For more information, see this week’s Research Report.

by Rushworth M. Kidder

It’s said that people buy more chocolate during economic downturns. Maybe it’s the only fun they can afford. Maybe it’s a cheap pick-me-up, or an escape mechanism, or a longing for simple childhood comforts. Whatever the reason, chocolate apparently is countercyclical: As the economy slows, chocolate sales rise.

I’m beginning to suspect that ethics also is countercyclical. Over the years, I’ve sensed a deepening of public concern over moral issues whenever the economy falters.

If that’s so, this past week not only should benefit Hershey’s and Cadbury; it also should drive ethics higher up the national agenda. With stocks sliding, oil prices rising, the housing market dragging, Midwest crops flooding, and global food shortages appearing, we well may see a greater interest in returning to ethics basics.

But why? Is there a link between moral insolvency and an economic slowdown? That suspicion was renewed last week with the arrests of two former executives at Bear Stearns (which was bailed out by the feds in March in a high-profile effort to stabilize the housing market) on charges of fraud related to the credit debacle. Last week, too, Canadian investigators brought criminal charges against three former top executives of Nortel, the Toronto-based telecommunications company long revered as a safe investment, in connection with an accounting scandal that severely rattled Canadian markets in 2004.

There also may be a link between political ethics and the economy. The Gallup Organization has just released data from its May 2008 survey showing that Republicans are particularly concerned about “the overall state of moral values.” This year and last, 51 percent of Republicans felt the nation’s moral condition was “poor” — up from a steady 36 percent between 2002 and 2006. Views of Democrats and independents, however, still sit at the 36-percent level.

The result puzzled Gallup’s analysts, who could find no apparent reason for this anomaly. But surely there are a few options:

1. Quagmire. Gallup asked participants about 16 issues, including abortion, homosexuality, cloning, gambling, polygamy, and divorce. Unlike their liberal colleagues, conservatives may feel stalemated on many of these fronts, leading to pent-up frustration that finally surfaced in this poll.
2. Skew. Gallup’s list didn’t include national security, education, immigration, or other current issues fraught with ethical overtones. Those issues might have given Republicans more reasons to applaud.
3. Definition. Listing only topics in the news, Gallup effectively defined morality in public-policy terms. Had Gallup used a virtues-based lens — asking about values such as honesty, respect, responsibility, fairness, or compassion — would Republicans have expressed less concern?
4. Exhaustion. President Bush’s approval ratings are in the cellar, even among some conservatives. With little time left to address ethics issues — and little visible appetite in the administration for doing so — once-loyal Republicans may be throwing in the towel.

But suppose Gallup got it right. Suppose a newly energized slice of the nation is, countercyclically, sounding the moral Klaxon. Have they recognized that unethical executives who deliberately wreck their companies may inadvertently be destroying whole economies as well? Are they sensing that while economic downturns can stem from broad, global forces, this one may have been abetted, at least in part, by local chicanery and turpitude? Are they realizing that a politics of divisiveness, animosity, and stalemate is not only inefficient and negligent but fundamentally immoral? Are they recognizing that when times are good, nobody wants to rock the boat with this “ethics stuff” — but that when times are tough, we face hard questions from the helmsman of our conscience? Are they feeling that perhaps we’ve overdosed on global resources — and that the globe finally may be pushing back?

If ethics is increasingly in demand, what the seekers will need most aren’t platitudes and surveys but ethical pathways and decision-making frameworks — structures to help embed integrity and resolve moral dilemmas all the way from the kindergarten couch to the CEO suite. But they’ll also need to be assured of something else: This didn’t need to happen. We didn’t have to wait for an economic shock to wake us up. We’re not so dumb that we can’t contemplate and correct our ethical future before it catches us unawares. And we’re not so hedonistic that we happily trash the moral long term as long as the short term feels great.

How do we know we’re not? Because, apparently, when times get tough we still care enough to be morally countercyclical.

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©2008 Institute for Global Ethics

Questions or comments? Write to newsline@globalethics.org.

“If the detainee dies, you’re doing it wrong.”

