a child’s adolescence because when the child grows older he or she is able to be happy by enjoying the wealth and success that comes with said achievement. Asian parents have more of an authoritarian parenting style, instilling self-discipline and work ethics into their child as they do not want them to go through the same hardships as they had to go through.

Chua’s style of raising her children can be seen as a means to an end, not an end in itself because there is more of an emphasis on grades than actually learning the material. But the logic here is that if one fully learns and understands the material, then getting a high grade in the class should come easily. Asian mothers believe that success and achievement reflects good parenting, therefore, if a child did not do well in school then parents were not doing their job effectively.

Asian parents believe the only key to success is hard work and persistence. Even if one has no talent or is not gifted, if hard work and all of one’s effort is put into a task, it could be done and done so successfully. But with hard work comes practice. Research shows that practice is needed to become more proficient at a mental task because it helps it become more automatic so the motor skills in a brain become less active, allowing it to shift to areas with higher level of thinking and reflection. Practicing is crucial for excellence, so Asian parents seem to push their child to practice more and for a longer time, whether with a musical instrument or studying a subject, because they want their child to be his or her best self. Asian parents push their child to practice more on the musical instrument because they know that once the notes are learned, it enables for a more in depth exploring of the emotional content of the piece of music and therefore allow it to be fun and enjoyable to play. This is especially shown when Chua pushes her daughter to correctly play a piano piece “The Little White Donkey.” There was much resistance and strong words exchanged between the two but once her daughter was able to play the piece correctly, both felt accomplished in their task and from this, her daughter learned that if she practiced and put enough dedication into something, she will be able to achieve it.

While Asian parenting can work effectively, as Chua’s eldest daughter is now attending Harvard, some children may rebel to strict discipline and come to resent their parents. Likewise, Western parenting can be very successful because of the freedom the parents allow, which permits the child to learn and grow from mistakes and perhaps instill a work ethic in his or herself. Personally, I’m glad and thankful that my own mother followed a strict discipline while raising me through my adolescent years. Reflecting back, I would not have minded if she was even stricter and pushed me harder because it has really made me who I am today; someone I’m proud to be. While my mother was not the essence of a tiger mom and certainty not as harsh as Chua was with her kids, by any means, she raised me with a firm hand. Even though I strongly disliked it since I did not understand it as a child, I now fully appreciate all that she has done and sacrificed for me and see that everything was out of love wanting the best for me.

Cam Tran blog posted by Steven Mintz, aka Ethics Sage, on June 18, 2013

What's Wrong with Eating Lion Meat?

Lion-meat tacos, with a side of controversy

This blog was previously posted but I receieved an important comment that I include below from Megan Knauss from Born Free USA. The original blog follows the comment.

Comment by Megan Knauss megan@bornfreeusa.org

Ethics Sage: First, thank you for the mention!  Second, in response to your question, here are three reasons why eating lion meat is wrong:

1) The lion meat industry is virtually unregulated.  Consumers therefore have no assurance that their lion tacos and burgers will not pose a risk to their health. 

2) The lion population is quickly disappearing.  To place lion meat on the menu in US restaurants is to further threaten this iconic, vulnerable species’ future survival.

3) The Humane Methods of Slaughter Act does not apply to lions.  When lions are slaughtered for food, there are no laws in place to ensure that the animals are unconscious or insensible to pain before they are killed.

Thank you for bringing attention to this important issue.  As you point out, lions do indeed have rights- rights that are being trampled on by businesses that have twisted the American “freedom of choice” to justify serving this beautiful species on a platter. 

Original Blog by Ethics Sage

My nephew, I’ll call him Howard, is sometimes skeptical about the veracity of topics I choose for my blogs labeling some “urban legends,” so I dedicate this blog to him. I know he will be skeptical so I’ve included a  photo of the taco with lion meat sold by a Tampa, Florida restaurant until last week.

Well, all you taco lovers, for $35 dollars you can try lion as in the king of the jungle.

"I thought the lion was good," said patron Lee Weiner. "It didn't taste too gamey to me, similar to steak."

Frankie Consoli commented that the lion meat is a bit tougher than steak. Consoli is a connoisseur of what many of us would think as ethically-challenged food choices.  He’s eaten rattlesnake and antelope before and if he didn’t want lion at Taco Fusion, Consoli could pick from other exotic meats on the menu: bison, shark, ostrich, gator, gazelle, rabbit, duck, camel and kangaroo.

Since Taco Fusion opened in February 2013, the restaurant has built a reputation for their unconventional taco filings. They have previously offered game like beaver and otter, but the controversy didn't start until lion meat made its way onto their menu.

"I really don't like that at all," said McKenzie Bremer who opposed the restaurant's decision and said that a threatened species should not be served at a taco place.

Brad Barnett, the owner of Taco Fusion, defended his actions by saying: "If you don't like it, don't eat it." However, he bowed to the pressure and removed the lion meat as one of a few exotic fillings for their tacos.

Meanwhile, Taco Fusion has even more unusual items coming: iguana, bear and zebra, which, on one level follows a trend in gourmet circles to use ever-more-exotic ingredients. It's not uncommon for the Food Network to broadcast cooking competitions where chefs use sea urchin, squab, quail eggs and bone narrow.

So why not eat lion meat? Why prohibit it when other "tasteless" food choices exist such as Biscuit Kite Spider, Tomato Frog, and Green Slug Caterpillar?

Wild animal advocacy group Born Free USA embarked on an undercover investigation into the lion meat trade in 2011, and as part of their campaign to curb the trade, have petitioned to have African lion listed as "endangered" under the U.S. Endangered Species Act. The U.S. Fish and Wildlife Service concluded that the petition presented substantial evidence indicating that listing this subspecies may be warranted, but has yet to issue a finding.

Here are my reasons for freeing the Lion as a food choice. Lions are considered “Vulnerable” in the wild, which is a step short of “Endangered,” according to wildlife conservation groups, and so importing or selling lion meat isn’t illegal. However the African lion - one of Africa's most iconic animals - has experienced an alarming population decrease since the 1960's. According to National Geographic, only 32,000 Lions remain out of 100,000 roaming Africa in the 1960s, and the actual number may be much lower.

Animal rights activists oppose lion meat for the same reasons they oppose any other meat: It infringes on the rights of the animals. This is the link to ethics. We accept that human beings have rights – freedom of speech, freedom to worship as we wish, freedom to assemble, and so on. Don’t animals have rights? Wouldn’t one of those rights be to roam the wild without fear of being killed for food?  ...Just food for thought… 

It has taken me a long time to accept that eating Bambi is routine in many parts of the world. However, I draw the line at Simba.

Blog re-posted by Steven Mintz, aka Ethics Sage, on June 14, 2013

What was the Motivation for Bradley Snowden to Blow the Whistle on the NSA?

Looking at the Ethics of Whistleblowing

Unless you are an ostrich you know that Edward Snowden, a twenty-nine-year-old former C.I.A. employee and government contractor working for Booz Allen Hamilton until he was fired for his actions on June 11, leaked news of National Security Agency (NSA) programs that collect vast amounts of information about the telephone calls made by millions of Americans, as well as e-mails and other files of foreign targets and their American connections. For this, some are hailing him as a hero and a whistle-blower while others, such as Jeffrey Toobin who writes for the New Yorker, call him “a grandiose narcissist who deserves to be in prison.” In this blog I examine the issue relying on motivation to assess whether Snowden’s actions were ethically motivated.

In an interview with Glenn Greenwald of The Guardian newspaper published in the United Kingdom, Snowden was asked why he became a whistle-blower. His answer was: “The NSA has built an infrastructure that allows it to intercept almost everything. With this capability, the vast majority of human communications are automatically ingested without targeting. If I wanted to see your emails or your wife's phone, all I have to do is use intercepts. I can get your emails, passwords, phone records, credit cards. I don't want to live in a society that does these sort of things … I do not want to live in a world where everything I do and say is recorded. That is not something I am willing to support or live under."

With those words, Snowden set off a firestorm of criticism of Snowden, and Congressional investigations of NSA personnel. Is Snowden a true hero for ‘blowing the whistle’ or a person who seeks fame and may even have a grudge against the NSA or U.S. government?

In ethics, we often judge one’s actions by the motivation for them and the intent of the whistle-blower. I hesitate to draw any definite conclusions at this early stage as the story is still unfolding. However, I do want to share some observations with you about whistleblowing in general and Snowden’s actions.

There is no one set definition of whistle-blowing although most definitions characterize the practice as disclosing to others in an organization (internal whistleblowing) an action that violates organizational norms or the law. External whistleblowing entails going to an organization outside the employer to report wrongdoing.

Near and Miceli take a broad view of whistleblowing in a research paper published in the Academy of Management Review in 1995. They define it as “the disclosure by organization members (former or current) of illegal, immoral, or illegitimate practices under the control of their employers, to persons or organizations that may be able to effect action.” They identify four elements of the whistleblowing process: the whistleblower, the whistleblowing act or complaint, the party to whom the complaint is made, and the organization against which the complaint is lodged. In discussing the act itself, they label it as an act of “dissidence” somewhat analogous to civil disobedience.

The key here is it is an act designed to inform those who may be able to correct the matter. Snowden did not go to the Inspector General of the NSA or Congress with the information. He leaked it to a newspaper and one outside the U.S. at that.

The Government Accountability Project (GAP) seems to take a broad view of the practice of whistleblowing. According to GAP, whistleblowing means calling attention to wrongdoing that is occurring within an organization. GAP lists four ways to blow the whistle:

• reporting wrongdoing or a violation of the law to the proper authorities such as a supervisor, a hotline or an Inspector General
• refusing to participate in workplace wrongdoing
• testifying in a legal proceeding
• leaking evidence of wrongdoing to the media

It is the leaking of wrongdoing to the media that makes Snowden’s actions that of a whistleblower, if you go along with GAP’s characterization of the practice.

Snowden claims he was not motivated by anything other than to inform the public of what he knew. From the moment he decided to disclose numerous top-secret documents to the public, he was determined not to opt for the protection of anonymity. "I have no intention of hiding who I am because I know I have done nothing wrong," he said. The problem is his actions don’t match his words. Why did he run off to Hong Kong or China or wherever, rather than come home and face the music?

The Snowden matter is a complicated one and undoubtedly more will be known about his true motives and whether any damage has been done to the security of the U.S. down the road. My take on the situation is he was motivated by the fact that someone knew he was thinking about leaking the information and he jumped the gun to portray himself as a true whistleblower and protector of the public interest. In other words, it was a self-serving act by an opportunist motivated by looking better in the public eye than would have been the case if his intended actions were first disclosed by another party.

Blog posted by Steven Mintz, aka Ethics Sage, on June 14, 2013

 

Is Following the Law the Same as Being Ethical?

IRS Official Invokes Ethical Legalism as a Defense

A question I got from my students all the time is if I follow all the laws doesn’t that mean I have acted ethically? I explain there is a difference between following the laws and making ethical decisions because the laws can’t cover every situation we encounter in life. If we limit the guidance for our actions to legalities, we are likely to miss the ethical signs that impropriety awaits us when the rules do not address a particular matter.

A perfect case in point is Lois Lerner, the IRS official whose unit is at the center of the investigation into alleged Tea Party targeting and other discriminatory treatment against certain groups and individuals with respect to the application of IRS regulations including nonprofit conservative groups applying for 501 (c) (4) tax exempt status.

Recently, Lerner was placed on administrative leave and Ken Corbin was named acting director of exempt organizations during Lerner's leave. He is currently deputy director of submission processing in the wage and investment division.  The reason for Lerner’s removal can be seen in how she responded to a Congressional investigation.

On April 30, 2013, Lerner and seven IRS colleagues spent six-hours being interviewed, on a bipartisan basis, by House Oversight & Government Reform Committee Subcommittee staff. That interview covered, among other topics, how the IRS determines which groups to review, what actions are taken in connection with the IRS reviews, and how the laws and regulations are used to examine those groups. Lerner failed to disclose the internal controversy over the search terms used by the Cincinnati office to identify 501(c) (4) groups for further review, the actions taken by that office in reviewing the identified groups, the investigation and imminent findings by the Treasury Department Inspector General for Tax Administration (TIGTA); and TIGTA’s conclusion that the IRS had used inappropriate criteria to target Tea Party and other conservative groups. Ms. Lerner also failed to disclose that she was fully aware of these issues as early as June 2011, and, according to TIGTA, had been personally involved in reviewing questionable actions taken by the Cincinnati office.

Given the serious failure by Lerner to disclose to Subcommittee members key information on topics that the Subcommittee was investigating, the House lost confidence in her ability to fulfill her duties as Director of Exempt Organizations at the IRS. No doubt Lerner, who was responsible for overseeing 1.6 million tax-exempt organizations, made decisions and failed in her oversight in a way that erodes public trust and confidence in the IRS and its professional integrity.

In a hearing in May on the matter, Lerner invoked ethical legalism as a defense for her actions. Ethical legalism holds that as long as I follow the rules, I have acted ethically. "I have not done anything wrong. I have not broken any laws," she said. "I have not violated any IRS rules or regulations and I have not provided any false information to this or any other committee."

Other than this self-serving statement, Lerner invoked her Fifth Amendment right to not testify before Congress.

Lerner doesn’t get it that treating one group of people differently than another violates basic fairness standards. Groups that apply for exempt tax status should be treated the same and decisions whether to grant it should be based solely on whether each group meets the federal guidelines to be granted exempt status. To decide otherwise leads to failing the ethics test of treating equals, equally and unequals, unequally, a basic tenet of justice.

Blog posted by Steven Mintz, aka Ethics Sage, on June 12, 2013

Civility and Michelle Obama’s Handling of the Heckler

Was Michelle’s Response Proper?

Was Michelle Obama’s reaction to a heckler last week an example of civility or incivility? Did she go too far in talking down a heckler while she was speaking at a private fundraising event in Northwest Washington? In case you haven’t heard, Michelle was interrupted by Ellen Sturtz, who wanted the First Lady to get the President to sign an executive order banning LGBT discrimination.

Sturtz's interruption began halfway through Obama's 20-minute speech. Obama, interrupted, paused, and proceeded to confront Sturtz face-to-face: 

"One of the things I don't do well is this," replied Michelle to loud applause. She left the lectern and moved over to the protester, saying they could "listen to me or you can take the mic, but I'm leaving. You all decide. You have one choice." 

The crowd started shouting that they wanted Michelle to stay. 

"You need to go!" said one woman near the protester. 

The protester was then escorted out, shouting "...lesbian looking for federal equality before I die." (First part of the quote was inaudible.)

In an interview with a reporter after the event, Sturtz said she was startled by Obama's response: "Basically, I was asked by the first lady to be quiet, and I can't be quiet any longer," Sturtz said, adding, "she obviously thought she was going to make an example of me or something. I wasn't scared at all."  Sturtz also said: “She came right down in my face...I was taken aback.”

The incident exemplifies the lack of civility in society. Michelle handled it perfectly. Her message was I am speaking; I was invited to speak; others want to hear me; you are interrupting…

We have morphed into a society where individuals like Sturtz fail to consider how their actions affect others. The people in attendance did not want to hear her rants. They came to hear Michelle Obama. Regardless of the validity of one’s cause, there is a time and place for everything, and Michelle’s fundraising event was not the time to bring up one’s own agenda. Just think, if everyone acted that way in any and every fundraiser and political gathering, then we would be spending our time shouting down each other and that’s not a very civil way to behave.

Quite frankly, I think Barack Obama can learn a lesson from his wife. Her reaction to the heckling shows she is not afraid to exhibit strong character traits in public and walk the talk of leadership. The President often reverts to his ‘I have to satisfy everybody’ mode and fears he might upset one political group or another if he acts in a way that supports thoughtful actions and civility by a responsible citizenry. He has been heckled by some who show no respect for the office of presidency or for those who come to hear what Obama has to say. He needs to send a strong message, as did Michelle, that that kind of behavior should not be tolerated in a civil society.

Blog posted by Steven Mintz, aka Ethics Sage, on June 10, 2013

Should Illegal Immigrants be Given Driver’s Licenses?

Rewarding Bad Behavior

Numerous states are considering issuing driver’s licenses to illegal immigrants while one state, New Mexico, is struggling to prevent out-of-staters from fraudulently obtaining them.

Until recently, undocumented immigrants were able to obtain driver's licenses or permits only from three states: New Mexico, Washington and Utah. But that number is expected to grow.

A utilitarian analysis of this issue would examine the harms and benefits of granting driver’s licenses to illegals. Those who favor granting driver’s licenses to illegals claim licenses will make streets safer, since the immigrants must take a driving test. Some police agencies say the licenses allow them to keep better track of this population. Immigrant advocates say the licenses give this group needed mobility.

First, there is no evidence to suggest that our streets will be safer by granting the licenses to illegals. Since it has only occurred in three states, the data is just not there to support this assertion. In fact, some might claim the streets will be less safe because illegals drive poorly [another unsubstantiated claim] and will add congestion to the already congested roadways, especially out here in California. Thus, by allowing illegals the privilege of driving with a license, current drivers may be inconvenienced.

It is a privilege to be given a driver’s license not a “right.” There is nothing in the Constitution that supports allowing anyone to drive without meeting certain standards. One reasonable standard is for the driver to be a legal resident if for no other reason than they have earned the privilege by going through the steps to become a legal citizen.

The police claim a benefit is being able to better track the illegal immigrant population. The scary thing about this is the admission illegals are not very well tracked. Who are they? What is their business in the U.S.? Where are they employed? It seems to me a robust E-verify system would accomplish the same end without rewarding illegal behavior.

Finally, immigrant groups claim the licenses give the group needed mobility. "Individuals have to get to jobs and schools," said Melissa Keaney, an attorney with the National Immigration Law Center, a Los Angeles-based advocacy group.

Once again this is rewarding bad behavior by granting a privilege that has not been earned the way legal citizens have earned it and further clog up our roadways.

The granting of driver’s licenses to illegals is likely to increase in the future. The governor of Illinois signed into law in January a bill that grants licenses to those who lack a Social Security number, while the governors of Maryland and Oregon approved such bills last month. Similar bills sit on the desks of the governors of Colorado, Vermont and Nevada, while a number of other legislatures are considering the move.

There are other potential harms of granting the licenses to illegals in addition to those already addressed.  New Mexico investigators recently busted a Mexican immigrant who tried to obtain a license with the help of a criminal ring. The ring, officials said, used fake New Mexico addresses to create fraudulent documents for out-of-state immigrants, charging $2,500 per license.

State police in April arrested the Mexican immigrant, who lived in Georgia. Authorities canceled 40 licenses the ring had helped secure for 40 other immigrants from Latin America.

In another case, two Central American immigrants were arrested in April for applying for licenses using fake residential leases provided by another criminal group. The immigrants, who had paid $1,500 each for help in securing the licenses, found out about the group's services through an ad in a New York newspaper, according to state investigators.

Demesia Padilla, the cabinet secretary at New Mexico's Taxation and Revenue Department, which oversees the state's Motor Vehicle Division, says it is costly and time-consuming to perform background checks to ensure applicants live in the state, and complains that the department lacks the resources to do the job.

Some New Mexico lawmakers have launched repeated efforts to repeal the license law, with the support of Republican Gov. Susana Martinez. But so far, they have failed.

Padilla said her agency had to open a fourth office in Albuquerque last year to deal with immigrant licenses. Earlier this year, the agency couldn't investigate a potentially fraudulent ring because it already was busy with two others, she said. "We're doing this full time," she said. "There's not ever a slowdown."

In conclusion, this blog is not about whether illegals are sent home because they came here illegally and broke the law. That is a matter for another blog. I am against granting them legal driving privileges because of the potential harms to society not the least of which is fraud in applying for and obtaining the licenses.

One suggestion is to link granting driver’s licenses to a commitment to become a U.S. citizen and follow-up on such requirements. The problem there is it would require an efficient government process of granting the licenses and follow-up to determine if illegals are meeting the requirements to become a legal citizen. Expecting our government to do anything in an efficient manner is a pipe dream that has been disproven over and over again, and that is why we are in the mess we are with illegals.

Blog posted by Steven Mintz, aka Ethics Sage, on June 5, 2013

Abuse of Disabled Passes at Disney

The ‘Magical Kingdom’ not Magical for those on Long Lines

It's made headlines recently. We all know how frustrating it is, waiting in those long lines at Disney. But now some families are cheating the system. They're hiring disabled tour guides so they can cut right to the front. Two investigative reporters -- Jeff Rossen and Josh Davis -- went undercover and caught it all on tape.

Disneyland is "the happiest place on earth" -- except if you're waiting in those long lines, you and your kids, waiting hours in the heat. So how did one family get to skip past everyone? They did it ride after ride after ride, escorted to the front every time.

The reporters point out that the outrageous business few even know about: families bypassing the lines by hiring disabled tour guides with special passes. At most theme parks like Disney, they allow the disabled to get speedy access to rides. But now healthy families are abusing the system, paying disabled guides to get them in with up to five guests.

On ads the reporters found on Craigslist, tour guides brag about their disabled passes: "Let's cut the Disney lines together," "access to ... special entrances." So they had their producer and his family go undercover with home video cameras, hiring two of those disabled guides to show them around Disneyland.

One guide told them she got her pass after a car accident. "I'm here to make sure everyone has fun at Disneyland and we get on as many rides as possible. I have a special card that's going to help us beat the lines. She charged $50 an hour for her services.

A second disabled guide charged $200 and got them right through another side door at Star Tours, an attraction inspired by "Star Wars."

The list goes on including Splash Mountain, Pirates of the Caribbean, and Alice in Wonderland.

The reporters asked their guide about the fact they were profiting from what they were doing. The responses speaks volumes about the greed that has infected our society and a lack of personal responsibility, apathy toward the consequences of one’s actions, and total insensitivity to right and wrong. It has become endemic in our entitlement society today.

Here is the exchange with one guide:

"You're profiting from this," the reporters said.

"Well, Disneyland's profiting a lot from all the people that enter," she said.

"Will you continue to do this?"

"Yes, I will," she said. "We live in a capitalist country, and I don't feel like it's morally wrong."

The reporters interviewed the second guide whether he felt guilty about what he was doing. His response was scarier than the first guide from a moral point of view.

"Do you think you're abusing the system, the reporters asked?"

"No," he said.

"Why not?"

"I gave him a wonderful tour."

"With your disabled pass, where you went through side entrances and exits," the reporters pointed out. "And they're not disabled at all. They're complete strangers. And you charged them for it."

"And?" the guide said.

"Do you ever feel any pangs of guilt when you're cutting past all of those people who are waiting in line with people who are paying you, who aren't disabled at all?" they asked.

"It's a moral question."

"And that's the question, you don't feel morally --"

"I couldn't care less," the guide said.

"About those people waiting in line," we said.

"No."

Disney issued a statement: "We find it deplorable ... We have initiated a review of this abuse and will take appropriate steps to deter this type of unacceptable activity."

The reporters stated Disney is cracking down, sending out warning letters to anyone advertising these services online. And if they catch any of these "disabled tour guides" in the act, their disabled passes will be revoked, and they won't be allowed back into the park.

The essence of the ethical issues can be found in virtue theory. Virtues are the characteristics of excellence that lead a person to follow a moral path in life. Virtues such as honesty, trustworthiness, responsibility, and accountability speak to the personal characteristics that a virtuous person should have. Characteristics such as wealth, power, and fame are selfish virtues that sometimes lead to a lack of sensitivity about how one’s actions based on such behavioral traits might affect others.

I am not at all surprised by the fact some people choose to abuse the disabled pass policy of Disney for personal gain. There are all too many people in society who look for the easy way to make money rather than through hard work and dedication to the job at hand, two qualities that built this nation.

During the past twenty years or so we have raised a generation that is tone deaf to ethical issues. Their attitude is my ethics are my ethics and no one can tell me otherwise. They even think you impinge on their rights if you try to enforce a set of standards on them that they don’t buy into.

From corruption in business, corruption in government, cheating in sports, misuse of power and authority (i.e., the IRS), to cyber-bullying, cyber-hacking, identity theft, increasing violence in our schools, to a general lack of civility in society, we have morphed into a country built on the pursuit of self-interest without regard to the consequences of our actions on others. I fear that our moral blindness as a nation will soon lead to a marked and sustained decline in our economic power as a country because evil will outweigh good; greed will outweigh benevolence; and disdain will outweigh respect for others. It is a slippery slope and the slide has begun in earnest.

