Public Downbeat on Moral State
May 24th, 2004 • Posted in: Statline
When a federal grand jury last week subpoenaed journalists Tim Russert of NBC and Matthew Cooper of Time magazine — trying to get them to reveal their sources — it raised one of democracy’s most fundamental right-versus-right dilemmas.
The jury wanted to know who leaked the information involving Valerie Plame, the wife of former ambassador Joseph Wilson IV. Last summer, Plame was exposed as an undercover CIA agent by a conservative media commentator — a subject covered in Mr. Wilson’s new book, The Politics of Truth: Inside the Lies that Led to War and Betrayed My Wife’s CIA Identity.
More on that couple later. First, two questions:
1. How important is a free press in the political arena? The question invites a knee-jerk response. It’s widely agreed that reporters must be free to report, and publishers to publish, whatever they learn from confidential sources.
2. How important is the keeping of political confidences? That question also taps a geyser of reaction. Enormous damage can be done by high-level leaks — though trying to plug the leaks may cause more damage than the leaks themselves.
The ethical dilemma facing a democracy lies in the fact that both of these questions are important. The public needs a spirited, unhampered press producing well-sourced stories. But public officials also need the freedom to act in confidence, below the radar, as they negotiate domestic and foreign policy. It’s right to let journalists dig and report. It’s also right to stamp out leaks.
Which brings us back to Ms. Plame. When conservative syndicated columnist Robert Novak outed her last July, he did not reveal the source of his information. But his piece followed hot upon an op-ed piece by her husband in the New York Times. In it, Mr. Wilson challenged President Bush’s assertion during the 2003 State of the Union speech that Iraq had sought uranium from Africa for making nuclear weapons. Mr. Wilson had a strong basis for his opinion: He had been sent by the Bush administration to Niger in 2002 to investigate the Iraqi uranium story, and found nothing to it.
Was this just a maelstrom in the mocha java? No, this was serious stuff. Revealing the identity of a covert agent is a criminal offense. And revealing a flaw in the principal argument for going to war with Iraq — that Saddam had weapons of mass destruction — could greatly weaken the president’s position. Small wonder, then, that someone in the administration apparently lashed out at Mr. Wilson by compromising his wife’s career.
A quick inventory reveals a thicket of ethically dubious issues here:
That brings us back to one true right-versus-right dilemma in this story: the subpoena of the journalists. On one hand, the need to ferret out lawbreakers is clear. Someone has illegally divulged a name. Let’s find out who it was and punish the criminals, thereby sending a signal that the law can’t be broken even in high places. That has the ring of true moral purpose.
But so does another argument: the need for journalists to protect their sources. If no journalist can promise that the confidentiality of a conversation won’t be compromised, some important sources — those most highly placed and with the most at stake — will fade away. The result will be a self-censoring media, too cowed by the courts to do anything but parrot back what the government says.
So which side of this individual-versus-community, short-term-versus-long-term dilemma is right? That depends on what resolution principle you choose. If ethics means “greatest good for the greatest number” — right now, in the short term — it’s right to force these individual journalists to reveal their sources. That way, a crime gets solved and the community benefits, even though a few individual journalists and sources are punished.
But if ethics means “standing by a high moral principle” and elevating that principle as a universal rule that extends through time, it’s right not to make journalists divulge their sources — not now, not ever, not for any reason. In the long term, the risk that constitutional malfeasance will grow when sources are silenced outweighs the danger of not catching this criminal in this case.
Where do I stand? I’m a journalist. I also feel strongly that the long-term needs of the community outweigh the short-term needs of individuals. I’m for protecting the sources and the journalism they support. But I only say that knowing that my position is not the ethical one, but an ethical one.
©2004 Institute for Global Ethics
“We got a little bit of a wake-up call. Our company is growing up, and it was time to become a leader in these issues.”