– CIA counterterrorism lawyer Jonathan Fredman, speaking to military and intelligence officials gathered at the U.S.-run detention camp in Guantánamo, Cuba, in 2002, according to minutes from the meeting. “The document, one of two dozen released by a Senate panel investigating how Pentagon officials developed the controversial interrogation program introduced at Guantánamo Bay in late 2002, suggests a larger CIA role in advising Defense Department interrogators than was previously known,” reports the Washington Post.

Source: Washington Post, June 18.

* * *

“We may need to curb the harsher operations while ICRC [International Committee of the Red Cross] is around. It is better not to expose them to any controversial techniques.”

– Now-retired military lawyer Lt. Col. Diane Beaver, as recorded in minutes from an October 2002 meeting at Guantánamo Bay. According to McClatchy Newspapers, newly released documents show that the “U.S. military hid the locations of suspected terrorist detainees and concealed harsh treatment to avoid the scrutiny” of the Red Cross.

Source: McClatchy, June 17.

* * *

“They had a gigantic amount of costs they couldn’t justify. Ultimately, the money that was going to KBR was money being taken away from the troops, and I wasn’t going to do that.”

– U.S. Army official Charles Smith, talking to the New York Times last week. Smith, who oversaw the U.S. government’s multibillion-dollar contract with KBR during the first two years of the Iraq war, says he was summarily removed from his post after threatening to withhold payments and bonuses to KBR over the company’s inability to justify more than $1 billion in questionably charges. Smith says KBR refused to act on his warning until he directed one of his deputies to hand-deliver a letter to the company. Two days later, Smith and the woman who delivered the letter were both summarily removed from their jobs and reassigned. They were replaced by a contractor, RCI Holding Corporation, which approved the payments and bonuses for KBR, once a subsidiary of Halliburton, the firm formerly run by U.S. vice president Dick Cheney. This spring, both KBR and RCI were awarded new contracts, notes the Times.

Source: New York Times, June 17.

Developments include compromise spy legislation, a report that Justice Department lawyer was reassigned because he opposed administration views on harsh interrogations, the ethics debate over offshore drilling, and a New Orleans congressman who will seek reelection despite corruption charges

WASHINGTON
Several ethics-related news stories garnered headlines last week in the Beltway press. Among them:

• The U.S. House of Representatives voted in favor of a spy law that would shield telecommunications companies from legal liability for opening their records and networks to government investigators in apparent violation of existing wiretap laws. The technology news network CNET reports that the threat of lawsuits to telecoms had been a major sticking point in revising the Foreign Intelligence Surveillance Act. Telecoms face lawsuits over their participation in the warrantless surveillance program started by President Bush after the 9/11 terror attacks. While not granting complete retroactive immunity, the bill will allow courts to dismiss suits if telecoms present written documentation that the government asked a company to participate and assured the firm that its actions were legal, according to CNET.
• ABC News reports that former U.S. attorney general Alberto Gonzales ousted a top lawyer who disagreed with the administration’s position on what constitutes torture. Gonzales asked Daniel Levin to leave in early 2005 shortly after Levin wrote an opinion declaring torture “abhorrent” and limiting the administration’s use of harsh interrogation techniques, according to the ABC report. The story cited unidentified sources as saying that Gonzales, concerned about the appearance of removing Levin under the circumstances, arranged for him to be offered a “less significant” position outside the Justice Department.
• Weighing environmental costs against the hardships imposed by soaring oil prices, the Bush administration last week called on Congress to lift the ban on domestic offshore oil drilling. Bush noted that the situation reflected a long-term versus short-term dilemma, in that alternative energy technologies offer a solution to demand for oil in the future, but “in the short run the American economic will continue to rely largely on oil, and that means we’ll need to increase supply especially here at home,” Forbes reported. Bush’s call was criticized as fraudulent posturing by New York Times economics columnist Thomas Friedman, who slammed the president and other GOP leaders for perpetuating the nation’s dependence on oil while blocking nearly all significant measures to improve fuel efficiency and foster renewable energy development over the past six years.
• Rep. William Jefferson (D-La.) announced that he will seek reelection to a tenth term even though he is preparing to go on trial for political corruption, the New Orleans Times-Picayune reports. Jefferson was stripped of his position on the powerful House Ways and Means Committee seat after a federal raid on his congressional office.

