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

by Rushworth M. Kidder

Last week, in a blizzard of public outrage over corporate greed, vandals smashed windows at the Edinburgh home of Sir Fred Goodwin, former CEO of the state-controlled Royal Bank of Scotland.

Then on Saturday night, in a blizzard of public enthusiasm over energy conservation, the Scottish Parliament building and Edinburgh Castle happily went dark during Earth Hour, a global demonstration calling for action on climate change.

Last week, angry workers facing layoffs at a 3M plant in Pithiviers, France, held plant manager Luc Rousselet hostage for several days, demanding better severance packages in an incident of what’s becoming known as “bossknapping.”

Then on Saturday night, as the lights shut down at the Eiffel Tower, householders across France gladly joined in, turning off inessential lights for an hour in an event designed to bring together a billion people in 80 countries and 25 time zones.

Last week Iowa senator Charles Grassley had to backpedal on his comment that AIG executives responsible for the ailing insurance firm’s financial mess should either “resign or commit suicide” — a retraction coming only days after AIG executives reported receiving death threats connected to large bonus payments.

Then on Saturday night, Americans dowsed TVs, dined by candlelight, and delighted as monuments from the Empire State Building to the Golden Gate Bridge temporarily vanished from nighttime skylines.

What’s going on? Who are we?

Are we a people fixed on revenge? When we find arrogance and greed in our midst, do we resort to vigilante violence to set things right — spurred on, at times, by ill-considered words from our top political leaders and media personalities?

Or are we a people wedded to reform? When a cause — like saving energy — unites us, do we readily band together in global networks to urge those same leaders to develop policies for a better world?

Looking at the cultural context of the twenty-first century, you can understand why there’s such a crisis of identity. On one hand, we’re marinated in a polarizing political discourse. For the sake of sound bites and tweets, we reduce complexity to black-and-white starkness. Result: Frustration is heightened, anger is encouraged, and we’re drawn into speaking and acting on these oversimplifications with all the belligerence of a schoolyard bully.

On the other hand, we’re surrounded by thoughtful, many-layered arguments about oil reserves, alternative energy sources, global warming, and rising energy costs. Result: We roll up our sleeves, do the hard intellectual work of comprehending such issues, knit together common frameworks for action, and join hands to promote them peaceably and respectfully around the world.

Some would say, of course, that these are two sides of the same coin. They argue that wrath is an essential precursor to reform, that local revenge and global hand-holding are simply different paths to the same goal, and that to save the world for good you must first save it from bad. For them the perception of humanity as morally bipolar — by turns brutish and generous, craven and thoughtful, hateful and loving, noxiously misanthropic and radiantly communitarian — is less a cause for alarm than a statement of fact.

In earlier centuries, that was an interesting theory. But changing the world demands that we change our theories of the world. And one of the theories most in need of change is that such dualism is okay. Given the moral stakes of our collective future, we can no longer tolerate this kind of two-sided approach to public affairs. Why? Because the technology of today’s media — from global satellite radio to instant messaging, from Google to Facebook, from BBC online to blogs and chat rooms — has brought us into a whole new moral universe. We can now gin up populist outrage immediately, globally, and deeply. We can use it for enormous good — to change energy policy, for example. Or we use it for enormous bad — to foment personal violence and the like.

Does that mean outrage is bad? Not at all: There are plenty of things that require us to rise in rebellion, look selfishness and tyranny squarely in the eye, and muster the moral courage to deliver a ringing condemnation. But that doesn’t give us permission to fight arrogance with disrespect or greed with violence. The fact that some corporate bonuses are unjust doesn’t give us license to vandalize. The fact that some executives made bad decisions doesn’t mean they should die.

Last week left us with a danger, a promise, and a way forward. We now know how easy it is to stir up populist outrage — and the danger of doing so. But we also know something promising about our better angels and our capacity for respectful, united action. Going forward, we need leaders committed to doing the former only in the service of the latter. Moral outrage? Yes. Violence? No. Respect? Always.