– Bryant Hilton, spokesman for computer maker Dell. While Dell got drubbed last year for its poor environmental record, changes at the company helped Dell and Hewlett-Packard earn top spots this year in a “report card” from the Silicon Valley Toxics Coalition. Still, with the highest recycling rates peaking at a mere 2 percent, “nobody is getting what any school child would recognize as a C grade,” coalition director Ted Smith told the Associated Press. “Even the best companies … have a long way to go.” (“HP, Dell Win Top Environmental Rankings,” AP, May 19)
BAGHDAD
U.S. Army Spc. Jeremy Sivits pleaded guilty last week to complicity in the abuse of Iraqi prisoners at the Abu Ghraib prison, apologizing for taking some of the photos that led to the broadening scandal.
Sivits, who received the maximum penalty of one year in prison and a bad conduct discharge, wept and apologized for his mistakes. “I should have protected those detainees, not taken the photos,” he said.
Sivits’ court martial last week marked only the first prosecution of alleged abusers. Among the other developments last week:
WASHINGTON
The Bush administration broke federal law by using public funds to pay for propaganda in the form of video “news releases” touting the new Medicare law, the General Accounting Office (GAO) ruled last week.
The videos — one version in English, another in Spanish — were formatted to look like news segments and ended with sign-offs such as, “In Washington, I’m Karen Ryan reporting,” reported the New York Times.
The releases, however, were not news, but promotions funded by the Bush administration to advocate its legislation — a provenance noted on the tapes’ boxes, but nowhere in the videos themselves.
The GAO, the nonpartisan investigative agency of Congress, last week said that lack of transparency made the advertisements into essentially “covert propaganda” during an election year, according to the Times.
Viewers of the videos, which aired on TV stations across the country earlier this year, would “believe that the information came from a non-government source or neutral party,” rather than from the administration, it ruled.
With images of President Bush receiving a standing ovation and of a pharmacist praising the new law, the videos were flawed by “notable omissions and weaknesses” and were “misleading as to source.”
The GAO found that the videos violate federal appropriations laws and strictures against the use of federal money for “publicity or propaganda purposes” without congressional approval.
Sen. Frank Lautenberg (D-NJ) last week said he would introduce legislation requiring the Bush reelection campaign to reimburse the Medicare program for the cost of the ads, reported the Reuters news agency.
WASHINGTON
Forty-eight Roman Catholic members of Congress last week urged church leaders to stop threatening to deny communion rights to pro-choice politicians, saying the separation of church and state must stay clear-cut.
The Catholic lawmakers — all Democrats in the U.S. House, representing both pro-choice and anti-abortion views — signaled their concerns in a letter to Theodore McCarrick, cardinal of the Washington archdiocese, reported the Washington Post.
Since January 2003, the Roman Catholic Church has been renewing its push to enforce portions of church doctrine via the law-making votes of Catholic politicians, issuing warnings on issues like abortion and same-sex marriage.
Recently, a handful of Catholic bishops announced that they would deny some religious rites, like the Eucharist, to politicians whose votes are not in line with church dogma on abortion.
Last month, Colorado Springs bishop Michael Sheridan went further, issuing a letter warning Catholic voters that they should not be allowed to take communion if they support candidates who do not agree with church doctrine, reported the AP.
While the threats so far are limited, they have been interpreted widely as a partisan push against presidential candidate Sen. John Kerry (D-Mass.), a Catholic who supports abortion rights.
The lawmakers noted that while church officials are threatening politicians who support same-sex marriage or the right to abortion, they are making no such threats against lawmakers defying church positions against the death penalty or the Iraqi war.
The lawmakers asked for a meeting with McCarrick, who is heading a seven-member taskforce deciding whether and how to punish U.S. Catholic politicians whose votes differ from church doctrine.
The lawmakers’ recent letter said such an effort undermines democracy and progress in ending any anti-Catholic bias at the polls, according to the AP.
“For many years Catholics were denied public office by voters who feared that they would take direction from the pope,” the lawmakers wrote, noting that the church’s current efforts could re-ignite such fears.
“Because we represent all of our constituents, we must, at times, separate our public actions from our personal beliefs,” the letter said. “[E]ach of us has the responsibility and the right to balance public morality with private morality without pressure from certain bishops.”