Sources: New York Times, June 22 — ABC News, June 21 — New Orleans Times-Picayune, June 21 — CNET, June 20 — Forbes, June 19.

For more information, see: Related Newsline story, May 12 — Related Newsline story, Mar. 24 — Related Newsline story, Feb. 11 — Related Newsline story, Sep. 10, 2007 — Related Newsline story, June 26, 2006.

Indian press says there’s anger that giant retailer cut relations rather than working to fix the issue

LONDON and NEW DELHI
A major British fashion chain last week said it has cut ties with its Indian suppliers after learning that the firms use child labor.

The Times of London reports that Primark said it will drop three firms that made thousands of clothes after discovering they had subcontracted work to firms using children as embroiderers.

According to a report from the Financial Times, the violation of the firm’s ethical sourcing code came to light after a BBC investigative documentary into child labor.

Primark stressed that it took swift action as soon as it found out about the allegations.

In an analysis, the Independent’s Sarah Arnott, notes: “Such robust condemnations are a sign of the public relations issues raised by offshore manufacturing. In response to growing public repugnance at sweatshop labor, ethical concerns have shot up the retail agenda. All members of the British Retail Consortium, which represents 80 percent of the country’s retailers, have signed up to the independently audited Ethical Trading Initiative. The code of practice covers such issues as the free choice of employment, the right to collective bargaining, safe working conditions, and payment of a living wage.”

But the Press Trust of India reports that some in that nation are criticizing Primark for dropping the suppliers rather than working with them to improve conditions.

Sources: Times of London, June 20 — Independent, June 16 — Press Trust of India, June 17 — Financial Times, June 16.

For more information, see: Related Newsline story, July 9, 2007 — Related Newsline story, Nov. 5, 2007 — Related Newsline story, Feb. 12, 2007 — Related Newsline story, Aug. 21, 2006 — Related Newsline story, June 12, 2006.

Running of Olympic torch through Tibetan capital stirs resentment; New York Times reports that in zeal for gold, Chinese athletes are pushed to compete with injuries; and IOC mounts antigambling initiative

BEIJING and SHANGHAI
Several ethics issues dominated Olympic coverage last week. Among the stories:

• China sent the Olympic flame through the streets of Tibet’s capital, Lhasa, last week, though there was barbed wire to keep ordinary Tibetans away and residents were told to stay inside their homes. The Globe & Mail reports that a small group of foreign journalists was allowed to see only the beginning and end of the run. Human rights groups were critical of the decision to run the torch through the Tibetan capital, according to the report. Recent separatist demonstrations in Tibet were crushed with violence, leading some critics to call for a boycott of the Beijing Olympics.
• The New York Times reports that China, in its quest for Olympic gold, routinely pushes injured athletes to compete. The report cites the case of Hu Jia, China’s champion 10-meter platform diver, who won gold in the 2004 Athens games. Despite diving injuries to both of his retinas, Hu is training for the upcoming Olympics — a decision likely motivated by cultural pressure, financial promise, and powerful nationalistic forces, reports the Times. According to the report: “For many athletes, playing through injuries is standard practice. Most of China’s Olympic-caliber competitors are tightly controlled by a system that manages almost every aspect of their lives, often from early childhood. This includes housing, education, medical care, and interactions with the public and the news media. In this system, decisions about training regimens and the risks of injuries do not get much of a public airing.”
• The International Olympic Committee (IOC) has introduced new antigambling measures, reports the Sydney Morning Herald. According to the report, the IOC will demand that all athletes, coaches, officials, and journalists sign documents pledging not to gamble or promote betting during the games.

Sources: Globe & Mail, June 21 — New York Times, June 20 — Sydney Morning Herald, June 19.

