Ethics Newsline®

The hotel maid who came to pick up the laundry last week spoke only Spanish. That seemed normal. Increasingly across the United States, service workers speak the language of our nation’s fastest-growing minority.

But this hotel was in Spain. I was the minority speaker, feeling slightly ashamed of my stumbling efforts to communicate. She, by contrast, felt no embarrassment as she coached my pidgin Spanish. What’s more, she probably felt little need to learn English. While Seville draws international visitors, it’s also a popular destination for Spaniards. Most of the time, I suspect, she can count on hearing her native language from the guests.

But after next week will she be an endangered species?

On May 1, the 15-nation European Union (EU), which includes Spain, adds ten new members from Central and Eastern Europe. Will my maid find her job at risk from waves of new workers pouring legally into her country? In a few years, will her coworkers at the Barceló Gran Hotel Renacimiento, built for the 1992 World Exposition in Seville, see yet another influx of foreigners, this time coming not as visitors but as employees? When I next visit Seville, will the maids speak Estonian or Slovenian to one another — and only stumbling Spanish to me?

These questions crossed my mind during a conference of 450 human resource managers from 55 countries gathered at the hotel last week. Speaking to the group, Victoria Curzon-Price, who directs the European Institute at the University of Geneva in Switzerland, raised a core question. When “73 million well educated, highly motivated, and underpaid individuals” join the EU, she asked, “will capital move East, or will people move West?”

The first alternative — capital moving East — is already part of the business landscape in Europe and the United States. The relentless economics that moves jobs offshore — replacing workers at home with lower-wage workers abroad — already is raising profound social and ethical questions. Similar movements may happen in Europe, but they won’t threaten my maid. It’s hard to clean a room unless you’re in it.

No, my maid’s challenge arises from people moving West. They’ll come, as Prof. Curzon-Price pointed out, because of disparities in wealth. The standard of living in an enlarged EU will stretch from that of Luxembourg, with a gross domestic product per capita of $56,660, to that of Lithuania, at $2,464. More important are the wage rates. Hiring a manufacturing worker for an hour, she said, costs $26.18 in Germany and $1.97 in Latvia. If entrepreneurial Latvians hear about hotel jobs in Seville, what are the chances they won’t come?

But there’s a darker question to enlargement. Put simply, will the new countries impact not only the economic but the ethical standards of the EU? The annual Corruption Perceptions Index (CPI), through which Transparency International ranks 133 nations, suggests reasons for concern. The current 15 EU nations score fairly high. Finland tops the CPI as the cleanest nation in the world, getting 9.7 out of a possible perfect 10. With the exception of Italy and Greece, no EU nation ranks below a 6.6. But among the enlargement nations, the picture is reversed. Cyprus (which will join the EU despite the May 24 vote by Greek Cypriots to remain a divided island) tops the list at 6.1, while Poland, at 3.6, is the lowest among the new EU nations.

What accounts for this disparity? With the exception of Cyprus and tiny Malta, the enlargement nations share a legacy of communism. And communism corrupts ethics in two ways: morally, by denigrating individualism and personal responsibility in favor of collectivism and the regulatory grip of the state, and economically, by creating such harshness and unfairness that individuals are driven into habitual disobedience and routine dissembling simply to survive. Result: a culture of creative survivors who have had little practice in giving — or expecting from others beyond their family — a sense of respect, honesty, fairness, and responsibility.

Fortunately, a legacy of corruption isn’t permanent. Ethics can be learned, especially by good people who have been trapped for decades in a bad system. The potential contribution of such people to the EU is enormous. But if the corruption index is right, employers who hire them may have more to teach than language and communication skills. They may have to teach also the rudiments of character and integrity and a work ethic of trust and commitment. Of such are free nations made.

©2004 Institute for Global Ethics

“Vanunu M. was hijacked in Rome Itl. 30.9.86 2100 Came to Rome by BA Fly 504.”