©2009 Institute for Global Ethics

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

“These political considerations, delays and implausible justifications for decision-making are not the only evidence of a lack of good faith and reasoned agency decision-making. Indeed, the record is clear that the FDA’s course of conduct regarding Plan B departed in significant ways from the agency’s normal procedures regarding similar applications to switch a drug from prescription to non-prescription use.”

– Excerpt from a ruling last week by U.S. district judge Edward Korman, who condemned the U.S. Food and Drug Administration (FDA) for its “arbitrary and capricious” treatment of the emergency contraception Plan B, widely known as the morning-after pill.

Korman criticized FDA officials for following “political and ideological” considerations imposed by the Bush administration, noting that the FDA repeatedly delayed action on approving wider use of Plan B, improperly communicated with the White House, departed from normal procedures, ignored favorable conclusions about the drug even when they came from FDA researchers, and “sought to influence decisions by appointing people with anti-abortion views to an independent panel of experts reviewing Plan B,” reports the New York Times.

Korman’s ruling will lower by one year the age limit on obtaining Plan B without a prescription, making it available to 17-year-olds. He also ordered the FDA to “review whether to make the emergency contraceptive available to all ages without a doctor’s order” reports the Washington Post.

Sources: Washington Post, Mar. 24 — New York Times, Mar. 24.

For more information, see: Related Newsline story, Dec. 22, 2008 — Related Newsline story, Nov. 19, 2007 — Related Newsline story, Aug. 28, 2006 — Related Newsline story, Aug. 7, 2006 — Related Newsline story, Sep. 6, 2005.

AIG employees say populist anger is scary and largely misplaced; FBI says financial crime investigations are skyrocketing; Treasury secretary’s proposal for government to take over ailing firms raises eyebrows

WASHINGTON
The economic crisis continued to touch on a variety of moral issues last week. Among the top stories:

• There was something of a moral backlash last week in the continuing saga over bonuses paid to employees of giant insurer AIG, which has received massive infusions of taxpayer bailout funds. ABC News reports that some employees of AIG, who say they were not involved with the exotic credit default swaps that sunk the company, are fed up with being blamed for a mess they didn’t create and frightened by threats of violence against them and their families. Some executives quit rather than continue to work at a company continually under siege, according to ABC.
• The head of the FBI says that a recent surge in financial crimes has put a strain on the agency and is stretching its resources thin as it tries to combat terrorism. Robert Mueller says that in the past three years the number of mortgage fraud cases investigated by the Bureau has more than doubled, with more than 560 cases of corporate fraud pending, many relating directly to the current economic crisis, reports the Voice of America. In addition, public-corruption investigations have spiked by 60 percent since 2003.
• Treasury secretary Timothy Geithner is lobbying for unprecedented authority to take control of collapsing companies to ensure that their failure will not bring down other institutions and to limit the amount of risk that certain financial firms can take. The ethics implications of the move were immediately sized up by critics, who argue that the provisions would be tantamount to allowing the government to seize and control private businesses, reports TIME magazine.

Sources: ABC News, Mar. 27 — Voice of America, Mar. 27 — TIME, Mar. 27.

For more information, see: Related Newsline Commentary, Mar. 23 — Related Newsline story, Mar. 23 — Related Newsline story, Mar. 16 — Related Newsline story, Mar. 9 — Related Newsline story, Mar. 2.

It clarifies and toughens existing law and penalizes firms for willfully turning a blind eye to graft

LONDON
A tough new bribery law has been proposed in the United Kingdom.

The U.K. Guardian reports that the bill presented to Parliament by Justice secretary Jack Straw offers stiff penalties for offering a bribe in Britain or abroad and proposes a new corporate offense: “negligent failure to prevent bribery.”

Straw says his draft bill will help “reinforce transparency and accountability in international deals,” reports the Scotsman.

