Question: “Do you think [the following industries] generally do a good or bad job of serving their consumers?”

Five Best
Supermarkets
Computer hardware companies
Online search engines
Hospitals
Computer software companies

 
Five Worst
Cable companies
Health insurance companies
Managed care companies, such as HMOs
Oil companies
Tobacco companies

Source: Harris Poll of 1,010 U.S. adults, conducted July 8-13, 2008

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

by Rushworth M. Kidder

The history of moral philosophy is littered with big, hairy arguments. Some are so antique they’re irrelevant. Others remain vitally important. Here’s one, put colloquially: “Hey, who needs ethics? We’ve got laws.”

Some lawyers (though fewer than you might think) are fond of this argument. So are some Enronesque corporations, happy to assert that “if it ain’t illegal, it must be ethical.” But the argument comes most clearly into focus when old laws don’t cover new crimes.

That’s the situation in a federal case involving Megan Meier, a 13-year-old Missouri girl we wrote about last December. She committed suicide in 2006 after “Josh,” a boy she’d met only on the social networking site MySpace, suddenly turned nasty and messaged her that “the world would be a better place without you.”

That tragedy would have been bad enough if Josh had been real. In fact, he was a fiction. While Megan thought she was chatting with another 13-year-old, she actually was corresponding with 47-year-old Lori Drew, the mother of one of Megan’s estranged girlfriends living four doors down the street. Drew invented Josh as a vengeful hoax in order to (as she reportedly told a neighbor) “mess with Megan.”

But what really iced this appalling cake was a kind of legal short-sightedness. It turns out that Drew’s behavior — cyberbullying, as it’s now called — wasn’t a crime under Missouri or federal law. As a local sheriff’s department spokesman put it at the time, what she did “might’ve been rude, it might’ve been immature, but it wasn’t illegal.” Now, finally, Drew is being brought to trial on October 7 — not in Missouri, however, but in California, where the MySpace servers are located. Reason: Federal prosecutors are having to use the Computer Fraud and Abuse Act, designed to prosecute Internet hackers who access computer accounts to steal data.

If Lori Drew walks free because judges can’t find any crime she committed, that conclusion will jar the national conscience, but it won’t be unprecedented:

• When 15-year-old Jonathan Lebed began using fictitious names to promote stocks on Yahoo’s finance message boards from his New Jersey bedroom in 1999, netting some $800,000 in six months, he triggered chaos in the markets until the U.S. Securities and Exchange Commission finally nailed him for stock-market fraud. Lebed however was allowed to keep a huge amount of his gains because the legal issues were so unclear that prosecutors dared not press for more.
• When the “I Love You” computer virus appeared in 2000, allegedly developed and launched in the Philippines by lone computer student Onel A. de Guzman, it created $5.5 billion in global damages. At the time, however, there were no laws against such crimes in the Philippines, so all charges against Guzman were dropped.

Given that technology always will be out ahead of regulation, are we helpless? Must we assume that humans are extraordinarily brilliant as technological innovators, but that as moral actors we’re dumb as fence posts? Are we capable of amazing foresight into communication systems, but so dense about their moral implications that we let ethical calamities smash us in the face before we say, “Wow! Look at this! Who knew?”

What’s needed is a willingness to say, “We knew” — or at least, “We should have guessed.” MySpace, we now know, is a wonderfully liberating but potentially damaging technology. Is it so hard to imagine what happens if we let teens access MySpace without any instruction in the ethics of its use? That instruction should include clear warnings about the Lori Drew syndrome: how to detect fraud, what questions to ask to be sure you’re talking to someone real, and where to turn if you’re in doubt.

Can we make such warnings stick? Sure we can. As a nation, we require environmental impact statements from developers of new construction projects. Why not ask for ethical impact statements from the developers of communication technologies like MySpace? And why not require clear mitigation procedures when the product affects the sensitive mental landscapes of teens and preteens?

The tech community, like the builders before them, may grumble at the costs. But if moral history is any guide, they’ll soon settle down to help keep people like Megan alive — and mothers like Drew from ever imagining they could mess with kids and get away with it.

©2008 Institute for Global Ethics

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

Readers offered a variety of responses to Rushworth Kidder’s column, “John Edwards, Undefended,” in which Dr. Kidder posited that Edwards was undone essentially by a lack of wisdom — “the judgment that intuitively detects wrong and separates it from right…. Without that alertness to danger, there’s little capacity to defend against the subtleties of ego, pride, and exceptionalism.”