Blog posted by Steven Mintz, aka Ethics Sage, on June 4, 2013   

Lateral Thinking and the Logic of Spock: Random Thoughts from the Blogisphere

On Wednesday I posted some questions to consider as an experiment in lateral thinking that relies on creativity in the thought process. I promised to post the answers today, so here they are.

       man 
1. ------------ = man overboard
      board 

      stand 
2. ------------ = I understand
          i 

3. /r/e/a/d/i/n/g/  = reading between the lines

          0 
4. ------------ = two degrees below zero
       M.D. 
       Ph.D. 

5.     knee = neon light
        light 

6.     ground 
--------------------             = six feet underground
feet feet feet feet feet feet 

7.     he's X himself = he’s by himself

8.     ecnalg = backward glance

9.     death ....... life = life after death

10.   THINK = think big!!

Bonus Question

abababababababababababababababababababab... = long time no ‘C’

The purpose of this exercise was to show how sometimes we act before we think. Reason and thought are two critical elements of ethical behavior.This got me thinking about the quintessential logical thinker of all the millennia and galaxies far and near. Yes, you "Trekkies." I'm talking about the beloved Spock from Star Trek. Given the popularity of Star Trek into Darkness, I want to share one of my favorite scenes from the original show that illustrates how Spock explains logic to an other-being.

Enjoy...

Blog posted by Steven Mintz, aka Ethics Sage, on May 31, 2013

 

Lateral Thinking in the Job-Hunting Process

Think Creatively to Get A Head* in Life

It’s that time of year again – graduation. My students are ready to walk and move their tassels from the right to the left signifying they have officially received the baccalaureate degree. This inspired me to develop the following blog that tests one’s ability to think creatively – out of the box. I find this is a challenge even for the best of students (i.e., high GPAs). Realizing that many of my students read my blogs, I include a puzzle to test their creative thinking skills. I invite all readers to try the puzzles below. To add some drama to the “test,” I will post answers on Friday, May 31. But first, a little background about the use of lateral thinking in job-hunting. It comes from my colleagues at the University of Kent in the United Kingdom.

A number of graduates have tried the commonplace methods of trying to gain a recruiter’s attention, such as enclosing a tea bag with their application, so that the recruiter could take a break to have a cup of tea before reading it. Here are more creative approaches.

A student wanted to become a staff journalist on her town newspaper. She decided to carefully analyze the content of the paper and compared it with similar local papers. She conducted a small survey of readers' opinions on the paper by interviewing passers-by downtown. Using this information, she drew up a list of possible changes to the paper, wrote a sample article to show what she had in mind and sent these to the editor. The editor invited her in to discuss her suggestions - they had a long discussion and the next vacancy that arose was offered to her without competition.

One New York graduate who wished to work in a top advertising agency Googled the names of the creative directors of these agencies and then spent just $ 6 on a set of Google ads that were triggered when the directors searched for their own names. The advertisements said "Hey, (creative directors name), Googling yourself is a lot of fun. Hiring me is fun, too" Of the five directors he targeted, four gave him an interview and two offered him a job. Here is a one-minute video  of what was done.

The following fun puzzles will test your ability to think laterally. Simple look at the puzzle and describe what it means. Here is an example:

       man 
1. ------------ = man overboard
      board 

Now you try it. I will post the answers on Friday so keep reading.

      stand 
2. ------------ 
          i 

3. /r/e/a/d/i/n/g/ 

          0 
4. ------------ 
       M.D. 
       Ph.D. 

5.     knee 
         light 

6.     ground 
--------------- 
feet feet feet feet feet feet 

7.     he's X himself 

8.     ecnalg 

9.     death ....... life 

10.   THINK 

Bonus Question

abababababababababababababababababababab...

* purposefully misspelled in the spirit of this blog

Blog posted by Steven Mintz, aka Ethics Sage, on May 29, 2013

Fraud in Awarding Government Contracts to Disadvantaged Small Business Owners

NASA Contractor Pleads Guilty To Faking Minority Status 

Just when I thought I had heard it all, along comes another example of greed in business. This time it is Michael Brian Dunkel of Merritt Island, Florida who pleaded guilty on May 24, 2013, to fraudulently obtaining more than $4.4 million in government contract payments that should have gone to what the U.S. government considers a disadvantaged small business.

Congress amended the Small Business Act in 1978 to require that agency heads, in consultation with the SBA, set goals for the percentage of federal contract and subcontract dollars awarded to small businesses each year. Congress further amended the act in 1988 to require the President to set government-wide goals for the percentage of federal contract and/or subcontract dollars awarded annually to various categories of small businesses. These goals must be equal to or exceed certain percentages specified in statute (i.e., 23% of federal contract dollars awarded to small businesses; 5% of federal contract and subcontract dollars awarded to women-owned small businesses; 5% to small disadvantaged businesses; 3% to HUBZone small businesses; and 3% to service-disabled veteran-owned small businesses).

According to the SBA website, the following individuals are presumed socially disadvantaged for purposes of the SBA Section 8(a) Business Development program: Blacks, Hispanics, Native Americans, Asian Pacific, or Subcontinent Asians.

Agency performance in meeting the small business contracting and subcontracting goals is of perennial interest to Congress because it is arguably the clearest indicator of whether the stated congressional “policy” of encouraging contracting with small businesses is being implemented. In particular, the government’s failure to meet either government-wide or agency-specific goals suggests that the current government-wide goals are too low and do not adequately reflect the availability of minority-, women-, and service-disabled veteran-owned small businesses in today’s marketplace.

Back to the Dunkel case who was charged with one count of major government fraud. He faces a maximum penalty of 10 years in prison when he is sentenced on October 4.  As part of his plea agreement, Dunkel has agreed to forfeit $2.9 million.

According to court documents, Dunkel admitted that in 2005, he learned that Keith Hedman, an executive at an Arlington-based security service consulting company referred to as Company A in court records, illegally controlled Company B, another Arlington-based security service consulting company.

Company B was a participant in the SBA “Section 8(a)” program, which enables certain small businesses to receive sole-source and competitive-bid contracts set aside for minority-owned and disadvantaged small businesses. Although Hedman controlled Company B, Company B had obtained its 8(a) status based on the disadvantaged status of Dawn Hamilton, its nominal owner.

Dunkel admitted that he agreed to pay Hedman and Company B a fee in exchange for Company B allowing Dunkel to use its 8(a) status to obtain NASA and other U.S. government contracts.  In reality, Dunkel simply paid a kickback to the Arlington company so it would pass the work through to him.

Although Company B was required to perform at least 50% of the work on the contracts and had represented it would do so, no Company B employees actually performed any work. Instead, Dunkel and others did all of the work as independent contractors, but they concealed that fact from the government agencies. 

In addition, Dunkel submitted fraudulent proposals and invoices to hide their scheme, used a third-party company’s Federal Employer Identification Number to prevent reporting of his contractor income to the IRS, and did not pay any income taxes on the income he received from Company B.

The ethical shortcomings in this case are clear. Dunkel was greedy; acted from an egoistic point of view without regard for the interests of deserving minority/small business owners; and he took work away from those who depend on it for their livelihood and business success.

I also have accounting questions in this case not the least of which is: Where were the internal auditors in the various companies while the deception took place? Aren’t these contracts reviewed to determine they are awarded properly? And, what about government oversight; is this another case of the government lacking the resources to properly audit contracts?

Blog posted by Steven Mintz, aka Ethics Sage, on May 28, 2013

 

Wal-Mart and Violations of the Foreign Corrupt Practices Act

Bribery and lack of Full Disclosure Evidences Unethical Behavior at Wal-Mart

Wal-Mart said last week that it spent $73 million on compliance with the Foreign Corrupt Practices Act (FCPA) during the first quarter of 2013. It had budgeted $40 million to $45 million. During its prior fiscal year, it spent $157 million for FCPA matters. It expects to spend $65 million to $70 million in the second quarter of 2013. The disclosures came during a conference call from Wal-Mart CFO Charles Holley to reporters.

The company has said it can't tell when its internal investigation of fraudulent payments by a Mexican subsidiary might end or when it will resolve the Department of Justice and SEC investigations. Wal-Mart started its internal investigation in 2011.

Last year, the New York Times reported in a Pulitzer Prize-winning story that the company's Mexico unit paid $24 million in bribes to speed up licensing and permitting for new stores. The paper said top managers in the U.S. covered up the bribery after learning about it.

During last week’s conference call, Wal-Mart said it spent $44 million on the investigation during the first quarter of this year and $29 million for a global compliance review, program enhancements, and organizational changes.

The details surrounding the Wal-Mart de Mexico bribery scandal include the stuffing of envelopes with cash handed off to mayors, bureaucrats and other government officials who wield the power to stand in the way of business. Wal-Mart is accused of not only participating in such bribery at its Mexican subsidiary, but also of sweeping it under the rug once it came to light.

On April 21, The New York Times published a lengthy article alleging that Mexico-based Wal-Mart officials participated in an ongoing bribery scheme several years earlier to achieve market dominance in the country, and that top executives had covered it up. The allegations are corroborated by internal company documents, according to lawmakers investigating the conduct.

A whistleblower -- a former Wal-Mart de Mexico executive -- informed a company attorney of the widespread practice via email in 2005. According to Reps. Elijah Cummings (D-Md.) and Henry Waxman (D-Calif.), who are investigating the allegations, Wal-Mart former general counsel Maritza Munich pressed the company to establish a stricter anti-bribery policy after being informed of the bribes. Munich recommended that a follow-up investigation look into "other potentially suspect transactions not yet identified." Three months after Munich resigned on Feb. 1, 2006, however, the new general counsel ended the investigation.

In its 10-Q form filed with the SEC on December 4, 2012, Wal-Mart admitted that the Company could be exposed to a variety of negative consequences as a result of the investigation into FCPA violations. These include:

• There could be one or more enforcement actions in respect of the matters that are the subject of some or all of the ongoing government investigations, and such actions, if brought, may result in judgments, settlements, fines, penalties, injunctions, cease and desist orders, debarment or other relief, criminal convictions and/or penalties.
• The shareholder lawsuits may result in judgments against the Company and its current and former directors and officers named in those proceedings. The Company cannot predict at this time the outcome or impact of the government investigations, the shareholder lawsuits, or its own internal investigations and review.
• The Company expects to incur costs in responding to requests for information or subpoenas seeking documents, testimony and other information in connection with the government investigations, in defending the shareholder lawsuits, and in conducting the review and investigations. These costs will be expensed as incurred.
• The Company has incurred expenses of approximately $48 million and $99 million during the three and nine months ended October 31, 2012, respectively, related to these matters. These matters may require the involvement of certain members of the Company’s senior management that could impinge on the time they have available to devote to other matters relating to the business.
• The Company expects that there will be ongoing media and governmental interest, including additional news articles from media publications on these matters, which could impact the perception among certain audiences of the Company’s role as a corporate citizen.

As a professor of accounting ethics I was intrigued by this disclosure. It seems ironic that Wal-Mart cares about “the perception among certain audiences of the Company’s role as a corporate citizen.” This from a company that has been investigated for other bribery situations and the finding in 2006 that it violated the underage child-labor laws in its factories abroad.

I also found it curious that Wal-Mart decided not to record a contingent amount for possible loss from the lawsuits and other legal actions. In its disclosure, Wal-Mart said: “The Company’s process of assessing and responding to the governmental investigations and the shareholder lawsuits continues. The review, inquiries and investigations are ongoing; and the Company cannot reasonably estimate any possible loss or range of possible loss that may arise from these matters. Although the Company does not presently believe that these matters will have a material adverse effect on its business, given the inherent uncertainties in such situations, the Company can provide no assurance that these matters will not be material to its business in the future.”

This is a classic narrow-minded view of materiality. In accounting a material event is not only one with a significant monetary impact on earnings, but also those with a significant qualitative effect on a company. That is where Wal-Mart falls far short of making an ethical disclosure about its bribery activities at Wal-Mart de Mexico.

Wal-Mart says it “can provide no assurance that these matters will not be material to its business in the future.” I never like negative statements of no assurance. Wal-Mart is looking at its own self-interest from an egoistic point of view and not the interests of its stakeholders – shareholders, creditors, employees, and so on. The Company’s statement includes no information on why the internal controls did not prevent or detect the illegal payments sooner. Major questions exist about corporate governance at Wal-Mart.

The Company needs to step up to the plate and be transparent about the bribery, violation of the FCPA, and possible long-term damage to the Wal-Mart brand. Some indication that the Company knows what happened was wrong would be nice rather than a ‘CYA’ approach. However, given my skepticism about corporate ethics, I never expect companies to act in an ethical mannerand once the cover-up is disclosed most companies rarely decide to fully disclose the details. History has taught us otherwise.

Blog posted by Steven Mintz, aka Ethics Sage, on May 21, 2013

Have our Schools Become Laboratories for Violence?

Fighting in Schools Has Become all too Common

Girl on girl violence; student on teacher violence; teacher on student violence. Where will it all end? It seems these incidents are increasing in number and raise serious questions about our role as a civilized society. Some of you may think I am overstating to make a point. Perhaps so. Nevertheless, those of us who grew up in the 1960s through the end of last decade rarely experienced the kinds of situations that should make all of us stand up and take notice of the decline in time devoted to academic instruction and increase in monitoring of bad behavior (of both students and teachers) in the classroom.

I have read about some troubling incidents in the classroom recently. Here are a few examples.

Stockton, CA: On April 25, 2013, a high school student was arrested after getting into a physical fight with her teacher, but the student claims the teacher was the aggressor.

Marlina Martine was playing makeup in math class when her teacher, who authorities have not named, confiscated the makeup. Martinez called her mother on her cellphone to tell the teacher to return the makeup, but the teacher confiscated the phone.

At that point, the teacher and student began shouting at each other as a student recorded the action. In the video, the teacher pushed Martinez and the two began throwing fists, eventually falling on top of each other on the floor.

The student who recorded the video then posted it to his Facebook page, where it has since gone viral. [No surprise there.]

Fort Worth, TX: On May 1, 2013, a former elementary school teacher previously charged with fondling a child was arrested for a second time after two students told authorities he sexually assaulted them.

Fifty-year-old Max Marchelli is facing charges that include aggravated sexual assault of a child. Police say two second-grade girls at Western Hills Elementary School claimed Marchelli had assaulted them. Marchelli resigned from the school district and is free on $100,000 bond.

Bronx, NY: On December 9, 2010, a beloved teacher had a miscarriage after she was hit trying to break up a fight between two students in her fifth-period Spanish class at Exploration Academy.

Here is how it went down: A student arrived five minutes late, walked up to another student who was already seated and told him to get out of his desk.

When the seated student refused, the conflict escalated and the teacher tried to intervene. She was accidentally elbowed in the stomach and fell to the ground, crying.

"I can't believe it," said another student later on. "I can't believe she lost her child over a fight over a chair."

The two students involved in the incident have been suspended.

Other NYC Fights: A few days earlier, a 49-year-old teacher was punched in the eye by a 14-year-old eighth grader at a Junior High School in East Harlem. The teacher got a black eye and was treated at a medical center. The student was arrested for assault and has been suspended.

And in a third incident, fights in the hallways of Murray Bergtraum High School in Manhattan led to the principal becoming involved and threatening to stop issuing bathroom passes if kids kept getting into fights, prompting students to organize a riot between 5th and 6th period.

One student was injured and sent to the hospital, and several others are being disciplined.

Palm Beach, FL: On December 1, 2010, a middle school boy was beaten by another student while, according to the parents, the teacher did nothing but sit by his computer while the fight raged in his classroom.

Video of the fight between Joshua Poole, 13, and his Jeaga Middle School classmate shows Poole swinging wildly as he is punched repeatedly before falling to the floor. The teacher's inaction was reportedly due to a school policy that staff can only intervene after undergoing training, according to the school district.

That type of "policy run amok" is a growing problem in schools across the country, according to Carol Kochhar-Bryant, a professor at George Washington University's Graduate School of Education and Human Development. Part of the problem is in the past there have been many instances where if the child gets injured in any way by an intervention by a teacher, the teachers have been reprimanded. "Those policies protect the school, they protect the teacher, but we are realizing now they don't protect the child in those situations."

The root cause of the school violence problem is two-fold. First, there has been a decline in ethics in society. All too many young people do not know right from wrong and what is worse, they don’t seem to care. Moreover, a lot of kids of all ages seem to think right and wrong is whatever they decide it to be. This ethical relativism approach to decision-making leads to acting out one’s aggressions rather than keeping feelings in check because such behavior is not acceptable under societal standards.

It is all too easy to blame social media for the problem. Perhaps some youngsters create mayhem to have their outburst videoed and go viral on You Tube. Maybe some even aspire to be on a reality TV show. That does not explain away the lack of parental oversight of what their kids are doing; who they are doing it with; and why.

I sometimes think parents find it easier not to care; not to discipline their kids. They don’t want to argue with their kids on what they can (should) and cannot (should not) do. It’s easier to let the kids decide what is in their best interests even though all too often those same kids fail to consider the interests of others and how their actions may affect others before deciding how to behave. As the old expression goes, this is like allowing the inmates to run the asylum.

Blog posted by Steven Mintz, aka Ethics Sage, on May 14, 2013

Space Crooner Chris Hadfield Returns to Earth

A True Space Oddity and Inspiration to ALL -- Chris Hadfield

Astronaut Chris Hadfield, the first Canadian to command the International Space Station, is preparing to make the return voyage to Earth after almost five months in orbit.

Hadfield, along with flight engineers American Tom Marshburn and Russian Roman Romanenko, have boarded a Soyuz spacecraft for the journey home. It marks the first time Hadfield will come back from space in the Russian capsule — during his previous space missions, in 1995 and 2001, he travelled aboard one of the now retired space shuttles.

"Reviewing Soyuz procedures onboard, but I wanted to thank every person at the Cdn Space Agency," Hadfield tweeted earlier today. "Your work takes Canada into orbit. Be proud."

NASA mission control relayed that hatches between the capsule and the space station were reported closed at 3:50 p.m. ET. The capsule is now on autonomous power as the astronauts work their way through a pre-departure checklist.

Bob McDonald, the host of CBC Radio's Quirks & Quarks, said the astronauts and ground control will verify that everything in the capsule and space station is airtight.

'They have to make sure all systems are tight and clear before they actually let go of the space station," he said.

At 7:08 p.m. ET -- right about the time I am posting this blog -- the Soyuz will undock from the space station.

During his time aboard the International Space Station, Hadfield has been a popular Internet figure, doing a lot on social media channels and YouTube to promote space science. From chatting on the phone with William Shatner  to posting breathtaking photos of Earth to his Twitter and Tumblr pages to explaining why you can't cry in space, Hadfield has been a constant expression of the sheer joy of being in outer space.

Hadfield is an inspiration to all of us who can only dream of going to space. Whats more he produced this poignant cover version of David Bowie’s Space Oddity. He recorded the vocals and guitar while on board the International Space Station. Piano and other musical accompaniment were provided by folks down on Earth. The video itself is gorgeous, featuring some amazing shots of Earth through the windows of the space station as Hadfield sings Bowie’s famous tune.

ENJOY!

 

 

Blog posted by Steven Mintz, aka Ethics Sage, on May 13, 2013

ACLU Sues the State of California for Failing to Teach 20,000 Students English

Who is at Fault for Students’ Failure to Learn English in California Schools?

I was surprised to learn on April 25, that the American Civil Liberties Union (ACLU) filed a lawsuit against the State of California for failing to correctly teach the English language. The lawsuit was filed by the ACLU on behalf of 20,000 students. The lawsuit is seeking a court order to ensure that students receive the courses they need to learn English, as many have been given low grades and are frequently being held back due to a language barrier.

Earlier this year, state officials said 98% of the state's 1.4 million English learners were receiving services. The number of students in the "2012 Cohort Graduation and Dropout Rates" is staggering.

 

 

State Department of Education statistics show 23.7 percent of English learners in the class of 2012 dropped out between 9th and 12th grade. State Department of Education statistics show 23.7 percent of English learners in the class of 2012 dropped out between 9th and 12th grade.

ACLU attorney Mark Rosenbaum said: “These kids are not getting the differentiated learning they’re supposed to be getting. English learners are falling behind without proper language lessons, even as school districts collect federal funds specifically for that purpose. Under state and federal law, schools are required to teach non-English speakers the language, but by its own records, the state isn’t offering English instruction to nearly 20,000 students.”

The suit, filed in Los Angeles County Superior Court, accuses state education leaders of violating section 300 of the California Education Code, which states, in part, “The government and the public schools of California have a moral obligation and a constitutional duty to provide all of California’s children, regardless of their ethnicity or national origins, with the skills necessary to become productive members of our society, and of these skills, literacy in the English language is among the most important.”

Advocates of the lawsuits base their conclusions on information that school districts report to the state Department of Education. About 250 districts acknowledge they are providing no services or inappropriate language help to these students. One example is that of F.S., a student in the Compton Unified School District who was allegedly denied language help in third grade, failed most of his classes, and ultimately was retained. The next year, the same student, in the same school system, received help and showed sufficient progress in his classes to move on with his education.

Although federal and state funds are set aside to help English learners, the best approach has long been a topic of contention. It's more common for English-speaking teachers to receive training in how to make their lessons more accessible. And students can also receive support in classes taught in English.

For their part, state officials insist they are meeting their legal obligations and not shirking their responsibilities. The education department is "determined to ensure that all English-learner students receive appropriate instruction and services," said Chief Deputy Supt. of Public Instruction Richard Zeiger.

"When questions arose," he added, the department "asked local educational agencies to provide additional information regarding the services they are required to provide." Zeiger also urged parents with specific issues to contact the department though its established complaint process.

It seems to me the education department is being reactive rather than proactive. The department waits for a problem or complaint to occur and then responds to the matter. This is different from making sure the English language instruction and use of technology for English language students is provided on a timely basis. If those with inadequate English language skills don't learn them before going to college, there is no doubt they will suffer throughout their college education. I have seen it first hand as a college professor.

The sad part for California is that its education budget has been cut for about five straight years. California’s K-12 public schools have been cut by over $18 Billion, or roughly $3,051 per student during the 2009-2012 periods. Over 30,000 educators and 10,000 other school employees have lost their jobs during that same time. Class sizes are increasing; music, art and sports programs being eliminated; and computer labs, libraries and schools are being shut down.

According to a study Winners and Losers: Corrections and Higher Education in California, since 1980, higher education spending has decreased by 13 percent in inflation adjusted dollars, whereas spending on California's prisons and associated correctional programs has skyrocketed by 436 percent. The state now shells out more money from its general fund for the prison system than the higher education system.

These statistics are alarming. Unfortunately, they are likely to get worse before they get better. The causes of the problem are many, and that is a subject for another blog. If I can identify one factor that leads to the lagging English language skills and burgeoning prison population it is the breakdown in the family unit. All too many kids grow up in one-parent families with the result that responsibility and accountability are not adequately taught. All too many parents do not spend the time to teach their kids -- not only learning and technical skills but a work ethic.

Nothing will change in California until parents, guardians, and the kids themselves start to focus on learning, working hard, bettering themselves, and contributing to society. As for parents, what ever happened to the mantra of generations that we want our kids to have a better life than we had growing up?

Blog posted by Steven Mintz, aka Ethics Sage, on May 9, 2011

Threats to Independence Raise Ethical Questions for the Big-Four CPA Firms

KPMG Faces Conflict of Interest Charges in Audit of JobsOhio

KPMG is at it again. In the most recent allegation of violating independence standards of the accounting profession, KPMG’s Columbus, Ohio office was auditing JobsOhio’s books while, at the same time, an out-of-state office of the firm was seeking $1 million in taxpayer money from JobsOhio for an unnamed client. As the state’s lead economic-development agency, JobsOhio is charged with recommending financial incentives for companies seeking to relocate in the state. On November 5, 2012, about the time that the audit was being conducted, KPMG was also listed on a sheet of eight pending grant commitments from the state for fiscal year 2013, one of which was for the unnamed client.

I will return to this case later on, but first a review of the recent insider trading charges against the firm. I have previously written about about insider trading at KPMG. In that case, KPMG resigned two audit accounts and withdrew its blessing on the financial statements of Herbalife for the past three years and of Skechers for the past two. KPMG withdrew its audit opinions, a serious step for any auditor, after concluding it was not independent because of alleged insider trading.

