Don’t get me wrong: I love bananas and always have. But until last week I never understood banana economics. Why are they so cheap? How can my grocer in Camden, Maine, sell a banana grown in an overseas jungle for less than a local apple? How can the complexity of transporting heavy, perishable fruit 2,000 miles in an age of rising fuel costs compete with a crate of in-state Cortlands slid into the back of a pickup truck and delivered from a few miles away? However it works, I can buy a banana typically for about half the price of an apple of the same weight.

Last week Chiquita Brands, the Ohio-based global banana company, agreed to pay a $25 million fine after admitting to the U.S. Justice Department that it had paid protection money to a terrorist organization in Colombia. Hearing that news, I found the economic tumblers beginning to fall into place. This is a classic case of the ethics of sourcing — or, more precisely, its absence. This is why nongovernmental organizations around the world have been insisting for years that a corporation’s ethics report card must include a moral assessment of its supply-chain practices. Crucial to those practices is a company’s willingness to address the wage differentials between workers on a Colombian banana plantation (who make a few dollars per day) and in an Appleton orchard (who make quite a few more dollars per hour) — especially when, to benefit from those differentials, the company is forced to pay protection money.

The dilemma facing Chiquita in 1997, when it began making payments to the United Self-Defense Forces of Colombia (known by its Spanish acronym, AUC), was never an easy one. In Colombia’s notoriously lawless countryside, narco-terrorists ran roughshod over the forces of law and order — or collaborated with them in a mutual game of shakedowns, kidnappings, and murders. Foreign companies doing business in Colombia and other rural hotspots around the globe were easy targets: Many of them had money, cared about their employees, and were willing to strike deals with terrorists as a cost of doing business. While many set up extensive security services of their own, they still found they had little choice but to engage in payoffs.

Chiquita was not immune to those threats. One of the largest global food companies, its 25,000 employees in more than 70 countries generate $4.5 billion in annual revenues, making it a natural target for extortionists. In a statement last week explaining the $25 million fine, Chiquita CEO Fernando Aguirre noted that the company had “been forced to make payments to both right- and left-wing paramilitary groups in Colombia to protect the lives of its employees.” Among those groups, according to the Justice Department, was AUC. One of the bloodiest of the cocaine trafficking organizations, it was designated as a terrorist organization by the U.S. government in 2001. Chiquita’s payments, which court documents put at $1.7 million, began in 1997 and ran until 2004. In 2003, Chiquita executives approached the Justice Department, and the company has been cooperating with the investigation ever since.

What’s all that got to do with the price of bananas? Simply this: that the price may be too low. Suppose a multinational company wants to continue producing bananas ethically. Suppose, in other words, it wants to continue improving the ethics of its vendor relationships up and down the supply chain. If that’s the goal, there are some countries where it simply cannot operate with a good conscience — because, while the labor rates are very low, the threat of terrorism is extremely high. Yet it also needs to show profitability and keep costs down, which get harder to do as it pulls out of some of the most economically advantageous but ethically problematic regions of the world.

So here’s the question: Is the U.S. public willing to pay as much for bananas as for apples? We clearly care enough about terrorism to want laws against it. Increasingly, we also desire to buy from suppliers who take environmental and labor conditions into account. But do we recognize that those laws and desires have an economic cost? Are we willing to pay that cost at the supermarket? How much more would we pay for a banana if we knew that some part of our money was not being hived off to support terror and trafficking?

The hard fact, after all, is that it wasn’t just Chiquita’s money that paid the terrorists. True, Chiquita executives made the decision, but it was our money. We stood there in the produce section, weighing our options between apples and bananas. When we bought the bananas, we consumed them happily, enjoying their low price. But we never paused to consider why the price was low.

It’s time to ask whether we are better off living in a world of cheaper fruit and global terrorism, or of costlier fruit and global peace. As the Chiquita story reminds us, it’s time to raise again the age-old question that hits us every time ethics and the economy collide: How much are my principles worth?

