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Archive for September 16th, 2002

CEO Pay Has Doubled in Past Five Years

Sep 16th, 2002 • Posted in: Statline



When Poor Kids Fail, so Does Ethics

Sep 16th, 2002 • Posted in: Commentary

There’s a new watchfulness in the air. After a summer of market collapses and a week-long flurry of 9/11 commemorations, the nation is getting back to business. But we go back with a sharper eye for executive chicanery. And we’re a lot more discerning about the threat of terrorism.

That’s good. But for millions of students and teachers, getting back to business means returning to public school, where hidden threats of similar magnitude lie waiting. No, I don’t mean the overt challenges — bombings, bullyings, suicides, plagiarism, drugs. Those have already caught our attention. Below the surface lurks a broad, debilitating, two-fold challenge. First, America’s schools are not delivering a globally competitive academic education. Second, and even more insidious, they are failing to educate minority children up to the standard of the majority.

True, our schools are focusing attention on character education — especially during this past week, which in Maine and elsewhere was decreed to be “Character and Citizenship Week.” It’s now time to extend the concept of character education beyond the students and to the public. As citizens, we need to redress the fundamental immorality of a system that has allowed two of our core moral values — fairness and respect — to languish in regard to our minority and impoverished populations.

The evidence for this collapse was spelled out the other day by Kati Haycock of The Education Trust. Speaking to a group of philanthropists in Michigan, her facts were as chilling as her conclusions were hopeful. First, on global comparisons:

  • At grade four, only one other nation exceeds the United States in student performance in science. By grade 12, 11 nations outperform the States.
  • The situation is worse in math, where seven nations outperform us at grade four, and 14 by grade 12.
  • After leading the world for decades in rates of high-school completion, “the United States now ranks 17th among 45 democratic, market-oriented countries,” says Haycock, who notes that the trend-line continues in decline.

Second, on inequalities within our system:

  • On average, African-American and Latino 17-year-olds read and do math at the same level as white 13-year-olds.
  • Students from low-income families (typically below $22,000 per year) drop out of high school at a far higher rate (12.5 percent in 1996) than those from high-income families (2.7 percent).
  • Of every 100 white kindergartners, 93 graduate from high school and 32 obtain at least a bachelor’s degree. For African-Americans, the numbers are 87 and 17; for Latinos, 63 and 11; for Native Americans, 58 and 7.

One common reason for failure: High numbers of U.S. teachers are called upon to teach in areas where they have little or no academic preparation. Is that important? Hugely. There’s little truth behind the old adage that says, “If you want to teach math to Mary, it’s more important to know Mary than to know math.” Studies in Tennessee, Texas, and Pennsylvania suggest that, when poor and/or minority students have well-qualified teachers for three years in a row, the differences in performance scores between minority and majority students essentially vanish.

Those studies deflate a lot of hidden agendas. It’s now perfectly clear that there is no innate inability or acculturated disinclination to learn among minority or poor kids. There’s a much simpler reason for their failure: Schools aren’t giving them the right opportunities to learn.

But blaming the schools misses the mark. Schools do what their taxpayers want them to do and pay for them to do. Are we, as a public, operating ethically when we permit an unfairness to persist that we know can be remedied? Are we acting with civic integrity if we don’t respect the underserved as much as the well-served?

In the last few days, there’s been a lot of uplifting and helpful talk about the greatness of America and the moral worth of its democracy. The situation in our schools, if unaddressed, could undermine all else that we do as a moral nation. Changes won’t be easy, and hiring qualified teachers will be expensive. But at least the issue has been joined. We know, now, that we can’t go on talking about character education without extending education to everyone, fairly and with respect.

(c)2002 by the Institute for Global Ethics



More of the Facts

Sep 16th, 2002 • Posted in: Letters From Readers

Re: “The Moral Debate on Iraq,” Sep. 3.