The KPMG insider trading case is a particularly egregious one because it involves an auditor tipping off a friend about stock of audit clients. Scott London, the KPMG auditor, did not trade in the stock himself but he did gain personal wealth (“unjust enrichment”) when his friend, Brian Shaw, used the inside information to trade in stock of Herbalife Ltd. and Skechers USA Inc. Shaw benefitted by $1.27 million on the trades. Shaw paid London $50,000 cash and gave him a Rolex watch.

Looking at the JobsOhio case, as KPMG was auditing JobsOhio's books in the fall of 2012 the firm also was seeking $1 million in taxpayer money from JobsOhio for an unnamed client. JobsOhio, the state's privatized development agency, said that the grant request was handled separately from and without the knowledge of the firm's auditing division.

The ethical problem for KPMG in the JobsOhio case is independence in appearance. This is an important requirement of an independent audit because factual independence is sometimes difficult to determine. Factual independence goes to the mindset of the auditor in approaching an audit with objectivity and professional skepticism. It is difficult to assess so appearances serve as a proxy in that regard.

JobsOhio denies any conflict of interest. Laura Jones, a spokeswoman for JobsOhio, said KPMG LLP's Columbus office conducted the audit, but the grant was sought by an out-of-state office. "The fact that KPMG serves JobsOhio and countless other businesses ... from the same office here in Columbus is not a conflict in our minds," she said, adding that “the state also monitors and ultimately approves taxpayer-funded incentives to companies.”

Most observers would probably conclude that the two offices of KPMG would never collude on their own to achieve some benefit for the firm. However, the more troubling issue is whether JobsOhio might perceive some pressure on them to provide financial incentives to the KPMG audit client perhaps to make it less likely that KPMG would point out problems with the JobsOhio audit, assuming any occur.

The accounting profession has strict independence standards to protect the public interest. Shareholders, creditors, and the beneficiaries of public funds rely on the honesty, trustworthiness, and responsibility of auditors to go the extra mile to ensure that the financial statements of entities that operate in the public interest are based on an independent audit – both in fact and in appearance.

KPMG is not alone in violating the most basic and cherished independence standards. As I have previously blogged, in 2010 Deloitte and Touche was investigated by the SEC for repeated insider trading by Thomas P. Flanagan, a former management advisory partner and a Vice Chairman at Deloitte. Flanagan traded in the securities of multiple Deloitte clients on the basis of inside information that he learned through his duties at the firm. The inside information concerned market moving events such as earnings results, revisions to earnings guidance, sales figures and cost cutting, and an acquisition. Flanagan’s illegal trading resulted in profits of more than $430,000. In the SEC action, Flanagan was sentenced to 21 months in prison after he pleaded guilty to securities fraud.

On January 7, 2013, the SEC announced it is investigating whether Ernst & Young violated independence rules by letting its lobbying unit perform work for several major audit clients. The SEC inquiry began shortly after Reuters reported in March 2012 that Washington Council Ernst & Young, the E&Y unit, was registered as a lobbyist for several corporate audit clients including Amgen, CVS Caremark, and Verizon Communications.

The problem for EY is that U.S. independence rules bar auditors from serving in an "advocacy role" for audit clients. The goal is to allow auditors to maintain some degree of objectivity regarding the companies they audit, based on the idea that auditors are watchdogs for investors and should not be promoting management's interests.

Finally, in December 2012, Thomson Reuters announced it signed a three-year contract with PwC, the company’s auditor, to provide use of the Thomson Reuters ONESOURCE Corporate Tax solution for China. PwC U.K. also uses this Thomson Reuters software for its tax clients. Business alliances between a company and its auditor are prohibited under U.S. and U.K. auditor regulations. Once again an independence violation exists because such arrangements create a “mutuality of interests” as a result of the business relationship between the auditor and audit client.

I am very concerned about the actions of KPMG in the JobsOhio case, Deloitte & Touche and KPMG insider trading scandals, EY serving as an advocate for an audit client, and PwC in becoming involved in a joint business relationship with an audit client. These relationships create threats to independence and taint the audit because of conflicts of interest.

The SEC needs to look into these matters, not just individually but collectively, and determine whether the Big-4 CPA firms have built adequate safeguards to protect audit independence and whether more stringent independence and ethics standards are needed to protect the public trust in the independent audit.

Blog posted by Steven Mintz, aka Ethics Sage, on May 7, 2013

Jason Collins Comes Out

What will be the Effect of Collins’ Announcement that he is Gay?

By now you have probably heard that Jason Collins, a professional basketball player in the NBA, probably changed the face of the ‘Association’ for years to come. With twelve words Collins made it acceptable for gay athletes to reveal their sexual preference. There were others before him including Martina Navratilova, the great women’s tennis star, but no athlete has “come out” while active in any of the major team sports in the U.S. – basketball, baseball, football and hockey.

Collins, in an exclusive interview given to Sports Illustrated (SI) stated these words: “I’m a 34-year-old NBA center. I’m black. And I’m gay.” Jason Collins, with the help of writer Franz Lidz, told the sports world two things it already knew and one that it didn’t, and in doing so has made history.

Jason Collins is not a superstar as was Magic Johnson when he publicly announced in November 1991 that he was HIV-positive. The announcement sent shock waves throughout the world of sports, in the U.S., and in countries far and wide. Many wondered how the sports world would react to the news. Back then many of us were ignorant about the virus, how it was transmitted, and the possible effects on others who came in contact with someone who was HIV-positive.

To understand how far we have come as a nation – evolved as a society – we need to examine the reaction to Magic’s announcement by the public and compare it to, thankfully, the world-wide acceptance of Collins’s announcement.

The day after his announcement, Johnson appeared on the late-night talk show of his friend, Arsenio Hall. There, he adamantly denied rumors that he was gay. The crowd cheered wildly, as if Johnson had just won another championship, or announced he’d been cured. What a difference twelve years makes, and with twelve short words Jason Collins has shown us our progress as a civilized nation.

Collins has bounced around the NBA for twelve years (there’s that ‘magic’ number again). He just finished the season playing for the Washington Wizards after being traded by the Boston Celtics. He is a free agent this summer, and is nearing the end of his years in the league, but he says he hopes to get picked up by another team next season. If he does, he may be the only openly gay player, but as he notes at the end of the SI piece, he will surely not be the only gay player: “Pro basketball is a family. And pretty much every family I know has a brother, sister or cousin who’s gay. In the brotherhood of the NBA, I just happen to be the one who’s out.”

The NBA league office issued a classy statement after the story broke in Sports Illustrated. The league offered a statement on its official Twitter account: “We have known the Collins family since Jason and Jarron (Jason’s brother) joined the NBA in 2001 and they have been exemplary members of the NBA family. Jason has been a widely respected player and teammate throughout his career and we are proud he has assumed the leadership mantle on this very important issue.” The series of tweets ends with the hashtag #NBAFamily.

As recently as 2007, the sports world, at least one member of it, reacted to a gay athlete coming out in an entirely different way. When the basketball center John Amaechi came out in 2007, three years after he had retired from the NBA, the former All-Star Tim Hardaway said, “First of all, I wouldn’t want him on my team. Second of all, if he was on my team I would really distance myself from him because I don’t think that’s right and I don’t think he should be in the locker room when we’re in the locker room.” Hardaway later apologized, and it is hard to imagine such comments being made or finding much public support today, but they surely hung over Collins’s announcement—and will continue to do so for other male athletes that follow his footsteps.

Gender matters as well. On Wednesday, April 17, Baylor University women’s basketball superstar, Brittney Griner, one of the best female basketball players on the planet, came out of the closet and few people even shrugged at the announcement.  Even though Griner’s announcement received relatively little press, her story is no less one of courage and pride. She is at the pinnacle of her sport; she was just selected No. 1 in the W.N.B.A. draft, and signed a high-profile endorsement deal with Nike. If Collins is a hero, then so is Brittney Griner.

For years I’ve blogged about the lack of role models in society including the sports world. Sports fans have been given two major jolts about their heroes the past few years. In baseball, the two biggest superstars of their era – Barry Bonds and Roger Clemens – allegedly used steroids. Regardless if they are or ever will be found guilty of the charges, most everyone knows they did use the performance enhancing drugs (PEDs). Then we have the devastating case of Lance Armstrong who duped the public for many years while using PEDs; denying the charges’ claiming he was the victim of a vendetta against him; and otherwise lying over and over again about the truth of the matter.

So we finally have heroes to look up to. Not because of their statistics. Not because of their athletic talent. But because of their selfless act of admitting being gay and the classy way they handled the announcement. Kudos to Jason and Brittney for showing all of us what it means to have integrity and be a role model for all youth – not just the LGBT community.

Blog posted by Steven Mintz, aka Ethics Sage, on May 2, 2013

"Black Box" Ethical Reasoning and the Atlanta Test-Cheating Scandal

Who is to Blame in the Atlanta Public School Cheating Scandal?

The cheating scandal in Atlanta, which led to the indictment of 35 teachers and school officials last month, raises ethical issues related to whether tests are to blame for student cheating and for school administrators allowing teachers to help students cheat.

According to the indictment and a state investigation, teachers held cheating “parties” to erase and change answers on state-mandated tests. One principal wore gloves to guard against leaving fingerprints.

Teachers who failed to meet testing goals were fired. So were whistle-blowers. Teachers who succeeded garnered financial rewards. The indicted school superintendent, who has denied wrongdoing, pocketed $580,000 in bonuses for her achievements.

Some have blamed the test itself for promoting an atmosphere of cheating and even rewarding of such behavior. These folks claim there are unintended consequences of our test-crazed policies. Others believe sanctioning cheating on tests is not a reflection of our testing culture but, instead, it shows what dishonest people do when bonuses are at stake and they're afraid they won't get them: They cheat.

There's plenty to debate about high-stakes testing: Is it the best way to measure student learning? Does it spur teaching to the test at the expense of more useful education? How much of a role should it play in teacher evaluations?

But cheating has no place in that discussion. Combining the two diminishes any honest debate about testing, excuses dishonest acts, obstructs efforts to prevent cheating and magnifies cheating into a false "everybody's doing it" problem. The statistics do not support this position.

While scandals have erupted in some of the nation's largest school districts, USA Today found statistical indications of cheating in districts in six states and Washington D.C. But there are nearly 14,000 districts in the US and cheating has been documented in a tiny fraction.

High-stakes testing, ushered in by the No Child Left Behind law during President George W. Bush's administration, provided a key element many schools lacked: a measure of accountability. Blaming the cheating on the tests is like blaming a bank with lots of money for being robbed.

The proper response to cheating is to ensure that it doesn't occur. This isn't complicated: Use independent monitors. Limit access to tests before and after they are given. Bar teachers from monitoring their own classrooms. Also needed: city and civic leaders who step up when confronted with allegations of cheating — the opposite of what happened in Atlanta.

After The Atlanta Journal-Constitution found evidence of cheating in 2008, civic and business leaders were more worried about protecting the city's reputation than the future of its children. It took a governor and a local prosecutor to follow through with independent investigations.

In Washington, the mayor and key City Council members recently decided against investigating evidence of earlier cheating to inflate scores despite a 2009 document indicating that as many as 191 teachers might have cheated. The failure to sanction teachers who enable cheating sends the wrong message that cheating is OK in some situations to other teachers, administrators, parents and, most of all, our nation’s school children.

From an ethical perspective, those who sanction cheating and enable it to occur operate in the “black box” world of ethical relativism. This is a philosophy that holds: “My ethics are my ethics and no one can tell me whether it is right or wrong.” (How do we know what your ethics are? Isn't this an example of judging the rightness or wrongness of an act by the standards of the person who commits the act?)

Black box ethics is antithetical to a civilized society with ethical norms that should guide actions in our personal and professional lives. We can’t pick and choose which ethical standards to follow and when we follow them. If we continue to go down the road of black box ethical thinking, we will surely continue to disintegrate as a civilized society just like the recent incidents in Aurora, Colorado, Newton, Connecticut, and the Boston Marathon – to name a few.

Blog posted by Steven Mintz, aka Ethics Sage, on April 29, 2013

Is stepping on a Sheet of Paper with the name Jesus an Expression of Academic Freedom?

Academic Freedom, Religious Beliefs, and Civility in the Classroom

Recently, I read about a self-proclaimed Christian instructor at Florida Atlantic University, Deandre Poole, who asked his students to write "Jesus" on a piece of paper and "Stomp on it."

The exercise was from a textbook manual and was designed to teach that "even though symbols are arbitrary, they take on very strong and emotional meanings." The instructor indicated that he would not have stepped on the paper if he had been asked.

I’ve been teaching at the university level for more than thirty years and have rarely heard of such a stupid and disrespectful exercise. I can’t figure out the point of the exercise.

Let’s assume one-half of the class stepped on the paper. So what? What does this indicate to the professor with respect to the academic learning experience? Does it mean those students believe anything goes in a college classroom in the name of freedom to inquire? Does it mean one-half of the students are not afraid of the instructor’s response to his exercise? Does it mean one-half of the students are anti-Jesus and his teachings?

It seems to me an intellectual discussion of what Jesus has meant to a large portion of the population of the world makes more sense. The instructor could have asked probing questions such as if Jesus is the son of God how could he allow what happened at the Boston Marathon or at Newton and so many other tragedies in our recent past? Is this a valid question to ask from an ethical point of view? If so, why is it proper to explore the ethical dimensions of horrific acts and our faith in a higher being? If not, what is the appropriate frame of reference for the discussion on a philosophical basis?

Ryan Rotela, a devout Mormon, refused, telling the professor, "With all due respect to your authority as a professor, I do not believe what you told us to do was appropriate.  I believe it was unprofessional and I was deeply offended by what you told me to do."

Rotela was suspended from class.  The university initially defended the professor, citing the lesson was intended to encourage a multi-faceted viewpoint and debate. Subsequently, the professor was put on administrative leave pending an investigation by the university.

Fay Voshell who holds a Masters of Divinity from Princeton Theological Seminary, reminds us that stomping on Jesus touches a sore nerve. Beginning in 1626, Japenese Christians were forced to stomp or spit on an image of Christ or Mary. The images, named fumie, became a means of identifying Christians and a method of forcing them to repudiate their faith.  Stomping on Jesus or Mary also became a prelude to torture and universal persecution.  One torture involved cutting off three fingers from each hand, leaving only the little finger and thumb.  Children as young as five were subjected to this mutilation. The idea was that Christians were worse than animals and therefore entitled to fewer digits than the beasts. 

Generally, however, if believers refused to stomp their feet on the fumie, they and their families were put to death by drowning or being burnt alive.  Some of the faithful were not up to martyrdom and went into hiding, utilizing special prayers asking forgiveness if they had capitulated to the Japanese government's demands they renounce their faith.  For the next 250 years, the persecution of Japanese Christians was so intense they were nearly all exterminated, along with the symbols of the faith.  To this day, the number of Christians in Japan remains very low.

The attempts to exterminate Christians and the images of their faith have a long and bloody history, and certainly have not been confined to pre-modern Japan. While persecution has remained a constant of Christian history since the time of Jesus and the apostles, iconoclasm, the concerted attempt to rid a given civilization of Christian religious images, has been a recurrent issue, especially during the eighth and ninth centuries. During that time period, imperial legislation of Byzantium attempted to bar the use of figural images.  Existing icons were destroyed by those who had a theory that sacred images were "graven images," and therefore idolatrous. 

The Florida Atlantic faculty is currently suggesting that the administration's handling of the situation has compromised the instructor's academic freedom. The question is where does academic freedom start and end and when does civility enter the classroom experience. I don’t think academic freedom is a license to experiment with tasteless and historically offensive actions. 

A healthy classroom engages students in a rich debate of ideas. It should not encourage students to perform symbolic gestures that ridicule the beliefs of others. Poole should apologize for his lack of civility and then continue his task of educating and enlightening his students.

Blog posted by Steven Mintz, aka Ethics sage, on April 26, 2013

'Black Jails' in China

Human Rights Challenges in China

Black Jails in China are a network of extralegal detention centers established by Chinese security forces across the People's Republic of China in recent years. They are used mainly to detain, without trial, petitioners, who travel to seek redress for grievances unresolved at the local level.

Black jails have no official or legal status, differentiating them from detention centers, the criminal arrest process, or formal sentencing to jail or labor camps. They are in wide use in Beijing, in particular, and serve as holding locations for the many petitioners who travel to the central Office of Letters and Calls to petition.

The jails were introduced to replace the Custody and Repatriation system after it was abolished in 2003 following the notorious Sun Zhigang incident.

Sun Zhigang, an employee at the Guangzhou Daqi Garment Company from Wuhan, capital city of Central China's Hubei Province, was beaten to death by eight patients at a penitentiary hospital just hours after being arrested as a vagrant for not carrying ID.

Qiao Yanqin, an employee of the hospital and the principal culprit, was given the death sentence for planning and organizing the beating.

Sun's case has triggered a major debate on the validity of the holding system and the two-decade-old Measures for Internment and Deportation of Urban Vagrants and Beggars.

The holding measures, an administrative regulation issued by the State Council in 1982, are currently the legal basis for internment and deportation by public security authorities.

The measures require urban vagrants and beggars to be housed and deported to their hometown and urge the local governments to make proper arrangements for them.

I was shocked to first discover these ‘black jails’ and that detaining citizens trying to take their local grievances to the central government is a long-practiced policy. It smacks of the remnants of Communist China and has no place in the “new China” that still lacks basic human rights.

The good news is the Chinese government may finally be coming to grips with the abusive practice. On February 5, 2013, a Beijing court sentenced 10 men to prison for illegally detaining petitioners and ordered them to pay compensation to their victims. The men, all farmers from the city of Yuzhou in central China’s Henan province, were given sentences ranging from six months to two years for intercepting and imprisoning a group of people, also from Henan, who had hoped to lodge complaints with the central government, according to the official Xinhua news agency. Three of the 10 were minors and therefore had their sentences commuted.

The court also determined that 10 of the 11 illegally detained petitioners were entitled to between 1,300 and 2,400 yuan ($208 to $385) each in lost wages, transportation and other costs, according to the news agency.

Officially, Beijing welcomes petitioners. Unofficially, according to human rights groups, it puts immense pressure on local governments to keep petitioners from getting to or staying in the city. In order to comply, local governments dispatch teams of thugs — sometimes referred to as “interceptors” — to round up Beijing-bound trouble-makers and store them in ad hoc black jails until they can be transported home, where they’re often punished or threatened.

There are additional encouraging signs that the Chinese government is serious about improving human rights. China will begin to separate suspects arrested for minor offenses from violent criminals as part of a series of proposed reforms to its detention system recently announced.The system has been under fire for months, following a series of at least 15 suspicious deaths in China's extensive system of prisons and jails this year.

It has also said it will stop handing down labor camp sentences this year under a system that allows police to lock up petitioners, government critics and others for up to four years without a trial, although details are still unclear.

China has been evolving from a purely communist to state-run capitalist society. In fairness, we should remember that the government has made significant progress during the past thirty-plus years since the death of Mae Zedong.  After Mao's death in 1976, forces within the party that opposed the Cultural Revolution, led by Deng Xiaoping, gained prominence, and most of the political, economic, and educational reforms associated with the Cultural Revolution and its excesses were abandoned by 1978.

We can only hope China continues to evolve on a human rights level while recognizing it has a long way to go to develop the systems to treat all citizens fairly and with respect. After all, it didn’t happen in the U.S. without years of struggle and abuse. Let’s hope recent steps are for real and that China is attempting to achieve the goal of freedom for all its citizens.

Blog posted by Steven Mintz, aka Ethics Sage, on April 22, 2013

Rape, Suicide and Cyber-bullying

Social-Media, Cyber-bullying, and Suicide Becoming all too Common in Society

Perhaps you’ve read the story of fifteen-year-old Audrie Pott who passed out drunk at a friend's house, woke up and concluded she had been sexually abused.

In the days that followed, she was shocked to see an explicit photo of herself circulating among her classmates along with emails and text messages about the episode. And she was horrified to discover that her attackers were three of her friends, her family's lawyer says.

Eight days after the party, she hanged herself.

"She pieced together with emails and texts who had done this to her. They were her friends. Her friends!" said family attorney Robert Allard. "That was the worst" Sheriff's officials arrested three 16-year-old boys on suspicion of sexual battery against Audrie,

Cynics might claim that Audrie is at fault as well. After all, she had been drinking at a sleepover at a friend's house, passed out and "woke up to the worst nightmare imaginable." She knew she had been assaulted. However, blaming the victim because she got drunk is not a defense to sexual assault. In fact, a good person, an ethical person, would take extra measures in such situations to take extra care of the inebriated party.

Audrie’s tragedy is becoming all too common in society. Two additional episodes were recently in the news — a suicide in Canada and a rape in Steubenville, Ohio.

In Canada, police recently received new information and are reopening their investigation in the case of 17-year-old suicide victim Rehtaeh Parsons. Parsons was photographed while being sexually assaulted in 2011 and was then bullied after the photo was shared on the Web.

In Steubenville, Ohio, two high school football players were convicted last month of raping a drunken 16-year-old girl in a crime that was recorded on cellphones by students and gossiped about online. The victim herself realized she had been attacked after seeing text messages, a photo of herself naked and a video that mocked her.

These cases underscore the ethical blindness and mean-spirited actions of some young people who use social media to bully and harass others in the most vicious of ways. To say they are cowards; to say they are without conscience; to say they are despicable are understatements.

A disturbing trend in society is the lack of ethics and personal responsibility of young people. Are these the future leaders in America? If so, we are all in trouble. The question is what can we do about it?

We need a change in the culture of society that uses the anonymity of the Internet and social media postings to mock others and strip away their dignity. It often starts with offensive postings and can lead to videotaping the event that goes viral.

The message to schools is that inaction, or an improper response, is not enough when it comes to dealing with bullies.  Schools need to be proactive in preventing bullying from getting out of control.  It is one thing to have a policy in place prohibiting bullying.  It is more important for schools to actively enforce it and take additional steps to foster a positive climate in which bullying of all kinds is not tolerated  by staff or students. 

Likewise, the ethical standards of our schools need to catch up with the technology. First, teachers and staff need to be sensitized to the signs of cyber-bullying, how to respond to such incidents, and the reporting mechanisms within the school/school district. Just as sexual harassment training has helped to inform men and women in the workplace of  the danger signs of sexual harassment and how it harms others, we need a similar approach to educate youngsters, teachers and staff to the equally egregious offense of cyber bullying.

Students must be taught an Internet ethic just as they should be taught societal ethics in the classroom. Given the amount of time most teenagers spend online each day, accountability and personal responsibility must become part of each school's response to cyber-bullying. There should be zero tolerance for such activities with suspension and ultimately expulsion the penalties for harassing another student in cyberspace. I ask: “Where is the moral outrage? Do we have to wait until a horrific event such as a mass suicide occurs before passing legislation making cyber-bullying a federal crime as are discrimination and sexual harassment?”

Blog posted by Steven Mintz, aka Ethics Sage, on April 19, 2013

Should the SEC Permit Social Media Postings of Financial Information?

Financial Disclosures on Social Media Sites Raise Questions of Fairness and Security

On April 2, the Securities and Exchange Commission outlined new disclosure rules that clarify how companies can use Facebook, Twitter and other social networks to disseminate information provided they meet certain requirements. The SEC said that companies must inform investors in advance that those will be the outlets used to disseminate financial reports. Some have heralded the move as bringing the SEC into the 21^st century and catching up with the new era of social media. Others have criticized it including Warren Buffett’s Berkshire Hathaway-owned Business Wire.  

Business Wire said that the SEC's rule "poses a disservice to the investment community” explaining that it threatens increased fragmentation of price-sensitive information, privacy concerns as users are required to register to gain access to material news, security risks that may adversely affect market stability, and the loss of simultaneity -- and the "level playing field" -- that is at the core of Regulation Fair Disclosure, commonly known as Reg FD.

Business Wire supports the use of social media tools, web posting on company web sites and blogging as supplemental platforms to communicate material information, but it believes that a broadly disseminated news release -- distributed simultaneously and in real-time via a legitimate news wire service -- is still the most effective way to maximize investor outreach, and to inclusively serve the needs of all market participants.

The use of social media to post financial information first came on the SEC’s radar last December when the regulator warned Netflix that it could take action against the company for a 43-word message that the company’s chief executive, Reed Hastings, posted in his personal Facebook feed. In the note, Mr. Hastings congratulated his team for exceeding one billion hours of video watched in a single month.

