The Ethical Barometer

The issue that has the FTC investigating Facebook is whether the company honored the terms of its 2012 consent decree on honoring the privacy rights of the site’s users. The FTC has requested, and Facebook has provided, thousands of e-mails in which CEO Mark Zuckerberg and others at the company discuss obtaining data and discussing whether proposed actions would be in compliance with the terms of the decree.

The Wall Street Journal has had several stories, based on interviews with those who have seen the e-mails, that the attitude of Facebook may not have been one of, shall we say, strict compliance with the regulatory parameters?

No matter what the PR and communications folks spin, write, and pledge, the truth about any company’s activities always emerges. In this tech era of e-mails, text messages, Chap Snat, or whatever, what we were really thinking at the time, what we were really planning, what we were really doing, and how we viewed regulators and their requirements somehow always seems available, and, too often, contradictory.

We shall see with Facebook, but the company’s push to settle seems to support the notion that perhaps the public statements of devotion to user privacy may not match Facebook’s actions.

The following quote of what attorney John Dowd (working for President Trump at the time) said to Robert Kelne, an attorney for Michael Flynn. The quote was used in the Mueller Special Counsel Report as an incident of potential obstruction of justice:

I]f . .. there’s information that implicates the President, then we’ve got a national security issue, . . . so, you know, . . . we need some kind of heads up. Um, just for the sake of protecting all our interests if we can …

The full transcript of the conversation appears below (sans the Special Counsel redactions):

If, on the other hand, we have, there’s information that. .. implicates the President, then we’ve got a national security issue, or maybe a national security issue, I don’t know … some issue, we got to-we got to deal with, not only for the President, but for the country. So … uh … you know, then-then, you know, we need some kind of heads up. Um, just for the sake of … protecting all our interests, if we can, without you having to give up any … confidential information.

The transcript was released by Federal District Judge Emmet Sullivan, the judge scheduled to sentence Michael Flynn.

Mr. Dowd believes his reputation has been damaged. Alan Dershowitz, Harvard Law Professor Emeritus, called it a “very serious issue.+

Netflix and its miniseries have become the source to which we all turn for truth. Just because the filmmakers for Netflix are not the traditional Hollywood types does not mean that they do not use cinematic license. We tolerate cinematic license for the sake of a good story. But when we accept the cinematic mini-series as truth, we risk harming those depicted in the series who may differ with the series presentation of “facts.”

In the Wall Street Journal, June 11, 2019, former prosecutorLinda Fairstein, who was involved in supervising the prosecution of the case against the Central Park Five, outlines the errors in the Netflix series, “When They See Us.” There were omissions from the story thread. The most critical fact was that the young men were involved in other crimes that night in Central Park.

However, based on the series, Ms. Fairstein’s publisher has dropped her as an author. She was forced out of a position on the board of her alma mater, Vassar. Based on a TV mini-series, the public has banished her from all activities and her livelihood.

The whole series of events affected the lives of so many. But, at the heart of both sides of the story is injustice. Is it possible that the injustice that occurred in 1989 has resulted in an injustice in 2019? Mob mentality is a dangerous thing, whether in Central Park, in rushes to judgment on guilt, and in condemnation based on a miniseries.

Paul Grassley, 95, U.S. Veteran, who flew B-24 bombing runs over Germany. (as quoted in the New York Times). So many stories and quotes emerged from the D-Day memorials. These were men who understood that there was good and there was evil. And they were on the side working to defeat evil. Getting folks to the point of good vs. evil these days is a tall order. That we sometimes must undertake rotten work to defeat evil seems to be an impossible discussion.

Michael Comeau, on a field trip to Washington, DC with his students, took a little detour to Archibald’s Gentleman’s Club. There Principal Comeau, who left the high-schools lads back at the hotel with other chaperones, was arrested after police received a call about an intoxicated man refusing to pay his bill.

Now former Principal Comeau resigned after 5 years as a principal and decades in education. Just the combination of strip club, booze, high-school field trip, and principal should have sent the red flags flying,

Attorney John Dowd was part of President Trump’s team. He was vilified in the special counsel report (Mueller Report) with suggestions of obstruction because of this portion of a taped phone conversation between Mr. Dowd and Michael Flynn.

