Ethics Newsline®

Last week, news arrived that Wall Street Journal reporter Daniel Pearl had been murdered by his abductors in Pakistan. Last week, too, the Pentagon floated plans to use the new Office of Strategic Influence to circulate deliberately false news stories overseas.

So appalling was the first story that the second escaped real scrutiny. In fact, the two are linked. The life and death of Daniel Pearl help make clear the moral failings of the Pentagon’s plan.

By all accounts, Mr. Pearl was a diligent, energetic reporter. As the Journal’s South Asia bureau chief, he was on the trail of terrorist activities in Karachi when he was kidnapped January 23 on the way to meeting an important source. Yes, he was taking risks. But his beat put him out there, on the leading edge of news gathering. He had the courage to bring home the facts. And facts — real, unvarnished, well-verified news items — are the first rung of the journalistic ladder that leads to news analysis, commentary, and editorial opinion.

In a democracy, that ladder continues into public opinion, public judgment, and public policy. Thomas Jefferson, well aware of that continuity, wrote that “were it left to me to decide whether we should have a government without newspapers or newspapers without a government, I should not hesitate a moment to prefer the latter.” Democracy, in other words, depends mightily on news. And news depends on the Daniel Pearls of the world.

At the time of his capture, Mr. Pearl was trying to comprehend the militant’s viewpoint — trying to hear what they had to say, so that he could help us understand the underlying hatred of America in that part of the world. Some of that hatred may have legitimate roots, as a reaction against the exporting of American pop culture and the arrogance of a global power. Those things need to be corrected. But much of the hatred has little basis beyond hype, propaganda, envy, and sheer malice. That needs to be squelched.

To do the squelching, the Bush administration created the Office of Strategic Influence (OSI) shortly after September 11. Its purpose is to shape the thinking of policy makers and the public in countries around the world, disabusing them of hype and falsehoods and promoting a friendlier view of the United States. So far, so good: Untruth needs correcting, more quickly than ever in an age of 24-hour news cycles.

But now comes news that the OSI may be planning to slink over to the dark side. It may start spreading disinformation and falsehoods in the guise of news aimed at foreign media outlets, intended to neutralize targets of anti-American influence.

If the Pentagon goes down that path, the ethical principles over which it will stumble should be so obvious as hardly to deserve comment:

• Don’t lie.
• Don’t tolerate those who lie on your behalf.
• Don’t enlist the diplomatic and military offices of the leading democratic nation in the world to spread those lies.

There are also some ethical issues specific to journalism that make this an extremely unfortunate idea:

• Don’t imagine that a lie published in a foreign media outlet won’t instantly get re-reported back into the U.S. media, where it will be taken as truth. Don’t imagine, that is, that you can lie to foreign nations without telling those same lies to your own citizenry.
• Don’t have so little faith in truth that you sink to your opponents’ level and respond in kind to fabrication and duplicity. In other words, don’t ignore the ability of facts to overcome falsehood.

That last point is essential. Daniel Pearl knew the power of facts. He gave his life in their pursuit. To fancy that facts aren’t important, and that a democracy has no particular obligation to speak truthfully, flies in the face of centuries of common experience. Worse, it puts democracy on no higher a plane than tyrannies whose “journalists” are nothing but pawns of government — and where (as Mr. Pearl’s captors seem to have believed) kidnapping a “journalist” is the same as capturing a high public official. Worst of all, such confusion renders Mr. Pearl’s death pointless. Why go to such lengths to collect facts, if the folks back home have no great respect for them?

The Office of Strategic Influence, if it continues, should correct error with truth and evil with good. Trafficking in ruses will only force the public into an unfortunate neo-Jeffersonian preference: longing for “newspapers without a government.”

(c)2002 by the Institute for Global Ethics

“In the midst of the great prosperity and boom of the 1990s, there has been a certain erosion of professional, managerial, and ethical standards and safeguards.”

MANHATTAN
Two insurers last week asked a New York court to void their policies with corporate pariah Enron Corp., saying the now-bankrupt firm misled them when taking out policies on its directors and officers.

The Royal Insurance Company of America and the St. Paul Mercury Insurance Company say they were deceived by “material misrepresentations” made by Enron during the underwriting process, reported the New York Times.

Had they known the company’s true financial position, the insurers say they would never have offered the policies and therefore should be released from honoring them, according to separate filings with a Manhattan bankruptcy court.