One reader offered this reaction: “Edwards brought this all on himself because he, as many in power believe, thought he would never get caught and, if he did get caught, believed he was bulletproof. ”

Another contended, “You have hit exactly the right note on this, in a clear but compassionate way, that will enable people to think this issue through to the right conclusion.”

Others saw media bias in favor of Edwards. “Had some other would-be or have-been candidates behaved as badly as John Edwards,” one wrote, “but did not share the media’s personal and political goals, I doubt that the media would have ‘ignored’ the story until they could ignore it no longer.”

And one reader argued that the root of the problem is the relentless pattern of attack waged by the media and by political opponents. “This cycle of constant personal destruction only encourages — no, that’s not strong enough — demands that leaders lie to cover their own weaknesses. It creates a cynical electorate who can’t comprehend the idea of a candidate being, well, candid and — this is the sad part — meaning it.”

– Compiled by Ethics Newsline® editor Carl Hausman

“This is unprecedented. It was considered an all-out imperative by the administration to keep troop levels low, particularly in the beginning of the war, and one way that was done was to shift money and manpower to contractors. But that has exposed the military to greater risks from contractor waste and abuse.”

– Charles Tiefer, a professor of government contracting at the University of Baltimore Law School, speaking to the New York Times about the U.S. government’s reliance on private contractors in the Iraq war zone. A new government report notes, in the words of the New York Times, that “one out of every five dollars spent on the war in Iraq has gone to contractors for the United States military and other government agencies, in a war zone where employees of private contractors now outnumber American troops.”

The government’s heavy reliance and high payouts to private contractors have led to allegations and incidents of “overbilling, fraud, and shoddy and unsafe work that has endangered and even killed American troops,” notes the Times, adding that “the role of armed security contractors has also raised new legal and political questions about whether the United States has become too dependent on private armed forces on the 21st-century battlefield.”

Source: New York Times, Aug. 12.

For more information, see: Related Newsline story, Jan. 7 — Related Newsline story, Mar. 21, 2005 — Related Newsline story, Nov. 15, 2004 — Related Newsline story, June 21, 2004.

As convention season begins, reports note that both Obama and McCain are confronting the fact that business and labor have donated millions to convention host committees

WASHINGTON
John McCain and Barack Obama, both of whom have made it a point to pledge that they will distance themselves from special interests, face some ethics challenges during the upcoming nominating conventions, according to a series of press reports.

Associated Press writer Jim Kuhnhenn reports: “Business and labor interests have donated millions to the Democratic and Republican convention host committees in exchange for premium seats and special access. Many institutions will also hold parties and receptions where lawmakers can get an earful … from lobbyists and their clients.”

“Tougher ethics rules aside, conventions remain the only activity where federal candidates can raise unrestricted amounts of money from wealthy donors, unions, or corporations — donations typically called ’soft money,’” Kuhnhenn notes.

Forbes reports that a group called the Sunlight Foundation, a watchdog advocating greater transparency in politics, has unearthed a list of donors who have paid for more than 400 parties and other events in Denver, the site of the Democratic convention, and in St. Paul, Minnesota, the Republicans’ venue.

MarketWatch analyst Rex Nutting argues that “the delegates themselves will turn into walking advertisements for the corporations, with their logos plastered to the tote bags they’ll be clutching as they wander around….”

Newsday quotes Crain Holman of the advocacy group Public Citizen as claiming the conventions are laced with “irony” because “this election year we’ve got the two biggest reform candidates in the most anti-reform election I’ve seen.”

Both candidates have said they are open to changing the convention-funding process, according to Newsday.

Sources: Newsday, Aug. 22 — MarketWatch, Aug. 21 — AP, Aug. 20 — Forbes, Aug. 20.

For more information, see: Related Newsline story, Aug. 11 — Related Newsline story, July 21 — Related Newsline story, July 21 — Related Newsline story, July 21 — Related Newsline story, June 9.

News organizations and bloggers uncover documents they say show Chinese passports used as identification were fraudulent

BEIJING
The governing body of world gymnastics has asked for additional verification of the age of five gold-medal-winning Chinese gymnasts.

Late last week, the Times of London reported that the Chinese Gymnastics Association was asked to supply further evidence to prove the athletes’ birthdates after a U.S. computer expert said he unearthed online documents showing that two of the competitors were only 14.