But the SEC raised concerns that the post violated Reg FD, which requires a company to publish material information to all investors at the same time. While Mr. Hastings’s announcement was made on his publicly available Facebook page, which had over 200,000 followers, the information was not subsequently disclosed in a securities filing or news release.

At the time, Hastings and Netflix said that his message was both immaterial and readily available to investors, having been picked up by a number of blogs and news media outlets. “We use blogging and social media, including Facebook, to communicate effectively with the public and our members,” Mr. Hastings wrote — on his Facebook page, naturally — after disclosing the investigation last year.

It seems the SEC is willing to allow “the tail to wag the dog” on this matter. From an ethical perspective, one obvious problem is reliance on social media alone will likely negatively impact market fairness and investor awareness. Potential also exists for the misuse of sensitive information and, I believe, hacking into the social media sites to change the reported information. Finally, I fail to see how the new rule protects investors’ interests and need for full and fair disclosure, the mandate for the SEC in its role as market regulator.

Blog posted by Steven Mintz, aka Ethics Sage, on April 15, 2013

Related articles

SEC Approves Social Media Use for Companies' Material Disclosure

KPMG Insider Trading Scandal Damaging to the Reputation of the Accounting Profession

What Possesses an Audit Partner to Trade on Insider Information?

KPMG is embroiled in an insider trading scandal that concerns me because a pattern of such improprieties may be developing. In 2010, Deloitte and Touche was investigated by the SEC for repeated insider trading by Thomas P. Flanagan, a former management advisory partner and a Vice Chairman at Deloitte. Flanagan traded in the securities of multiple Deloitte clients on the basis of inside information that he learned through his duties at the firm. The inside information concerned market moving events such as earnings results, revisions to earnings guidance, sales figures and cost cutting, and an acquisition. Flanagan’s illegal trading resulted in profits of more than $430,000. In the SEC action, Flanagan was sentenced to 21 months in prison after he pleaded guilty to securities fraud. Flanagan also tipped his son, Patrick, to certain of this material non-public information. Patrick then traded based on that information. His illegal trading resulted in profits of more than $57,000.

The KPMG case is a particularly egregious one because it involves insider trading by an auditor of client stock. Scott London, the partner in charge of audits of Herbalife Ltd. and Skechers USA Inc., traded on inside information for personal gain.  KPMG resigned as the auditor of both companies after learning that London provided non-public information about the companies to a third party, who then used the information in stock trades. The firm fired London.  

In resigning the two audit accounts, KPMG said it was withdrawing its blessing on the financial statements of Herbalife for the past three years and of Skechers for the past two. KPMG stressed, however, that it had no reason to believe there were any errors in the companies' books. Both companies said they are moving to find new auditors.

In a statement that should raise red flags for all CPA firms that audit public companies, KPMG stated it had concluded it was not independent because of alleged insider trading. Independence is the foundation of the accounting profession and the cornerstone of an audit conducted in accordance with generally accepted auditing standards. The public (i.e., shareholders and creditors) relies on auditors’ independence, objectivity, and integrity to ensure that the audit has been conducted in accordance with such standards and that the financial statements are free of material misstatements.

I’m having a hard time understanding the stupidity and moral blindness of London in this case. Surely he knew of his ethical obligations. All audit firms supposedly have been carefully assessing independence in the aftermath of financial frauds in the late 1990s and early 2000s (i.e., Enron and WorldCom). Firms generally have quality controls in place to prevent compromises to audit independence.

Trading on insider information for cash and gifts is bad enough, and when done by an audit partner it is unforgiveable. Even more baffling to me is that the quid pro quo for passing along stock tips about clients to a friend for London was to receive cash and gifts in return. According to London, he received a discount on a watch, and the friend bought him dinners from time to time and on a couple of occasions gave him $1,000 to $2,000 in cash. A cynic might say he sold himself cheap.

So, what happens next? Both Herbalife and Skechers will need to have their financial statements re-audited, not an inexpensive proposition. Even though the companies were not at fault, the public may misunderstand and think the companies were complicit in the matter.

For KPMG, the insider trading investigation is a setback. The accounting firm has worked hard to rehabilitate its reputation after coming under scrutiny last decade in a wave of corporate accounting scandals and the firm’s role in the marketing of fraudulent tax shelters. KPMG paid large nine-figure settlements to resolve lawsuits related to accounting scandals at the drugstore chain Rite-Aid and Oxford Health Plans. In 2005, the firm paid a $456 million penalty to the government related to tax fraud.

I have to wonder whether insider trading by partners at Deloitte and KPMG portends a larger scandal on the horizon. It seems every ten years or so the accounting profession finds itself in a “pickle” and hauled before Congress to explain its actions. It is about that time following financial frauds at Enron, WorldCom and a host of other companies. I don’t know how to get the message across to those in the profession that every time such incidents occur, and now insider trading, the public loses patience with the profession and doubts begin to surface about whether the profession truly acts to protect the public interest.

Blog Posted by Steven Mintz, aka Ethics Sage, on April 12, 2013

Cyber-Bullying in Sports

Canadian Tennis Star Suspends Her Career Due to Cyber-bullying

Imagine being ranked # 38 by the WTA and being named the Female Player of the Year by Tennis Canada two times, in 2010 and 2011, and then deciding to quit tennis because of cyber-bullying. This is the case of Rebecca Marino. The former Canadian tennis player suffers from depression and has been bullied about it on social media.

Marino had a big serve and a monster forehand. She had gone toe-to-toe with the great Venus Williams under the lights at the U.S. Open and appeared to be a bright a prospect. But after losing at Wimbledon in 2011, she announced that she was taking an indefinite leave, citing the scourge of depression after talking openly about the cyber-bullying and abuse she absorbed.

Within a year after that Wimbledon defeat, she had vanished from the women’s tour altogether. She tried to return last year, and even played in the Australian Open in January, but tumbled to No. 418 in the world.

“I have been suffering from a form of depression for many years,” she said. “Depression is nothing to be ashamed about. I’m hoping by opening up about this, I can encourage someone to get the help they deserve.”

In February 2013, she spoke of her past problems with social media to the New York Times. Internet criticism — including nasty Twitter messages from people who lost money after betting on her matches — was sometimes overwhelming. She said those people told her to burn in hell or to die.

“You know, there’s that saying ‘Sticks and stones may break my bones, but names will never hurt me.’ But that’s not true. Names definitely hurt. Words hurt," she told the newspaper.

She responded to taunts on Twitter about her weight, saying she was happy with her body. But the constant berating caused her to abruptly close down her Twitter and Facebook accounts, and then announcing she would stop playing. “Social media has been taking its toll on me,” she acknowledged.

Among the many sad aspects of this story is the real issues people face fighting depression. To be bullied on top of it can be debilitating and soul-destroying, as it clearly has been for Marino.

Marino has a great deal of inner-strength to have dealt with the problem while trying to move up in the WTA standings. One thing I know is she deserves better. She has strength for dealing with the depression openly and living with the taunting until it became too much.

Cyber-bullying is at epidemic proportions especially of school-age kids. I have blogged before about the use of social media to bully others. It is cowardly and violates just about every ethical standard there is, in particular being disrespectful, mean-spirited, and lacking in empathy.

Marino has not ruled out returning to tennis and I hope should does. A talent like hers should not be discarded because of bullying or for any other reason than it is time to retire. The tennis world is weaker as a result of what happened to her. Let’s wish all the best and to have a long and fulfilling life.

Blog posted by Steven Mintz aka Ethics Sage on April 8, 2013

Ban on Large Sugary Drinks: Personal Liberty vs. Personal Responsibility Issues

New York State Supreme Court Overturns Ban on Sugary Drinks

I have previously blogged about the New York City law that banned sugary drinks greater than 16-ounces because of health concerns including the increased risk of diabetes and heart disease among youngsters. The law created a major controversy about how far the government can (or should) go in protecting what might be perceived to be the public (health) interest by banning the sale of an unhealthy product. The issue has become even more controversial because on March 11 2013, New York State Supreme Court Justice Milton A. Tingling decided in New York Statewide Coalition of Hispanic Chambers of Commerce v. New York City Department of Health and Mental Hygiene, to enjoin New York City’s controversial ban on the sale of large sugary beverages.

Justice Tingle noted among other things that the Department had cited the “enormous toll” that obesity places on the “economic health” of New Yorkers. To Justice Tingle any regard for the economic consequences of obesity demonstrated that the Department based its regulation “on economic and political concerns” outside the scope of its authority. Thus the very fact that the Department considered the economic consequences of the issue it addressed, a consideration that most people would claim is a critical component of sound regulatory policy, helped to doom the ban on large sodas.

Without arguing the legal issues I want to look at some of the health consequences of over-indulging in the sugary drinks and personal liberty versus personal responsibility concerns.

A recent study by Harvard University found that two out of three adults and one out of three children in the United States are overweight or obese, and the nation spends an estimated $190 billion a year treating obesity-related health conditions. Rising consumption of sugary drinks has been a major contributor to the obesity epidemic. A typical 20-ounce soda contains 15 to 18 teaspoons of sugar and upwards of 240 calories. A 64-ounce fountain cola drink could have up to 700 calories.

Sugary drink portion sizes have risen dramatically over the past 40 years, and children and adults are drinking more soft drinks than ever. Before the 1950s, standard soft-drink bottles were 6.5 ounces. In the 1950s, soft-drink makers introduced larger sizes, including the 12-ounce can, which became widely available in 1960. By the early 1990s, 20-ounce plastic bottles became the norm. Today, contour-shaped plastic bottles are available in even larger sizes, such as the 1.25-liter (42-ounce) bottle introduced in 2011.

[What’s next – a 10-liter “big gulp” at 7-11? Where does it all end?]

Here are some more facts:

• In the 1970s, sugary drinks made up about 4% of US daily calorie intake; by 2001, that had risen to about 9%.

• Children and youth in the US averaged 224 calories per day from sugary beverages in 1999 to 2004—nearly 11% of their daily calorie intake. From 1989 to 2008, calories from sugary beverages increased by 60% in children ages 6 to 11, from 130 to 209 calories per day, and the percentage of children consuming them rose from 79% to 91%.

• On any given day, half the people in the U.S. consume sugary drinks; 1 in 4 get at least 200 calories from such drinks; and 5% get at least 567 calories—equivalent to four cans of soda. Sugary drinks (soda, energy, sports drinks) are the top calorie source in teens’ diets (226 calories per day), beating out pizza (213 calories per day).

• A 20-year study on 120,000 men and women found that people who increased their sugary drink consumption by one 12-ounce serving per day gained more weight over time—on average, an extra pound every 4 years—than people who did not change their intake. Other studies have found a significant link between sugary drink consumption and weight gain in children. One study found that for each additional 12-ounce soda children consumed each day, the odds of becoming obese increased by 60% during 1½ years of follow-up.

• People who consume sugary drinks regularly—1 to 2 cans a day or more—have a 26% greater risk of developing type 2 diabetes than people who rarely have such drinks.

• A study that followed 40,000 men for two decades found that those who averaged one can of a sugary beverage per day had a 20% higher risk of having a heart attack or dying from a heart attack than men who rarely consumed sugary drinks. A related study in women found a similar sugary beverage–heart disease link.

• A 22-year study of 80,000 women found that those who consumed a can a day of sugary drink had a 75% higher risk of gout than women who rarely had such drinks. Researchers found a similarly-elevated risk in men.

Before going on let me raise the question whether we should blame the soft drink industry for their irresponsibility in selling increasingly larger sizes of drinks without regard to the health effects? Do they have an ethical obligation to consider the health effects? Where does corporate responsibility end and personal responsibility begin?

If those who consume the soft drinks pay no heed to these fairly well-known facts by now, why should we care if they shorten their lives through consumption of unhealthy drinks? Isn’t this an affront to personal liberty? Where does it all end? Why not ban fast food over certain calorie limits?

Some will say that banning soft drinks over 16-ounces won’t stop the consumption of large sugary drinks. Those who want to drink it will find a way to do so. The alcohol prohibition ban from 1920 to 1933 didn’t stop alcohol consumption. Has the illegality of marijuana affected the level of smoking? I think not.

This does not mean we shouldn’t ban a harmful practice simply because those who are abusers will find a way to still behave in a reckless manner.

The debate over banning sugary drinks over 16-ounces reminds me of the debate over gun control. Critics claim that banning certain weapons won’t stop criminals from getting their hands on such weapons; it will only stop those who want to protect home and property from violent people who would do them harm. Still, don’t we have an ethical obligation, and an obligation to all those who died from violent acts such as in Aurora Colorado, and in Newtown, to do something; act in some way; make an effort to stem the tide of rising violence?

These are difficult issues because increasingly in our society people, especially young people, feel entitled to do whatever they want; say whatever they want; act in any (often times ridiculous and offense) way that they want. As I have blogged about before, we have an entitlement society. Frankly, I blame the parents of today’s youngsters for the problem. All too many gave their kids whatever they wanted without holding them responsible or accountable for their actions.

So, I believe the answer lies in education in our schools about the dangers of unhealthy eating practices similar to unhealthy sexual practices and other behaviors. It may not work but we have to try and our schools should provide a laboratory to influence behavior in a positive manner whether it is by teaching about ethics or about dangerous and harmful habits that can end one’s life before it is time.

Blog posted by Steven Mintz, aka Ethics Sage, on April 5, 2013

 

The Ethics of Profit Repatriation by U.S. Multinationals

U.S. Companies Using Short-Term Loans to Avoid Taxes on Repatriated Cash

I have previously blogged about the use of transfer pricing techniques by U.S. companies to shift profits away from the U.S., which has the highest corporate tax rate (about 40%), to countries with lower tax rates such as Ireland (12.5%). As long as profits made overseas are not repatriated back to the U.S., those overseas profits remain untaxed by the IRS. Critics claim that a much lower tax rate (say, 15-20%) would encourage U.S. companies to bring the profits home in the form of investments and spur economic development and job growth.

Other countries have come to realize their corporate tax rates are too high. For example, Germany has reduced its rate from a high of 45% in 2008 to 15% today. The UK has gradually lowered its rate from 52% in 1981 to a projected 20% in 2015.

Repatriation is more than an economic issue; it has ethical overtones. It also highlights a practice used by some U.S. companies to skirt the repatriation law by taking the “trapped” overseas cash and providing loans to their U.S. parent companies. Under U.S. tax rules, a foreign subsidiary can lend funds to its parent without jeopardizing its untaxed status. Here is how it works:

• The loans have to be short term and can remain outstanding throughout a fiscal quarter as long as they don't cross beyond its end. If they do cross a quarter, they can remain outstanding for a total of 30 days. And that can be done for 60 days a year by any one foreign unit.
• If the borrowing is carefully set up to comply with IRS rules and U.S. auditing standards, the funds can be used over and over without incurring taxes.
• Companies are not required to disclose these moves, which makes it difficult to assess how many use them.

According to the Wall Street Journal, Hewlett-Packard (H-P) entities lent the parent about $6 billion in the year that ended in October 2010. For the 2011 fiscal year and through July 2012, the average outstanding balance of the alternating loans was $1.6 billion.

The sums rivaled H-P's borrowings in the commercial-paper market—the traditional source of big firms' day-to-day funds. Those averaged $1.9 billion over the 2011-2012 period.

More details of H-P's transactions have emerged since a 2012 hearing conducted by the U.S. Senate. The company said it told the Senate panel it used the alternating loans for all but 85 days of the 2011 and 2012 fiscal years. In a 2008 internal presentation, H-P called the loans "the most important source of U.S. liquidity for repurchases and acquisitions."

H-P spokesman Michael Thacker says H-P has "complied fully with all applicable provisions of the U.S. Internal Revenue Code, and auditor Ernst & Young has consistently reviewed and approved the accuracy of H-P's financials." The IRS has never raised concerns about the loan programs, he adds.

American concerns have long argued they should be allowed to bring back some of the estimated $1.7 trillion in profits they hold at their foreign subsidiaries, saying the money could be put to use in the U.S. The firms claim to be deterred by the huge tax liabilities they would incur under current IRS tax rates.

The U.S. is the only major economy that taxes its companies' overseas earnings. Those taxes aren't actually incurred until the money is considered to have been transferred to the U.S. parent, giving companies an incentive to maximize their earnings at foreign subsidiaries and keep them there indefinitely.

People on both sides of the debate argue the system doesn't work, creating perverse incentives that distort companies' balance sheets and deprive the U.S. Treasury of tax revenue. The short-term loans to avoid repatriation and taxes is the main example of the practice.

During the last Presidential election, business interests called for a “tax holiday,” in which American corporations would be allowed to transfer their foreign profits to their American bank accounts at a tax rate under 6 percent for one year. Such a holiday would raise revenues and create jobs in the U.S., according to the WinAmerica Campaign, a coalition of companies including Apple, Google and Pfizer.  

But the last time such a holiday was tried, in 2004, it raised less than $19 billion and did not substantially increase jobs. Most of the repatriated profits went to corporate shareholders, through dividends or stock repurchases.

Instead of a one-off holiday, some corporations — Caterpillar and Kimberly Clark, for example — have called for a permanent fix: a territorial system for taxing foreign corporate profits, as most industrialized countries use. In a pure territorial system, the profits of multinational companies based in the U.S. would be taxed only by the country in which the profit is earned.

But none of our major trading partners takes a pure territorial approach, for two good reasons. First, almost all countries impose domestic taxes on “mobile” corporate income — for example, investment interest or royalties that can easily be shifted from one country to another. Second, many countries still collect taxes on foreign profits of domestic corporations if those profits are earned in tax havens that collect little or no taxes, like Bermuda and the Cayman Islands. These havens violate the premise of the territorial system, which is that corporate profits are taxed somewhere in the world at a reasonable rate.

The ethical issue I raise is: Does a U.S. corporation have an ethical obligation to repatriate profits to the U.S. to pay their “fair share” of taxes and help to stimulate the economy in an increasingly competitive global economic marketplace?  The answer is not a simple one because we could argue about the ethics of having the highest tax rate in the world. We could also argue and debate whether the government uses its tax revenue in an ethical or socially-desirable manner to employee the unemployed, give opportunity to those wanting to improve their economic lot, and help stimulate our economy.

For me, it is time to lower the corporate tax rate to be more competitive with other countries and challenge U.S. companies on their claim to repatriate profits with a lower rate. Without debating how low is low enough to achieve the desired goal, we need to try harder to improve the economic status and wealth of the middle and lower-classes and repatriation with taxation is one way the goal might be accomplished. At least it is worth a try. If corporations do not repatriate with lower taxes but still find ways around their obligation, then they will be exposed for all to see the hypocrisy of their position.

Blog Posted by Steven Mintz, aka Ethics Sage, on April 1, 2013

IRS "Dirty Dozen" Tax Scams

Tax Scams and Scammers Cheat All of Us

The IRS issued it “Dirty Dozen list of tax scams" Tuesday, highlighting fraudulent schemes commonly committed by and upon taxpayers. The annual warning, released to coincide with tax filing season, emphasizes the most egregious schemes involving filing false returns or return items, but it also advises the unsuspecting about practices that prey upon the unwary and uninformed.

As you read thought the 2013 list, think about all the scams and scammers and how they cheat all of us who pay the correct amount of our taxes due and, while we may not agree with the way the government uses our tax dollars, we do see paying taxes as a civic responsibility.

1. Identity theft: The IRS spotlighted its measures, including its new Identity Protection we portal, to prevent and combat the growing problem of tax fraud involving stolen identities, which it called one of its top priorities. During 2012, the IRS prevented issuance of $20 billion in fraudulent refunds including those related to identity theft, up from $14 billion in 2011, it said. The IRS also noted that its identity theft enforcement sweep in January led to nearly 300 indictments, complaints, and arrests, on top of thousands of enforcement actions against identity theft tax fraud in 2012.

2. Phishing: The IRS again this year warned against fake electronic communications designed to obtain recipients’ information, reminding that the IRS does not initiate contact with taxpayers by email, text messages, or social media to request personal or financial information.

3. Return preparer fraud: In addition to suggesting taxpayers make sure paid preparers sign returns and enter their preparer tax identification number (PTIN), the IRS this year included information about using Form 14157, Complaint: Tax Return Preparer, to report abusive tax preparers.

4. Hiding income offshore: This warning also updated the number of participants in the IRS’s Offshore Voluntary Disclosure Program to 38,000 and its collections to $3.4 billion from the 2009 program alone (March 23, 2009, through Oct. 15, 2009) and $1 billion so far in “up-front” payments from the 2011 program (Oct. 16, 2009, through Sept. 9, 2011). In 2012, the program was extended indefinitely.

5. “Free money” from the IRS and tax scams involving Social Security: With fliers and advertisements “appearing in community churches around the country,” promoters of schemes promising refunds for returns with little or no documentation have enticed “unsuspecting and well-intentioned” victims, some of whom have spread the word to friends and relatives, the IRS said. One scheme falsely advises taxpayers to claim the American opportunity tax credit even if they have no current qualifying educational expenses.

6. Impersonation of charitable organizations: Some fraudsters have doubly victimized people hit by a natural disaster by claiming to be working on behalf of the IRS to help them claim a tax casualty loss but instead steal their financial and personal information. This replaced “abuse of charitable organizations and deductions” from the 2012 list.

7. False/inflated income and expenses: Exaggerating wage or self-employment income is a common ploy by some unscrupulous preparers to inflate refundable credits, including the earned income tax credit, by more than any additional tax.

8. False Form 1099 refund claims: One scheme involves issuing a bogus information return, often Form 1099-OID, Original Issue Discount, to the IRS. A refund is then claimed on a corresponding tax return. The IRS says this is based on the theory that “the federal government maintains secret accounts for U.S. citizens and that taxpayers can gain access to the accounts by issuing 1099-OID forms to the IRS.”

9. Frivolous arguments: The IRS maintains a webpage describing some of the more common and legally fanciful of these theories.

10. Falsely claiming zero wages: A Form 4852, Substitute Form W-2, or “corrected” Form 1099-MISC, Miscellaneous Income, is fraudulently filed to reduce or eliminate income on a legitimate information return. Sometimes it is accompanied by a frivolous argument regarding the income.

11. Disguised corporate ownership: The IRS said it works with state authorities to identify entities by which taxpayers underreport income, claim bogus deductions, and engage in other misconduct.

12. Misuse of trusts: The IRS said it has seen an increase in improper use of private annuity trusts and foreign trusts to shift income and deduct personal expenses.

As frequent readers of my blog know, I like to use famous quotes to make a point.

James Madison, the "Father of the Constitution," "Father of the Bill of Rights," 4th President of the U.S. stated the purpose of income taxation:

"The power of taxing people and their property is essential to the very existence of government.''   

A poignant statement that expresses a philosophy held by some today (whether you agree with it or not) dates back to 400 B.C. and was expressed by Plato, the Greek philosopher:

“Where there is an income tax, the just man will pay more and the unjust less on the same amount of income.” 

I leave you with a quote from Ben Franklin: “…but in the world nothing can be said to be certain except death and taxes."

Blog posted by Steven Mintz, aka Ethics Sage, on March 29, 2013

Entitlement Ethics

Making Sense of our Entitlement Society

The one issue that divides us as a nation more than any other is “entitlement ethics.” Entitlement theory comes from the Theory of Justice. Here, I discuss the theory as espoused by two philosophers – John Rawls and Robert Nozick – and evaluate it against the Moral Theory of Rights put forth by Immanuel Kant. The issue of whom in society is entitled to the resources produced by others and how much of it lies at the foundation of the divide. An important point is there is no one right or wrong point of view. More important, there are practical limitations on those resources that must be considered in making the arguments.

Theory of Justice: Just Distribution of Resources

Rawls argues that the state should have whatever powers are necessary to ensure that those citizens who are least well-off are as well-off as they can be (though these powers must be consistent with a variety of basic rights and freedoms). This viewpoint is derived from Rawls’s theory of justice, one principle of which is that an unequal distribution of wealth and income is acceptable only if those at the bottom are better off than they would be under any other distribution. Hence we have the viewpoint to tax the rich and transfer resources to the least well off amongst us. This view of Justice Theory would justify the reallocation of resources in society.

Entitlement Theory of Justice

Nozick, on the other hand, responds to such arguments by claiming that they rest on a false conception of distributive justice: they wrongly define a just distribution in terms of the pattern it exhibits at a given time (e.g., an equal distribution or a distribution that is unequal to a certain extent) or in terms of the historical circumstances surrounding its development (e.g., those
who worked the hardest have more) rather than in terms of the nature of the transactions through which the distribution came about. For Nozick, any distribution of “holdings,” as he calls them, no matter how unequal, is just if (and only if) it arises from a just distribution through legitimate means.