©2007 Institute for Global Ethics

“We didn’t intend our presidents to be kings or to be allowed to act like kings. Their records belong to us.”

– Thomas Blanton, director of the National Security Archive at George Washington University, speaking recently about efforts by President Bush to bar the release of millions of pages of official records. A bipartisan effort in Congress is seeking now to overturn a 2001 executive order by President Bush that “allows former presidents and their heirs to keep White House papers secret forever,” reversing a standard of openness installed after Richard Nixon tried to seal or destroy documents related to Watergate, reports the Dallas Morning News.

“Historians and scholars need access to our nation’s history as it happened, not as a former president wished that it happened,” says Rep. Henry Waxman (D-Calif.), one of the lawmakers leading the effort to restore the Presidential Records Act of 1978.

Earlier this month, the House voted to overturn Bush’s 2001 executive order, and adopted three other bills designed to improve open government, notes the Reuters news agency. The Senate is expected to take up similar measures soon. President Bush has said he will veto the presidential records bill, as well as a bill strengthening protections for government whistle-blowers, should they reach his desk.

WASHINGTON
U.S. attorney general Alberto Gonzales last week rejected calls for his resignation as an unfolding scandal centering on the firings of eight U.S. attorneys dominated the week’s news in ethics.

At issue is the claim that several of the fired prosecutors were targeted for political reasons and were replaced with up-and-comers more loyal to the Bush administration, according to UPI.

The controversy heated to a boil late last week when an email document released by the Justice Department showed top Bush adviser Karl Rove asking the White House counsel’s office in 2005 whether it planned to proceed with a proposal for a mass firing of all prosecutors, later scaled back to target only a handful, the Washington Post reports.

While Rove opposed the initial proposal, the emails appear to indicate a deeper level of White House involvement than was originally acknowledged, according to the Los Angeles Times.

Federal law permits the president to hire and fire U.S. attorneys at will, and former president Bill Clinton did exactly that when he replaced all 93 of them when taking office. But Mary Jo White, one of those Clinton appointees, told Newsweek that “replacing political appointees is part of the normal political process when the party of the president changes,” but that it is “quite atypical, absent some misconduct or other quite significant cause” for replacements to be made in the middle of a president’s term.

White says it would be “very, very disturbing” if they were removed for not waging politically advantageous prosecutions or for a lack of perceived loyalty.

The newly released emails appear to show that such considerations were part of the firing process, with Gonzales’s chief of staff, Kyle Sampson, ranking all 93 U.S. attorneys on factors including whether they “exhibited loyalty” to Bush and Gonzales, reports the Washington Post. Sampson resigned last week.

Before the release of the emails, the Justice Department had steadfastly insisted that all of the firings were performance-related, with Alberto Gonzales dismissing the controversy as an “overblown personnel matter,” notes USA Today.

Over the weekend, Sen. Patrick Leahy (D-Vt.), chairman of the Senate Judiciary Committee, said that he will push for public testimony under oath from Karl Rove, Kyle Sampson, and Harriet Miers, the former White House counsel.

While most observers expect President Bush to invoke executive privilege to block such testimony, Leahy said the private, no-oath meetings preferred by the White House will no longer suffice, especially after weeks of shifting explanations from the Justice Department about why the attorneys were fired and what role politics played in the matter.

“I do not believe in this ‘We’ll have a private briefing for you where we’ll tell you everything,’ and they don’t. I want testimony under oath. I am sick and tired of getting half-truths on this,” Leahy said on ABC’s “This Week,” reports the New York Times.

SAN FRANCISCO
In an ethical and legal confrontation that amounts to a line drawn in the sand between “old” and ‘new” media, Viacom last week sued YouTube, claiming that the popular video-sharing site violates copyright by publishing Viacom-owned clips.

Viacom also sued Google, which bought YouTube last year for $1.65 billion, according to the San Francisco Examiner.

At the crux of the dispute is what the San Jose Mercury News calls one of the “key laws” of the digital age: the Digital Millennium Copyright Act, which relieves Web content hosts of most infringement responsibility if they immediately remove copyrighted material after a notification from the owner.