Olympic rules introduced in 1997 stipulate that gymnasts must be at least 16.

Officials had accepted Chinese government passports as proof of age, reports the Voice of America.

The claims that at least some of the gymnasts are underage already had surfaced on several occasions, according to the Washington Post, with various investigations by news organizations and bloggers purporting to show a variety of birthdays for at least two of the girls.

CNN reports that in women’s gymnastics, younger teens can have an advantage over older competitors because of their smaller bodies and lighter frames.

The head coach of the Chinese gymnastics team says the athletes conform to all age regulations and blamed suspicion on the fact that Asians have different body types than Westerners, reports CNN.

Sources: Times of London, Aug. 22 — Washington Post, Aug. 22 — Voice of America, Aug. 22 — CNN, Aug. 22.

For more information, see: Related Newsline story, Aug. 11 — Related Newsline story, Aug. 11 — Related Newsline story, Aug. 11 — Related Newsline story, Aug. 4 — Related Newsline story, July 14.

Stock options, auction-rate securities, and “moral hazard” of borrowing and bailouts highlighted in week’s news

VARIOUS DATELINES
Investment issues and attendant ethical problems were the subjects of several major reports last week. Among them:

• Former Apple general counsel Nancy Heinen settled charges with the U.S. Securities and Exchange Commission (SEC) that she had improperly backdated stock options when she worked at the company, according to a report from CNET. The SEC sued Heinen for allegedly choosing favorable dates for granting of stock options to Apple executives. Heinen will pay $2.2 million in penalties and fines to settle the suit, but will not have to admit or deny any guilt in the case, according to CNET. Backdating stock options is not illegal, but hiding the details of the arrangement and the income is. A stock option is an offer made by a company to allow someone to buy shares of stock in the future at a predetermined price. By backdating the date of the predetermined price to a time when stock prices were low, it is sometimes possible to artificially depress the purchase price of the stock.
• The Wall Street Journal reports that there is a feud growing between Wall Street firms that have agreed to buy back auction-rate securities and those who have not. The complex investments collapsed in February, and regulators later charged some investment banks and brokerages with civil fraud, claiming that they had been aware of the dangers but still hawked the securities. But while some Wall Street companies agreed to buy back the issues, some brokerages say they should not be obligated to buy them back because they were merely sellers of the vehicles, not the originators, saying they were kept in the dark about the problems as much as were customers, according to the Journal.
• Federal Reserve chairman Ben Bernanke last week proposed a broad system to police the credit markets and prevent a recurrence of the crises that have walloped the economy. The New York Times reports that among Bernanke’s proposals is a suggestion that regulators should more closely scrutinize lending practices to filter out risky loans. Critics have claimed that reckless and sometimes deceptive lending and borrowing practices set up the economy for a fall — and that subsequent bailouts had reinforced the “moral hazard” of removing risk from shaky transactions. Bernanke spoke at the Fed’s annual symposium at a Wyoming mountain resort.

Sources: CNET, Aug. 22 — Wall Street Journal, Aug. 22 — New York Times, Aug. 22.

For more information, see: Related Newsline story, Aug. 11 — Related Newsline story, July 14 — Related Newsline story, May 19 — Related Newsline story, Jan. 2, 2007 — Related Newsline story, Jan. 16, 2007.

A strange case apparently involves TV-anchor rivalry in Philadelphia; toughened defamation laws in Britain cited as cause of “libel tourism”; Apple checks into claims that iTunes downloads have been blocked in China because of pro-Tibet album

PHILADELPHIA and LONDON
The intersection of media and ethics was a busy place last week, with these reports figuring in world headlines:

• A bizarre story involving a fired Philadelphia anchorman was capped by his guilty plea last week, as former KYW anchorman Larry Mendte pleaded guilty in federal court to hacking his former co-anchor’s email account. Trade journal Broadcasting and Cable reports that Mendte was charged with accessing Alycia Lane’s personal email account and leaking some of the information to a local newspaper. Mendte was fired in June, and Lane was let go earlier in the year following a late-night confrontation with a police officer in New York City. Lane’s attorney, who has filed a gender-discrimination suit against the station, claims that Mendte leaked headline-grabbing information about the police incident and other stories out of jealousy over his co-anchor’s rising popularity and salary, according to Broadcasting & Cable. Mendte could be sentenced to up to six months in prison.
• British libel laws, which were recently revamped and made much tougher on the media, are stifling free speech — not only in Britain, but also around the world, according to a report from the United Nations’ Committee on Human Rights. The London-based Independent reports that a study from the committee says that U.K. defamation law has discouraged critical reporting on subjects of public interest, and also has prompted plaintiffs to engage in “libel tourism,” where foreigners use the High Court in London to sue publishers. The report cites the case of a U.S. author who was sued in London by a Saudi businessman over a book that was not published in the United Kingdom, according to the Independent. Twenty-three copies however were sold into the jurisdiction via the Internet.
• Apple Computer is investigating claims that its iTunes online music store has been blocked in China after a pro-Tibet album starting selling on the site, the BBC reports. Beijing authorities had not commented by the time the BBC report was filed, but activists claim the site was blocked soon after “Songs for Tibet” was released.

Sources: Broadcasting & Cable, Aug. 22 — BBC, Aug. 22 — Independent, Aug. 14 — Broadcasting & Cable, July 22.

For more information, see: Related Newsline story, Aug. 4 — Related Newsline story, Mar. 31 — Related Newsline story, Oct. 15, 2007 — Related Newsline story, Apr. 16, 2007 — Related Newsline story, Oct. 16, 2006.

Those supporting the resolution say involvement in interrogation violates “do no harm” premise, while opponents say eliminating psychologists’ involvement would make interrogation more harmful

BOSTON
Psychologists in the United States are debating the appropriate use of their skills and training during interrogations carried out by military and intelligence forces.

UPI reports that members of the American Psychological Association are considering making any involvement in a military interrogation a violation of the organization’s ethics code.

Steven Reisner, who led a protest at the organization’s annual convention in Boston, told the Boston Globe that psychologists’ involvement in interrogations involving prolonged isolation, sleep deprivation, or sensory overload violate the primary obligation of all medical personnel to do no harm.

Opponents of the resolution say it is too vague and that the association’s existing anti-torture regulations are sufficient. They also claim that eliminating the involvement of psychologists could leave those being interrogated open to risk, USA Today reports.

Members will vote by mail on a resolution to ban all involvement in interrogations, with the results due by mid-September, reports the Chronicle of Higher Education.

Sources: USA Today, Aug. 17 — Boston Globe, Aug. 17 — UPI, Aug. 16 — Chronicle of Higher Education, Aug. 16.

For more information, see: Related Newsline story, Nov. 5, 2007 — Related Newsline story, Aug. 15, 2006 — Related Newsline story, July 11, 2005 — Related Newsline story, Jan. 10, 2005 — Related Newsline story, May 24, 2004.

In Canada, there’s controversy over sites where addicts can inject drugs under medical supervision; Indian hospital probes deaths of infants in drug trials; doctors debate ethics of speeding up the harvesting of babies’ organs for transplants

VARIOUS DATELINES
Medical controversies across the globe sparked headlines last week. Among the top stories:

• Canada’s health minister has stirred up a controversy after criticizing the ethics of doctors who support a safe-injection facility for addicts. The Canadian Press reports that Tony Clement said that a safe-injection site in Vancouver has created a moral “slippery slope.” Clement told a meeting of the Canadian Medical Association: “Already there are advocates saying that injection sites are not enough, that government should hand out heroin for free…. Others are now calling for inhalation rooms for people who smoke their drugs. While I support various aspects of harm reduction, I believe that we have to draw the line somewhere with regard to these kinds of measures. Is it ethical for health-care professionals to support the administration of drugs that are of unknown substance or purity or potency, drugs that cannot otherwise be legally prescribed?” The Canadian Medical Association’s president countered that allowing addicts to inject their own narcotics under the supervision of medical staff has been successful in reducing drug use and preventing the spread of disease, according to the Canadian Press report.
• India’s most prestigious medical facility is investigating the deaths of 39 babies in clinical trials, reports the Agence France-Presse. The All-India Institute of Medical Sciences has been in the spotlight after it was disclosed that the deaths occurred during clinical trials that an activist group says were associated with foreign drug companies. According to the AFP, India has become a popular venue for clinical research because of its enormous population and low costs. But the fact that many who participate in the trials are poor and have few other treatment options poses ethics questions about the human testing of new drugs there, reports the AFP. A spokesman for the hospital says that all of the infants who died were in the control groups and not among those receiving experimental medical intervention.
• A new approach to infant heart transplants — in which organs are removed from babies before they are declared brain dead — has sparked an ethics debate among physicians, reports ABC News. Reporter Joseph Brownstein writes: “Some say the approach saves lives by providing more viable organs to babies who have a chance at survival. But others say the practice devalues one life to try and save another.” The new protocol, known as “transplantation after declaration of cardiocirculatory death,” allows organs to be removed about 90 seconds after the heart stops beating.