For many months, I’ve been growing increasingly suspicious of President Bush’s motives and alarmed at what seems to be a very ham-handed approach to most issues. Your commentary on the Iraqi situation made me think twice. The clarity — and even more, the respectfulness — with which you presented the “long-term” viewpoint has convinced me to hold my judgment until we know more of the facts about Saddam’s war-making capabilities. I hope the President listens to Tony Blair’s suggestion that these facts be made public soon. I applaud your balance. It helped me regain mine.

–David Walton
Denver, Colorado, U.S.A.



Maintaining Integrity

Sep 16th, 2002 • Posted in: Letters From Readers

Re: “Changing the Post-9/11 World,” Sep. 9.

In the early part of your remarks about healing the cynicism toward corporate ethics, it struck me how similar that attitude is to a longer-held attitude of cynicism toward politics. It has long seemed to me that it is a huge task for a politician, especially a president, to be truthful and forthright with his public. Now, it seems that a similar attitude is developing toward CEOs. But it seems to me honesty and forthrightness is a lot more doable in business, since national security is not in question. In business it is more often the case of being responsible and maintaining integrity.


–Jim Raynesford
Lakewood, California, U.S.A.



The Violence Has Now Transformed Itself

Sep 16th, 2002 • Posted in: What They're Saying

“The violence has now transformed itself into employment discrimination. Murder, arson, defacements, and attacks — blatant acts of brutality — have been replaced with conduct in the workplace or in public accommodations.”

–William Haddad, executive director of the Arab American Bar Association in Illinois, speaking to the Associated Press. According to the AP, “Reports of beatings, stabbings, shootings, and other backlash violence after Sept. 11 have slowed to a trickle, only to be replaced by complaints of subtler — and harder to prove — forms of discrimination at work, at school, and in everyday interactions.” The U.S. government has warned that “anger at those responsible for the terrorist attacks should not be misdirected” against Arab-Americans, and is specially tracking alleged violations.



UN Replaces Controversial Human Rights Chief

Sep 16th, 2002 • Posted in: News

UNITED NATIONS
The United Nations’ top human rights official used her last days in office to warn the U.S. government that domestic erosion of civil liberties in the name of combating terrorism is leading to a similar and dangerous erosion around the world.

UN Commissioner for Human Rights Mary Robinson left her post last week after five years in office, a departure that came after she fell foul of Russia and the United States, whose governments she had outspokenly criticized, reported the New York Times.

Last week, Robinson refused to let up, criticizing the Bush administration for stripping U.S. civilians of their legal rights, detaining international citizens without filing charges, and turning a blind eye to human rights violations in countries helping in the fight against terrorism.

“The United States could be a leader in combating terrorism while upholding human rights,” Robinson, the former president of Ireland, told the Times. “Instead it has sought to put all the emphasis on combating terrorism and has not been fully upholding human rights standards. And that’s having a ripple effect on other less democratic countries” who are simply suppressing dissent.

“The world needs leadership in human rights and the United States could give great leadership. It’s not giving it at the moment, unfortunately,” she said.

By press accounts, Robinson revolutionized her UN office by abandoning soft-toned diplomacy for public criticism of industrialized and developing nations alike for human rights abuses.

Her stands against the Israeli occupation of the Palestinian territories, Russia’s war on Chechnya, and U.S. civil rights capitulations since September 11, have made her a thorn in the side of many powerful governments, press reports indicated.

Robinson was replaced by Sergio Vieira de Mello, a Brazilian diplomat with 33 years of experience at the UN.



Media Reports Highlight Flawed Airport Security, Draw Government’s Ire

Sep 16th, 2002 • Posted in: News

NEW YORK
The U.S. press came under government fire last week after reporters smuggled dangerous items through airport security to test new safety measures, sparking a debate over the media’s role in publicizing public hazards.

In a report published last week, the New York Daily News said its reporters had easily smuggled knives, razors, and pepper spray through airport security 14 times at 11 different airports without ever being detected. All four airports used by the September 11 hijackers failed to catch the contraband.