One legitimate means is the appropriation of something that is unowned in circumstances where the acquisition would not disadvantage others (i.e., taxing the rich at, say, 50% would not disadvantage them – a popular notion espoused by the liberal point of view). A second means is the voluntary transfer of ownership of holdings to someone else (i.e., the Warren Buffett’s of the world
choose voluntarily to share their wealth with others less fortunate). A third means is the rectification of past injustices in the acquisition or transfer of holdings (i.e., those harmed by wrongful acts in the past deserve an increased distribution of resources). According to Nozick, anyone who acquired what he has through these means is morally entitled to it. Thus the “entitlement” theory of justice states that the distribution of holdings in a society is just if (and only if) everyone in that society is entitled to what he has. Ah, but there is the rub: Who is entitled to what?

Theory of Moral Rights

So, the key becomes how to define “entitlement.” In this regard we can turn to the theory of “moral rights.” Rights theory provides that human beings have certain fundamental rights that should be respected in all decisions: the right to free consent, privacy, freedom of conscience, free speech, and due process. A right is a capacity, a possession, or condition of existence that entitles either an individual or a group to enjoy some object or state of being. For example, the right to free speech is a condition of existence that entitles one to express one's thoughts as one chooses.

The moral force of a right depends on its strength in relation to other moral considerations applicable to the context in question. According to rights theory, as long as the distribution of wealth in society is achieved through fair acquisition and exchange, the distribution is a just one
regardless of any degree of inequalities that may ensue. The morally correct action is the one that a person has the moral right to do, that does not infringe on the moral rights of others, and that furthers the moral rights of others.

People who rely on rights theory to reason their actions emphasize the entitlement of individuals. Restrictions on behavior should prevent harm to others, but unless your actions harm others, you should be free to do as you please.

My discussion is, of course, a simplification of the theories made necessary by the limitations of blogging. Bringing it home in today’s terms, an entitlement is a guarantee of access to benefits 
based on established rights or by legislation. A "right" is itself an entitlement associated with a moral or social principle, such that an "entitlement" is a provision made in accordance with legal framework of a society. Typically, entitlements are laws based on concepts of principle 
("rights") which are themselves based in concepts of social equality or enfranchisement.

Individual Entitlements

In a casual sense, the term "entitlement" refers to a notion or belief that one is deserving of some particular reward or benefit—if given without deeper legal or principled cause, the term is often given with pejorative connotation (e.g. a "sense of entitlement").

In the past election Mitt Romney claimed that 47% of Americans "are dependent upon government.” That sounds about right. According to the Center on Budget & Policy Priorities, the percentage of the federal budget devoted to aid to others is about 54 percent: 20% social security; 21 percent Medicare/Medicaid/Children’s Health Programs; and 13% for “safety net” programs including programs that provide cash payments to eligible individuals or households, including Supplemental Security Income for the elderly or disabled poor and unemployment insurance; various forms of in-kind assistance for low-income families and individuals, including food stamps, school meals, low-income housing assistance, child-care assistance and various other programs.

On a practical level, we cannot sustain these levels of payments going forward given that: the numbers will increase with an aging population; poorly trained or poorly motivated young people are not competitive in today’s technology-driven economy; and the growing attitude that “I am entitled to be sustained by the government if I choose not to work because it is my basic right and the government’s duty to meet it.”

We need to distinguish between entitlement payments, including those in the supplemental security income programs, and rights-oriented payments including social security and Medicare, both of which most of us have paid into through payroll deductions throughout our working lives. Entitlement payments should be restricted to a percentage of the resources coming into the government so that if we become more prosperous as a nation i.e., GNP goes up, we can then share more with the less fortunate. The shortfall should be made up by religious institutions and private charities. As for social security and Medicare payments, these emanate from rights we have as tax-paying citizens. Oh, by the way, 47 percent of Americans pay no tax.

Blog posted by Steven Mintz, aka Ethics Sage, on March 25, 2013

Should Casey Anthony be allowed to Profit from a Book on Her Life?

Is it Wrong to Sell a Book and Profit after a not-guilty Verdict?

Perhaps you’ve heard that the trustee overseeing Casey Anthony's bankruptcy case has filed a motion to sell the rights to her story so she can pay her debts. In a motion filed last Friday in federal court in Tampa, trustee Stephen Meininger asked Judge K. Rodney May for permission to sell the "exclusive worldwide rights" of Anthony's life story.

Casey Anthony, who is now 26, was acquitted of murder in 2011 in the death her 2-year-old daughter, Caylee. Anthony has never told her side of the story, despite intense media scrutiny of the case.

During a meeting with creditors in her bankruptcy case in Tampa, Anthony said she was unemployed and hasn't received any money to tell her story. She said that she is living with friends and that those friends -- and strangers who send her gift cards and cash -- help her survive.

But Meininger, through his attorney, said he thinks that her story has value and should be auctioned off to the highest bidder.

So, the question I raise is whether it is ethically appropriate to allow Anthony to sell the rights to her story under any conditions.

First, let’s look at the basic issue of whether a criminal can profit from a crime, bearing in mind that Anthony was not convicted of murdering her daughter. If a criminal writes a book about his crimes, who gets the money? What if he sells his personal items, which may have increased in value due to his notoriety? What if he writes a book, does a TV appearance, or is interviewed for a newspaper or magazine story many years after he is released from prison? And what about O.J.? Since he wasn't convicted of any crime, could he keep the profits if he wrote a book about how he killed Nicole?

The rule isn't universal, but judges generally do try to prevent people from profiting from their own wrongs. A classic case in this respect is Riggs v. Palmer, that dates back to 1889. Palmer had poisoned his grandfather because his grandfather intended to disinherit him. Under New York inheritance statutes, Palmer was entitled to inherit all but a small portion of his grandfather's estate. The statutes required valid wills to be enforced, and provided no exception that would prevent a killer from inheriting from his victim. The validity of a will is determined at the time it is executed. When the will was executed, Palmer had done nothing wrong.

The court looked to the maxims of equity (fairness) and decided that Palmer should not be allowed to profit by his own fraud or to take advantage of his own wrong because it would be against public policy.

The Riggs court didn't come up with this idea on its own. The principle is much older and is still around today, although most states have codified it in statutes. For instance, Scott Peterson, a convicted killer, was prevented from receiving benefits under his wife's life insurance policy by California Probate Code.

Of course, earning money and keeping it are two different things. Courts have held that criminals remain liable to victims and their heirs. The cases of O.J. and Robert Blake show that a person can be acquitted of a crime but still be held civilly liable. If the victims fear that the killer will dissipate assets before they can get a judgment, they can try to get an order freezing those assets. So even in cases where criminals elude statutes meant to keep them from profiting, their victims and the victims' families can still see to it that they don't.

As for Casey Anthony, the rationale provided to allow her to sell the rights to her story is to repay huge amounts of debt. Anthony filed for bankruptcy in Florida in late January, claiming about $1,000 in assets and $792,000 in liabilities. Court papers list Anthony as unemployed, with no recent income.

Her listed debts include $500,000 for attorney fees and costs for Jose Baez, her criminal defense lawyer during the trial; $145,660 for the Orange County Sheriff's office for investigative fees and costs; $68,540 for the IRS for taxes, interest and penalties; and $61,505 for the Florida Department of Law Enforcement for court costs.

It seems to me Anthony should be allowed to sell the rights to her story so long as the proceeds are used to compensate others who have sacrificed a great deal as a result of her “crime.” A good analogy is the Ron Goldman case. OJ wrote a book based on his warped perspective called "If I Did It," which has sold more than 100,000 copies. A federal bankruptcy judge awarded rights to the book to the family of murder victim Ronald Goldman to help satisfy a $38 million wrongful death judgment against Simpson.

Just about everyone is profiting from the Casey Anthony case starting with Jose Baez, the attorney for Anthony. Baez’s book, Presumed Guilty: Casey Anthony: The Inside Story has sold over 1 million copies. By the way, Amazon reviewers give it 3 stars out of 5.

Then there is the prosecutor in the case, Jeff Ashton. His book, Imperfect Justice: Prosecuting Casey Anthony, tells the “behind-the-scenes story of the investigation, the trial, and the now-infamous verdict.” It must be well written since his book received 4 ½ stars.

Then there are those looking to profit by their "expert" insights such as Keith Ablow, a forensic psychiatrist. His book, Inside the Mind of Casey Anthony: A Psychological Portrait, aims to explain to people “as much as possible about how this little girl disappeared from the face of the earth by using psychological reasoning as a lens to explore the death of Caylee Anthony.” Sorry, Keith, but you only received 2 stars from Amazon readers and your book sounds boring, like the trial.

Finally, there is Wendy Murphy, a frequent guest on talk shows that dissect legal verdicts, who wrote Casey Anthony What REALLY Happened to Caylee and Why Truth Matters.  In this book Murphy and her co-authors answer a variety of questions about the trial and verdict including the one that all inquiring minds want to know: Is there a real "Zanny the Nanny"? This book must be a disappointment given such a compelling question because it received only 2 ½ out of 5 stars.

Now that you are up to date on the profiteers from the Anthony trial, we must ask from an ethical perspective what are the motives of those who wrote books? Was it a way to vent frustration with the trial and verdict? Or, is it a way to share one’s insights on one of the most watched criminal trials since OJ? Or, was it an attempt to profit from the misery of an innocent little girl and so many like her whose lives are taken suddenly and inexplicably? Perhaps I should write a book to explain my perspective on this issue. 

Blog posted by Steven Mintz, aka Ethics Sage, on March 22, 2013

Instagram’s Terms of Service and Privacy Issues

Ethical Issues and Instagram

Social networking websites (such as Facebook, MySpace, Google+, Twitter, and LinkedIn) have become the established norm for communication and maintaining relationships. While these websites are useful tools for exchanging information, many users are concerned that their personal details are being circulated far more widely than they would like. The growing concerns over privacy breaches have resulted in a number of class action lawsuits. In this blog I address the situation at Instagram.

Instagram is a mobile photo sharing app which allows people to add filters and effects to photos and share them easily on the Internet. Instagram was acquired by Facebook in 2012. Instagram is a free service that allows users to share their photos with friends and family. Of course, one never knows where is the photo goes once it is posted on the Internet.  

On December 17, 2012, Instagram announced several changes to its Terms of Service. The new Terms of Service suggested Instagram would be allowed to use pictures in advertisements without notifying or compensating users, and to disclose user data to Facebook and to advertisers. Instagram also proposed that the parents of minors implicitly consent to the use of their childrens' images for advertising purposes. The new Terms of Service also introduced a mandatory arbitration clause which would force users to waive their rights to file a class action lawsuit in most circumstances. The changes were to take effect on January 16, 2013 and would not apply to pictures uploaded before that date.

Many users expressed outrage. As a result, a few days later, Instagram again revised the Terms of Service announcing that it would withdraw some of the proposed changes. Instagram backed off a plan to use the names, images, and photos of users for advertising purposes by deleting language about displaying photos without compensation. However, Instagram kept language that gave it the ability to place ads in conjunction with user content, saying "we may not always identify paid services, sponsored content, or commercial communications as such.” It also kept the mandatory arbitration clause.

Instagram's new terms include a clause asserting that users under the age of 18 imply by their agreement that a parent or legal guardian has also read and agreed to the terms. The word “imply” is key. These days if any organization expects users under the age of 18 to follow through a guideline with ethical action…well, that organization has had its head in the sand the past few years.

The new terms require users with a legal complaint to submit to arbitration rather than sue Instagram in court, and it prohibits them from joining a class-action lawsuit under most circumstances. That didn’t go very far.

A class action lawsuit was filed in the U.S. District Court for the Northern District of California on December 21, 2012 which accused Instagram of violating the property rights of its users and breaching its existing terms of service. The class action lawsuit seeks to preserve valuable and important property, statutory, and legal rights, through injunctive, declaratory and equitable relief before such claims are forever barred by adoption of Instagram’s New Terms. The lawsuit takes particular issue with Instagram’s ownership of user images, especially in the situation where a user quits the service and, according to Instagram’s Terms of Service, loses ownership of their photos to the company.

On February 13, 2013, Instagram asked the federal court to dismiss the class action lawsuit filed over changes to Instagram’s Terms of Service. Instagram argued that the plaintiff, Lucy Funes, had no right to bring her claim because she could have deleted her Instagram account before the changes in the Terms of Service went into effect on January 19, 2013. According to Instagram's filing, Ms. Funes filed the lawsuit on December 21, nearly a month before the changes in the Terms of Service went into effect and she continued to use her account after that day. Instagram also disputed Funes' claims that the new terms required her to transfer rights in her photos to the company. Furthermore, Instagram took the position that both the old service terms and the new terms "emphasize that the individual owns the content he/she posts through Instagram's service."

Numerous ethical questions arise in a case like Instagram. Here is one as food for thought:

Do social networkers have a right to privacy? More and more users of Facebook and MySpace are finding that prospective employers are perusing their sites, despite the fact that they may conceive of their online presence as personal space. Also, what is a private person’s right to control the images and information about them available on line? I will address these issues in an upcoming blog.

One final thought. I went to the Instagram website and read its short version of its Community Guidelines. That pretty much told me all I needed to know. When an online photo-sharing service has to tell its members “to keep your clothes on” it implies the site has had such issues before and the users have no idea about the consequences of their actions. A word to the wise: What we do today affects who we are tomorrow.

Blog posted by Steven Mintz, aka Ethics Sage, on March 18, 2013

 

Is it Ethical to Save Four People at the Expense of One?

Lessons from the Talmud

On Tuesday I posted a blog that presented two ethical dilemmas based on the “Trolley Problem.” The Trolley Problem is a thought experiment in ethics, first introduced by Philippa Foot in 1967. Others have  also extensively analyzed the problem including Judith Jarvis Thomason, Peter Unger, and Frances Kamm  as recently as 1996. I have used these problems in my ethics class to challenge students’ moral intuition. Here are the two dilemmas once again:

Dilemma #1

Imagine that you are standing on a footbridge spanning some trolley tracks. You see that a runaway trolley is threatening to kill five people. Standing next to you, in between the oncoming trolley and the five people, is a railway worker wearing a large backpack. You quickly realize that the only way to save the people is to push the man off the bridge and onto the tracks below. The man will die, but his body will stop the trolley from reaching the others. Legal concerns aside, would it be ethical for you to save the five people by pushing this stranger to his death?

Dilemma #2

Now assume that the runaway trolley is heading for five railway workmen who will be killed if it proceeds on its present course. The only way to save these people is to hit a switch that will turn the trolley onto a side track where it will run over and kill one workman instead of five. Ignoring legal concerns, would it be ethically acceptable for you to turn the trolley by hitting the switch in order to save five people at the expense of one person?

The choice is between saving five lives at the cost of taking one life. Before I get to the “answers,” I want to explain how one researcher is using MRI technology to map brain response while analyzing the dilemma. Joshua Greene at Harvard University was more concerned to understand why we have the intuitions, so he used functional Magnetic Resonance Imaging, or fMRI, to examine what happens in people’s brains when they make these moral judgments.

Greene found that people asked to make a moral judgment about “personal” violations, like pushing the stranger off the footbridge, showed increased activity in areas of the brain associated with the emotions. This was not the case with people asked to make judgments about relatively “impersonal” violations like throwing a switch. Moreover, the minority of subjects who did consider that it would be right to push the stranger off the footbridge took longer to reach this judgment than those who said that doing so would be wrong. Interestingly results to say the least.

I received quite a few responses to my blog and selected the best one with respect to identifying the ethical issues. The response comes from Michael Belk, a frequent reader of my blog. Here it is:

#1: I do not believe it to be ethical to intentionally end someone else's life whether it is to save others or not.  I do not believe it is my moral responsibility to sacrifice one life in order that others may go on. 

You hope and pray that it is not their time and leave the results of their outcome to faith.  I would feel terrible, but if you push someone in the way to save others, you may as well say you killed a man.  I would never be able to forgive myself.

The man has a family and people who love him, so how could you explain your actions to his family.

#2. Again I do not believe you should intentionally take a life, but if your intentions were to save the other five men and you were unaware of the damage it would do to the sole man, then you acted out of goodwill and that is more admirable.

Michael’s insights are right on the money. We have no right to sacrifice the life of one person to save others. There is a saying from the Talmud, an authoritative record of rabbinic discussions on Jewish law, Jewish ethics, customs, legends and stories: “Whoever destroys a soul, it is considered as if he destroyed an entire world. And whoever saves a life, it is considered as if he saved an entire world.”

We have no right to decide who lives and who dies. Yes, if we can save one person without harming others we have a moral obligation to do so. However, to save one life while sacrificing others is an arbitrary act in many ways. What if the one sacrificed is a humanitarian, well-respected and well-known person who works tirelessly for the poor and others who can’t help themselves? What if those saved are criminals who committed murder and escaped from prison. You see the dilemma? Who are we to judge who is a good person, and be saved, and who is a bad person? We should focus on leading the best possible life we can; to serve others whether through medicine, the clergy, the law, a teacher, nurse, or first-responder.

Blog posted by Steven Mintz, aka Ethics Sage, on March 15, 2013

What would you do?

Ethical Dilemmas Challenge our Reasoning Skills

What Is Ethics?

The term ethics is derived from the Greek word ethikos which itself is derived from the Greek word ethos, meaning “custom” or “character.” In philosophy, ethical behavior is that which is “good.” The Western tradition of ethics is sometimes called moral philosophy. The field of ethics or moral philosophy involves developing, defending, and recommending concepts of right and wrong behavior. These concepts do not change as one’s desires and motivations change. They are not relative to the situation. They are immutable.

In a general sense, ethics (or moral philosophy) addresses fundamental questions such as: How should I live my life? That question leads to others such as: What sort of person should I strive to be? What values are important? What standards or principles should I live by? There are various ways to define ethics. The simplest may be to say that ethics deals with “right” and “wrong.” However, it is difficult to judge what may be right or wrong in a particular situation without some frame of reference.

Ethical Dilemmas: Are you an ethical person?

I decided to do something different today in my blog. I describe two hypothetical situations below to challenge readers to think through what the most ethical action would be? I want to give you some time to think about it, so I will post my response on Friday.

Good luck and no cheating!

Dilemma #1

Imagine that you are standing on a footbridge spanning some trolley tracks. You see that a runaway trolley is threatening to kill five people. Standing next to you, in between the oncoming trolley and the five people, is a railway worker wearing a large backpack. You quickly realize that the only way to save the people is to push the man off the bridge and onto the tracks below. The man will die, but his body will stop the trolley from reaching the others. Legal concerns aside, would it be ethical for you to save the five people by pushing this stranger to his death?

Dilemma #2

Now assume that the runaway trolley is heading for five railway workmen who will be killed if it proceeds on its present course. The only way to save these people is to hit a switch that will turn the trolley onto a side track where it will run over and kill one workmen instead of five. Ignoring legal concerns, would it be ethically acceptable for you to turn the trolley by hitting the switch in order to save five people at the expense of one person?

Blog posted by Steven Mintz, aka Ethics Sage, on March 12, 2013

STUPID IS AS STUPID DOES: THE SAGA OF THE TSA

TSA TO ALLOW WEAPONS ON PLANES: SERIOUSLY?

Forrest Gump quotes are uncomplicated, basic and true. They are almost Zen-like in their simplicity. One of the best Forrest Gump quotes is "stupid is as stupid does" which may not be poetry or very deep, but it ends up being true and a more workable metaphor for life than the movie's tag line "life is a box of chocolates". The TSA has now given us a real-life example of stupidity at its stupidest.

As you probably heard by now, federal officials said they will allow passengers to carry small knives, golf clubs, hockey sticks and pool cues into the cabins of commercial jets. The policy change, which will take effect April 25, is being made to help align the list of prohibited items on U.S. flights with those of international carriers and cut the time passengers spend going through security screening. This is an example of using the lowest common denominator to set policy.

The TSA list of prohibited items will no longer include small knives with non-locking blades less than 2.36 inches (6 centimeters) long and 1/2-inch wide. Also removed from the list will be sporting equipment such as golf clubs, billiard cues, ski poles, toy bats and hockey and lacrosse sticks.

The TSA pointed out that other security measures are already in place to protect planes, including hardened cockpit doors, armed federal air marshals, armed pilots and crew members with self-defense training. It is nice to protect planes but what about we, the passengers, who may need help fending off the crazed golfer or hockey player sitting next to us?

The TSA can’t seriously believe that no danger exists to passengers by allowing these potential weapons on planes. Where has the TSA been these past few months while mentally and emotionally-challenged individuals have shot up schools, shopping malls, committed random acts of violence, and caused pain for all too many families?

Someone at TSA should explain to the American people how a small knife is less dangerous than a box cutter. A hockey stick can do great damage. What is to stop one passenger from pulling out his or her stick or club and pounding another passenger because that person is too loud or taking up too much space?

The phrase "blunt instrument" is used to describe a type of weapon that lacks a sharp point or edge. Examples of a blunt instrument include baseball bats, canes, rocks, and hockey sticks. Congratulations TSA for letting blunt instruments on planes.

Here is some interesting information for the TSA to consider as they (hopefully) reconsider this stupid change.

• Annual FBI crime statistics show that more people are killed with clubs and hammers each year than by rifles or shotguns.
• In 2011, there were 323 murders committed with a rifle but 496 murders committed with hammers and clubs.
• Michael Skakel lost a bid for freedom on October 24, 2012, since being convicted of beating Martha Moxley to death with his golf clubs.
• Hockey sticks are routinely used in hockey games to injure opponents on the ice.

Brandon M. Macsata, executive director of the Association for Airline Passenger Rights and a critic of airport security screening procedures, said he is not sure how the change will improve security or speed the screening lines at airports. I also can’t understand how the TSA believes the new rule will speed security lines and the boarding process. What will the airlines do when they realize after only one-half of the plane has been boarded, there no longer is any bin space because people are storing what will become fold-up hockey sticks and golf clubs manufactured specifically for ease of transportation on our planes?

Some family members of victims killed in the September 11 terror attacks said they are outraged by the TSA’s decision to let passengers carry pocketknives on planes. The change is an affront to all people of goodwill and it dishonors the memory of those who died on 9/11.

To say the TSA decision seems to be a poorly thought-out decision is an understatement. TSA now stands for "TOTALLY STUPID AGENCY!"

Blog posted by Steven Mintz, aka Ethics Sage, on March 8, 2013

Politicians have fallen off the Civility Cliff and need to be Sequestered

The Lost Art of Civility

Civility: It seems to be discussed everywhere today. It seems to be misunderstood in most of those discussions. I have written about the loss of civility in society many times, but it always is worth a return visit since I believe it is the number one issue preventing our government from functioning in a way that serves the public good. Whether we are taking about “the fiscal cliff” or “sequestration,” the common theme is incivility in politics is driving most Americans, especially the middle-class that politicians purport to care about, to lose all hope that they ever will be able to achieve the American Dream.

The word ‘civility’ shares an etymological root with the idea of ‘citizenship’ on the one hand, and of ‘civilization’ on the other. The first sense of civility, reflecting the link to the concept of citizenship, is found in the idea of ‘civic behavior.’ Political theorist John Rawls argues that political legitimacy must be based on public reason. As such, ‘the ideal of citizenship imposes a moral, not a legal, duty—the duty of civility—to be able to explain to one another . . . the principles and policies they advocate and vote for’.

For those directly engaged in politics, this means listening to others, being tolerant of views other than one’s own, and recognizing that the principle of ‘shared governance’ must be put ahead of one’s own ideological claim. In other words, a civil society depends on the ability of its leaders to look beyond self-interest and make decisions based on what is best for the country. Given that Democrats and Republicans typically have different views on this matter, the fact is compromise is the basis for having a civil society because it involves listening to others and recognizing one side or the other cannot always get what it wants but, in the interests of the country, a middle ground must be found.

I have previously blogged about an interesting poll that was taken in 2010 by Weber Shandwick and Powell Tate, in partnership with KRC Research: Civility in America: A Nationwide Survey. The survey asked 1,000 American adults to express their views about the tone and level of civility in government and traditional and social media. Here are some of the results: (1) two in three respondents believe civility is a major problem while three in four believe the problem has gotten worse; (2) three in four said the financial crisis and recession made the level of civility in America worse; (3) just one in four expect civility to improve while one in three think it will get worse; (4) not surprisingly, the government and politics were identified as having the least civil discourse and a majority characterized America’s high schools, talk radio, and Hollywood celebrities as uncivil. No argument there from me.