– Text written on the palm of Mordechai Vanunu and photographed by journalists when Vanunu flattened his palm against the window of a police van 18 years ago. The text, detailing his kidnapping by Israeli security forces, was Vanunu’s last substantial communication with the outside world before being imprisoned on charges of leaking secrets about Israel’s deliberately ambiguous nuclear program. (“Israel’s Whistle-Blower, Still Under a Nuclear Cloud,” Washington Post, Apr. 21)

* * *

“He felt it was his duty to expose what he knew so that people in the Middle East would be aware that Israel was lying to the world about its capability, in the hope that public pressure would limit nuclear proliferation.”

– Peter Hounam, the lead reporter on the October 1986 Sunday Times story that publicized Vanunu’s account of Israel’s nuclear program and allegedly shoddy security. (“Israel’s Whistle-Blower, Still Under a Nuclear Cloud,” Washington Post, Apr. 21)

* * *

“I was neither a spy nor a traitor. I wanted to inform the world about what was happening…. I acted in a way that was honest with myself. And also for the world.”

– Mordechai Vanunu, speaking about his motives for disclosing state secrets to prison interrogators, who leaked the recording to the media last week. (“Israel’s Whistle-Blower, Still Under a Nuclear Cloud,” Washington Post, Apr. 21)

* * *

“Vanunu violated norms and betrayed his country. This is justice.”

– Former Israeli foreign minister Shimon Peres, the architect of Israel’s policy of “strategic nuclear ambiguity,” defending Vanunu’s continuing punishment on Israeli Army Radio. Vanunu, who was released last week after 18 years in prison, is barred from leaving Israel, going within 300 yards of any international port of entry, speaking to foreigners without government permission, accessing email or the Internet, and disclosing information about much of the past 27 years, according to the Washington Post. (“Traitor. Hero. Fool. Whistleblower,” Washington Post, Apr. 21)

UNITED NATIONS
At the request of the United Nations, an independent panel was launched last week to investigate allegations that senior U.N. officials accepted kickbacks from Saddam Hussein while administering the U.N. Oil-for-Food program.

More than 270 companies, government officials, and others from 46 countries also are implicated in papers from the former Iraqi Oil Ministry now being held by the Iraq Governing Council, according to a report from ABC News.

The Washington Post reports that among the individuals who allegedly took part in the scams is U.N. Undersecretary General Benon Sevan, who administered the Oil-for-Food program, which began in 1996.

Sevan and others allegedly paid $4.4 billion in kickbacks to Saddam Hussein’s government in exchange for oil vouchers and other incentives that gave them the right to trade in Iraqi oil at cut-rate prices.

Though ABC News last week quoted an August 1998 memo from Iraq that allegedly implicates Sevan in a $3.5 million deal in illegally traded oil, Sevan so far has denied any wrongdoing.

U.N. Secretary General Kofi Annan last week said the U.N. will “investigate these allegations very seriously,” proposing a three-member independent panel to look into the charges.

Russia, whose Communist Party, Liberal Democratic Party, Presidential Cabinet, and Russian Orthodox Church all are implicated in the kickback scheme, initially blocked the proposed investigation.

After Annan interceded with a personal phone call to Russian Foreign Minister Sergey Lavrov, the country’s former ambassador to the United Nations, Russia relented, reported the New York Times.

The inquiry panel will be headed by Paul Volcker, former head of the U.S. Federal Reserve. He will be joined by a former South African prosecutor of war crimes in Rwanda and the former Yugoslavia and by a Swiss law professor with expertise in tracking money laundering, according to the Times.

“If there is substance” to the allegations, Volcker said last week, the best course will be to “get it out there, get it out in a hurry, and cauterize the wound.”

Last month, the independent investigative arm of the U.S. Congress concluded that Saddam Hussein’s government pilfered more than $10 billion from the Oil-for-Food program, which was designed to help the Iraqi people endure an international trade embargo imposed after the 1991 Persian Gulf War.

NEW YORK
For the second time in less than a month, a federal judge has rejected a guilty plea in one of the country’s high-profile crackdowns on corporate fraud — this time nixing the deal between prosecutors and Martin Grass, the former chief executive of Rite Aid.