But Viacom argues that this places the cost of enforcement on “the victims of infringement,” according to the Mercury News report. Viacom claims in court papers that the provisions of the act don’t apply in this case because YouTube makes appropriating copyrighted works “the cornerstone” of its business model.

As noted in an analysis from the Economist, YouTube “ostensibly … owes its stunning rise to the popularity of ‘user-generated content’ — home videos that amateurs upload for fun. There are indeed plenty of those on YouTube. But advertisers seem unable to make any use of clips featuring dogs on skateboards or teenagers trading expletives. So YouTube’s paltry revenues — about $15m last year, according to Robert Peck at Bear Stearns, a broker — in fact depend on old-fashioned, professionally produced content. This is why Google and YouTube have recently struck deals with such media companies as CBS and the BBC. Others, such as NBC and Viacom, have been holding out.”

The New York Times reports that the suit throws a wrench into the gears of YouTube’s business plan, which was to seek an alliance with “old media” firms to not only gain access to programming but shield itself from liability for past copyright violations.

LOS ANGELES
Blogging, a practice so new that the word hasn’t yet worked its way into many dictionaries, is also uncharted territory in ethics texts. Examples from last week’s news include:

• The Los Angeles Times profiles blogger Colleen Caldwell, who features “rants and riffs” about such varied topics as charity campaigns and new movies — and who is paid by various firms to do so. While she may make only about $12 for a movie mention, her blogging-for-dollars arrangement can bring in thousands. According to the Times report, thousands of bloggers, paid by marketing middlemen, are “blogging for dollars,” causing critics to charge that they are blurring the ethical line between unbiased opinion and advertising. The middlemen argue that the financial arrangements are usually disclosed and that they are helping individuals make money from their blogs.
• An article in last week’s San Francisco Chronicle details the controversy surrounding Ed Jagels, the district attorney of Kern County, California, who raised eyebrows with his blog, one of many across the nation promoting prosecutors’ views about court decisions, politics, hostile news coverage, and their own careers. The Chronicle reports that the trend is highlighting questions about the ethics of such commentary as well as the legal implications of prosecutors commenting on current cases. Legal ethicist Diane Karpman tells the Chronicle that such blogging is “unseemly” and could impact district attorneys’ “ability to prosecute cases is a fair and objective manner.”
• The medical profession also is seeing a spike in controversies related to blogging. The Detroit Free Press reports that doctors’ observations about their patients are often expressed explicitly on their blogs, and sometimes with enough detail that an observer could deduce identities. While some doctors say their blogs offer them a needed outlet and allow for valuable public discourse, critics say the practice can inhibit patients from talking frankly with medical professionals. The Free Press notes that blogging is so new a concept that medical boards, universities, and medical professionals disagree on the propriety of the practice.

CHICAGO
Jury selection was completed last week in the trial of Canadian media tycoon Conrad Black — a process that revealed some surprisingly candid juror attitudes about CEOs.

The jury was empanelled after 86 people were questioned over a two-day period. Prospective jurors were quizzed aggressively about their attitudes toward executive white-collar crime, according to the Toronto Globe & Mail.

An analysis from the Edmonton Sun notes that juror attitudes about alleged CEO transgressions make it challenging to find an impartial jury. Sun correspondent Peter Worthington, covering the trial in Chicago, writes that the judge “has tried over and over to convince potential jurors that someone is not necessarily a crook because he makes million of dollars, and is not bilking the government if he has a legal tax loophole, and that an FBI agent’s testimony is not necessarily more credible than a CEO’s.”

The Chicago Tribune notes that even a prospective juror who suggested she was already convinced Black had done something wrong was eventually accepted on the jury. She said Black and his defendants must have done something wrong “if they got into trouble and needed to be in court.” Although the defense attempted to have her removed, the judge ruled that prospective juror had indicated that she accepted that the defendants are presumed innocent.