The 2012 survey was recently released and the overall results are about the same. In other words, we’ve made no progress in becoming more civil during the past two years. You might say we are falling off the cliff of a civilized society.

Americans of all political persuasions agree that civility is a major problem today (65% of Republicans, 63% of Democrats and 62% of Independents). However, Democrats are somewhat more likely to believe civility has improved over the past few years and will continue to get better. Republicans and Independents expect civility to get worse. No surprise here because everything done by our Congressional “representatives” is driven by party affiliation and a desire to make the other party look stupid while avoiding looking stupid while doing so. Both parties have failed on this account. They all look stupid and are getting stupider by the day.

Compared to the blame pointed at politicians, government officials and the economic downturn, corporate America (42%) is less often faulted for making civility worse. Notably, the Internet and social media are also less likely to be mentioned as causing our current uncivil state of affairs. It is surprising even to me that politicians and government officials are less civil than what is said and done on the Internet and in the social media.

A civil society cannot avoid tough but important issues, simply because they are unpleasant to address. There must also be more to civility than a scrupulous adherence to the laws governing public-policy decision making. Clearly, there are numerous instances in which the parties to public-policy conflicts act in ways which are destructive and inappropriate, even though they are (and should continue to be) legal.

In short, any reasonable definition of civility must recognize that the many differing interests which divide our increasingly diverse society will produce an endless series of confrontations over difficult moral and distributional issues. Often these issues will have an irreducible win-lose character and, hence, not be amenable to consensus resolution. While continuing confrontation is inevitable, the enormous destructiveness which commonly accompanies these confrontations is not.

Our nation cannot survive as beacon of light if we cannot make the tough decisions in the name of the public good. We have been witness to the political theater of the absurd for all too many years with our politicians playing the role of blocking what the other party wants to do out of some sense of serving their constituency rather than what the American people really want – just get it done!

Our elected politicians have to stop playing games and become dispassionate advocates for the public good during a time when you can’t satisfy all of the people all, or even most, of the time. Not while we fall deeper into the black hole of over spending and less revenue coming into the government coffers; not because the rich are not taxed enough but because there aren’t enough working Americans to contribute to the revenue system, and all too many depend on government support for their livelihood.

Unfortunately, today our politicians mirror the egoistical society we have become. It manifests itself in selfishness, an unwillingness to compromise for the public good, and level of immaturity and civility as low as I can ever remember. I suppose to expect our politicians to deal intelligently with our problems – as statesmen and stateswomen – is pie in sky thinking today.

Blog posted by Steven Mintz, aka Ethics Sage, on March 4, 2013

 

A Governor's Attack on Academic Freedom

Governor Brown Insensitive to the Effects of Budget Cuts and Seeks to Control Academic Decision-Making

This blog first appeared as an article on February 18, 2013 in The Chronicle of Higher Education. It challenges California Governor Jerry Brown’s recent intrusion into the process of academic freedom. Gov. Jerry Brown's 2013-14 budget for California intrudes on academic freedom in a way that could harm the 23 campuses of California State University and the 10 campuses of the University of California—but the impact of his attempt to control academic decision-making threatens every public college and university in the country.

Putting aside for the moment the fairness of Brown's proposed $250-million increase for both the CSU and UC systems, and an additional $10-million to each one to develop online courses, the governor's budget attempts to dictate how the increased funds should be spent. That is a violation of academic freedom, the bedrock of colleges and universities.

Universities exist to promote the public interest, not to further the interests of individual professors, the institution as a whole, or, in this case, the governor of California. The public interest is not served by Brown's inserting himself into education decision-making.

Academic freedom fosters an independent academic voice and encompasses the conflict-of-interest issues that might impair impartiality. This conflict is between the goals of the governor in dictating how the increased funds should be spent and the wishes of the college administrators and faculty members who should be making the educational decisions.

Several statements by Brown on his Web site are troubling. "The people in the university are going to have to find a way to do the same thing with fewer growing resources," he says. What does he think we have been doing for the past five years? While it is true that tuition increases have been excessive and unfair to the students, they have been necessary to stem the tide of canceled classes, overly crowded classrooms, and good faculty members lost to institutions that actually have increased faculty salaries during the past five years. In the California state systems, we have seen no such increases and have endured a 10-percent cut in salary during one of those years.

Brown wants to tie financial support to the universities' ability to improve graduation rates and to graduate students on time. Fair enough. But such linkage is likely to lead to a decline in standards in order to "improve graduation rates," as has been the case in the elementary- and secondary-education systems.

Moreover, doesn't the governor know that virtually all colleges and universities in the state are subject to accreditation standards by, at a minimum, the Western Association of Schools and Colleges? Professional programs undergo a more specialized accreditation process as well, such as that of AACSB International—the Association to Advance Collegiate Schools of Business. Those organizations already look at graduation rates and the quality of programs, and are more qualified than the state to make such assessments.

The most intrusive demand by Brown is that universities expand their online courses to reduce costs and allow more students to get the classes they need to graduate. Once again the governor is placing quantity ahead of quality. Among the many questions involving online education is whether the same quality of education can be made available online as that available in the classroom.

What's more, the costs of developing and maintaining online courses may divert funds from other programs, lowering the quality of the educational experience of all students. The state spent $1.6-billion less on higher education in 2010-11 than it did 10 years earlier, according to the independent Public Policy Institute of California. While that decline is due in part to the recession since 2008 and to lower general-fund revenues, it also reflects changing state priorities. During the past 10 years, state support for higher education has fallen 9 percent, while that for corrections and rehabilitation services has increased 26 percent. Shouldn't we devote more funds to higher education, in the hope of developing skills among people who might otherwise get in trouble and wind up in our prisons?

I have taught in the California State system for 25 years, and it no longer resembles what once was among the best public-­college systems in the country. The facilities on many campuses have not been modernized, the failure to keep up with salary levels of comparable institutions has led to a brain drain, and the lack of funds has inhibited the development of programs to meet the needs of a changing world.

The irony is that faculty members have continued working as hard or harder to maintain the quality of education, despite overall declines in salaries and being asked to teach more classes with more students in technologically marginal classrooms.

State universities exist to serve the needs of young people who want to be educated and advance their position in life. They should provide a low-cost alternative to private colleges and universities, and should have faculty and staff members committed to excellence in education.

Part of the process of running a multi-campus system, such as CSU and UC, is to leave academic governance to local campuses. It does not matter whether the state universities are in California, New York, or Wisconsin—the principle is the same. Shared governance on each campus dictates that decisions should be made by the faculty and academic administrators of that campus and not by a government official.

California has the largest and most diverse state-run university systems in the country, and it often serves as a bellwether for other large state-university systems. Governor Brown is using the state's woeful budget situation to exact concessions from the University of California's chancellor and California State University's Board of Trustees, who are content to avoid further program and salary cuts in the 2013-14 academic year.

What happens in California does not necessarily stay in California, which is why faculty and staff members across the country should sit up and take notice of our governor's efforts to use a financial crisis to dictate academic policy.

Blog posted by Steven Mintz, aka Ethics Sage, on March 1, 2013

Slavery used to teach Math in NYC Schools

Slavery Examples Raise Insensitivity to new Highs (or lows)

It’s not always easy teaching fourth-graders to really get math. Word problems can be especially useful because they give children easily imagined, real-life examples that make numbers and equations come to life. Remember these from your childhood?

“If Susie had four cookies and John had two cookies and they put all their cookies on a plate, how many cookies would be on the plate?” “Jane carried six books. She gave one to Bella and two to Tom; how many books was Jane still carrying?”

Very effective but so old-school! Now we find out about the crassest way I’ve ever heard to teach math to grade students. I’m referring to the inappropriate questions asked by Jane Youn, a New York City teacher, who had asked fourth-graders to write homework questions that blended math and social studies, education officials said. Last month, the fourth-grade teacher sent pupils home with math problems that were based on slavery as submitted by the pupils themselves.

The teacher used the students' questions, including the slave-related ones, as homework for the class. Another teacher, Jacqueline Vitucci, had copied the offensive questions and was going to assign them before common sense somehow intervened.

Question 1 on the sheet, entitled “Slavery Word Problems Homework,” was written as a matter-of-fact subtraction problem. The question asked: “In a slave ship, there can be 3,799 slaves. One day, the slaves took over the ship. 1,897 are dead. How many slaves are alive?”

Another question said a slave was whipped five times a day and asked students to calculate how many times a month he was whipped. The school principal said she's "appalled" by a homework assignment that used scenarios about killing and whipping slaves to teach math. Adele Schroeter, the principal of P.S. 59, a well-thought-of elementary school that draws students from Midtown and the area around the United Nations, told the Daily News that she has ordered sensitivity training for all of the staff. The school is 60 percent white and five percent African American.

The NYC Department of Education said the situation was "obviously unacceptable." It said "appropriate disciplinary action" would be taken.

Parents of students at the school called the lesson inappropriate and offensive. "I don't understand how teachers aren't aware that would be offensive. Why aren't they aware? Why aren't they in touch? Why aren't they concerned with these issues of minorities in America nowadays?" parent Tim Tate told CBS New York. "It's a little unnerving, a little unsettling."

This issue goes beyond insensitivity into the realm of abject stupidity. The NYC Department of Education should fire the teacher, fire the principal, and send a formal apology letter to all parents and students, black or white. There is no place in our society for such an egregious offense.

The Emancipation Proclamation was issued on September 22, 1862. It has been over 150 years since the passage of that incredibly important piece of legislation in the development of our nation as a civilized society. To learn that a fourth grade teacher uses slavery to teach math is nothing short of shocking and disheartening.

As an educator I always look for ways to use inappropriate statements by students as a teaching tool. The only way the assignment could have been salvaged once students were asked to submit the questions would have been for the teacher to use the questions submitted about slavery as a teachable moment so students could learn why it is inappropriate to use such examples given the sensitivity we all share about such an application in a classroom. It could have been used as a teachable moment about choices, respect, civility and character development. The fact that it wasn’t just adds fuel to the insensitivity fire started by the NYC teacher.

What I don’t understand is the lack of coverage in the media of this travesty. I can only wonder what the uproar would have been, and rightly so, if the question had said: A concentration camp occupant was gassed five times a day and asked students to calculate how many times a month he was gassed.

Blog posted by Steven Mintz, aka Ethics Sage, on February 25, 2013

What are our Ethical Responsibilities when Witnessing a Vicious Crime?

Violent Acts threaten our Civil Society

By now you have probably heard about the vicious beating of a 22-year old in Newark, NJ. He did not report it for fear that his three tormenters would come back for more.

Police arrested 22-year old Ahmad Holt, 23 year old Jamaar Gray and 31-year old Raheem Clark. All three are charged with aggravated assault, robbery and possession of a weapon . The belt was used to whip the victim.

After he took a belt from someone else, Holt proceeded to viciously whip the man for 90 seconds while ordering him to yell the phrase "Doggy Dawg" and to tell the camera that it is a "Doggy Dawg" world. DeMaio said "Doggy Dawg" is a street name used by Holt, and said all three suspects have known gang affiliations.

In much of the video, which is too graphic to embed in this blog, police say Holt is the man who was behind the vicious beating, wildly swinging away at the victim. Gray allegedly took the video. Investigators believe Clark supplied the belt that was used in what is described as a dispute over a measly $20.

Newark Mayor Cory Booker called this vicious beating a "human tragedy" and while Newark police made three arrests, the mayor said it was "unacceptable behavior." We do not tolerate this viciousness. We do not tolerate this kind of evil in our community," Booker said.

The evil that Booker refers to spilled out for all to witness in the beating of the young man stripped of his clothes and whipped with a belt. All of it was recorded and put out on the internet, leading to a call to Newark police, and now the arrest of these three men and the discovery of a reluctant victim.

The alleged cameraman, Jamar Gray, and another man named Raheem Clark have also been charged in the crime.

This incident reminds me of the recent NYC subway death where passengers on the subway platform watched while Ki-Suck Han was pushed off a subway platform by Naeem Davis. Mr. Han was hit by the train and died while observers did nothing other than snap a shot on their cellphones all the while Mr. Han sought a way off the tracks before the oncoming train did him in. Davis was arraigned on a second-degree murder charge and held without bail in the death of Mr. Han.

Do we have an ethical responsibility to help others in need when a life may be at stake? If someone is being attacked in the streets should we intervene to help? In a civilized society the answer is “yes” to both questions.

I attribute both of these incidents to the “bystander effect,” that reflects a moral blindness ingrained in our society. Moral blindness in this sense is the inability to see the moral dimensions of a problem. This is an issue whereby our judgment is clouded by failing to see we have responsibilities to others. The universal ethical principle is: How would I want others to act [toward me] in similar situations. We would want on-lookers to help us off the tracks especially when it would have been easy to do so. Mr. Han already had his hands on the platform. The train was still a bit from the station. There appeared to be no danger to others. The attacker had already fled.

Recently in our country we witnessed 20 elementary students at Sandy Hook Elementary randomly and violently gunned down in their classroom by Adam Lanza, a 20-year-old former student at the school. The Sandy Hook killings did surpass the mass murder on April 20, 1999 at Columbine High School outside Littleton, Colorado when two , 18-year-old senior students, Eric Harris and Dyle Klebold, massacred 12 students and one teacher and injured 21 others.

Then there was a lone gunman, 22-year-old Jacob Tyler Roberts, going into an Oregon shopping mall and killing two, seriously wounding another, after getting off at least 60 rounds of ammunition. Finally, Seung-Hui Cho who killed 32 people and wounded 17 others on April 16, 2007 at Virginia Polytechnic Institute.

In virtually all of these cases the killer or killers took their own lives after the killings. In  other words they seem to have viewed the mass murders as a way to make a statement about how badly they had been treated whether it was losing a job, bullying, or some other perceived wrong-doing, and wanting to go out “with a bang.” It also appears in most, if not all cases, the killers were mentally disturbed. I don’t mean mentally disturbed because they committed such heinous crimes. That goes without saying. They were mentally disturbed with respect to having an anti-social personality disorder perhaps accompanied by depression and social anxiety.  One question is whether such mental problems could have been diagnosed in advance and treated early on.

One disturbing trend about these mass killings is they were done by teenagers and other young people who targeted children and students at our schools. Why is it occurring in our society with such frequency today? Have we gotten to the point as a nation where our goal in life is to video something that gets on You Tube? Have we become so desensitized to violence in our society that we see it as an extension of a video game, violent movie, or even realty TV? What does it mean for us as a “civilized” society down the road. How can we stop the alarming trend of gratuitous violence that has led us down the path of the killing of innocent children? These are questions I raise that need to be discussed in a national dialogue. What we need now are people of good will and leaders in the psychiatric community with the help of mental health experts to somehow begin a national dialogue supported by all aspects of society – civic leaders, business leaders, and the government – before it is too late.  

Blog posted by Steven Mintz, aka Ethics Sage on February 22, 2013

Accounting for Nuts

Diamond Foods Fraud Illustrates the Danger of overly-optimistic Earnings Projections

Management does it all the time – set overly optimistic earnings and earnings per share projections to motivate financial analysts to give positive recommendations to current and potential investors with respect to stock holdings. It was the fuel that engineered the accounting frauds at Enron, WorldCom, et al. A recent example is Diamond Foods.

On November 14, 2012, Diamond Foods Inc. disclosed restated financial statements tied to an accounting scandal that reduced its earnings during the first three quarters of 2012 as it took significant charges related to improper accounting for payments to walnut growers. The restatements cut Diamond’s earnings by 57 percent for fiscal 2011 to $29.7 million and by 46 percent for fiscal 2010 to $23.2 million. By December 7, 2012, Diamond’s share price had declined 54 percent during 2012.

Diamond Foods, long-time maker of Emerald nuts, and subsequent purchaser of Pop Secret popcorn (2008) and Kettle potato chips (2010), became the focus of a SEC investigation after The Wall Street Journal raised questions about the timing and accounting of Diamond’s payments to walnut growers. The case focuses on the matching of costs and revenues. At the heart of the investigation was the question of whether Diamond senior management adjusted the accounting for the grower payments on purpose to increase profits for a given period.

The case arose in September 2011, when Douglas Barnhill, an accountant who is also a farmer of 75 acres of California walnut groves, got a mysterious check for nearly $46,000 from Diamond. Barnhill contacted Eric Heidman, the company’s director of field operations, on whether the check was a final payment for his 2010 crop or pre-payment for the 2011 harvest. Diamond growers are paid in installments, with the final payment for the prior fall’s crops coming late the following year. Though it was September 2011, Barnhill was still waiting for full payment for the walnuts he had sent Diamond in 2010. Heidman told Barnhill that the payment was for the 2010 crop, part of fiscal 2011, but that it would be “budgeted into the next year.” The problem is under accounting rules you cannot legitimately record in a future fiscal year an amount for a prior year’s crop. That amount should have been estimated during 2010 and recorded as an expense against revenue from sale of walnuts.

An investigation by the audit committee in February 2012, found payments of $20 million to walnut growers in August 2010 and $60 million in September 2011 that were not recorded in the correct periods. The $20 million payments to growers in 2010 caught the eye of Diamond’s auditors, Deloitte & Touche. However, it does not seem that the auditors lived up to their professional responsibilities in detecting and/or reporting the fraud.

The disclosure of financial restatements in November 2012 and audit committee investigation led to the resignation of former CEO Michael Mendes who agreed to pay a $2.74 million cash clawback and return 6,665 shares to the company. Mendes’ cash clawback was deducted from his retirement payout of $5.4 million. Former chief financial officer Steven Neil was fired on November 19, 2012 and did not receive any severance.

An interesting aspect of the case is the red flags including unusual timing of payments to growers, a leap in profit margins, and volatile inventories and cash flows. Moreover, the company seemed to push hard on every lever to meet increasingly ambitious earnings targets and allowed top executives to pull in big bonuses, according to interviews with former Diamond employees and board members, rivals, suppliers and consultants, in addition to reviews of public and nonpublic Diamond records.

Nick Feakins, a forensic accountant, noted the relentless climb in Diamond’s profit margins including an increase in net income as a percent of sales from 1.5 percent in fiscal 2006 to more than 5 percent in fiscal 2011. According to Feakins, “no competitors were improving like that; even with rising Asian demand…it just doesn’t make sense.” Reuters did a review of 11 companies listed as comparable organizations in Diamond’s regulatory filings and found that only one, B&G Foods, which made multiple acquisitions, added earnings during the period.

Another red flag was that while net income growth is generally reflected in operating cash flow increases, at Diamond the cash generation was sluggish in fiscal 2010 when earnings were strong. This raises questions about the quality of earnings. Also, in September 2010 Mendes had promised earnings per share growth of 15 percent to 20 percent per year for the next five years. In fiscal 2009, 2010, and 2011, $2.6 million of Mendes’ $4.1 million in annual bonus was paid because Diamond beat its EPS goal, according to regulatory filings.

The ethical issues in this case are fairly obvious: misleading financial results; improper accounting; and a corporate governance system that did not work. The earnings projections raise questions whether auditors should include these projections in their audit work. In accounting, they are referred to as “forward-looking” statements and cautionary language is assigned to the amounts. However, this is insufficient to protect the public in an environment of capitalism run amok.

Blog posted by Steven Mintz, aka Ethics Sage, on February 18, 2013

What is the Value of Ethics Education?

Are Universities Successfully Teaching Ethics to Business Students?

Last week I read an article on the failure of ethics education of business students to change the dynamic in the business world where the pursuit of self-interests trumps all else. We certainly have been through a decade or so of glaring unethical business practices at companies such as Enron and WorldCom, Bernie Madoff’s insider-trading scandal, and the financial meltdown of 2008-2010 from which we still have not recovered.

As a professor who teaches ethics I was struck by the reasoning given for the failure of ethics education. Some claim ethics is taught only in a separate course rather than integrated throughout the curriculum creating a perception in the minds of students that ethics is only important tangentially rather than as an integral part of business practice. I agree with this perspective but realize, having been an academic administrator for many years, the problem lies in not being able to get faculty from various business disciplines on board to incorporate ethics into their individual courses. Some feel unequipped to do so; others do not believe we should be “preaching” to college students.

I did some research on how ethics is taught to business students and their perspectives on business responsibilities and found some interesting results. Surveys conducted by the Aspen Institute, a think tank, show that about 60% of new M.B.A. students’ view maximizing shareholder value as the primary responsibility of a company; that number rises to 69% by the time they reach the program's midpoint.

There is nothing wrong with maximizing shareholder value – it is a basic tenet of capitalism. The problem lies when that is the only driver of corporate behavior to the exclusion of broader stakeholder approaches that would include customers, suppliers, and employees in the mix. Though maximizing shareholder returns isn't a bad goal in itself, focusing on that at the expense of societal interests can lead corporate decision-makers down the road of greed. By maximizing shareholder value, bonuses increase and stock options are worth more.

Some schools are experimenting with a more integrated approach. This fall, Boston University's School of Management will introduce a required ethics course for freshman business students, and is also tasking instructors in other business classes to incorporate ethics into their lessons. It may also overhaul a senior seminar to reinforce ethics topics.

"We need to hit the students hard when they first get here, remind them of these principles throughout their core classes, and hit them once again before they leave," says Kabrina Chang, an assistant professor at Boston University's business school, who is coordinating the new freshman class.

Another school with a serious attempt to teaching ethics to business students is Kansas State University. Kansas State has developed a Business Ethics Education Initiative designed to help strengthen business ethics education internationally, nationally, and locally. The goals include enhancing public awareness of the importance of business ethics coursework and identifying effective models of ethics education for relevant stakeholders. Without tying ethics to a business curriculum, "we are graduating students who are very myopic in their decision-making," says Diane Swanson, founding chair of the Business Ethics Education Initiative at Kansas State University.

Interestingly, K-State strives to achieve those goals through external and internal (campus) outreach activities, including affiliations with profit and not-for-profit organizations. I particularly like the stakeholder-influenced approach to business ethics education. It should be a two-way street between the college and greater business community to move the effort more towards the practical implications of business ethics education.

I could mention additional business ethics programs but the fact is the value of such programs is unclear. The whole issue of business ethics education has not been aptly dealt with by AACSB – International, the worldwide accrediting agency for business schools in colleges and universities. AACSB’s task force addressed this issue in 2004 and came up with what can best be described as weak and ineffective standards. I can tell you first-hand that business schools generally will not follow standards set by AACSB unless they are mandatory, and AACSB’s are not. Here are excerpts from the standards:

“While the task force does not prescribe a particular curriculum or course, it recommends that AACSB encourage its member schools and their faculties to renew and revitalize their commitment to ethical responsibility at both the individual and organizational levels. Schools should be encouraged to demonstrate this commitment throughout their academic programs, assessment processes, research agendas, and outreach activities.”

This is "academic-speak" for we do not want to hold the schools accountable for ethics education. AACSB's failure to set specific goals for business ethics education speaks volumes about the political pressure from accredited schools that were brought to bear on any new standards that require specific education. Academic administrators do not want to be tied down to a specific course of action or program; they want a more "flexible" approach. The result is a meaningless standard that fails to address the critical problems that face us today in graduating business students who become tomorrow's future abusers of the capitalist system because of narcissitic behavior.

So, what should be done about the failure of business ethics education over the years to stem the rising tide of corporate fraud and wrongdoing? I believe the emphasis of business ethics education has to change from teaching philosophical reasoning methods that rarely work in practice to a more values-based approach that emphasizes ethical leadership. Ethical leadership is a must in any discipline -- accounting, finance, information systems, management and marketing. Therefore, all college instructors should buy into the need to slant their teaching methods to incorporate leadership -- ethical leadership.

Blog posted by Steven Mintz, aka Ethics Sage, on February 12, 2013

 

Should Students who cheated at Harvard be Rewarded or Punished?

Students Disciplined in Harvard Scandal

You may have read last week that Harvard has forced dozens of students to leave in its largest cheating scandal in memory but the institution would not address assertions that the blame rested partly with a professor and his teaching assistants. The issue is whether cheating is truly cheating when students collaborate with each other to find the right answer – in a take-home final exam.