A similar report was aired last week by “CBS Evening News,” which said that 70 percent of airport screeners failed to scrutinize the network’s carry-on bags containing lead-lined film holders, which block X-rays and could be used to carry knives or other weapons.

While the Daily News actually carried weapons through security, CBS left its lead-lined bags empty, reported the Associated Press.

Federal regulators last week complained that the Daily News’s actions were illegal and unhelpful, saying they publicize weaknesses that could be exploited by terrorists hunting for poorly patrolled airports.

“It’s bad for the country,” Department of Transportation spokesman Chet Lunner told the AP. “That these stories are helping the bad guys seems to be completely obfuscated by the rush to get attention or notoriety for your newspaper or broadcast.”

Not so, insists Edward Kosner, Daily News editor-in-chief, who warns that without such tests the system goes untried, with civilians caught in between. Yes, such techniques are illegal, but the findings underscore their importance, he told the AP.

Jane Kirtley, a professor of media ethics at the University of Minnesota, said she understood the paper’s point.

“I don’t condone breaking the law just for the sake of doing it, just to get great footage for sweeps week,” Kirtley told the AP. “But the question always comes down to, how else are you going to test these things out?”



Canadians and Americans Honor Friendship and Solidarity of Small Newfoundland Community on 9/11 Anniversary

Sep 16th, 2002 • Posted in: News

Special to Newsline from Canadian correspondent Errol P. Mendes

GANDER, Newfoundland
Canadian Prime Minster Jean Chrétien, together with many foreign dignitaries and Americans, started the day of remembrance of 9/11 at the tiny Newfoundland community of Gander with a memorial service on the tarmac of the Gander airport.

Last September 11, 2001, the most eastern airport in North America was jammed with 69 huge passenger jets that had been diverted to the small airport when U.S. airspace was closed following the terror attacks in New York and Washington.

The 2,500 people who attended the memorial service included U.S. Ambassador to Canada Paul Cellucci and former U.S. passengers and crew who had returned to honor the friendship and solidarity of the local community.

The people of Gander and other local communities rushed to take care of the 6,700 passengers with food, shelter, and clothing.

Across the country, Canadians mourned for the loss of innocent lives in the terror attacks, including those of 24 Canadians.



New York Fed President Questions Runaway CEO Pay

Sep 16th, 2002 • Posted in: News

NEW YORK
Corporate heads and other heavy hitters should take voluntary pay cuts to correct an escalating wage imbalance that is hurting U.S. workers and morale, the president of New York’s Federal Reserve Bank said last week in a speech on September 11.

Fed president William McDonough’s comments mark the most outspoken criticism of escalating corporate pay to date, according to a report from the Reuters news agency.

“CEOs and their boards should simply reach the conclusion that executive pay is excessive and adjust it to more reasonable and justifiable levels,” McDonough said in a speech at Trinity Church, near the site of the World Trade Center.

McDonough cited figures showing that CEO pay had risen ten-fold over the past 20 years, jumping from 42 times that of the average production worker to 400 times, reported the Reuters news agency.

“Should there not be both economic and moral limitations on the gaps created by the market-driven reward system?” McDonough asked. “It is hard to find somebody more convinced than I of the superiority of the American economic system, but I can find nothing in economic theory that justifies this development.”

“We must recognize that the leadership of the American economy has made a large number of American citizens, and countless more around the world, question our judgment and/or our ethics,” McDonough continued.

McDonough’s challenge to corporate leaders caught the attention of Carol Bowie, director of governance research at the Investor Responsibility Research Center.

“It’s noteworthy that somebody in that position — with an emphasis on the free markets — would be suggesting that there ought to be some limits,” Bowie told Reuters.