The insurance policies in question cover legal fees for Enron’s executives and board of directors, many of whom have been sued for leading the company into scandal and bankruptcy with accounting wrongdoing.

Enron already has filed requests for $350 million in coverage claims for its officers, noted the Times.

If the court allows the two insurers to escape from the terms of their policies, nine other insurers will likely follow suit, forcing Enron to come up with even more cash to pay plaintiffs, according to the Times.

The Los Angeles Times last week reported that insurers are sharply raising the price of covering corporate executives from mismanagement claims — hiking premiums by between 50 percent and 500 percent.

The spike in premiums correlates to a jump in claims filed against corporate executives, reports the Times. Recent years have seen records in both the number of lawsuits (500 in 2001, instead of the 200 to 300 in each of the previous five years) and the size of settlements (an average of $25 million in 2000, up from $17.5 million in 1999) in cases involving corporate mismanagement.

WASHINGTON
The U.S. Securities and Exchange Commission (SEC) last week pledged to hunt down executives who are mismanaging their companies, saying such abuses are undermining public trust in the U.S. economy.

Following the collapse of Enron and subsequent accounting improprieties at other leading U.S. firms, public confidence in the private sector has been badly shaken, SEC head of enforcement Stephen Cutler charged last week.

“Practically overnight, a system we’d all come to believe in has been exposed as plagued with weaknesses,” Cutler said, promising to restore faith in the system by prosecuting executives who do wrong, reported the Associated Press.

While past SEC actions have often amounted to little more than a slap on the wrist, especially when insurance covers the fines, future efforts will pack more punch, Cutler promised.

“Recent accounting scandals have focused attention on the critical responsibilities and obligations of officers and directors of public companies, and the consequences that follow when they place their own interests ahead of those of the company or its shareholders,” Cutler said in a speech at a securities law conference in Florida.

“It is essential that the (SEC) find ways to deter wrongdoing by individuals who hold these positions of public trust,” he said.

JACKSON, Mississippi
WorldCom Inc. last week suspended three of its leading salespeople and froze the commissions of at least 12 others, accusing the workers of participating in a fraud scheme that double-billed the company by as much as $4 million.

The leaders of the alleged scheme — two men and one woman, all of them ranked among the company’s top revenue earners — have been suspended without pay while WorldCom officials decide whether to fire them or let them resign.

According to press reports, the scheme began between six months and one year ago, when the managers began taking credit for sales made by other divisions of telecom giant WorldCom, which operates in more than 65 countries.

Using blind spots in the company’s computer system, the alleged ringleaders gave their sales teams credit for other divisions’ work, getting commissions for deals they never made, reported the Wall Street Journal.

While the three leaders reportedly kept their subordinates largely in the dark, the Journal notes that despite the dubious nature of their swelling commissions, no one raised questions to halt the scheme.

“This has nothing to do with financial reporting or earnings,” WorldCom spokesman Brad Burns insisted, trying to reassure investors wary of Enron-like fraud. “We’ve fixed the problem and fully expect to recover the money. This is not a financial issue. This is an ethics issue.”

The 15 workers implicated to date operated out of WorldCom’s offices in Baltimore, Chicago, and Arlington, Virginia.

WASHINGTON
The U.S. Defense Department last week promised that even though it may spread disinformation during military operations, it would not lie to the press.

The Pentagon was responding to criticism about a new office quietly opened in recent months, the Office of Strategic Influence (OSI), tasked with countering lies told by the Taliban government in Afghanistan.

At a time when the Taliban was lying about civilian casualties and poisoned food drops by the United States, the U.S. government needed a way to get the truth out, explained Douglas Feith, the undersecretary of defense for policy, who oversees the new office.

The OSI, whose existence was made public last week by the New York Times, has raised red flags from press groups around the world who worry they may be used to help spread lies.

But Feith assured reporters that the OSI will be honest with the press. “When Defense Department officials speak to the public, they tell the truth,” Feith said at a Defense Writers Group breakfast last week. “We are not going to have Defense Department officials lying to the public — neither the foreign public, nor the domestic public, nor to the press.”

To help with its propaganda, the OSI has hired the Rendon Group, a Washington-based consulting firm hired in 1990s by the CIA to create propaganda aimed at undermining Iraqi President Saddam Hussein, reported the Reuters news agency.