Harvard released the results of its investigation into the controversy, in which 125 undergraduates were alleged to have cheated on an exam in May 2012. The university said more than half of the students were forced to withdraw, a penalty that typically lasts from two to four semesters. Of the remaining cases, about half were put on disciplinary probation—a strong warning that becomes part of a student's official record. The rest of the students avoided a punishment.

In previous years, students called Government 1310 an easy class with optional attendance and frequent collaboration. But students who took it last spring said that it had suddenly become quite difficult, with tests that were hard to comprehend, so they sought help from the graduate students who ran the class discussion groups and graded assignments. Those teaching fellows, they said, readily advised them on interpreting exam questions. (It seems to me the actions of the teaching assistants in prompting student understanding of test questions to prepare for the exam were a blatant violation of academic honesty).  

Administrators said that on final-exam questions, some students supplied identical answers, down to, in some cases, typographical errors, indicating that they had written them together or plagiarized them. But some students claimed that the similarities in their answers were due to sharing notes or sitting in on sessions with the same teaching fellows. The instructions on the take-home exam explicitly prohibited collaboration, but many students said they did not think that included talking with teaching fellows.  

The first page of the exam contained the instructions: "The exam is completely open book, open note, open internet, etc. However, in all other regards, this should fall under similar guidelines that apply to in-class exams. More specifically, students may not discuss the exam with others—this includes resident tutors, writing centers, etc. (Did the ‘etc.’ mean teaching fellows?).

Students complained about confusing questions on the final exam. Due to "some good questions" from students, the instructor clarified three exam questions by email before the due date of the exams.

Students who spoke to the New York Times said that collaboration was widely thought to be allowed in the course. The class’s teaching fellows—graduate students who graded the exams and ran weekly discussion sessions—varied widely in how they prepared students for the exams, so it was common for students in different sections to share lecture notes and reading materials. The course’s instructor and the teaching fellows sometimes encouraged collaboration. During the final exam, some fellows even worked with students to define unfamiliar terms and help them figure out what, exactly, certain test questions were asking.

Some have questioned whether it is the test’s design, rather than the students’ conduct, that should be criticized. This is a good point because test questions were unclear and needed to be clarified while the exam was in process. This would never occur in an in-class exam. Others place the blame on teaching assistants who opened the door to collaboration outside of class by their own behavior in helping students to better understand the questions.

The Harvard cheating scandal is not black or white from an ethical perspective. One way to evaluate it is by examining the behavior and actions of the stakeholders. The instructor is partly to blame because unclear questions had to be clarified and that would have have promoted collaboration to better understand just what the instructor’s intentions were.

For the instructor, the students’ collaborative work does make it difficult to assess individual performance—because many people’s answers sounded similar, instructors could not determine who really understood the work and who was merely free-riding. As a professor, this is why when I assign a group project I require oral presentations so I can grade individual effort.

It seems some of the cheating students engaged in rationalizations for their behavior. We hear the test was confusing; collaboration was expected in other areas; and the teaching fellows promoted the idea through their involvement in helping to interpret the questions.

I do think the students violated the rules in this case and should be held accountable for their actions. However, there were mitigating circumstances not the least of which was from the teaching assistants who seemed to work with those students who came forward asking for help to interpret information and develop responses to test questions.

Perhaps the lesson to be learned from the Harvard cheating scandal is we, in academe, need a new approach to evaluating the benefits and potential harms of collaboration. It can be a great teaching tool and mirrors collaborative effort in the workplace. Test questions in a collaborative enivornment can better assess analytical reasoning and critical thinking skills, two skills essential for success in today's workplace.

The level playing field argument is key in evaluating the use and purpose of student collaboration. Academic integrity is at stake. Collaborative effort may impair fairness in the grading process unless collaboration is expected of all students. Otherwise, those who “play by the rules” may receive lower grades because they worked individually while those who shared information may benefit from such an approach.

Blog posted by Steven Mintz, aka Ethics Sage, on February 8, 2013

How to Prepare for a Behavioral Interview

Behavioral Competencies Assessed by Employers through the Behavioral Interview

Behavioral based interviewing is interviewing based on discovering how the interviewee acted in specific employment-related situations. The logic is that how you behaved in the past will predict how you will behave in the future (i.e. past performance predicts future performance).

In a traditional interview, the potential employee is asked a series of questions which typically have straight forward answers like "What are your strengths and weaknesses?" or "What major challenges and problems did you face? How did you handle them?" or "Describe a typical work week."

In a behavioral interview, an employer has decided what skills are needed in the person they hire and will ask questions to find out if the candidate has those skills. Instead of asking how you would behave, they will ask how you did behave. The interviewer will want to know how you handled a situation, instead of what you might do in the future.

In a survey of 1,400 chief financial officers by Robert Half International, the following question was asked:

“Other than technical ability and willingness to do the job, what quality impresses you the most when hiring a candidate?”

The answers may surprise some as behavioral characteristics account for 92 percent of the responses:

•Honesty & Integrity 58%

•Enthusiasm 14%

•Communications Skills 12%

•Professional Appearance 7%

•Sense of Humor 1%

•Other 8%

Behavioral interview questions will be more pointed, more probing and more specific than traditional interview questions:

• Give an example of an occasion when you used logic to solve a problem.
• Give an example of a goal you reached and tell me how you achieved it.
• Describe a decision you made that was unpopular and how you handled implementing it.
• Have you gone above and beyond the call of duty? If so, how?
• What do you do when your schedule is interrupted? Give an example of how you handle it.
• Have you had to convince a team to work on a project they weren't thrilled about? How did you do it?
• Have you handled a difficult situation with a co-worker? How?
• Tell me about how you worked effectively under pressure.

Follow-up questions will also be detailed. You may be asked what you did, what you said, how you reacted or how you felt.

Keep in mind that you won't know what type of interview will take place until you are sitting in the interview room. So, prepare answers to traditional interview questions.

Then, since you don't know exactly what situations you will be asked about if it's a behavioral interview, refresh your memory and consider some special situations you have dealt with or projects you have worked on. You may be able to use them to help frame responses. Prepare stories that illustrate times when you have successfully solved problems or performed memorably. The stories will be useful to help you respond meaningfully in a behavioral interview.

Finally, review the job description, if you have it, or the job posting or ad. You may be able to get a sense of what skills and behavioral characteristics the employer is seeking from reading the job description and position requirements.

It's important to keep in mind that there are no right or wrong answers. The interviewer is simply trying to understand how you behaved in a given situation. How you respond will determine if there is a fit between your skills and the position the company is seeking to fill. The key is to listen carefully, be clear and detailed when you respond and, most importantly, be honest. If your answers aren't what the interviewer is looking for, this position may not be the best job for you anyway.

The Virginia Tech University provides useful questions for behavioral interviewees to prepare for the interview including:

Describe a time when you were faced with problems or stresses at work that tested your coping skills. What did you do?

Give an example of a time when you had to be relatively quick in coming to a decision.

Give me an example of an important goal you had to set and tell me about your progress in reaching that goal.

Describe the most creative work-related project you have completed.

Give me an example of a problem you faced on the job, and tell me how you solved it.

Tell me about a situation in the past in which you had to deal with a very upset supervisor or co-worker.

Give me an example of when you had to show good leadership.

At the end of the day the interview process is designed to see if a potential employee’s values and work ethic are a good fit for the company. Remember,

Technical gets you the interview, Behavioral gets you the job !

Blog posted by Steven Mintz, aka Ethics Sage, on February 4, 2012

Does Everyone Lie?

Are we a Culture of Liars?

In the aftermath of the Lance Armstrong fraud perpetrated on the entire world we have to question whether everyone lies. Has it become so ingrained in our national psyche that lying has become the right way to behave?

I watched the Katie Couric interview a week ago Thursday and saw Manti Te'o commit a common lie. Katie asked whether he was truthful about his relationship with Lennay Kekua and Manti responded he never lied because whenever he was asked if he had ever met her, he skirted the issue. He admits to being less than forthcoming. But, a lie by omission is still a lie.

We say it is wrong to lie our kids and claim we don’t do it ourselves, yet lying is common, used to get out of tight situations, and part of the narcissistic behavior pattern that has enveloped Americans during the past twenty years or so. It has become part of our self-esteem – who we are and what we believe in. We live in a society where deception is thought of as nothing wrong. So what if we take advantage of others so long as it advances our own self-interests.

Liars think they have good reasons to lie, or good intentions. But the people being deceived don’t necessarily feel that way. I always tell my students that lying is wrong on many levels not the least of which is you are using people for your own personal gain. It goes against the basic “Golden Rule” that we should treat others the way we want to be treated. No one wants to be lied to so why should we lie to others?

On a practical level once we begin to lie or cover-up, we begin the slide down the proverbial ethical slippery slope where one lie leads to another and we struggle to get our story straight and consistent when we are questioned about our actions. This is the classic way police detectives catch criminals. They ask them to repeat their stories many times and in different ways to respond to probing questions. It’s hard to remember the initial lie and subsequent cover-ups, but not so with truthful statements.

"People do it because it works," said Robert Feldman, dean of social and behavioral sciences at the University of Massachusetts in Amherst and a leading researcher on the psychology of lying. "We get away with lies all the time. Usually they're minor: 'I love your tie.' 'You did a great job.'

“The reality is, people lie all the time — ‘I love the report you gave,’ for instance — and tell you what you want to hear. Most of us lie, and most of us don’t get caught. If others hadn’t come forward, I’m sure Lance Armstrong still be living the lie.”

According to Feldman, Bill Clinton is a prime example of a public figure who lied to protect himself — by denying he had sexual relations with White House intern Monica Lewinsky — and later, after confessing, reclaimed some vestige of his credibility and moral standing. Clinton is now one of the country’s most admired public figures, if by no means universally beloved.

The popular television show House features a character who always tells people “everyone lies.” The statistics seem to bear this out. A variety of studies have been conducted about lying. One that was published in the Journal of Basic and Applied Social Psychology found that during a 10-minute conversation between two strangers, 60% lied at least once. Those liars told an average of two to three fibs.

According to a 2012 Gallup poll, 43 percent of Americans rate the country’s state of moral values as “poor,” and 73 percent indicate it’s getting worse. Dishonesty, deception, and integrity (or lack thereof) are part of the problem, respondents said, along with loss of religious faith and a breakdown in family structure.

Moral philosopher and author Sissela Bok, whose books include “Lying: Moral Choice in Public and Private Life,” agrees that lying is prevalent throughout this society and others, often starting with small steps and at a young age. Step by step, the lies can build to what seems like the point of no return.

From a liar’s perspective, “You’re very optimistic about not getting caught,” adds Bok. “Also, you think you have good reasons to lie, or good intentions. But the people being deceived — investors, public citizens, whoever — don’t necessarily feel that way.”

So ask yourself whether you, too, lie all the time. Do you tell people what they want to hear rather than the truth? Do you deceive by obfuscating the truth?  Do you lie by omission?

Here are five common forms of lying in serious matters:

• The potential worker who lies on his/her resume to get a job or get ahead
• The husband who says he is working late when he is having an affair
• The worker who takes long-term disability for a serious injury, only to be found puttering around the golf course
• The guy who says his car broke down because he is late for work
• The dog who ate your homework.

Lying has become endemic to our society. Perhaps the best way to deal with it is to assume whatever a person says to us when questioned about a serious matter that the opposite is true.

Blog posted by Steven Mintz, aka Ethics Sage, on February 1, 2013

Should the Monday After the Super Bowl be a Holiday?

Super Bowl Monday and Work Ethic

Perhaps you have heard there is a petition circulating to send to President Obama to make next Monday, the day after the Super Bowl, a national holiday.

" Declare the Monday following the Super Bowl a national holiday" is the brain child of the Fantasy Football site, 4for4.com. Here is the petition:

“In 2012, an estimated 111 million American citizens watched the Super Bowl, making it the most- viewed television braodcast in history and one of the largest location-independent gatherings of American people to date. 

We at 4for4.com Fantasy Football petition the Obama Administration to consider  declaring the Monday following Super Bowl Sunday a national holiday. By doing so, the Obama Administration can promote camaraderie among the American people, keep the streets safer for our children on Sunday night and Monday morning, promote a productive workplace when work resumes on Tuesday, and honor the most popular event in modern American culture.”

Now, the fact that a Fantasy Football site initiated the petition detracts from the seriousness of the effort since there can be no doubt Fantasy Football hopes the PR effort leads to more sign-ups for its newsletter, betting, and other self-promoting activities. Nevertheless, the fact that many Americans have already signed the petition and more are seriously considering it speaks volumes about the declining ethical values in our society.

The rationale typically given to have Super Bowl Monday as a holiday is that people do not want to go to work after eating and drinking for four hours on a Sunday -- so let's make the Monday after the Super Bowl a national holiday. I suppose given our work-ethic-challenged society many already call in sick that Monday while others are unproductive at work. Still, that doesn’t mean we need to set new lows for work effort and caring about the quality of work one does in the workplace.

One important ethical value is the pursuit of excellence. Having a national holiday after the most watched show of the year elevates laziness and the declining work ethic in our society to new heights (or lows!). When sports gets priority over keeping the engine of economic development and capitalism going even for one day, we have morphed into selfish society of the first order.

Glassdoor.com surveyed employees asking what the Super Bowl does to the workplace the Monday after the game. They found:

• 20% of employees say that employee morale is typically better in the office the day after the Super Bowl.
• 22% of employees notice, however, that the Monday following the Super Bowl is commonly a less productive day than usual.
• 8% of employees plan to take the day off following the Super Bowl.
• 9% of employees plan to take the Monday off as a vacation day.  
• 3% of surveyed employees admit that they plan to call in sick the day after the Super Bowl.

Glassdoor.com also asked employees if their employers offer any type of perks for the Monday after the Super Bowl. Several employees said that they are either allowed to work from home or use the Monday as a flex day. Another employee noted that their weekly Monday morning meeting gets bumped until later in the day on the Monday after the Super Bowl. Other survey respondents said that their employers buy breakfast for employees on the Monday after the game.

In a broader survey that illustrates laziness in society, two-thirds of U.S. workers who call in sick at the last minute do so for reasons other than physical illness, according to the findings of the 17th annual CCH Unscheduled Absence Survey. CCH is a leading provider of human resources and employment law information and services.

Is worker absenteeism a problem for business in general? Yes, according to the 2007 CCH Survey. It found that while 34 percent of people call in sick to work at the last minute due to “personal illness,” 66 percent are taking time off to deal with personal or family issues.

“Most people today are juggling the demands of busy personal and professional lives, and are trying to do their very best in both places,” said CCH Employment Law Analyst Pamela Wolf. Employers, however, have failed to make significant headway against the costly absenteeism problem that takes billions of dollars off the bottom line for U.S. businesses. The nation’s largest employers estimate that unscheduled absenteeism costs their businesses more than $760,000 per year in direct payroll costs, and even more when lower productivity, lost revenue and the effects of poor morale are considered.

The CCH Survey also found that for many employers, it’s no surprise when employees are likely to be no-shows. More than two-thirds (68 percent) report finding a discernable pattern in unscheduled absences, with 37 percent of organizations reporting the most noticeable pattern is people calling in sick on Mondays and Fridays, followed by 17 percent recognizing the most noticeable pattern occurring around holidays such as Christmas or the Fourth of July and 13 percent reporting their most noticeable pattern of unplanned absences occurs during flu and hay fever seasons.

Our country runs the risk of falling behind China as the world’s largest economy. We need to get serious about the importance of staying competitive in an increasingly globalized world economy with countries like China chomping at the bit to overtake us as the world leader.

You can bet the Chinese government has not declared a national holiday for the day after the country’s national Ping Pong Championship.

Blog posted by Steven Mintz, aka Ethics Sage, on January 28, 2013

Sandwich Generation

What are our Ethical Obligations to Care for our Aged-Parents and Children?

The other day I found out for the first time in a conversation with my brother that I was part of the “sandwich generation.” You can find the term in both the Oxford English and Merriam Webster Dictionaries.

In the early 1990's very few had even heard of the term "sandwich generation." Most thought it was connected to a sandwich eaten by children who were "latch key" kids. Instead, sandwich generation refers to those people who are sandwiched between aging parents who need care and/or help and their own children. It could be the parents have “boomerang” adult kids who come back home after school and/or unsuccessful attempts to get a job. At the same time, one’s parents need in-home care, 24/7 adult supervision or independent/assisted living.

The task is not easy to become elderly or a parent to your parent(s). After all, our society "says" adults should be able to take care of themselves. But, as more live well into their 80s and 90s and families are dispersed across the country, everyone is going to be involved somehow, some way, in elder care. If not today, then tomorrow.

Being a Sandwich Generationer - an elder/parent caregiver - is a new role on the stage of life for which no one can ever rehearse. Becoming a parent to an aging parent presents extraordinary challenges. The challenges to elders are just as daunting. To lose control of one's life - even the little things - can be shocking and frustrating.

Members of the sandwich generation face difficulties in allocating time and money and often describe themselves as being pulled in two directions. Emotional difficulties, especially depression, and marriage conflicts are common problems for those in this situation.

The challenges currently present in the field of aging lend themselves strongly to issues that require ethical consideration. Ethics, defined as a set of principles of right conduct, or a theory or a system of moral values, are critical to reevaluating our treatment and beliefs toward aging individuals. 

Should families be required to care for their aging family members? One ethical principle is “Universality” that asks: Would I want others in my situation to do the same thing I am about to do for the same reason? For me the answer is simple. I would want my daughter and her family to care for me if I were in the position of my aged mom.

We must create a world that provides to older adults independence (including access to safe environments, health resources and opportunities for personal growth), participation (including the ability to remain integrated in society and have a voice), care (care and protection, ability to maximize well-being, and enjoy basic human rights and freedoms), self-fulfillment (access to educational, cultural, spiritual and recreational resources) and dignity (freedom from exploitation and being valued independently of their economic contribution).

While the need for care by older adults is increasing, availability is decreasing; people over 65 are expected to increase at a 2.3% rate, but the number of family members available to care for them will only increase at a 0.8% rate. Unfortunately, availability of care is a major factor in predicting whether or not an older person can remain at home (aging in place) versus being moved to institutionalized care. Furthermore, the services provided by family caregivers represent 80% of all home care services and are conservatively valued at $306 billion a year, more than twice the amount spent on paid home care and nursing home services combined.  

Family caregiving has become the norm. According to the National Family Caregivers Association, more than 50 million people provide care for a chronically ill, disabled or aged family member or friend during any given year. Currently, there are over four million family caregivers in California alone. Caregivers care for spouses (5%), and parents (40%) as well as grandparents, parents-in-law, other relatives, and friends (55%).

Here are five simple rules for caring for the aged: (1) listen; (2) always be there; (3) make them smile; (4) don’t lie; and (5) protect them.

Blog posted by Steven Mintz, aka Ethics Sage, on January 25, 2013

The Ethics of ‘Birthing Tourism’

U.S. Maternity Hotels Cater to Pregnant Chinese Women

Is it ethical to establish a “maternity hotel” in the United States to accommodate Chinese women who want to give birth to their children in the U.S. solely to reap the benefits for their child of U.S. citizenship? The question is real as “birthing tourism” in the U.S. has become the destination of choice. According to the 14th Amendment to the U.S. constitution (ratified in 1868), anyone born in United States automatically becomes an American citizen and obtains access to public education, university loans, voting, and so on.

Is the practice dishonest because the motivation is to game the immigration system for selfish reasons? Do such practices take away resources that otherwise would go to U.S. citizens? Is it fair to those less well-off and unable to take advantage of the system that those who can afford to fly to the U.S. and pay for the birthing costs reap the benefits of the questionable practice? Should the U.S. ban the practice of birthing tourism and shut down such sites?

The Chinese women who come to the U.S. to give birth to their children pay as much as $20,000 to stay in the hotel facilities during the final months of pregnancy, and then spend an additional month recuperating and awaiting the new baby's U.S. passport. U.S. citizenship will allow some of the children to return to the U.S. to take advantage of free public schools and low-interest student loans. Parents may also be able to piggyback on the child's status and apply for a green card when the child turns 21.

One example of how it works is the case of Liu Li. After consulting quite a few agencies for expectant mothers, Liu chose a reputable one. Airplane tickets, fees for labor, pre- and post-delivery care cost her roughly $20,000. Since most airlines refuse to accept women passengers who are more than 32 weeks pregnant, Liu set off for America when she was six months pregnant and then checked into a Chinese birthing center in California.

After her arrival, Liu Li realized that the area was full of facilities set up for Chinese women like her. On the limited occasions when Liu Li goes to the Punete Hill Mall near her birthing center — the facility limits walks outside its premises to three per week, each time for about three hours — Liu bumps into lots of pregnant Chinese women. Birthing centers such as Liu’s, which are mostly situated in west coastal areas, operate without a business license, and try to be as discreet as possible. In April, a number of illegally converted maternity centers in Los Angeles were discovered and shut down.

Many of the hotels operate in violation of zoning laws, their locations known mainly to neighbors who observe the expectant mothers' frequent comings and goings. Such was the case in Chino Hills, where residents recently protested an alleged maternity hotel operating in a hilltop mansion. City officials have sued the property owner, claiming that the seven-bedroom house was illegally subdivided with 17 bedrooms and 17 bathrooms, with at least 10 mothers and babies living there. San Gabriel officials shut down a similar facility in 2011, and Chino Hills officials hope their lawsuit will result in a similar outcome.

Critics also cite safety concerns surrounding the largely unregulated industry. A local attorney says he is representing a maternity hotel in a case where a baby was dropped and died. The California Department of Public Health also is investigating a case that may involve maternity hotels, said a spokesman who said he could not provide further details.

Federal immigration authorities say no law prevents pregnant women from entering the country. The women typically travel on tourist visas and return home with their newborns, who will have the option of coming to the U.S. for schooling, sometimes while the parents remain in Asia. American citizenship is also considered a hedge against corruption and political instability in the children's home countries. For some, giving birth in the U.S. staves off hefty fines under China's one-child policy.

Maternity hotels have proliferated in the last decade as mainland China's new middle class tries to give its offspring every advantage. But birth tourism is not limited to Chinese and Taiwanese nationals. South Korean and Turkish mothers are also reported to pay thousands of dollars for package deals that include hotel rooms and assistance with the visa process.

Since the publicity surrounding the Chino Hills case, Los Angeles County officials have received at least two dozen complaints, mostly regarding sites in Rowland Heights and Hacienda Heights. The unassuming home at the top of the hill in an upscale Chino Hills neighborhood has been operating as a “maternity mansion” charging women from China high prices to give birth in the U.S., essentially buying American citizenship for their babies, according to neighbors who want the operation shut down.

For me, it is hard to unequivocally label the birthing tourism practice as unethical. No laws are broken and the Chinese women who take advantage of our 14^th Amendment pay the costs to travel to the U.S. They are not sneaking into the country illegally as so many others have done especially down by our southern border. We either have to pass a new law to prohibit the practice, if that is what we want to do as a nation, or accept it as a reality in today’s globally interconnected world.

Blog posted by Steven Mintz, aka Ethics Sage, on January 21, 2013

Calling out Dr. Drew and Dr. Phil

School Violence and Cyber-bullying Threatens our Civil Society

Where is Dr. Drew? Where is Dr. Phil? Why aren’t they devoting every show to school violence, cyber-bullying, and the general decline of civility and ethics in society? Don’t they have a responsibility to use their good names, significant influence, public persona, and vast resources to help stem the rising tide of violence in schools and the killing of innocent young children? I find them wanting in all these areas. Maybe these kinds of shows do not draw the ratings. If well-respected psychologists like Dr. Drew and Dr. Phil don’t care enough to take the lead, and then who will?

So, here we go again. On January 10, a 16-year-old student who blasted a California high school classroom with a shotgun was targeting two classmates because he felt he'd been bullied. One student was hit and was in critical but stable condition, and the shooter was in custody after a teacher and the school's campus supervisor talked him into putting his shotgun down.

Kern County Sheriff Donny Youngblood said he did not know whether bullying had actually occurred between the Taft Union High School students.

Over the past few years, cyber-bullying has become the most serious problem facing our schools and the consequences can be devastating including suicidal ideation on the part of the bullied individual and even suicide. Unfortunately, school violence has now surpassed cyber-bullying as the number one problem because it can lead directly to the death of innocent school children.

Cyber-bullying has become all too common in part because of social media. The bullying can be done anonymously. The party being bullied may not even know the person doing the bullying. At the beginning of bullying, the self-esteem of the victim is hit very hard. The victim feels guilty and confused at the same time, trying to figure out why this is happening to them. As it continues, social skills begin to fade away even more and depression starts to set in. If no help is found or if the bullying isn’t even noticed, more severe consequences start to surface.