NEWARK, New Jersey
Nine current and former executives from Lucent Technologies were charged last week with civil fraud for allegedly rigging the company’s books to falsely report nearly $1.2 billion in revenue.
Lucent, the world’s largest maker of telecommunications equipment, last week also agreed to settle its role in the case, finalizing a deal hammered out in March with the U.S. Securities and Exchange Commission (SEC).
Last week’s charges stem from a federal investigation into 20 specific Lucent deals dating back to the fall of 2000, when the firm disclosed that it had found problems with its bookkeeping, reported the New York Times.
Lucent ultimately restated $679 million in sales and agreed to pay $517 million to settle 54 class-action lawsuits that accused the company of distorting its balance sheets and misleading investors.
Federal investigators originally had planned to let the company go without a fine. But Lucent, which initially had cooperated with investigators, later dug in its heels and hindered them, the government said.
As punishment, the SEC slapped Lucent with a $25 million fine — the highest penalty yet leveled by the SEC for a firm’s failure to cooperate with regulators, noted the Times.
“Stiff sanctions and exposure of their conduct will serve as a reminder to companies that only genuine cooperation serves the best interest of investors,” SEC Associate Director of Enforcement Paul Berger said in a statement.
The nine Lucent workers charged last week allegedly falsified documents, entered into secret agreements with clients, and evaded Lucent accounting strictures in a “drive to realize revenue, meet internal sales targets, and/or obtain sales bonuses,” according to the Washington Post.
Three of the accused workers settled last week, agreeing to pay a total of roughly $400,000. Three of the indicted executives still work for Lucent, though the company declined to identify them, according to press reports.
WASHINGTON
Richard Strong, founder of the Wisconsin-based mutual fund firm Strong Capital Management, last week settled federal fraud charges by agreeing to $60 million in penalties and a lifetime ban from the financial services industry.
The Strong Capital firm also agreed to pay $80 million.
Strong and his firm were implicated last September in a report by New York Attorney General Eliot Spitzer, who shocked investors with allegations that the mutual fund industry was engaging in widespread misconduct.
Among the first firms to be named by Spitzer, Strong Capital was accused of letting powerful clients engage in rapid short-term trades, known as market timing, while barring common investors from the practice.
That two-faced approach, designed to win business from wealthy clients and enrich favored investors, is not strictly illegal but is widely regarded as improper, especially when brokerages refuse to disclose their activities.
The case against Strong Capital was compounded by the fact that former chief executive and chairman Richard Strong allegedly engaged in hundreds of market timing trades himself, reported the New York Times.
The irony that a powerful chief executive worth an estimated $800 million would jeopardize his career for those trades’ relatively paltry $1.8 million in profits was noted by the Times.
Strong resigned last December. Today, the firm he founded manages slightly less than $34 billion — a drop of more than 20 percent since before the scandal broke, according to the report.
“His personal trades were a betrayal of the highest order, warranting the stiffest possible civil sanctions,” U.S. Securities and Exchange Commission Enforcement Director Stephen Cutler said in a statement.
In settling the case last week, Strong neither admitted nor denied wrongdoing. Instead, he was required by regulators to write a letter of contrition, which was released by the SEC.
“Throughout my career, I have considered it to be my sacred duty to protect my investors; and yet in a particular and persistent way I let them down,” Strong wrote.
NEW YORK
U.S. sprinting champion Kelli White last week admitted using illicit steroids and a blood-booster to improve her performance, accepting a two-year ban from competition as punishment.
White, who won the 100- and 200-meter gold medals at the 2003 world championships, will be barred from the 2004 summer Olympics in Athens, scheduled to begin in August, reported the New York Times.
White’s disclosure stems from an ongoing investigation into designer steroids created by the Bay Area Laboratory Co-Operative (BALCO), which has been linked to homerun king Barry Bonds and other prominent athletes.
Confronted with evidence turned over to investigators after Sen. John McCain (R-Ariz.) subpoenaed the Justice Department for the documents, White last week admitted using steroids and other performance-enhancing drugs.