Only Ethics Will Keep Companies from Collapsing: KPMG

Sep 16th, 2002 • Posted in: News

LONDON
Asked how to improve public trust in their companies, some of the world’s most powerful business leaders say they would advocate a stronger emphasis on personal ethics instead of red tape and regulation, according to a new report from consulting firm KPMG.

The survey, released last week, queried executives at the top ten firms by market capitalization in France, Germany, Japan, the United Kingdom, and the United States, reported the Reuters news agency.

Respondents warned that the collapse of Enron, WorldCom, and other firms was triggering a dangerous reliance on burdensome oversight and legislation that could cripple innovation.

“CEOs have to bear in mind the potential trade-off between polishing the corporate reputation and delivering growth,” synopsized the KPMG-sponsored report by the Economist Intelligence Unit.

Though wary of quick-fix legislation, executives say they would welcome several systemic changes, including the full disclosure of all off-balance sheet transactions, stronger corporate audit committees, and the regular rotation of external auditors.

But in the end, an abundance of well-intentioned rules cannot compensate for ill-intentioned executives, warned report author Victor Smart, who noted that even Enron appeared to have good governance practices.

“Ultimately rules are no substitute for ethics or how trust operates in business,” Smart wrote. “There is no one set of regulations which is going to stop an Enron.”



Regulators Seize Documents in Probe of Vivendi Finances

Sep 16th, 2002 • Posted in: News

PARIS
French regulators last week seized emails and documents from media powerhouse Vivendi Universal, which is suspected of pressuring its local auditor to inflate the firm’s 2001 earnings by $1.4 billion.

With portions printed last week in Le Monde, the emails detail an angry flurry of letters from Vivendi executives, including former CEO Jean-Marie Messier, to local auditor Salustro-Reydel.

Messier and others had pushed Salustro to accept a proposal made by the firm’s U.S. auditor, Arthur Andersen, which advocated counting a forced $1.4 billion stock sale as a profit instead of a liability, according to the New York Times.

Salustro reviewed the scheme, but rejected it as a violation of acceptable standards, and convinced France’s regulatory agency, the Commission des Operations de Bourse (COB), to follow suit.

When Vivendi, which had been lobbying the COB to quickly approve the deal, found out, the firm blasted its auditor for interfering, reported the Times.

Messier himself personally castigated Salustro and one of its employees for meddling, saying the auditor’s behavior “posed a true problem of ethics in the professionalism of Salustro.”

Former Vivendi head Messier was ousted in July after the company’s share price dropped 70 percent within one year, setting France’s record for corporate losses, reported the Associated Press.

Vivendi now faces a raft of shareholder suits in France and the United States over alleged deceptive accounting practices.



Georgia-Pacific Drops Lobbying Efforts, Apparently over Contract Concerns

Sep 16th, 2002 • Posted in: News

ATLANTA
Paper giant Georgia-Pacific last week said it would stop pushing for a swifter approval process for generic drugs — lobbying that the company apparently worried would jeopardize a lucrative contract with drug maker Eli Lilly & Co.

Until last week, Georgia-Pacific had been a leader in Business for Affordable Medicine (BAM), a coalition of state governors, employers, and labor unions pushing for generic alternatives to expensive prescription drugs.

The group has been lobbying Congress to enact legislation making generics available more quickly. While the Senate has passed such a measure, the House has proved hostile, reported the Dow Jones news service.

In internal emails published by the Wall Street Journal, Georgia-Pacific executives said they were worried that the company’s lobbying efforts were ruining its relationship with Eli Lilly, which opposes the legislation.

Georgia-Pacific is the leading supplier of paper goods and packaging for Eli Lilly, according to Dow Jones.

Last week, Georgia-Pacific spokesman Greg Guest confirmed the content of the emails, and said the company would abandon its leadership role in BAM, adopting a “passive” position instead.

In one email, a Georgia-Pacific official wrote, “We did talk to [United Parcel Service Inc.] and they are being put under pressure by Eli Lilly as well.” UPS is a member of BAM, reported Dow Jones.