I can’t help but wonder whether Adam Lanza, the mass killer at Sandy Hook Elementary School in Newtown, Connecticut, was bullied because he may have had Asperger’s syndrome. Of course, that doesn’t excuse his behavior. What he did was horrific and shocked our national conscience and it raises the broader societal issues of civility and ethics.

The Golden Rule that we should treat others the way we want to be treated has been replaced in our society by a sociopathic, antisocial personality disorder syndrome that bubbles over at the slightest provocation, whether real or imagined, leading to the disasters we have witnessed at Sandy Hook and the shootings at the Aurora, Colorado movie theater.

We need a change in the culture of society that uses the anonymity of the Internet and social media postings to mock others and strip away their dignity. It often starts with offensive postings and can lead to videotaping the event that goes viral.

Likewise, the ethical standards of our schools need to catch up with the technology. Students must be taught an Internet ethic just as they should be taught societal ethics in the classroom. Given the amount of time most teenagers spend online each day, accountability and personal responsibility must become part of each school's response to cyber-bullying. There should be zero tolerance for such activities with suspension and ultimately expulsion the penalties for harassing another student in cyberspace. I ask: “Where is the moral outrage? Do we have to wait until a horrific event such as a mass suicide occurs before passing legislation making cyber-bullying a federal crime as are discrimination and sexual harassment?”

There needs to be sustained public attention to the horrific school shootings and cyber-bullying. We need a person such as Dr. Drew or Dr. Phil to develop community-wide education and outreach programs to educate the public to the signs that something might be terribly wrong with their kids. We need public forums on these issues – town hall-type events where parents and teachers can come together and discuss their concerns and share observations with professionals like Dr. Drew and Dr. Phil.

Principals and teachers have to take a more active role in talking about school violence and cyber-bullying and provide options for troubled kids. Schools should have mandatory psychological evaluations for all kids starting in third or fourth grade.

I leave you with two quotes that sum up where we are as a nation. The first is attributed to Edmund Burke: "All that is required for evil to prevail is for good men to do nothing." The other addresses the role of teachers and how they can influence young people for good. This quote is attributable to Henry Brooks Adams: “ A teacher affects eternity; he can never tell where his influence stops.”

Blog posted by Steven Mintz, aka Ethics Sage, on January 15, 2013

Hall of Fame Vote Places Integrity over “Accomplishment”

Ethics of Denying PED users a vote into the Hall

By now you’ve heard no one received the 75% vote of sportscasters needed to be inducted into the Baseball Hall of Fame in Cooperstown, NY. Craig Biggio was closest with 68.2 % approval followed closely by Jack Morris with 67.7%; Jeff Bagwell, 59.6%; and Mike Piazza with 57.8%.

Most observers believe these and other worthy players were denied entrance into the Hall because they played during the steroid era. There is absolutely no proof they used performance enhancing drugs (PED’s). Is it right to deny entrance to someone who established Hall-like records simply because they played during the steroid era?

Personally, I think Morris and Piazza should have been voted into the Hall. They were the best players of their era during the 1980s and 1990s, well before suspected steroid use. Morris was a five-time All Star; played on four World Series Championship teams winning the MVP award in 1991; and pitched the most innings and had the most wins of any pitcher of his time. Piazza was a 12-time All Star and had more home runs than any other catcher. He also had a .308 lifetime batting average, unheard of for a catcher.

Morris, Piazza, and the others clearly got caught up in the frenzy over suspected PED users such as Barry Bonds and Roger Clemens. Morris and Piazza were denied entrance to the Hall with astonishingly low percentage approval of  36.2% and 37.6%, respectively or about one-half the required votes needed.

Bonds, of course, holds the all-time baseball record for career home runs with 762 reached in 2006, surpassing Hank Aaron’s record of 733 that had stood since 1976. Bonds holds the single record of 73 home runs surpassing Mark McGwire’s record of 70 in 1998. Bonds was awarded a record seven MVPs and is a 14-time All Star.

McGwire’s record knocked Babe Ruth off the pedestal of most home runs (60) in a season with 61 during 1961. Babe Ruth had set the record in 1927. So, it took Maris 49 years to overtake Babe Ruth; McGwire took just 22 years to dethrone Aaron; and Bonds took only 8 years to surpass McGwire. The validity of these results do not pass the smell test.

As for Clemens he tallied 354 wins, a 3.12 earned run average, and 4,672 strikeouts, the third-most all time. Clemens was an 11-time All-Star and two-time World Series champion. Most impressive is his seven Cy Young Awards, the most of any pitcher in major league baseball (MLB) history.

How can we evaluate the ethics of the sportswriters vote to keep Bonds and Clemens out of the Hall? First, is it right to deny entrance to baseball’s most prestigious shrine given the record-setting careers of these two players? Neither one was convicted of using PEDs. However, if they did “juice up” then it would be unfair to elect them into the Hall because other players who played by the rules during the steroid era of baseball did not amass the same statistics but are compared to players like Bonds and Clemens.

One thing that concerns me most is holding players accountable after the fact when baseball had no rules at the time banning steroid use. It seems like the rules of the game are being changed by the sportswriters – the same sportswriters that voted for Bonds for MVP and Clemens for the Cy Young award on multiple occasions and watched while Bonds' head grew in size from his Pittsburgh Pirate days to SF Giants. 

One way to judge accomplishment is to look at their careers before the alleged period of steroid use. If we do that both Bonds and Clemens had Hall of Fame careers before the telltale date of juicing up. On that basis I think they should be elected to the Hall.

Another perspective is to ask: Did cheating make them fundamentally different than they would have been absent the steroid use?  Bonds averaged 35 home runs each year during his first 14 years in baseball and 52 during the next five years. Is it logical that a player would become a better home run hitter later in his career?

The story is much the same with Clemens who averaged 16 wins each year during the tail-end of his career with Toronto and the NY Yankees from 1997 through 2003. Prior to that in his last years with the Boston Red Sox he averaged 10 wins a year. One can conclude the juice started flowing in 1997.

For me the bottom line is Clemens and Bonds should not be let into the Hall because they cheated even if they did not violate MLB rules at the time. Part of ethical analysis is to consider how one’s actions affect others. There must be dozens of pitchers whose earned run averages are higher because Bonds (allegedly) juiced up; there must be dozens of hitters whose batting averages are lower than they would have been otherwise had Clemens (allegedly) not used PEDs. Other pitchers and hitters played by the rules but were not able to compete on a level playing field with the players who used steroids.

We should not reward players, no matter how impressive their statistics, as long as their records are tainted. The performance of Bonds and Clemens the last few years of their careers when compared to the early years is so overwhelmingly out of whack that, in my mind, they used steroids; cheated; failed to consider the impact of their actions on other players and MLB; and cheated fans out of honest performances on the field that raises ethical questions about the win-lost results for teams like the NY Yankees and SF Giants.

Blog posted by Steven Mintz, aka Ethics Sage, on January 11, 2013

Transocean Settlement of Deepwater Horizon Spill and Ethical Responsibility

Transocean Settles with US Government

On January 3, Transocean whose floating Deepwater Horizon oil rig blew out in 2010, causing a massive oil spil in Gulf of Mexico agreed to settle civil and criminal claims with the federal government for $1.4 billion.  

The Deepwater Horizon exploded, burned and sank in April 2010. Eleven men were killed and millions of gallons of oil flowed into the Gulf of Mexico and fouled the shores of coastal states. The well, known as Macondo, was owned by British oil giant BP, which settled its own criminal charges and some of its civil charges in November for $4.5 billion.

While this settlement resolves the government’s claims against Transocean, that company and the others involved in the spill still face a civil case, which is scheduled to begin in February in New Orleans. Stephen J. Herman and James P. Roy, lawyers who represent the steering committee of plaintiffs in the cases, said that Thursday’s settlement did not change the case, and that the plaintiffs thought that BP, Transocean and Halliburton “will be found grossly negligent” at trial.

In a deal filed in federal court in New Orleans, a subsidiary, Transocean Deepwater, agreed to one criminal misdemeanor violation of the Clean Water Act and will pay a fine of $100 million. Over the next five years, the company will pay civil penalties of $1 billion, the largest ever under the act.  Under a law passed last year, 80 percent of the penalty will be applied to projects for restoring the environment and economies of Gulf States.

As part of the criminal settlement, Transocean also agreed to pay the National Academy of Sciences and the National Fish and Wildlife Foundation $150 million each. Those funds will be applied to oil spill prevention and response in the Gulf of Mexico and natural resource restoration projects. The agreement will be subject to public comment and court approval. The company agreed to five years of monitoring of its drilling practices and improved safety measures.

The company announced in September that it had set an “estimated loss contingency” of $1.5 billion against the Justice Department’s claims.

The multistate trial over claims in the Deepwater Horizon cases that have not been settled are scheduled to begin in February.

BP continued its longstanding argument that the accident, in the words of the spokesman Geoff Morrell, “resulted from multiple causes, involving multiple parties,” and that other companies had to shoulder their share of the blame. This attitude continues BP’s approach of trying to lay off blame to other parties. Whatever happened to the buck stops here?

Looking back at was has happened since the spill, federal inspectors do share much of the blame for not catching safety problems before they got out of hand. on December 2, 2010 the staff of the presidential commission looking into the Horizon Deepwater oil spill issued a report critical of the way federal inspectors handled their role in dealing with what has become the largest oil spill in U.S. history.  While some safety experts investigating the causes of the spill lay blame on human error, it goes much deeper than that and reflects the general malaise in the way federal agencies oversee such activities. As I see it, the causes of the spill can be attributed to the following factors: (1) poorly trained inspectors; (2) lack of resources to adequately oversee and inspect oil rig operations; (3) failure of inspection procedures to keep up with the advanced technology of oil rigging operations; (4) starting salaries for college graduates that pale in comparison to what Engineering school graduates make ($47,448 versus $94,000); (5) a failure of management to devote the resources necessary to prevent oil spills and a cutting corners mentality as was the case with BP; (6) and, perhaps, the most significant cause, the conflict of interests that exists between inspectors and their managers and oil industry executives who develop social ties with the inspectors and pressure them to not look as closely as they should at potential problems.

Looking at the ethics of the matter, I believe the root cause of the BP oil spill was an attitude that has become pervasive in our society that we don’t have to look to closely at oversight because the worst won’t happen. Let’s just go through the motions, document what we have found, and move on to the next assignment. The failure of savings and loan institutions in the late 1980s and early 1990s and the meltdown of financial services companies starting in 2008 can be blamed partly on regulator incompetence or at least, indifference to the possible crises that could arise in the institutions being regulated. In other words it is a failure of work ethic.

Also, it is a lack of ethics in the sense of failing to exercise a reasonable level of care in doing one’s job that contributes to disasters happening such as the Horizon Deep Water Oil Spill. We must get back to pursuing excellence in whatever we do, accepting responsibility for our actions, and being accountable. BP has not learned that lesson as yet. I guess they feel the dozens of commercials they have funded about how clean the coast now is and “come on down” statements from representatives of Alabama, Florida, Louisiana and Mississippi have satisfied its corporate social responsibility and mitigates its horrific response to the Horizon disaster.

Blog posted by Steven Mintz, aka Ethics Sage, on January 7, 2013

How to be a Better Person

Work Ethic, Civility and Personal Responsibility are the Keys

As a college professor I always look forward to this time of year with a new term starting; new faces to see; new thoughts to probe; new ideas to discuss with my students. In preparing for my first class on ethics I wondered what to say to encourage my students to examine their own behavior and think about how they can treat others better or do something for the betterment of the community or become more contributing members of society.

I was motivated to think about these questions by the recent events when on two separate occasions a person either fell to his death or was pushed off the NYC subway platform. I have already blogged about the needless subway death when bystanders stood idly. I also have blogged about our falling off the “moral cliff” and how much more severe it is than the “fiscal cliff.” I can help but wonder about how quickly we forget the message of abusive behavior to others in society in the form of mass killings, the most recent at Sandy Hook Elementary.  How can a human being treat other human beings this way? The question that still has not been answered in this and other cases is: What prompts one person to pick up multiple assault weapons and kill innocent children?

I have often blogged about cyber-bullying, a practice that demeans youngsters because of some perceived difference in appearance, behavior, or sexual preference. It is a virus attacking our schools fueled by the widespread use of social media and anonymous way a posting can be made that leads to ridicule and abuse against the bullied individual. In some respects it is a “faceless” crime; the perpetrator is a coward of the worst kind.

As we begin the New Year all of us should commit to being better people. I will ask my students to do so in their own lives. I will encourage them to do the following:

Social Interaction

Put down the smart phone, tablet, and laptop and speak directly and personally to friends and family. The personal interaction creates a connection that is difficult to come by when you “let your fingers do the talking.”

Work Ethic

Work harder in school and in whatever endeavor you choose in life. The ancient Greeks knew the pursuit of excellence through virtuous practice is its own reward. The most rewarding experiences in my professional life have been when I set a goal, worked hard to achieve, and succeeded in doing so. It makes us feel like we have accomplished something in our lives.

Civility

Don’t make fun of others for any reason. The diversity of our culture whether in race relations, national heritage, or sexual preference is what makes us strong and the most admired country in the world. Don’t be rude; practice patience; and be kind to others.

Personal Responsibility

Don’t blame others for your failings. If something bad happens to you, search inside your own mind for an answer and commit to doing better next time. If you make a mistake in life, admit it, promise never to do it again, be remorseful towards those you have harmed, and then become a better person.

Entitlement

We are not entitled to have the government pay our way. We are not entitled to receive benefits that don’t come from hard work and dedication. We should not complain when circumstances change for the worse and insist we are entitled to better. Search inside your own soul for an answer.

Work hard; practice kindness and be empathetic; accept personal responsibility; and strive to be the best person you can be. Just imagine if each of us took these words to heart how much better of a society we would have.

Blog posted by Steven Mintz, aka Ethics Sage, on January 2, 2013

U.S. in 19th Place in Corruption Perceptions Index

Transparency International Results Troubling for the U.S., China and India

The well-respected international ratings service, Transparency International (TI), just came out with its annual rankings of its Corruption Perceptions Index (CPI).

The CPI ranks 176 countries based on how people in those countries perceive the severity of corruption at all levels of government. It is a composite index, a combination of polls, drawing on corruption-related data collected by a variety of institutions. The CPI reflects the views of observers from around the world, including experts living and working in the countries/territories evaluated.

Corruption is the abuse of entrusted power for private gain. This is the working definition used by TI, applying to both the public and private sectors. The CPI focuses on corruption in the public sector, or corruption which involves public officials, civil servants or politicians. The data sources used to compile the index include questions relating to the abuse of public power and focus on: bribery of public officials, kickbacks in public procurement, embezzlement of public funds, and on questions that probe the strength and effectiveness of anti-corruption efforts in the public sector. As such, it covers both the administrative and political aspects of corruption. In producing the index, the scores of countries/territories for the specific corruption-related questions in the data sources are combined to calculate a single score for each country.

According to Transparency International, corruption generally comprises illegal activities, which mainly come to light only through scandals, investigations or prosecutions. It is thus difficult to assess absolute levels of corruption in countries or territories on the basis of hard empirical data. Possible attempts to do so such as by comparing bribes reported, the number of prosecutions brought or court cases directly linked to corruption cannot be taken as definitive indicators of corruption levels. Rather they show how effective prosecutors, the courts or the media are in investigating and exposing corruption. One reliable method of compiling comparable country data is to capture perceptions of those in a position to offer assessments of public sector corruption in a given country.

The 2011 CPI draws on 17 data sources from 13 institutions. The information used for the 2011 CPI is survey data from these sources gathered between December 2009 and September 2011. The CPI includes only sources that provide a score for a set of countries/territories and which measure perceptions of corruption in the public sector. TI ensures that the sources used are of the highest quality. To qualify, the data collection method must be well-documented and the methodology published to enable an assessment of its reliability.

Here is a listing of the top 25 countries and their scores.

Worldwide Corruption Perceptions ranking of countries published by Transparency International

Rank Country Index 2012 2012 [20] 2011 [21] 2010 [22] 2009 [23] 2008 [24] 2007 [25] 2006 [26] 2005 [27] 2004 [28] 2003 2002 1  Denmark 90 9.4 9.3 9.3 9.3 9.4 9.5 9.5 9.5 9.5 9.5 1  Finland 90 9.4 9.2 8.9 9.0 9.4 9.6 9.6 9.7 9.7 9.9 1  New Zealand 90 9.5 9.3 9.4 9.3 9.4 9.6 9.6 9.5 9.5 9.4 4  Sweden 88 9.3 9.2 9.2 9.3 9.3 9.2 9.2 9.3 9.3 9.0 5  Singapore 87 9.2 9.3 9.2 9.2 9.3 9.2 9.3 9.4 9.4 9.4 6  Switzerland 86 8.8 8.7 9.0 9.0 9.0 9.1 9.1 8.8 8.5 8.4 7  Australia 85 8.8 8.7 8.7 8.7 8.6 8.7 8.8 8.8 8.6 8.5 7  Norway 85 9.0 8.6 8.6 7.9 8.7 8.8 8.9 8.8 8.5 8.6 9  Canada 84 8.7 8.9 8.7 8.7 8.7 8.5 8.4 8.7 9.0 8.9 9  Netherlands 84 8.9 8.8 8.9 8.9 9.0 8.7 8.6 8.9 9.0 8.8 11  Iceland 82 8.3 8.5 8.7 8.9 9.2 9.6 9.7 9.6 9.4 9.2 12  Luxembourg 80 8.5 8.5 8.2 8.3 8.4 8.6 8.5 8.7 9.0 8.7 13  Germany 79 8.0 7.9 8.0 7.9 7.8 8.0 8.2 7.7 7.3 7.4 14   Hong Kong 77 8.4 8.4 8.2 8.1 8.3 8.3 8.3 8.0 8.2 7.9 15  Barbados 76 7.8 7.8 7.4 7.0 6.9 6.7 6.9       16  Belgium 75 7.5 7.1 7.1 7.3 7.1 7.3 7.4 7.6 7.1 6.6 17  Japan 74 8.0 7.8 7.7 7.3 7.5 7.6 7.3 7.0 7.1 7.1 17  United Kingdom 74 7.8 7.6 7.7 7.7 8.4 8.6 8.6 8.6 8.7 8.3 19  United States 73 7.1 7.1 7.5 7.3 7.2 7.3 7.6 7.5 7.7 7.6 20  Chile 72 7.2 7.2 6.7 6.9 7.0 7.3 7.3 7.4 7.5 7.5 20  Uruguay 72 7.0 6.9 6.7 6.9 6.7 6.4 5.9 5.5 5.1 5.1 22  Bahamas 71 7.3                   22  France 71 7.0 6.8 6.9 6.9 7.3 7.4 7.5 6.9 6.3 6.7 22  Saint Lucia 71 7.0   7.0 7.1 6.8           25  Austria 69 7.8 7.9 7.9 8.1 8.1 8.6 8.7 8.0 7.8 7.8

 

Greece, which is the recipient of aid and loans from Europe and the International Monetary Fund totaling nearly €250 billion ($327 billion), dropped to 94 from 80, and replaced ex-communist Bulgaria at the bottom of the list of 27 EU members. Bulgaria now ranks 75th.

The ranking also shows that Italy, which hasn't received a bailout but has been struggling with high interest rates on its government debt, slipped to 72nd, below Romania, at 66.

Portugal and Ireland, which along with Greece have received euro-zone bailouts, were placed 33rd and 25th, respectively. It is not surprising that many countries in the euro zone are struggling from a corruption point of view given the internal financial pressures that exist.

Denmark, Finland and New Zealand tied for first place, helped by strong access to information about government activity and rules governing the behavior of public officials. Sweden, Singapore and Switzerland ranked fourth, fifth and sixth, respectively. Somalia once again ranked last, behind North Korea, Afghanistan and Sudan.

The report also notes that Egypt, where frustrated citizens overthrew the authoritarian government in last year's Arab Spring, is now perceived as more corrupt than before the revolution. Egypt slipped to 118 from 112.

The United States ranked 19^th, just behind Japan and the United Kingdom. I do not view these results as positive for the U.S. given countries like Chile and Uruguay were almost tied with the U.S. There is no glory in saying we are only four rankings ahead of France, a country known for corruption in government.

China ranked 80th and that should be of concern to a government, already perceived as corrupt, with respect to global economic development and growth. I believe the point will be reached in the future where foreign businesses become more reluctant to do business in China if it doesn’t conform to international norms with respect to anti-corruption and transparency, especially in the financial results of state-owned enterprises.

The news is not much better for India, the other rapidly developing economy, that is ranked 94^th. Corruption is endemic in virtually all aspects of government in India. A culture of bribery has existed for a long time. I wonder whether India will ever achieve all of its promise as an economic powerhouse given the culture of corruption.

On a broader level, I believe the TI CPI results are important because they measure countries against a common standard and provide benchmarks for comparison. They highlight the importance of transparency and echo the concerns expressed by President Obama in his 2009 inaugural address that emphasized the importance of transparency in government practice and its value in holding government accountable for its actions “… And those of us who manage the public's dollars will be held to account, to spend wisely, reform bad habits, and do our business in the light of day, because only then can we restore the vital trust between a people and their government.”

I hope the President revisits the issue in his second inauguration on January 21, 2013. He needs to acknowledge that the trust between the public and our government has worsened during the past four years. I do not blame him. I blame mainly Congress – on both sides of the isle – as its members sought out their own narrowly-perceived self-interests to the detriment of what is in the best interests of society and the public good.

Blog posted by Steven Mintz, aka Ethics Sage, on December 28, 2012

 

NRA Solution to Gun Violence: Add More Guns to School

The Key to a Safer Society is Impulse Control and Personal Responsibility

Should we blame video games, movies and the media for the mass shooting at Sandy Hook Elementary School in Newtown, Connecticut? Should we blame the easily obtainable guns that attack our moral sense of right and wrong? Yes, yes, yes and yes, but that still is not the answer to the sickness that inflicts our society in the form of mass killings.

Last week I blogged about the incredible number of mass killings in 2012 that has shocked our collective consciousness. I presented suggestions to stem the rising tide of violence in society including personal responsibility education starting at the elementary school level with impulse control a major part of the curriculum; mandatory psychological evaluations for all kids starting in elementary school, some of which can be done using art therapy; and airport-security-type measures that can be implemented more smoothly by staggering student arrival times at school.

The NRA wants to put armed security guards in every school. Add a gun; stop the violence. This doesn’t pass the laugh test. Any student or other person such as Adam Lanza who is crazy enough to want to kill innocent children is crazy enough to get a gun into school and avoid the security guard. The only way to have a measure of comfort this can’t happen is by screening everyone who comes into the school building for weapons as we do in airports, courts and other federal buildings. Yes, the kids won’t like it and yes, it’s awful to even suggest it. But, we have to take extreme measures before another catastrophe occurs.

We do need gun control. The ban on assault weapons, which expired under President Bush in 2004, wasn’t the complete answer to stopping violence in society. In fact, the specific assault weapon used by Lanza would still have been legal to purchase. However, to stand by and do nothing is unacceptable. If we can save one life by re-establishing the ban on assault weapons it would be worth it. The worse thing is to talk about it amongst ourselves; hold Congressional hearings about it; and wind up with marginal or superficial changes in gun control laws.

The real answer lies in changing behavior. The sickness in our society is due to many factors. Yes, the entertainment industry has no conscience when it comes to the message sent through movies, television, and other forms of media. Yes, our own country commits senseless violence in other countries and it has been in the news and on television all too often (i.e., Vietnam and Iraq).

But the problem is exacerbated by moral absence in the form of parental guidance and the failure of our schools to teach ethics and personal responsibility. It’s almost as if “ethics” has become a dirty word in our society. There are no socially accepted rules of conduct any more such as honesty, trustworthiness, caring and empathy, personal responsibility, and the pursuit of excellence. We have a “do your own thing” mantra in our society today without regard to how our actions affect others. It’s a form of ethical relativism – my ethics are whatever I want them to be.

We no longer can stand idly by as a nation and watch as the cancer of mass killings eats at our very soul as a nation. Edmund Burke said it best: "All that is necessary for the triumph of evil is that good men [and women] do nothing."

Blog posted by Steven Mintz, aka Ethics Sage, on December 24, 2012