She will forfeit her medals, records, times, and $120,000 in prize money earned since December 2000, when she first started using, reported the Reuters news agency.
“In doing this, I have not only cheated myself, but also my family, friends, and sport,” she said in a released statement. “I am sorry for the poor choices I have made.”
“The choice to cooperate is completely my own,” White added. “I felt it was important to step up, accept responsibility, and assist in cleaning up my sport.”
“Ms. White has made mistakes but I admire her courage in acknowledging these mistakes and accepting responsibility for them,” U.S. Anti-Doping Agency chief executive Terry Madden said last week.
“It is not easy to admit you have done wrong and then stand up to do something about it.”
Kelli White last week promised to help investigators by providing information regarding other athletes’ use of steroids.
BOULDER
An independent panel looking into the football program at the University of Colorado released a scathing report last week, citing “systemic failings” that have lead to sexual and substance abuse by players and recruits.
The report follows allegations from at least nine women, who say they were sexually assaulted by players or recruits since December 1997, reported the Rocky Mountain News.
An independent panel was formed to look into the athletic culture and the administration’s response at the Boulder campus, where Athletic Director Dick Tharp was put on paid leave last February.
Last week, the panel’s findings were released, slamming the school for lax oversight that contributed to rampant abuses and urging regents to consider whether President Betsy Hoffman is up to the task of leading reforms.
While finding “no clear evidence” of wrongdoing by university officials, the report lambasted administrators for “systemic failings that jeopardized students’ safety and allowed for ongoing misconduct in the football recruiting program,” criticizing head football coach Gary Barnett for providing “insufficient supervision of recruits.”
“The commission’s investigation only reaffirms the cultural challenges facing the nation today,” the report said. “Across the country, intercollegiate athletics have been undermined by a hyper-competitive recruiting ‘arms race’ that is complicated by the presence of big money, lucrative media, and easy access to alcohol and sex.”
In addition to asking whether President Hoffman should be removed, the panel recommended drastic changes to the football program’s recruitment policies, including a ban on such visits during the football season, noted CNN.
DETROIT
In a landmark move, the Detroit Zoo last week announced that it would stop exhibiting elephants, saying that even its respected facilities were insufficient to meet the animals’ real needs.
While some smaller institutions have dropped their elephant displays in the past, those moves usually have come under pressure from animal-rights groups or regulators concerned about facilities or mistreatment.
Last week’s decision is different, marking the first time that a major U.S. zoo has decided that ethical considerations alone require it to abandon the display of elephants, according to the Detroit Free Press.
Detroit, whose one-acre elephant pen is about 16 times larger than required by regulations, said last week that its two Asian elephants, females Winky and Wanda, have been exhibiting health problems common among confined animals.
Such problems range from severe arthritis and foot problems caused by unnatural ground surfaces to psychological problems like aggressiveness from stress and neurotic rocking from extreme boredom.
“People’s traditional expectation of zoos is that they see lions and tigers and elephants,” zoo director Ron Kagan told the Free Press. “But it’s also their expectation that an animal has a good life.”
Saying Winky and Wanda deserve a better life than the zoo can offer, Kagan said the facility will send the elephants to one of two U.S. wildlife sanctuaries in the late summer or early fall.
Elephants “are the only animals at the zoo for which there is a great disparity between what they need and what we can provide,” he said.
“Ron Kagan has been in the forefront of behavioral enrichment for animals, and for him to make this decision is big,” Carol Buckley, cofounder of the Elephant Sanctuary, told the Free Press. “Their minds and bodies are designed to stay busy. When you put them in a sterile environment like a zoo, they can’t do that.”
While Detroit’s news — ending the facility’s 81-year-old tradition of exhibiting elephants — may hit zoo-goers hard, Kagan said he hopes the public will eventually support the zoo’s ethical stance.
“I wouldn’t expect the American public, which has been told for 100 years it’s okay to have elephants in captivity, to say ‘Oh, okay, we understand’ right away,” Kagan told the Free Press. “But we have an educational mission.”