While the government’s need to counter lies and protect U.S. troops with misinformation is understandable, such efforts may be illegal, according to Reuters, which reports that the U.S. government is barred by law from spreading misinformation at home. Given the global nature of today’s news media, lies told abroad will be difficult to keep out of the U.S. press, creating a possibly unconstitutional situation, according to the Reuters report.

Lawrence Korb, director of studies at the Council on Foreign Relations, opposes the OSI and its propaganda efforts on a more fundamental level.

It is “an attempt to basically manage the news and the media and make them a tool of the Department of Defense in the war effort, without the normal checks and balances,” Korb told Reuters. “It’s an inappropriate role”

Deputy Defense Secretary Paul Wolfowitz has no such qualms, he told USA Today. “This is a battle for minds.”

TOKYO
Thirteen women will share in a $420,000 penalty assessed against Japan’s largest brokerage, Nomura Securities Co., which they accused of a pattern of sexual discrimination over the past 30 years.

The women, who worked as clerical employees for Nomura, said they were denied warranted pay and promotions simply because of their gender, a claim upheld by the Tokyo District Court last week.

The court’s ruling followed testimony showing that Nomura operated two separate pay scales — one for women, one for men — since its formation. Although the company revised the pay scheme in 1986 to ostensibly reflect qualifications instead of gender, all female employees remained in the lower tier while all male employees were placed in the upper tier.

While the women had sought $5 million, the court ruled that the most it could award was $420,000 due to insufficient means of figuring lost wages due to possible promotions, reported the Associated Press.

The verdict, though smaller than many had hoped, is still being viewed as significant — a victory in spirit, if not substance, for Japan’s working women, who face persistent sexual discrimination in the world’s second-largest economy.

“Japan is still very behind the times in sexual equality on the job,” the plaintiffs’ lawyer said in an interview with the AP last week. “The double standard rampant in big Japanese companies must be corrected.”

NEW DELHI, India
Policewomen in India last week said they will join forces to fight rampant discrimination on the job, forming a national forum to address the problem, according to a report from the BBC.

The policewomen say that outdated stereotypes by male colleagues limit their effectiveness on the job, causing coworkers to second-guess their decisions and undermine their authority.

The stress that such discrimination engenders is only compounded at home, where many policewomen say they fight sexist stereotypes about their role in society, noted the BBC.

To combat the problem, policewomen last week formed a coalition to address sexual discrimination on the job, announcing the effort at the end of the country’s first conference for women in the police force.

A recent study by the British High Commission in India found that 58 percent of policewomen reported having been held back from exercising their authority because of their gender. Nearly half said their ideas were ignored, and 45 percent said their mistakes were attributed to their gender.

WASHINGTON
The U.S. Supreme Court last week heard arguments on a wide range of fronts, taking up cases that portend changes in public policy and private protections. The cases included:

• Execution of the mentally retarded. In 1989, the Court upheld the right of states to execute mentally retarded prisoners on death row, saying that public attitudes supported such procedures. Since then, a sea change has taken place in public sentiment, with the majority of states now barring such executions, reported the Los Angeles Times. The Court, hearing the case of a Virginia man, must now decide whether executing the mentally retarded constitutes “cruel and unusual” punishment — a designation that would make the practice illegal.
• Eviction of public-housing tenants for drug activity. In a case argued last week, the Court must weigh the rights of people living in government-run public housing projects against a “zero tolerance” policy for drug use. In the case before the Court, three senior citizens say it is unfair for them to be thrown out of their homes because of secret drug use by family members and caregivers — drug use that occurred off property in two of the cases. The government argues that the tenants signed a contract that stipulated they would be evicted for any in-house drug use, as well as for drug use by family members regardless of whether they knew about it and where it occurred, according to the New York Times.
• Copyright protections. The Court heard a challenge last week to the practically perpetual monopolies enjoyed by media companies on books, recordings, and other communications they own. Plaintiffs argue that Congress intended for copyright law to protect and stimulate artistic output, but meant for such works to eventually come into the public domain, reported the New York Times. Media firms disagree, saying copyrights are needed to prevent piracy and value deflation in the spread and sprawl of the Digital Age, when ownership and property bounds are becoming increasingly fluid.

Decisions in these cases are expected by July.

WASHINGTON
After coming under fire from conservative groups, U.S. Secretary of State Colin Powell last week defended his support of the use of condoms by sexually active teenagers, saying any other message would be irresponsible.

On a special broadcast by MTV last week, Powell fielded questions from teenagers around the world, one of whom asked him about his view on the Roman Catholic church’s opposition to condoms, even in the face of the spreads of HIV and AIDS.