Eli Lilly official Joseph Kelly denied any undue influence over the firms. “To the best of my knowledge nobody has threatened to pull any contracts from anybody,” Kelley told Dow Jones, calling its communications with BAM members a “purely educational process.”



Goodyear Targeted for Employee Evaluation System

Sep 16th, 2002 • Posted in: News

AKRON, Ohio
Tire maker Goodyear last week said it was making changes to its method of evaluating employees, a handful of whom have sued the company alleging that the review process is skewed against older workers.

Goodyear has been using a “10-80-10″ system, in which the top 10 percent of its workforce get an A grade, the middle 80 percent get a B, and the bottom 10 percent get a C. Those low-rated workers lose their bonuses and face possible termination.

After evaluating its program, Goodyear last week said it was abandoning the quota system, which has sparked an age discrimination suit filed last.

Older workers, which often cost companies more in salaries and benefits, complain that they have been railroaded by the review process, alleging that they have been graded down in a bid to push them out.

Goodyear denies the charge, and says its newly announced changes are the result of general feedback instead of specific complaint. Workers receiving low grades will now be required to attend an improvement program, reported the Associated Press.

Ford Motor Co. abandoned a similar 10-80-10 system after older employees filed an age-discrimination suit, which was settled in March for $10.6 million.

General Electric, whose maverick CEO Jack Welch is credited with a turnaround partly based on a system similar to the 10-80-10, says it has no plans to abandon the method, according to the Dow Jones news service.



U.K. Court Says Police Can Keep DNA Samples of People Cleared of Crimes

Sep 16th, 2002 • Posted in: News

LONDON
British police were given the green light last week to continue storing DNA samples from people charged but then cleared of committing crimes, part of a government-approved plan to create a criminal DNA database.

While conceding that keeping the DNA of innocent people violates their right to privacy, Britain’s Court of Appeal said the public benefits of the practice mattered more, reported the Associated Press.

The ruling follows a joint appeal by two people whose DNA was collected by the police: a 12-year-old boy cleared of robbery, and a man who faced harassment charges that were later dropped.

Both plaintiffs argued that the police had no right to retain their DNA, calling the genetic archiving an invasion of privacy. The state argued that the public interest in solving possible future crimes outweighed such concerns.

Last week, a three-member panel of judges agreed, saying that saving acquitted people’s DNA was a “relatively minor invasion” of privacy that mattered less than the possible benefits to crime solving.

“The larger the databank of fingerprints and DNA samples … the greater the value of the databank will be in preventing crime and detecting those responsible for crime,” Chief Justice Lord Woolf said for the court.

The U.K. government has pledged support for a national criminal DNA database, which currently stores more than 1.5 million samples. That number is expected to double by 2004, according to the AP.

Critics of the database say it sets a dangerous Big Brother-type precedent for cataloguing citizens, and could lead to abuses.

Sir Alec Jeffreys, a U.K. geneticist who pioneered the process of DNA fingerprinting, last week warned that the court’s ruling created a “discriminatory” policy that places too much focus on a tiny pool of citizens.

Speaking at a conference of the British Association Festival of Science, Jeffreys said a nationwide database “with the right, very stringent safeguards” would make more sense — both for identifying criminals and victims.

But “the national database must only be used as an investigative tool, not as a prosecution tool,” he warned.

Currently, about 1,600 DNA matches are made each week in cases under investigation by U.K. law enforcement, noted the BBC.



Personal Privacy and the DNA Database

Sep 16th, 2002 • Posted in: Education Activity

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Purpose
To model a process for analyzing ethical dilemmas using a current events article

Background and Materials
In-Class Reading:
Ethics Newsline™ article, “U.K. Court Says Police Can Keep DNA Samples of People Cleared of Crimes”
Homework: “Analyzing Right-versus-Right Ethical Dilemmas”

Process
The fish-bowl technique involves using one small group of students to demonstrate a process of thinking and working to the rest of the class. Once the fish-bowl activity has been completed, all students should be prepared to follow the same process in small groups without the close attention of the teacher.