From the Gallup News Service:
“In a year filled with partisan bickering, it may come as some solace that Republicans and Democrats agree on at least one thing: the state of moral values in the country. Unfortunately, the consensus is not good. Roughly four in five Republicans and Democrats alike rate moral values in the United States as ‘only fair’ or ‘poor.’ Just one in five in either group thinks morals are ‘excellent’ or ‘good.’
“Naturally, then, national adults’ perceptions follow a similar pattern. Overall, just 19 percent of Americans characterize moral values in the United States as excellent or good, while 80 percent consider them only fair or poor.
“These findings come from Gallup’s annual ‘Values and Beliefs’ survey, conducted May 2-4. The question is a recent addition to the survey, and was first asked in May 2002. However, historical measures on this subject suggest that Americans have traditionally been concerned about the state of moral values in the nation….
“Not only is the public critical of the state of moral values in the United States today, but most Americans are pessimistic about the direction in which morals are headed. Just 16 percent believe moral values in the country as a whole are getting better, while 77 percent say they are getting worse….
“While criticism of moral values in the United States is high across the board, it is particularly high among older Americans. More than half of adults aged 65 and older (53 percent) consider moral conditions poor, versus only 27 percent of adults under 30 who feel this way.”
“The punishment suffered by the wise who refuse to take part in the government, is to live under the government of bad men.”
– Plato (Greek philosopher, ca 428-348(or 347) B.C.)
It happened again last week: More top Democrats urged Sen. John McCain, a Republican from Arizona, to join John Kerry’s campaign as Democratic candidate for vice president. McCain insists he’s not interested. But the drumbeat continues. Why? Consider his latest book.
In the aftermath of 9/11, an astute editor asked McCain to write a book on courage. It was a time when many Americans were afraid to fly or enter tall buildings. Yet it was a time when television showed vivid images of firefighters and police officers rushing into burning buildings as the public rushed out. Clearly the question of courage was in the air. And who better to write about it than a decorated Vietnam hero who had spent five and a half years as a prisoner of war?
So with his longtime administrative assistant Mark Salter (with whom the senator already has written two books), McCain got down to work. But the wheels of the New York publishing gods grind slowly. Only last month did the book finally appear. Now, I suspect, most readers of Why Courage Matters: The Way to a Braver Life won’t be thinking about the Twin Towers. They’ll be thinking about Abu Ghraib Prison in Iraq, about Washington’s response to it, and about the need for courageous leadership in public affairs.
This book is silent on Iraq. But it sends out some telling signals that remind us why McCain remains such a popular figure in the nation’s political pantheon.
First, it’s a humble book. No model of personal meekness, McCain can be brusque and irascible. But he never claims any special privilege in the realm of courage. This isn’t a book about his own wartime experiences, but about the courage of others. Like other books of its sort — John F. Kennedy’s Profiles in Courage (1956) and the Scottish novelist Compton McKenzie’s On Moral Courage (1962) — this text is studded with engaging set-piece stories of noteworthy heroes. Some are public figures, like longtime political activist Aung San Suu Kyi of Myanmar and former Alabama freedom marcher John Lewis, now a congressman from Georgia. Others earned fame in their day, like Hungarian Zionist and World War II resistance fighter Hannah Senesh and the nineteenth-century Navajo tribal leader Chief Manuelito. Not surprisingly, given McCain’s background, several of his examples feature decorated military heroes. Before all of these, McCain professes unqualified admiration. And while he puzzles at times over the line between bravery and foolhardiness, he searches honestly for the key to courage.