While saying he respected the church, Powell said that in his view, “Condoms are a way to prevent infection. Therefore, I not only support their use, I encourage their use among people who are sexually active.

“It is important that the whole international community come together, speak candidly about it, forget about taboos, forget about conservative ideas with respect to what you should tell young people about it,” Powell told the MTV audience. “It’s the lives of young people that are put at risk by unsafe sex, and therefore protect yourself.”

Conservative groups, including the Family Research Council and Focus on the Family, lashed out at Powell, accusing him of betraying the core conservative constituency of the Bush administration, reported the Washington Post.

Powell fired back, noting that while he supported Bush’s party line of abstinence education first, he had “no apology for the way in which I answered the question,” he said on CNN’s “Late Edition.”

With more than 36 million people currently infected with HIV, the need for prevention takes priority, Powell insisted. If young people “are going to be sexually active, we’ve got to educate them how to protect themselves. And one way to do that is with condoms. And for me to have said anything else would have been irresponsible,” Powell added on NBC’s “Meet the Press.”

The controversy put the spotlight on Bush’s strong push for abstinence-only programs, which will get a 33 percent funding jump — to $135 million — this year under Bush’s proposed budget, while many AIDS projects get no increase, according to the Post.

BUDAPEST
Hungary’s six leading political parties last week said they would sign a code of ethics meant to temper the typical rhetoric and mud slinging of past elections.

The ethics code was drafted by the Hungarian Democratic Forum, which rests in the center-right of the six-party coalition comprising Parliament’s majority, reported the Associated Press.

The code is designed to curb harassing antics and antagonistic tactics often used by the various parties in wrangling for seats in Parliament. This year’s election is scheduled for April 7.

Special to Newsline from editor Carl Hausman

Recognizing that the United States’ financial markets are fueled by trust as much as by money, corporate regulators vowed, as detailed in Newsline this week, to crack down on dishonest executives. Current penalties, some regulators argue, are no deterrent to the fabulous wealth that can be generated by financial skullduggery, especially when insurance companies often foot the bill for fines, penalties, and settlements. As we also reported this week, some insurers are balking at paying the price of deception when they themselves claim they were lied to.

The latter story, of course, evolved from the continuing Enron debacle, which figured prominently in our reports throughout the month. February saw the Senate subpoena Enron’s tax records and President Bush call for a “single standard” in the administration of 401(k) plans, eliminating the preferential treatment that allowed executives of Enron to sell equities nested in their 401(k)s while rank-and-file employees were forced to hold the tanking stock. During February, we also reported on former Enron CEO Kenneth Lay’s subpoena to testify before a Senate subcommittee, a suit by the General Accounting Office for details of meetings between Enron and White House officials and the hero status afforded by some to the whistleblower who first warned that Enron was about to collapse in a blizzard of accounting scandals.

Health care issues continued to figure prominently in ethics news this month. U.S. Secretary of State Colin Powell made headlines with his endorsement of condom use for sexually active teens. Allegations that high-powered medical researchers are simply adding their bylines to “research” conducted for them by drug companies figured prominently in our February 18 issue. New proposed guidelines for stem-cell research were a major story on February 11, and the issue of February 4 carried two health-ethics items: a controversial federal provision to extend health-care coverage to fetuses, which critics contend is a backdoor step toward defining a fetus as a person; and a heart transplant, at taxpayers’ expense, to a convicted felon.

Four speech and press cases figured in the month’s news in ethics: a promise from the U.S. Defense Department that government propaganda would not involve lying to the public, an agreement to keep things clean in traditionally nasty Hungarian political campaigns, a suit over a so-called “censorship clause” prohibiting purchasers of certain software to criticize it in the press, and a controversy over a teacher’s complaint that students got off too lightly after allegedly plagiarizing a paper.

And sports provided many ethics-related reports this month. The Olympic judging controversies raised calls for reform (Feb. 18, Feb. 25), and Mike Tyson’s checkered past continued to raise the question of when an athlete’s personal morality should disqualify him from competing (Feb. 4, Feb. 25).

WASHINGTON
Mike Tyson last week was given the green light to stage his championship fight with Lennox Lewis in Washington, D.C., putting a possible end to the troubled boxer’s efforts to find a city that would host the bout.

Last month, Nevada refused to grant Tyson a license to fight in the state, killing a planned $150-million meet up on the Vegas strip.