For more information, see: Related Newsline story, May 27 — Related Newsline story, May 27 — Related Newsline story, May 27 — Related Newsline story, May 19.

Judiciary had allowed some secret evidence because of rampant witness intimidation; prosecutors worry that the most recent ruling could overturn scores of convictions

LONDON
A British court last week ruled that it is improper to allow anonymous evidence to be admitted into some criminal cases — a decision that worries prosecutors, who fear that scores of previous convictions may be thrown out.

Judicial officials in Britain had been pondering an extension of existing law allowing teenage witnesses to give evidence of gun crimes anonymously, reports the London Daily Mail. In addition, other government agencies had favored allowing the elderly and other vulnerable witnesses to give evidence in secret.

The ethics angle: While being able to confront one’s accuser is a traditional part of British law, prosecutors say that witness intimidation has become increasingly commonplace, especially among the poor and within gang-ridden neighborhoods. The London Evening Standard reports that some in the judiciary are willing to bend tradition in order to protect the vulnerable.

But as a report from the U.K. Press Association notes, civil libertarians worry that witnesses who do not have to face cross-examination could concoct stories that lead to convictions based on false evidence from people seeking revenge or having other axes to grind.

John Yates, the assistant commissioner of the Metropolitan Police, says last week’s ruling backing the right to confront accusers is “potentially disastrous” because it may prompt many appeals by dangerous convicts, reports Sky News.

Sources: U.K. Press Association, June 21 — Guardian, June 21 — London Daily Mail, June 20 — London Evening Standard, June 19.

For more information, see: Related Newsline Commentary, June 16 — Related Newsline story, Mar. 3 — Related Newsline story, Jan. 22 — Related Newsline story, July 16, 2007 — Related Newsline story, July 2, 2007.

Test makes it easier to diagnose Down syndrome, worrying some who say abortion rates will increase; American Medical Association panel says ‘mystery shoppers’ have no place in doctors’ offices

VARIOUS DATELINES
Ethical issues relating to medicine and the life sciences made headlines last week. Coverage included the following stories:

• A new test that allows for easy determination of whether a fetus has Down syndrome is raising ethics questions. The method under development is much less invasive and dangerous that amniocentesis, a procedure in which a sample of fluid is drawn from the uterus. Because amniocentesis carries a risk of miscarriage, it is typically performed only in high-risk cases, such as a baby being carried by a mother in her 40s. The new test, if it passes regulatory oversight, would cause no danger to the fetus but could raise the abortion rate if more fetuses are diagnosed with the disorder, reports the London Daily Telegraph.
• In Chicago, the annual meeting of the American Medical Association’s policy-making House of Delegates gave a thumbs-down to an unusual proposal: “secret shoppers” to rate the quality of medical care. The Chicago Tribune reports that while secrets shoppers are used commonly to rate and improve the quality of service in retail stores, they probably won’t show up in doctors’ offices any time soon. Delegates to the Chicago meeting said they did not trust the concept, worrying that secret shoppers could clog the pipeline for real patients and could be used by lawyers in malpractice cases. Proponents argued that while secret shoppers would not be used to assess doctors’ clinical skills, they could have provided valuable insight into how physicians manage patient relationships, according to U.S. News & World Report.

Sources: London Daily Telegraph, June 21 — U.S. News & World Report, June 20 — Chicago Tribune, June 20.

For more information, see: Related Newsline story, June 2 — Related Newsline story, Mar. 17 — Related Newsline story, Nov. 5, 2007 — Related Newsline story, Oct. 1, 2007 — Related Newsline story, Sep. 17, 2007.

Reports include a shortfall of funding, gaps in delivery of aid by insular junta, and money being diverted

YANGON, Myanmar, and BANGKOK
The situation in Myanmar continues to be unstable as ethical and political issues related to providing aid continue to plague that isolated nation.

According to a report from the Associated Press, the United Nations warned last week that it might not be able to continue helicopter deliveries to cyclone survivors unless the international community provides more funding.

The helicopters were the centerpiece of a conflict between the outside world and the secretive Myanmar government, which refused to allow them into the ravaged nation for two weeks after the early-May cyclone, eventually relenting under withering international criticism.