Grass is accused of heading up an accounting scam that inflated profits, hid losses, and forced the nation’s third-largest pharmacy chain into a $1.6 billion restatement, reported the Associated Press.

Facing criminal charges and up to ten years in prison, Grass copped a deal just days before his case was to go to trial. That deal — a guilty plea on just two counts — would have given him eight years in prison, with time off for cooperating with prosecutors, noted the AP.

Last week, U.S. District Judge Sylvia Rambo killed the deal, saying she agreed with the U.S. Probation Office that the plea arrangement was too lenient in light of Grass’s alleged role as head of the conspiracy.

“Based on the court’s intimate knowledge of [Grass's] role in the events underlying his guilty plea, the court finds it would not serve the ends of justice,” Rambo wrote, saying he should face the maximum sentence.

Rambo dismissed contentions that Grass’s cooperation should ease his way, saying that he pleaded guilty only days before the trial was to begin and after the court had spent nearly $13,000 selecting a jury.

She also said Grass should not get preferable treatment simply because his plea deal, which included $3.5 million in fines and restitution, involved more cash than required by federal sentencing guidelines.

Lightening his sentence because of the agreed-upon monies, might “give the perception to the public that certain criminal defendants can buy a sentence,” she noted, according to the AP.

Rambo is expected to formally reject the guilty plea on April 29, after which prosecutors and defense lawyers — all of whom had urged her to accept the plea deal — have the chance to strike a second deal.

Last week’s development came shortly after a federal judge in Texas rejected the plea deal of former Enron executive Lea Fastow, insisting that he would not allow his hands to be tied during her sentencing.

WASHINGTON
Under the weight of a new report indicting the newsroom culture at USA Today for enabling widespread wrongdoing by a former star reporter, two of the national newspaper’s top editors resigned last week.

Editor Karen Jurgensen, who had run the paper since 1999, was the first to go. Citing the unfolding scandal of Jack Kelley, she resigned last Tuesday in a move characterized as a “retirement” by the paper.

Kelley, the paper’s star reporter who was nominated five times for the Pulitzer Prize, was forced to resign in January. Subsequent investigations found that he fabricated content in at least 20 stories, plagiarized at least 100 passages from other publications, and misused expense account funds, reported the Associated Press.

“Like all of us who worked with Jack Kelley, I wish we had caught him far sooner than we did,” Jurgensen said last week. “The sad lessons learned by all in this dreadful situation will make USA Today a stronger, better newspaper.”

Jurgensen’s step-down ends her 22-year career at USA Today, which was tainted last week by an independent report blaming the paper’s problems largely on lax leadership, a star system, and a climate of fear that kept questions about Kelley’s lies from being detected earlier, noted the AP.

The harsh tone of the report, authored by a three-member team of respected former editors and delivered to USA Today last week, compelled the paper to publish a page detailing the findings and statements from the paper.

Reacting to last week’s developments, USA Today reporter Tom Squitieri noted that, “the editor least responsible for what happened is the one who has been forced to go. I and several of my colleagues are waiting to see if others will follow her lead.”

That question was answered last Thursday, when managing news editor Hal Ritter, who was responsible for overseeing Jack Kelley, resigned. Executive editor Brian Gallagher also is expected to resign, reported the New York Times.

“All of us who were Jack’s editors over the years made the same mistakes,” Mark Memmott, who handled some of Kelley’s fabricated articles and eventually launched the investigation that led to his resignation, told the Los Angeles Times. “It didn’t start under Karen’s leadership, and Jack betrayed many people over many years. It’s the case of the last people in the chair who get the blame.”

After months of denying any wrongdoing, Kelley last week finally conceded that he had “made a number of serious mistakes that violate the values that are most important to me as a person and as a journalist.”

“I recognize that I cannot make amends for the harm I have caused to my family, friends, and colleagues. Nor can I make it up to readers who depend upon good journalism to understand a chaotic and confusing world,” Kelley wrote in an email released last week by his lawyer, according to USA Today. “I can only offer my sincere apology to those I have let down.”