According to an analysis in the Economist, the bill would replace a hodgepodge of difficult-to-enforce existing laws. Drafters hope that its “negligent failure” provision will keep companies from willfully turning a blind eye to bribery, while also preventing higher-ups from shielding themselves by allowing junior employees to take the blame for breaking the rules.

In an editorial, the Financial Times partially endorses the measure, saying that the proposed law will, to an extent, “help the U.K. put its house in order.” But the editorial also warns that there are troubling exceptions carved out in the proposal, including a provision that would allow bribery that is deemed necessary for security or intelligence purposes.

Sources: Financial Times, Mar. 26 — Economist, Mar. 26 — Scotsman, Mar. 26 — Guardian, Mar. 25.

For more information, see: Related Newsline story, Mar. 23 — Related Newsline story, Feb. 2 — Related Newsline story, Dec. 22, 2008 — Related Newsline story, Oct. 27, 2008 — Related Newsline story, Oct. 20, 2008.

U.N. report claims that children were intentionally put at risk; human rights group says Palestinians were denied medical aid; declassified report says medical ethics were violated around the time of the first Gulf War, when vaccine was tested on soldiers

JERUSALEM
Ethics issues remained on the radar last week in the wake of Israel’s December 2008 attack on Gaza. Among last week’s coverage:

• A United Nations report made public last week alleges that Israeli soldiers intentionally put children in harm’s way during the three-week Gaza conflict. According to a summary by CNN, the report cited several instances where soldiers allegedly used children as human shields, forcing them to open packages that may have contained explosives or walking in front of moving troops. A spokesman for the Israeli prime minister called the report “one-sided and unfair,” according to CNN.
• An Israeli human rights group last week charged that Israel’s military violated medical ethics during the Gaza offensive, reports the Reuters news agency. Physicians for Human Rights-Israel charges that the military failed to evacuate wounded Palestinians and prevented Palestinian medical teams from reaching injured noncombatants. The military says the claims are being investigated, according to the Reuters report.
• Israel’s defense ministry violated medical ethics in 1991 by subjecting soldiers to unnecessary testing of a potentially dangerous anthrax vaccine without informing them of the dangers, claims a report declassified last week. According to the Agence France-Presse, the test was designed to create a vaccine against anthrax weapons believed to be under development by Saddam Hussein. The findings from a government medical inquiry commission were revealed under court order after the details of the report were leaked to an Israeli television station. Unconfirmed reports in the Israeli media claim that many of the soldiers who received the vaccine have fallen ill, some to epilepsy, reports the AFP.

Sources: CNN, Mar. 27 — AFP, Mar. 26 — Reuters, Mar. 23.

For more information, see: Related Newsline story, Mar. 23 — Related Newsline story, Feb. 2 — Related Newsline story, Feb. 2 — Related Newsline story, Jan. 26.

Another Japanese government minister resigns; Taiwan’s former president goes on trial for corruption; journalists in South Asia increasingly targeted by factions who don’t like their coverage, warns human rights group

VARIOUS DATELINES
Ethics-related stories were prominent is news from and about Asia last week. Among the coverage:

• Japan’s vice finance minister, Koichi Hirata, resigned after admitting breaching government ethics guidelines relating to stock sales. Bloomberg reports that Hirata sold about $6 million worth of stock in a company founded by this father. Japanese government ministers are not supposed to directly trade securities. The incident followed two recent and related scandals: the resignation of a transportation minister who called the teachers’ union a “cancer on Japanese education,” and the resignation of a finance minister who appeared to be drunk during a press conference.
• Taiwan’s former president went on trial for corruption last week. Chen Shui-bian is accused of various counts of bribery and embezzlement that could culminate in a life term if he is convicted. His wife and son already have pleaded guilty to money laundering, according to the New York Times. Chen blasted the proceedings as a “tool for political suppression and persecution” by his successor, notes the report.
• Journalists in South Asia are at “severe risk,” according to human-rights watchdog Committee to Protect Journalists (CPJ). The U.S.-based CPJ says attacks on reporters have spiked in Sri Lanka and Pakistan, as well as in Afghanistan, Bangladesh, India, and Nepal, reports the BBC. Shawn Crispin, the Committee’s Asia program consultant, says the brutality often results when journalists are targeted by political groups angry about unflattering coverage.