As the Washington Post reports, the haphazard relief efforts by the Myanmar government have spawned a new type of social activism: citizen groups that, while not overtly political, have defied government travel bans to visit many parts of the devastated Irrawaddy Delta, delivering food and water and returning with photos that “contradict claims in the state media that life is returning to normal,” the Post says.

That stance by the government was behind a recent order to start drawing down the number of medics in the disaster area — a decision that Christian Science Monitor correspondent Simon Montlake describes as “another entry, perhaps, in the ledger of international outrage against a junta whose deep suspicion of foreign influence has slowed aid efforts.”

At last count, according to an article carried by Reuters AlertNet, the international community has invested about $85 million into Myanmar, but human rights groups increasingly are contending that the nation’s reclusive junta is misusing and manipulating the funding. A spokesman for Amnesty International is quoted as saying there have been reports where aid delivered by the junta was conditioned on victims’ willingness to vote in the May constitutional referendum or to join the military. According to the AlertNet article, Amnesty International said it confirmed 40 reports of soldiers or local government officials confiscating or diverting aid.

Sources: AP, June 21 — Washington Post, June 21 — Reuters AlertNet, June 20 — Christian Science Monitor, June 19.

For more information, see: Related Newsline story, June 2 — Related Newsline story, May 12 — Related Newsline story, Dec. 10, 2007 — Related Newsline story, Nov. 19, 2007 — Related Newsline story, Nov. 5, 2007.

Less than a quarter say their organizations ‘have a comprehensive ethics and compliance program in place’

From the Society for Human Resource Management and the Ethics Resource Center:

“In a new national survey, only 43 percent of human resources professionals said their organizations include ethical conduct as part of employees’ performance appraisals.

“In the study … human resource professionals said they are their organizations’ primary resource for ethics-related issues, and they help create ethics policies. But most don’t feel that they are truly part of the ethics infrastructure. Instead, they are just asked to ‘clean up’ the situations caused by ethics violations….

“Results of the study were compared, or benchmarked, to ERC’s National Workplace Ethics Survey, a broader study fielded in 2007. The current SHRM/ERC study questioned 513 human resource professionals on six key business ethics themes, while ERC’s poll surveyed 3,452 employees.

“According to the SHRM/ERC study, only 23 percent of HR professionals say that their organizations have a comprehensive ethics and compliance program in place, and 7 percent report that their employer has no program at all….

“‘Establishing a comprehensive ethics program is the foundation for building a strong ethical culture in any organization,’ said Dr. Patricia Harned, president of the ERC. ‘Since HR professionals are partners with ethics and compliance officers in building and maintaining a culture of integrity, it’s disappointing that less than one-quarter of them indicate that their organizations have established a full program.’

“‘But it is reassuring to see that 82 percent of HR professionals said they reported ethical misconduct when it was observed, compared with 61 percent of employees.’

“The study found that when HR professionals did not report wrongdoing, it was typically because they didn’t think they could remain anonymous, nor did they think that the people involved would be disciplined. Having a comprehensive ethics program addresses those concerns….

“Key findings in the survey:

• “Ethical misconduct most commonly identified by HR professionals included abusive or intimidating behavior toward fellow employees, plus abuse of e-mail or Internet privileges. Employees (U.S. average) cited instances of colleagues calling in ’sick’ inappropriately, and people taking credit for someone else’s work.
• “HR professionals think that top management (77 percent) would be less likely to be held accountable if caught violating their organization’s ethics standards than supervisors (86 percent) and non-management employees (91 percent).
• “A small proportion of HR professionals (19 percent) and employees (U.S. average: 11 percent) reported feeling pressure by others (within their organization or externally) to compromise their organization’s ethics standards, company policy, or the law.

“A complete copy of ‘The Ethics Landscape in American Business’ is available for sale….”

For the full press release, June 12, click here.

“It is not from nature, but from education and habits that our wants are chiefly derived.”

– Henry Fielding (English novelist, 1707-1754)