Sources: AFP, Aug. 22 — ABC News, Aug. 21 — Canadian Press, Aug. 20.

For more information, see: Related Newsline story, July 28 — Related Newsline story, June 30 — Related Newsline story, June 23 — Related Newsline story, Sep. 5, 2006 — Related Newsline story, Mar. 20, 2006.

Edmonton Journal reports that workers in knowledge industries sometimes put themselves in conflict

EDMONTON
As the economy tightens, more people are picking up extra cash by moonlighting — but, according to a report from the Edmonton Journal, they’re also confronting some related ethical dilemmas.

Writing in the Journal, freelancer Caitlin Crenshaw notes that moonlighters run the risk of harming their reputations if it becomes known they have put themselves in a conflict of interest.

Crenshaw quotes Simon Fraser University business ethics professor Mark Wexler: “These days, when you’re selling knowledge, you don’t get an audience if your reputation isn’t good.”

Wexler points out that one of the particularly tricky areas is the use of proprietary knowledge and skills. While it is clear to most people that using company equipment for side work is not appropriate, Wexler poses a nettling scenario about specialized information: “Say, I’m a chef. You hire me. I work 40 hours for you. I have your secret recipe for some kind of salad dressing. Someone else hires me part-time and I make the salad dressing. There’s a problem — or a potential problem.”

Wexler maintains that the only foolproof option is total transparency, both to the full-time employer and your moonlighting client. Moonlighters should clearly communicate the circumstances of their actions, he tells the Journal, and be up-front about how their time will be divided.

Source: Edmonton Journal, Aug. 22.

For more information, see: Related Newsline story, May 19 — Related Newsline story, Mar. 17 — Related Newsline story, Jan. 14 — Related Newsline story, Dec. 17, 2007 — Related Newsline story, Oct. 8, 2007.

Poll finds that “supermarkets score best; tobacco and oil at the bottom”

From Harris Interactive:

“Every year at this time, The Harris Poll® measures public attitudes about 20 different industries. Specifically, we ask whether each industry is generally doing a good or a bad job of serving consumers. This year’s survey finds many big changes, up and down, since last year….

“Industries with the Best Reputations

“Supermarkets continue to get better scores than any other industry; fully 90 percent of all adults think they do a good job and only six percent think they do a poor job, giving them a net positive score of 84. Next in the list of industries with the best reputations are online search engines (65), computer hardware companies (64), computer software companies (59), hospitals (53), and Internet service providers (52).

“Industries with Worst Reputations

“Tobacco companies (-43) and oil companies (-32) come at the bottom of the list, far below the other 19 industries. The two other industries with negative scores are managed care companies (-14) and health insurance (-9), which are now more or less synonymous….

“Industries that Have Lost Ground since Last Year

“Six industries have seen their scores get worse this year. Investment and brokerage firms have lost the most ground (-21). Also banks lost ten points. These changes reflect the problems triggered by the sub-prime mortgage crisis….

“Changes since 1997

“Three industries have seen truly massive declines in their reputations since Harris first asked these questions eleven years ago in 1997:

• “Oil companies have fallen 56 points from 24 point positive to 32 negative;
• “Airlines have fallen 48 points from 66 positive to 18 positive since 1998 (they were not included in the 1997 survey);
• “Pharmaceutical companies have fallen 45 points from 60 positive to 15 positive this year.

“Three other industries have suffered declines of more than 20 points since 1997: managed care (down 27 points), telephone companies (down 24 points since 1997), and health insurance (down 22 points)….”

For the full press release from Harris, Aug. 7, click here.

“Nothing you do for children is ever wasted. They seem not to notice us, hovering, averting our eyes, and they seldom offer thanks, but what we do for them is never wasted.”

– Garrison Keillor (U.S. author, humorist, and radio personality, b. 1942)