Sources: Bloomberg, Mar. 26 — New York Times, Mar. 26 — BBC, Mar. 26.

For more information, see: Related Newsline story, Sep. 29, 2008 — Related Newsline story, Mar. 31, 2008 — Related Newsline story, Apr. 28, 2008 — Related Newsline story, Dec. 31, 2007 — Related Newsline story, May 2, 2005.

The judge admitted taking kickbacks from a detention center to which he sent youths, often for minor offenses

WILKES-BARRE, Penn.
Punctuating one of the most bizarre judicial-ethics cases in recent memory, the Supreme Court of Pennsylvania last week ordered the slate wiped clean for hundreds of the 2,500 youths who had been sentenced by a corrupt judge.

The juveniles had been sent to private detention centers, which prosecutors say kicked back money to two judges who sent the youths there.

The New York Times reports that the exact number of records to be expunged has not yet been determined.

Judges Mark Ciavarella and Michael Conahan pleaded guilty last month to taking more than $2.6 million in kickbacks, according to USA Today. Ciavarella admitted his role in the sentencing scheme, while Conahan admitted that he made the financial arrangements.

Ciavarella and Conahan will be sentenced in the coming weeks under a plea agreement that allows for more than seven years in prison, notes the New York Times.

A Times piece last week traced the scandal, noting that the judges worked systematically to hide their scheme, inking the kickback deal quietly, shutting down competitors by cutting their funding from the court system, and sealing court records that could raise questions.

Local TV station WNEP reports that many of the offenders sent to detention in the scheme were convicted of fairly trivial offenses. One juvenile interviewed by WNEP was locked up by Judge Ciavarella after being charged with mocking a school official on a website.

In the aftermath of the scandal, advocates are charging that prosecutors in the judges’ jurisdiction of Luzerne County, located in the northeast coal-mining region of the state, share part of the blame.

A spokesman for the Juvenile Law Center, which filed the petition that eventually led to the order to expunge records, told the Scranton Times-Tribune that prosecutors stood by for five years while the juveniles’ rights were being abused.

The district attorney disputed that claim, saying that Ciavarella was simply regarded as a tough, zero-tolerance judge and that prosecutors had no reason to suspect wrongdoing.

Sources: Scranton Times-Tribune, Mar. 28 — New York Times, Mar. 27 — WNEP-TV, Mar. 27 — New York Times, Mar. 26 — USA Today, Mar. 26.

For more information, see: Related Newsline story, Mar. 9 — Related Newsline story, Feb. 16 — Related Newsline story, Nov. 17, 2008 — Related Newsline story, Oct. 27, 2008 — Related Newsline story, Oct. 27, 2008.

He defends his decision to lift some federal restrictions, saying it was “ethical” and “the right thing to do”

WASHINGTON
President Barack Obama last week publicly confronted moral issues related to his decision to lift some federal restrictions on embryonic stem-cell research.

During a prime-time news conference, he said his decision was “the right thing to do and the ethical thing to do,” reports the Associated Press.

According to National Public Radio, Obama, who reversed the Bush administration’s near-total ban, said that his guidelines — limiting research to stem cells that were slated to be destroyed — pass the “ethical tests” that he applies to human life issues.

U.S. News & World Report religion columnist Dan Gilgoff notes that Obama, recognizing that many Americans are torn over the issue, said that if a non-controversial method of producing stem cells eventually obviates the need for embryonic research, that would “make him happy…. If the science determines that we can completely avoid a set of ethical questions or political disputes, then that’s great.”