Following Nevada’s decision, Tyson started casting for a replacement host. Last week, Washington stepped forward, offering its services for a June rumble at the city’s MCI Center, reported the Reuters news agency.

The decision by the Washington, D.C., Boxing and Wrestling Commission caused a rumble of its own, sparking angry reaction from many residents who say catering to Tyson, who has a reputation for extracurricular violence and has been convicted of rape, sets a bad precedent.

But Boxing Commission chairman Mike Brown said such concerns are insufficient when pitted against the economic benefits the fight could bring to the Capital, which has been hard hit following September’s terrorist attacks.

“If this can provide a boost to get people back in spending money and doing business, we are all in favor. And that outweighs any issues concerning Mr. Tyson’s past,” Brown told Reuters.

The fight is expected to pull in between $5 million and $6 million for the city.

Brown’s view was backed last week by Washington Mayor Anthony Williams, who added, “We’re standing on a difficult road here if we start playing the police and saying this person can’t play for this reason, because sports is not a completely clean business.”

Brad Edwards, general manager of the Renaissance Washington hotel, questioned such reasoning. “Economically we want any event like [the Tyson fight]. But we have to be careful and think, ‘Does it signal that we’ll take any event to turn the city around?’” Edwards asked the Washington Post.

The commission’s decision to green-light the fight is not final, noted the Post. A public hearing is scheduled for March 12, followed by a final vote, though Brown expects the decision to be approved.

Special to Newsline from Canadian correspondent Errol P. Mendes

SALT LAKE CITY
French Olympic skating judge Marie-Reine Le Gougne is recanting her earlier admission, made orally and in writing, that she was pressured to vote against the Canadian skating pair, Jaime Salé and David Pelletier.

She now claims that a British referee, Sally-Anne Stapleford, verbally intimidated her to vote in favor of the Canadians.

She is also alleging that since the 2000 World Championship in Nice, Canadians had put tremendous pressure on her to favor the Canadian skating pair, who now share the gold medal with the Russian skaters.

Meanwhile, the head of the International Skating Union has confirmed that a committee of his organization is still investigating the incident. He also announced a plan to change the number of skating judges and the rules for judging to stop unethical block voting and vote swapping.

The Russian Olympic team, which has also been hit with a potential doping scandal, last week threatened to pull out of the final events of the Olympics due to what it sees as discrimination against its team, including the judging of the pairs skating event. In a final twist of what some are calling an Olympic-sized farce, the Russian team has sent a letter to Russian President Putin outlining its complaints against the Olympic organizers.

From the Society for Human Resource Management:

“The majority of Human Resource (HR) professionals and corporate executives agree that workplace romance is something they would personally avoid; yet their organizations typically don’t have policies addressing it. These are among the findings of a survey on workplace romance jointly produced by the Society for Human Resource Management (SHRM) and CareerJournal.com, the executive career site from The Wall Street Journal….

“The majority of HR professionals (81 percent) and executives (76 percent) said that workplace romances were dangerous because they can lead to conflict in the organization….

“Despite the fact that most executives would avoid a romantic relationship in the workplace, very few organizations have policies that formally govern workplace romance. Seventy-five percent of HR professionals and 59 percent of executives said their organizations had no policy on workplace romance. For those organizations that do have policies, 64 percent of HR professionals and 52 percent of executives said their organizations permitted, but discouraged, romance in the workplace.

“‘It’s natural that when people work together closely romantic feelings sometimes emerge,’ said SHRM President and CEO, Helen Drinan. ‘That is why organizations need a workplace romance policy to help set guidelines for what is and is not appropriate, and to prepare the organization for challenges that may arise.’…

“‘Colleagues who are dating should find out what the company policies are on workplace romance so they can avoid potential negative consequences,’ says Tony Lee, editor in chief and general manager of CareerJournal.com. ‘Although they may not lose their jobs, employees involved in office romances could be viewed as unprofessional, especially if they are public in their displays of affection.’

“While workplace romance clearly presents challenges, it is also a success in many cases. A majority of HR professionals (66 percent) and corporate executives (57 percent) reported that over the past five years, employees who had been involved in a workplace romance got married. The survey also found that about a quarter of the organizations are offering training on ways to best manage workplace romances — a ten percent increase over the last three years.”

“No man can, for any considerable time, wear one face to himself, and another to the multitude, without finally getting bewildered as to which is the true one.”

– Nathaniel Hawthorne (U.S. author, 1804-1864)