Black is accused of stealing $84 million from Hollinger International Inc., the newspaper chain he once owned. Three of his former executives also are on trial. All have pleaded innocent, reports the Toronto Star.

FROM VARIOUS DATELINES
Corruption issues figured in several ethics-news reports from Asia last week. Among the top stories:

• A new poll shows the Philippines are perceived as Asia’s most corrupt economy. The survey, conducted by an organization called Political and Economic Risk Consultancy, ranked Thailand and Indonesia as the next most corrupt nations. Bloomberg reports that the findings are a setback to the government of Philippine president Gloria Arroyo, who survived two impeachment attempts based on allegations of cheating in the 2004 election. A government spokesman told the Philippine Star that it is clear that a “culture of corruption” has crept into the society over many decades, but maintained that the current government has undertaken “strong, steady” reforms. The survey named Singapore and Hong Kong as the least corrupt locales.
• The same survey ranked South Korea in a surprisingly low eighth position, dropping three slots toward the “more corrupt” side of the ledger since last year. The Seoul newspaper Chosun Ilbo noted that the survey, which measures perception of corruption by expatriates, ranks South Korea as even more corrupt than China.
• South Vietnamese media are reporting on the trial of a former vice minister of trade accused of bribery in a corruption scandal involving exports to the U.S. The Vietnam News Agency reports former deputy trade minister Mai Van Dau and 13 trade officials are accused in a bribery case that has been one of the centerpieces of the government’s crackdown on corruption. Dozens of senior Communist Party and government officials have faced similar charges in the past year, according to the Hanoi-based Thanhnien News.
• In a report to the People’s National Congress last week, Chinese chief justice XiaoYang reported that the nation’s anticorruption campaign resulted in 825 convictions of government officials last year, including nine high-ranking provincial and ministerial appointees, according to a report from the official government publication People’s Daily. Four Chinese judges also were charged with accepting bribes to fix cases, China Central Television reported.
• The wife of Thaksin Shinawatra, the former Thai prime minister ousted in the midst of corruption allegations, will be charged with tax evasion and could face 14 years in prison. Potjaman Shinawatra is under investigation by a government panel that is attempting to unravel the allegedly corrupt financial dealings of the exiled prime minister and his family, according to reports from Radio Australia and the Bangkok Post.

BEIJING
China last week said that the use of organs from executed prisoners is strictly regulated and carried out only in “exceptional cases.”

The Associated Press reports that official from the Chinese state media were reacting to charges from human rights groups that many organs, including some sold to wealthy foreigners, are harvested from executed prisoners who may not have given permission.

The official government news agency Xinhua issued a statement quoting an unidentified official who said that “the main source of organs for transplant in China is voluntary donation by deceased citizens in accordance with their last wills.”

But the Jurist, a publication of the University of Pittsburgh Law School, notes that a variety of human rights groups have charged that the organ trade, in fact, is an unregulated and lucrative black-market business.

In related news, a Calgary, Canada, firm last week came under fire for allegedly helping North Americans to obtain livers and lungs from China. The Ottawa Citizen reports that a company called Overseas Medical Services “assists patients with purchasing organ transplants for $120,000 U.S., facilitating four transplant surgeries recently for Americans who faced lengthy wait lists at home.” The Citizen reports that human rights advocates in Canada are demanding that Ottawa and the provinces enact laws prohibiting Canadians from being involved in the international organ trade, again charging that many organs are harvested from executed prisoners.

The same theme is being echoed in New Zealand, where a medical academy is warning patients thinking about having a transplant in China to “consider where the organs came from,” reports Radio New Zealand.

MONROVIA, Liberia
Liberia’s former interim president was arrested last week on charges of stealing public funds, punctuating the current government’s anticorruption campaign.

Gyude Bryant faces up to 10 years in prison for allegedly stealing $1.4 million from the government, according to the Liberian Times.

Voice of America reports that Bryant has denied all charges.

Bryant was appointed to lead the interim government of the troubled nation after former warlord Charles Taylor was deposed in 2003, holding power until Ellen Johnson Sirleaf was elected president in 2006.