  • Assign the “Analyzing Right-versus-Right Ethical Dilemmas” reading as homework the night before
  • In class, hand out the current events article: “U.K. Court Says Police Can Keep DNA Samples of People Cleared of Crime” and allow time for students to read it.
  • Identify the students (four or five) who will be “in” the fish bowl and ask them to come together at the front of the room or, even better, in a small circle in the
  • middle of the room. Make sure all remaining students are able to observe the activity closely.
  • Tell those not in the fish bowl that their role is one of observation rather than participation. Advise them that you, too, will only observe unless the process gets off track. Remind them of the purpose of the exercise.
  • After the fish-bowl group has considered the relevant facts of the article, ask the members of the group to discuss the dilemma and decide:

– Is this situation an ethical dilemma?

– If so, how can the two rights be stated? (It is right, on the one hand, to…. It is right, on the other hand, to….)

– And, finally, which of the four dilemma paradigms applies?

  • Your role in the fish-bowl exercise is one of coach. Only intrude into the discussion if the small group seems to be getting off track, in which case it is important to let the class as a whole understand how that happened and what should have happened instead. Also, be sure the exercise moves along at a reasonable pace, allowing perhaps ten minutes for the entire activity.
  • When the fish-bowl activity has been completed, give your demonstration group a round of applause.
  • Bring the students back together as a large group and solicit feedback from students on the process. Remind them that this process has been about analysis, not conclusion. Now, open up the discussion to everyone on the topic of privacy versus public safety. Can anyone suggest a solution to the case in the U.K. that may be a compromise?



‘Post-Recession Workplace Equals Heavier Workloads and Longer Workdays’

Sep 16th, 2002 • Posted in: Research Report

From CareerBuilder:

“Workers in today’s post-recession workplace are struggling to survive. Demands placed upon workers has resulted in increased workloads, longer workdays, and rarely a break from the routine of work, according to CareerBuilder.com’s ‘Life at Work’ survey. The CareerBuilder.com survey included more than 1,400 survey respondents.

“After months and months of layoffs, many organizations are attempting to do the same amount of work as they managed to do last year; however, the volume of work is taxing the capacities of an already compressed staff. Not surprisingly, more than one-third of workers reported an increase in their workloads in the past six months.

“‘Since Labor Day 2001, layoffs have touched the majority of workers in the workforce, either indirectly or directly,’ said Dawn Haden, a senior career advisor at CareerBuilder.com. ‘Because of the impending threat of a layoff, actual or implied, workers are getting the job done and making themselves appear indispensable. This has resulted in longer hours and heavier workloads.’

“Despite the workplace innovations of flextime and 4-day workweeks, the majority of workers spend 40 hours or more working 5 days a week on the job…. With more than two-thirds of workers scheduled for a 5-day workweek, 46 percent reported that they work 40 hours or more as compared to 42 percent as measured in a CareerBuilder.com survey conducted in October 2001.

“In the post-recession workplace, the lunch hour is a misnomer: Half of workers surveyed spent 45 minutes or less at lunch and 35 percent took 30 minutes or less for lunch. Sixty-seven percent stated that they did not leave the company premises for lunch. Instead, these workers ate in a designated lunch area, took a break in their work area, or ate while working.

“Forty-five percent of workers indicated that they were dissatisfied with their pay and more than one-third was dissatisfied with opportunities for career advancement. ‘Once the economy shows solid signs of improvement, the balance of these workers will be poised to seek another opportunity,’ commented Haden.”



Education Makes a People

Sep 16th, 2002 • Posted in: Quote from the Ethics File

“Education makes a people easy to lead, but difficult to drive; easy to govern, but impossible to enslave.”

–Henry Brougham (Scottish jurist and politician, 1778-1868)