The USA Today scandal comes less than a year after similar revelations of fabrication, fraud, and plagiarism by reporter Jayson Blair led to the resignations of top editors at the New York Times.

LONDON

As top editors at USA Today were resigning over charges of weak leadership, their counterparts in industry were taking similar falls, with executives at several prominent firms stepping down under pressure.

Among last week’s developments:

• London-based Royal Dutch/Shell chief financial officer Judy Boynton resigned after nearly three years with the firm, following the release of an internal probe showing that high-level executives knew the company had overstated the size of its oil reserves since 2001. The scandal already has claimed the posts of two other executives, including former chairman Sir Philip Watts, and will force the firm to downgrade its reserves again — the third time in three months, reported the New York Times.
• Computer Associates chairman and chief executive Sanjay Kumar last week resigned his leadership posts and seat on the board of directors, following allegations of more than $1.4 billion in accounting fraud at the California-based firm. Kumar will stay on as “chief software architect” at the firm, where at least 14 employees have either been fired or resigned over the scandal, reported the Reuters news agency. “The changes in Sanjay’s role are not based on the conclusion that he engaged in any wrongdoing,” Computer Associates’ director Lewis Ranieri said last week. “Nonetheless, the conduct in question occurred during his tenure, and the board felt this action was appropriate.”
• Denver-based Janus Capital Group announced last week that CEO Mark Whiston will resign as Janus works to clear its name in the mutual-fund scandal being prosecuted by New York State attorney general Eliot Spitzer. Denying that Whiston had any role in alleged market time violations, Janus said its CEO will be replaced by an outsider, former Charles Schwab executive Steve Scheid, who was named board chairman in January. “For a fairly insular shop, this is a dramatic change,” a Morningstar mutual fund analyst told USA Today. “They’ve been lacking an outside perspective.”

CHICAGO
Merrill Lynch & Co. was ordered last week to pay $2.2 million to a former female employee who accused the nation’s largest brokerage of discriminating against her and other women.

Last week’s ruling comes in the case of Hydie Sumner, a former Merrill Lynch broker in Texas from 1991 to 1997, who accused her boss of sexual harassment and subsequent intimidation.

After more than 900 women brought similar charges against Merrill Lynch in 1997, the company agreed to settle many cases and have others heard by an arbitration panel, reported the New York Times.

So far, more than $100 million in settlements have been paid to women accusing Merrill Lynch of fostering a hostile work environment and holding them back because of their gender.

Last week’s decision, however, breaks new ground by marking the first time that the arbitration panel formally has concluded that sexual discrimination was systematic, not a rare exception, at Merrill Lynch.

“Merrill’s failure to train, counsel, or discipline employees who engaged in sexual harassment constitutes discrimination with malice or reckless indifference,” the panel wrote.

Ruling in Sumner’s favor, the three-member panel awarded her more than $1.6 million in back pay and lost earnings, as well as $500,000 in punitive damages — far more than the $500,000 total awarded to another plaintiff last fall.

Last week’s decision also marks the first time that a Wall Street firm has been hit with a legal ruling upholding long-whispered accusations of endemic industry bias against women, noted the Times.

In a network of 15,000 brokers, only 17 women held management positions at Merrill Lynch as of 1999, according to figures cited by the Times.

Merrill Lynch last week tried to distance itself from the scandal, issuing a statement that said “the firm described in the panel’s decision is not today’s Merrill Lynch.”

Similar gender bias allegations have been made against Morgan Stanley and Citigroup’s Smith Barney, as well as against Bank of America just last week, reported the Reuters news agency.

NEW YORK
CBS News encountered blistering criticism last week after airing photographs of a dying Princess Diana, ignoring her family’s pleas and a media industry taboo on displaying the death scene photos.

Princess Diana was killed in a Paris car crash in August 1997, with paparazzi arriving on the scene moments after the accident and snapping pictures that were confiscated by the French police.

Diana’s lover, Dodi al Fayed, and her driver, Henri Paul, also were killed in the crash, which has been blamed on Paul, who investigators concluded was drunk and speeding at the time of the crash.