In related news, Obama will be speaking at the University of Notre Dame commencement ceremony on May 17. MSNBC notes that there are already ripples of protest on the campus of the Catholic University over the president’s stands on abortion and embryonic stem-cell research.

Sources: NPR, Mar. 27 — AP, Mar. 25 — U.S. News & World Report, Mar. 25 — MSNBC, Mar. 25.

For more information, see: Related Newsline story, Mar. 16 — Related Newsline story, Mar. 16 — Related Newsline story, Mar. 16 — Related Newsline story, Mar. 9 — Related Newsline story, Mar. 9.

U.S. senator wants to make papers eligible for nonprofit status; critics say government control over tax-exempt operations would stifle free press

WASHINGTON
There’s controversy about the ethical and practical implications of a proposal by a Maryland senator to allow newspapers to become nonprofit entities.

Under a measure proffered by Sen. Benjamin Cardin (D-Md.), members of the foundering newspaper industry would have the option of becoming tax-exempt businesses, what are called 501(c)(3) corporations in a reference to a section of the U.S. tax code, reports newspaper trade journal Editor & Publisher.

The proposal drew immediate criticism on many fronts, reports analyst Rick Edmonds, writing in the media think-tank publication PoynterOnline. Some critics say supporting the old, faltering model will stifle digital innovation. Others argue that “what the government can give, the government can take away,” meaning that the Internal Revenue Service would have final say over the money stream to newspapers.

The Wall Street Journal’s James Taranto points out that under 501(c)(3) status, newspapers would not be allowed to make political endorsements.

Also, Taranto notes, rules governing nonprofit entities could, under the most extreme interpretation of the law, result in newspapers being barred from commentary on any election or pending piece of legislation.

According to the Boston Globe, the bill has been submitted to the Senate Finance Committee and does not yet have a hearing date.

Sources: Wall Street Journal, Mar. 27 — Poynter Online, Mar. 27 — Slate, Mar. 27 — Editor & Publisher, Mar. 26 — Boston Globe, Mar. 25.

For more information, see: Related Newsline Research Report, Mar. 30 — Related Newsline story, Jan. 12 — Related Newsline story, Jan. 5 — Related Newsline story, Nov. 24, 2008 — Related Newsline story, Nov. 24, 2008 — Related Newsline story, Nov. 17, 2008.

As bankruptcy looms, fewer than half say losing their local paper would hurt civic life

From the Pew Research Center for the People & the Press:

“As many newspapers struggle to stay economically viable, fewer than half of Americans (43%) say that losing their local newspaper would hurt civic life in their community ‘a lot.’ Even fewer (33%) say they would personally miss reading the local newspaper a lot if it were no longer available.

“Not unexpectedly, those who get local news regularly from newspapers are much more likely than those who read them less often to see the potential shutdown of a local paper as a significant loss. More than half of regular newspaper readers (56%) say that if the local newspaper they read most often no longer published — either in print or online — it would hurt the civic life of the community a lot….

“With media coverage of newspaper company bankruptcy filings, threats to close papers, actual shut downs and continuing job cuts, the public is aware of the industry’s financial problems. More than half (53%) say they have heard ‘a lot’ about the problems facing newspapers, while 31% say they have heard ‘a little.’ Only 15% say they have heard nothing at all.

“When it comes to local news, more people say they get that news from local television stations than any other source. About two-thirds (68%) say they regularly get local news from television reports or television station websites, 48% say they regularly get news from local newspapers in print or online, 34% say they get local news regularly from radio and 31% say they get their local news, more generally, from the internet.

“Newspapers have long struggled to attract younger readers. A recent analysis of newspaper readership by Pew Research found that just 27% of Generation Y — those born in 1977 or later — read a newspaper the previous day. That compares with 55% of those in the Silent or Greatest Generations, born prior to 1946.

“Not unexpectedly, far fewer young people than older Americans say they would miss their local newspaper a lot if it were to close….