I]f . .. there’s information that implicates the President, then we’ve got a national security issue, . . . so, you know, . . . we need some kind of heads up. Um, just for the sake of protecting all our interests if we can …

But the actual transcription, just released last Friday, has much more to it:

If, on the other hand, we have, there’s information that. .. implicates the President, then we’ve got a national security issue, or maybe a national security issue, I don’t know … some issue, we got to-we got to deal with, not only for the President, but for the country. So … uh … you know, then-then, you know, we need some kind of heads up. Um, just for the sake of … protecting all our interests, if we can, without you having to give up any … confidential information.

Mr. Dowd’s reputation has been destroyed unless he receives the same sort of attention and coverage that goes with such a story. Here’s hoping that the little Ethical Barometer brings about some attention, if not resolution.

Anyone can hop onto Wikipedia — the information site run by a nonprofit organization gets it information from users who post, correct, and footnote. However, North Face found a way, through a Brazilian ad agency, to gets its brand and goods imposed on the site’s photos of majestic and natural wonders. In short, North Face products were featured on people at destination places around the world.

Such posts violated Wikipedia’s rules on self-promotion and the use of the sit for promoting commercial products. Nonetheless, the result was that the company got more Google searches as people searched for North Face clothing and equipment.

The company issued a policy and Wikipedia users and supporters suggested that the North Face make a donation to the nonprofit site. Wikipedia responded by calling the actions a “marketing stunt” that compromised the trust users place in Wikipedia.Trust, once breached, is tough to gain back.

Disney, NBCUniversal, and WarnerMedia announced that they either will no longer continue filming or be strongly affected in their decision process on filming in Georgia should that state carry out its highly restrictive abortion law.

Economist Milton Friedman wrote about the dangers to businesses that use social and political issues as a controlling factor in their decision processes. Professor Friedman urged particular caution when businesses become involved in hot-button issues. The Barometer calls them “loser issues.” Both labels apply to those social and political issues that find customers divided. No matter what position the business takes on an issue and the decision to boycott cities, states, and other businesses, it will lose customers. The issues themselves are important, but businesses will lose support (and revenue and possibly employees) no matter which position they take. Abortion and gun control are two such issues. They are critical social and political issues, but a business that vows a boycott because a city or state has taken a position its managers oppose will affect the business.

There is one position a business can take on such issues that is universal and easily explicable. That position, the Friedman position, is one made on the basis of the business’s costs and needs. Such a universal position makes the business an agnostic on social and political issues. The business allows the people of cities and states to make decisions on these issues without tantrums and boycotts from a land far, far away (Hollywood). A business should serve people of all views and allow them the freedom to decide for themselves what their laws and regulations will be. Should the residents of a state or city make decisions that infringe rights there is an active and engaged court system designed to handle those emotional issues on the basis of laws and rights, not whether “Black Panther” or “Captain America:Civil War” will be filmed in their state.

Uber permits banishment of passengers from the kingdom of ride-sharing. What gets passengers on the list of exiles? Leaving litter in the car. Rudeness. And asking the driver to exceed the speed limit. Manners and ethics — all you need to be a solid Uberite.

From McKinsey’s 57-page handbook entitled, “Bankruptcy 101,” we have the following:

“In representing a bankrupt company, we must avoid conflicts of interest and the appearance of conflicts of interest.”
. . .
Failure to adequately disclose material connections may result in severe penalties and fines.”

McKinsey did not disclose in any of its bankruptcy work that it has a $25 billion hedge fund, MIO, that manages retirement funds for McKinsey employees retirees, and former employees. And MIO had investments in the bankrupt companies, creditors, and a whole web of connections. Seems material enough and has all the appearances of a conflict.

McKinsey paid a $15 million fine to settle a case, without admitting guilt, brought by the Justice Department, for failure to disclose conflicts. McKinsey continues to resist, denying that there is a conflict and even expressing outrage that the proprietary company document, Bankruptcy 101, made its way to a reporter. (New York Times reporter, Mary Williams Walsh)

Someone please, take these folks aside and tell them how the cabbage is cut, conflicts-wise. We can’t take the denials any longer. And heed one more piece of advice in the handbook — you do not want your actions showing up “in the Wall Street Journal.” The Barometer is guessing that those who did not disclose will defend their actions as follows, “The book said Wall Street Journal.We only made it into the New York Times.” For the love of ethics, McKinsey, give it a rest. Things are just sounding silly now.