Western media outlets so far had refrained from showing the death-scene photos, which had remained off-air out of respect for Diana’s family and out of a sense that they added little insight to the circumstances surrounding the accident.

Last week, CBS decided to break ranks and air photocopies of the photos on its primetime show “48 Hours Investigates,” insisting that the act had journalistic merit, reported the Reuters news agency.

The photos were “placed in a journalistic context — an examination of the medical treatment given to Princess Diana just after the crash — and are in no way graphic or exploitative,” the network insisted.

For many observers, such explanations carried no weight, earning condemnations as a crass and careless stunt designed to win viewers, according to several press reports.

Diana’s brother, Earl Charles Spencer, summed up the mood of many, saying his family was “shocked and sickened by CBS’s actions,” reported CNN.

While CBS’s decision earned a lot of attention, most of it came after the fact and little was flattering. The network earned a disappointing third place in its primetime spot that night, reported Reuters.

WASHINGTON
Young TV viewers are being bombarded with ads pitching alcohol, suggesting a need for heightened regulation, the Center on Alcohol Marketing and Youth at Georgetown University warned last week.

The Center’s alert comes on the heels of a new report that found a sharp increase in the number of alcohol ads on cable, local, and network TV — a nearly 40 percent one-year jump to 289,381 ads in 2002.

The amount of money spent to get those ads in front of viewers also rose strikingly, climbing 22 percent from 2001 to hit $990 million last year, reported the Associated Press.

“Kids are being swamped. There was an enormous increase in alcohol ads between 2001 and 2002,” the Center’s research director and study co-author David Jernigan said. “All of the top shows had alcohol ads. Teenagers were more likely to see ads for beer and other alcohol than for soda pop.”

The Center on Alcohol Marketing and Youth said its new study found that many of those ads were aired on shows that are disproportionately popular with young viewers, making them more likely than drinking-age adults to see the ads.

“This seems to be like what the cigarette companies used to do,” a New York child psychologist told HealthDayNews. “It puts alcohol in [teens'] minds as something that’s acceptable and intriguing, and it gives the alcohol companies a way of beginning to establish a market base for later on. It bodes badly for all of our attempts to help teenagers not drink.”

The Center last week called on the alcohol industry to scale back its ad campaigns and limit product pitches to TV shows with audiences in which children make up no more than 15 percent.

The current voluntary limit is 30 percent, noted the Reuters news agency.

Last week, the alcohol industry declined to take up the 15-percent recommendation, instead defending its current practices and noting that the study found it was observing the 30-percent rule.

“Study after study shows that parents and other adults are the primary influence over a youth’s decision regarding drinking, not advertising,” Distilled Spirits Council president Peter Cressy told the AP.

WASHINGTON
About 70 high-school students staged a mock graduation ceremony on the West Lawn of the U.S. Capitol last week, hoping to highlight their educational plight as the children of illegal immigrants.

The students, many of whom were brought to the States as children, are asking for help with receiving in-state tuition rates at U.S. universities, saying they should not be punished for the illegal status of their parents.

So far, seven states have agreed, granting in-state tuition rates to such college-bound students — about 65,000 of whom are expected to graduate from U.S. high schools this year, reported the Washington Post.

Other states, including Maryland, have blocked such efforts, saying they give illegal immigrants a leg up on U.S. citizens and legal residents, and might encourage other people to enter the country illegally.

The debate soon may move to Washington, where both houses of Congress have introduced legislation that would help undocumented high-schoolers both with college tuition and with becoming citizens, noted the Post.

Special to Newsline from Canadian correspondent Errol P. Mendes

OTTAWA
A Liberal senator of the Canadian Parliament last week accused China of blackmailing Canada by hinting at economic retaliation for a too-warm welcome that the Dalai Lama received on his visit to Canada.

The complaints from Senator Jim Munson, who filmed government abuse of Bhuddist monks in Lhasa, Tibet, as a journalist 15 years ago, focus on Chinese warnings of possible strains to Sino-Canadian trade relations.