Second, this is not a scholastic book. Neither footnoted nor indexed, and divided into chapters without numbers or titles, it claims simply to be, as he says, “a manual of courage” designed to “encourage people to find the fortitude to get on with their lives.” Readable and probing, it’s the kind of book you’d expect from an intelligent non-specialist mind fulfilling the congressional mandate to raise questions about policy and practice. McCain does, however, have a point of view. He worries that courage is in danger of being “defined down” by including under its rubric all sorts of attributes (like fortitude and discipline) that he feels don’t quite rise to that height. While the point is a good one — what term will we reserve for the 9/11 rescuers if we use “courage” for everyday experiences? — the events at Abu Ghraib ought to make us wonder whether courage needs a more rather than less expansive ambit. How else can we instill courage in military personnel, even when all they’re doing is routine, boring work like looking after prisoners? How do we train them to say no, to disobey bad orders, to blow the whistle? Don’t we start by saying, “This, too, takes genuine courage”?
Third, unlike so many books emanating from the Beltway, there is no subtext here of a defense of McCain’s own profession as a politician. Having surveyed the courage displayed under enemy fire and in times of intense fear, he writes that by contrast “I don’t really need much courage for the challenges most frequently encountered in a political career. Political courage in our consensual political system is seldom all that courageous.” Sadly enough, he may simply be recording an observable phenomenon — leading the reader to wonder whether politics does need to become more courageous.
This last point cuts to the core of an unresolved challenge McCain faces in writing this book. Throughout, he returns to words rich with ethical resonance — like conscience, moral, honor, and duty — to explain how courage works. On several occasions, he explicitly considers the topic of moral courage. Yet he never quite sorts out its relation to physical courage. At times he notes that moral courage trumps physical courage — that it is “the enforcing virtue, the one that makes all the others possible.” Elsewhere, however, he insists that the two are really much the same.
But then, this book never set out to carry a lot of conceptual freight. It is, in his own description, “a small book.” Inspirational, sensible, candid, it makes its largest point simply by appearing. That a sitting senator in 2004 should take the trouble to publish a book on a classical virtue — and that the market should receive it with such interest — reminds us how much the public longs for leaders who think about, and lead with, moral values. No wonder Democrats want him on their ticket.
©2004 Institute for Global Ethics
“As you have said, the war against terrorism is a new kind of war. The nature of the new war places a high premium on other factors, such as the ability to quickly obtain information from captured terrorists and their sponsors in order to avoid further atrocities against American civilians. In my judgment, this new paradigm renders obsolete Geneva’s strict limitations on questioning of enemy prisoners and renders quaint some of its provisions.”
– White House counsel Alberto Gonzalez, in a written memo to President Bush on January 25, 2002, endorsing a plan to ignore portions of the Geneva Conventions when interrogating captured members of the Taliban or al Qaeda. The policy was adopted by Bush, whose use of sweeping executive powers to designate captured fighters as “enemy combatants” without the protection of traditional laws, has prompted legal challenges currently before the U.S. Supreme Court. The newly revealed memo, quoted in Newsweek, has raised the question of “whether the Bush administration set up a legal foundation that opened the door for the mistreatment” of Iraqi prisoners now making headlines, according to the Associated Press. (“The Roots of Torture,” Newsweek, May 24; “Abuse Scandal Focuses on Bush Foundation,” AP, May 17)
WASHINGTON
As the abuse of Iraqi prisoners by U.S. forces continues to dominate headlines, the military announced that the first court-martial to address the situation would take place this week.
Army Spc. Jeremy Sivits, who took some of the photos now circulating widely, is scheduled to face a military tribunal on Wednesday in Baghdad. Among other charges, he is accused of dereliction of duty for failing to stop the abuse.
While Sivits faces up to a year in prison and various other penalties, stiffer sentences may await six other soldiers charged with more serious crimes, reported the New York Times.
Sivit’s trial, which will be open to the media, was not the only news last week to spark scrutiny and continued debate over the ethics of the military and those involved. Among the developments:
LONDON
After many years of tackling prejudice with separate agencies and efforts, the United Kingdom last week announced that it was changing course, unveiling plans to put all of its anti-bias agencies under a single roof at a new Commission for Equality and Human Rights (CEHR).
The plan would unify the United Kingdom’s multiple government offices tasked with combating bias based on gender, race, age, ethnicity, and sexual orientation, reported the Financial Times.