The Associated Press reports that the Sirleaf government’s anticorruption campaign has been welcomed by the Liberian citizenry, who are exhausted by war and unrest and live with limited electricity, a crumbling transportation system, and a ruined industrial base.

The South African Independent reports that a recent audit of the Liberian government implicated several other high officials in the looting of government funds.

PARIS
When French president Jacques Chirac concludes his term in May, he will lose the immunity granted under French law to heads of state — and will likely face at least one corruption probe, according to press reports.

The most anticipated case dates back to his term as mayor of Paris, and several of his political allies already are under investigation, the BBC reports.

According to the Associated Press, a case dossier with Chirac’s name on it is locked in an investigator’s safe, where it will remain until the president’s immunity expires.

The London Telegraph reports that Chirac may face other cases involving allegations he illegally used Paris city funds to pay staff and political allies, rigged contracts, and accepted free airline tickets.

Katrin Bennhold of the Paris-based International Herald Tribune notes: “Chirac’s cases will provide a test for the French judicial system, which has long faced criticism for ties with the political class. Scandals have been a regular feature in administrations of all political colors, but few of them have resulted in high-level convictions. Magistrates insisting on independence have sometimes made claims of intimidation.”

A magistrate familiar with the case told the Herald Tribune, “If Chirac is pursued, as every regular citizen would be, it would create a powerful precedent. For starters, it would affect the way future presidents act.”

Chirac has denied all allegations of wrongdoing.

From the Scripps Howard News Service at Ohio University:

“Americans increasingly suspect the federal government has become cloaked in secrecy, a concern they don’t have with their local and state governments.

“People also overwhelmingly believe that their federal leaders have become sneaky, listening to telephone conversations or opening private mail without getting court permission, according to a survey of 1,008 adults commissioned by the American Society of Newspaper Editors for national Sunshine Week, March 11-17.

“By a 2-1 margin, people want FBI agents and other investigators to obtain search warrants before monitoring private communications, even if they suspect terrorism….

“Twenty-five percent believe the federal government is either ‘very open’ or ’somewhat open,’ while 69 percent said it’s either ’somewhat secretive’ or ‘very secretive.’

“That’s a shift from a similar poll last year, when 33 percent thought the federal government was open and 62 percent thought it was secretive. About 6 percent and 5 percent were undecided in the 2007 and 2006 polls.

” ‘This is quite disturbing news,’ said David Westphal, Washington editor for McClatchy Newspapers and co-chairman of ASNE’s Freedom of Information Committee. ‘When only 25 percent of the people consider theirs is an open government, that’s a real problem in a democracy.’

“The perception of secrecy has not eroded public confidence in other levels of government. A clear majority said they believe their local and state governments are open to public scrutiny….

“…[A]dults in the poll were deeply divided on whether the press should report on government actions even when their own privacy is at issue. Forty-six percent said they approve of the disclosure that the National Security Agency had been monitoring international telephone calls without permission from a court, and 45 percent said they disapprove. Nine percent were undecided.

“‘This is a complex issue with a range of views. Different people hold different levels of respect for the watchdog role of journalism,’ said Robert Steele, who teaches press-ethics issues at the Poynter Institute. ‘Editors must constantly make judgments on how much information should be given to the public.’

“Only 43 percent approved of press reports that the CIA has used electric shock and water torture during interrogations, 41 percent approved of disclosure that the CIA operated secret prisons in Eastern Europe and 38 percent approved of the press requiring disclosure of the identities of most of the enemy combatants held at a special prison in Guantánamo Bay, Cuba.

“The survey found that support for news-media decisions to disclose questionable government operations rose substantially among better-educated Americans. Almost two-thirds of people who have continued their college education beyond a bachelor’s degree said they approve of the disclosure of the NSA domestic spying program….”

“Vigilance is not only the price of liberty, but of success of any sort.”

– Henry Ward Beecher (U.S. clergyman, 1813-1887)