“However, many more of those younger than 40 (41%) say the shutdown of their local newspaper would hurt the civic life in their community a lot. About the same proportion of those ages 40 to 64 (42%) express that view, as do 51% of those 65 and older….

“Among those who say the loss of the local daily paper would hurt civic life a lot, three-in-ten say people rely on the paper to know what is going on in their community….

“Many of those who say the closing of the local paper wouldn’t make much, if any, difference in their communities note that there are other news sources available or criticize the newspaper’s quality. About three-in-ten (29%) say there are other ways to get news, including television, radio news and the internet. One-in-five say the quality of the newspaper is poor, while 5% say it is biased….”

For more information, see: Full press release from Pew, Mar. 12 — Related Newsline story, Mar. 30.

“The falling drops at last will wear the stone.”

– Lucretius (Roman poet and philosopher, ca. 99 BC – ca. 55 BC)

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

by Rushworth M. Kidder

Last week’s revelations about bonuses paid to AIG executives raised numerous questions. For some voters, they were questions about money and finance. For others, they were about law and regulation. But for Barry C. Black, “the issue of Wall Street versus Main Street” is an “important ethical issue,” causing lawmakers to ask, What’s right?

As chaplain of the U.S. Senate, Dr. Black sees his role as “spiritual fitness advisor and ethical coach” to senators. What he’s seen convinces him that the broadest questions facing the future direction of the nation are rarely matters of right versus wrong. Instead, they bring to bear powerful moral arguments on both sides. While partisans may see them in stark right-versus-wrong terms, Black says that by the time such issues “reach the Senate chamber, they are nuanced — they are definitely right-versus-right conundrums.”

A retired rear admiral and former chief of Navy chaplains, Black is the first black American, the first military chaplain, and the first Seventh-day Adventist to hold this position, which was established in 1789. His is not a political post: His five years in the chaplain’s vault-ceilinged, fireplaced, and book-lined office in the Capitol already have spanned a change in parties. So in discussing senatorial decision making during a telephone conversation last month with members of our Institute, he maintained a thoughtfully nonpartisan stance.

No doubt as a result, there’s hardly a moral issue that the senators haven’t discussed with him, including abortion, stem-cell research, gay marriage, Terry Shiavo and the right to life, the question of just or unjust wars, the public expression of sectarian views — and now, of course, the economic stimulus package. One of his tasks, as he sees it, is to help senators “look through ethical lenses” in order to “enable each lawmaker, after voting, to at least be able to explain to the press why he or she voted that way, and give ethical reasons for the vote.”

Sometimes, he says, senators invite his help and counsel on particular topics. Sometimes they attend his weekly prayer breakfasts. Sometimes they visit the Bible study sessions he conducts five times a week. And sometimes they seek him out in his office in more private ways — “you know,” he chuckles, “‘Oh, Chaplain, I was just passing by!’” — and end up coming in for an hour of conversation.

But the core question is always the same: What’s the right thing to do?

While Black sees “a tremendous amount of faith on Capitol Hill,” he’s not blind to the temptations senators face. As humans, he says, we sometimes “tend to move toward the darker angels of our nature” and “avoid the ethical narrow road.” Politicians in particular, he says, can get caught up all too easily in “the things that accompany power.” When “you start believing the news clippings, you start believing the accolades,” he explains, it sometimes becomes “easier to see the ethical lapses of others than your own.”

I asked Black how he himself negotiates the fine line between helping others find their own way and simply telling them what he thinks they should do — especially when the vote on which they may be seeking guidance could have what he calls “incredibly challenging and negative unintended consequences” if his advice were wrong.

“I find if you are not doctrinaire and dogmatic,” he says, “and if you delay providing your perspective until you are certain that the individual has used some of his or her creative juices, then by the time you get around to making some suggestions or observations, you are pretty much helping an individual solidify a position that he or she is already leaning toward.”