As British society has awakened to different forms of bias, the government has kept pace by forming new agencies — a somewhat piecemeal approach that should be better coordinated, ministers decided.
The new CEHR will bring together three current watchdog agencies: the Commission for Racial Equality, the Disability Rights Commission, and the Equal Opportunities Commission.
“Every one of us should have the chance to fulfill our potential, live with respect and dignity, and not face the fear of prejudice, discrimination, and hate,” Secretary of State for Trade and Industry Patricia Hewitt said last week, pledging to fight discrimination in society and the workplace.
“As individuals, our identities are diverse and complex. People don’t define themselves as just a woman or black or gay, and neither should our equality organizations,” she added. “The CEHR will bring together knowledge and experience to overcome and challenge all types of discrimination.”
While the move was widely welcomed, some cautioned that without bolstered powers of enforcement and a concerted effort to stay sharp and vigilant, a mere agglomeration could weaken current oversight, according to the BBC.
SAN FRANCISCO
Popular U.S. clothing retailer Gap Inc. last week released a report aimed at gauging its factories’ compliance with ethics standards, winning praise for its candor in admitting that there are problems.
After two years of pushing by labor-rights and anti-sweatshop groups, Gap, which also operates the Old Navy and Banana Republic chains, undertook the massive effort of inventorying practices at roughly 3,000 overseas factories spread throughout more than 50 countries.
Although about 90 percent of factories failed to meet company standards upon initial inspection, Gap said that many facilities were able to make improvements, reported the San Jose Mercury News.
Still, the company conceded, “few factories, if any, are in full compliance all of the time.”
Problems cited in the 44-page report include improper storage of hazardous materials, machinery without sufficient safety devices, inadequate first aid, anti-union activities, discrimination, and underage workers.
Gap said it closed down 136 factories last year due to severe or repeated violations, with China and Southeast Asia accounting for the highest number of closures at 42 each, reported the Reuters news agency.
Gap chief executive Paul Pressler last week helped release the report, urging other clothing firms to join in a common effort to set uniform standards for foreign factories, noted the Mercury News.
“We feel strongly that commerce and social responsibility don’t have to be at odds,” Pressler said.
Conrad MacKerron of the As You Sow Foundation, which had been pushing for the Gap to audit its factories, welcomed last week’s report as an important step for the garment industry.
“If Gap can do its report without damage to its supply chain, we intend to now go ask their competitors, ‘Why can’t you also report so we can compare their performance to your performance?’” MacKerron told the Mercury News.
NEW YORK
Citigroup, the world’s biggest financial services firm, agreed last week to pay $2.65 billion to settle a series of class-action suits accusing the firm of misleading investors into buying WorldCom stock before 2002.
The settlement ends a number of suits alleging that Citigroup and its analysts, including star Jack Grubman, touted WorldCom stock even though its own private analyses noted that the stock was a bad buy.
Under the weight of massive accounting irregularities, WorldCom filed for the biggest bankruptcy in U.S. history in July 2002.
Citigroup, its Salomon Smith Barney division, and other finance firms are wrestling with lawsuits and investigations into whether they allowed their desire to win lucrative banking contracts with powerful companies to color their brokerage advice, according to a report from the Associated Press.
Last week, Citigroup denied any wrongdoing, but agreed nevertheless to pay $2.65 billion in order “to put an unfortunate chapter behind us,” according to chief executive Charles Prince.
While Citigroup refused to concede any violation in the WorldCom case, New York State Comptroller Alan Helvesi split no hairs in denouncing the firm in a brief filed last month, noted the New York Times.
“Grubman fraudulently manipulated the underlying financial analyses he used to value WorldCom stock to maintain falsely inflated target prices for the stock and justify a ‘buy’ rating,” Helvesi wrote. “[P]roviding accurate stock ratings conflicted with Salomon’s paramount goal of securing investment banking business, and not giving true and accurate information to investors.”
Citigroup also said it has set aside $6.7 billion for potential claims stemming from its involvement with Enron Corp. and to pay for settlements involving other inquiries and irregularities, noted the AP.