China’s hints came as Canada’s leader, Paul Martin, last week became the first Canadian prime minister to meet the exiled Dalai Lama, reported the Agence France-Presse.

“It has been argued by some that meeting the Dalai Lama may affect our trade relations with China,” Munson said last week. “This is nothing short of diplomatic blackmail.”

Prime Minister Martin agreed to meet with the Dalai Lama only as a spiritual leader in a meeting at the residence of the Roman Catholic archbishop of Ottawa. The meeting was attended also by other religious leaders in what was termed a spiritual meeting covering topics that could include human rights in Tibet.

The Chinese government regards the Dalai Lama as a menacing separatist who threatens the unity of the country, noted the Globe & Mail. Canada has recognized the sovereignty of China over Tibet.

In his Canadian meetings, the Dalai Lama reaffirmed that he is only seeking autonomy for Tibetans within a sovereign China and has urged Canada to act as a mediator to resolve the conflict with China.

From the Gallup News Service:

“An abortion rights march of ‘historic size’ is being planned for Washington, D.C., this weekend…. The march presents a good opportunity to review where the public stands on abortion, and how abortion is likely to factor as an election issue.

“Americans are sharply divided in their identification with the two political sides of the abortion debate: 48 percent consider themselves ‘pro-choice,’ while 45 percent identify as ‘pro-life.’

“A different question designed to tap more specific attitudes about the legality of abortion finds Americans generally favoring restrictive laws. More than half the public says abortion should be ‘legal only in a few circumstances’ (40 percent) or ‘illegal in all circumstances’ (17 percent). Four in 10 favor less restrictive laws, saying abortion should be ‘legal under any circumstances’ (26 percent) or ‘legal under most circumstances’ (14 percent).

“But when asked whether the current laws should be made more strict, less strict, or kept as they are, only 37 percent want stricter laws. The plurality — 40 percent — wants the laws to remain as they are, while a smaller percentage (20 percent) thinks they should be less strict.

“This leads to one of the prime motivating factors behind this weekend’s event: the future makeup of the Supreme Court….

“Last fall, a CNN/USA Today/Gallup poll measured public reaction to the charge that Bush wants to ban all abortions in the United States. Exactly 50 percent said he does; 37 percent said he does not, while 13 percent had no opinion.

“A different question is whether the perception of being anti-abortion will hurt Bush at the polls in November. It appears that the net effect of perceptions that Bush wishes to ban abortion is not entirely damaging to his potential re-election. Of those who think Bush will ban all abortions, more than half (58 percent) said this will have no effect on their support for him. Seventeen percent said it would make them more likely to vote for him, while just slightly more, 23 percent, said it will make them less likely….

“Abortion attitudes have been quite stable over the past several years. In fact, for most of the nearly 30 years Gallup has been tracking abortion attitudes, the majority has preferred to see abortion legal, but only under certain circumstances. The percentage holding one or the other of the extreme positions has shifted somewhat. The percentage saying abortion should be legal in all circumstances gradually rose from 21 percent in 1975 to 34 percent in 1992, and then slipped back to the 25 percent range in 1996, at about which it has stayed ever since. The percentage saying abortion should never be legal has varied from a low of 12 percent in 1995 to a high of 22 percent as recently as May 2002.

“Gallup typically finds small differences in men and women’s attitudes on abortion. Consistent with this, an aggregate of abortion surveys from 2001 to 2003 finds no statistical difference in the percentage of men and women identifying with the pro-choice and pro-life labels. Overall, 47 percent of men and 48 percent of women call themselves ‘pro-choice,’ while 45 percent of men and 43 percent of women call themselves ‘pro-life.’

“Younger women and baby boom-era women are a bit more likely to be pro-choice than older women are. …[T]he average ‘pro-choice’ figure for women aged 18 to 49 (52 percent) is significantly higher than the average of 42 percent among women 50 and older….”

“Language is by its very nature a communal thing; that is, it expresses never the exact thing but a compromise — that which is common to you, me, and everybody.”

– Thomas Earnest Hulme (English critic, poet, and philosopher, 1883-1917)