In his ethics training work, he explains, he helps the participants understand that different ethical perspectives — all of which are “right” — can produce very different conclusions. But “by encouraging them to do their own thinking, and to arrive at their own conclusions using certain ethical constructs as a springboard for their reflection, inevitably it’s not going to be my decision. It’s going to be theirs.”

That, to my mind, is a singularly important lesson these days. Given the explosion of polarizing opinions made possible by a pop culture of ubiquitous blogging and anonymous call-in shows, it can take true moral courage to formulate a position slowly and carefully. Where blaring self-assertion so often rides roughshod over judicious reasoning, the very act of stepping outside without an opinion sometimes feels like standing naked in a hailstorm. Yet if Black is right — if the toughest issues facing our global future have powerful moral arguments supporting each side — the best counseling will not be to tell people what to think. It will be to teach them how to think.

Which, I suspect, is why Black is so effective. If even a fraction of those serving in Congress are willing to factor ethics into their decision making — and if people like Black are there to help them along — that very fact may be a strong leading indicator pointing the way out of the financial crisis. It may not end the outrage expressed last week by a frustrated nation. But it certainly offers hope that, at the highest levels of government, the bedrock moral causes of the current ethics recession can be addressed.

©2009 Institute for Global Ethics

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

“Regardless of my personal opinion about the death penalty, I do not have confidence in the criminal justice system as it currently operates to be the final arbiter when it comes to who lives and who dies for their crime.”

– Gov. Bill Richardson of New Mexico, speaking last week at the signing of legislation that bans the death penalty in his state. The law, which takes effect on July 1, makes New Mexico “only the second state after New Jersey to ban executions since the U.S. Supreme Court reinstated the death penalty in 1976. Fourteen other states do not impose capital punishment,” reports the Associated Press.

Source: AP, Mar. 19.

For more information, see: Related Newsline Research Report, Nov. 17, 2008 — Related Newsline story, June 16, 2008 — Related Newsline story, Nov. 19, 2007.

Outrage reaches such levels that some AIG employees receive private security details; House passes bill imposing 90 percent tax on bonuses given to bailed-out companies; Gallup finds three-quarters of Americans saying AIG bonuses should be blocked or returned; some execs begin returning their controversial bonuses

NEW YORK and WASHINGTON
The revelation that foundering insurer AIG, kept on life support with a government bailout, has doled out as much as $218 million in bonuses is fueling what some say is an unprecedented explosion of public indignation.

As this issue of Newsline goes to press, the Associated Press is reporting that 15 of the top 20 bonus recipients at AIG have agreed to return their controversial bonuses. New York attorney general Andrew Cuomo announced the news, saying the commitments currently amount to more than $30 million.

Among the story’s angles making headlines last week:

• The New York Times reports that AIG executives are being targeted by demonstrators, who in some cases have gone so far as to protest in front of the executives’ offices and homes. Writes the Times’s James Barron and Russ Buettner: “[B]onuses in years past helped make A.I.G. executives into prominent local citizens…. Now these executives are toxic, and those communities are rattled and divided. Private security guards have been stationed outside their houses, and sometimes the local police drive by. A.I.G. employees at the company’s office tower in Lower Manhattan were told to avoid leaving the building while a demonstration was going on outside. The memo also advised them to avoid displaying company-issued ID cards when they left the office and to abandon tote bags or other items with the A.I.G. logo.” Some AIG workers tell the Times they feel betrayed and are victims of a new type of McCarthyism, maintaining that the so-called bonuses are payments that had been promised long ago to workers, including technical and support personnel.
• Congress last week moved to slap punitive taxes on AIG-type bonuses — with the House approving a bill that would impose a 90 percent tax rate on those who received more than $125,000 while working for a firm that received a government bailout. The Senate is poised to consider a similar measure. The Washington Post reports that some industry representatives protest that such actions harm middle management and weaken already tottering firms. Some lawmakers however appeared to be aware of the potential consequences, but were unfazed. “Bonuses for what?” asked Sen. Olympia Snowe (R-Me.). “They have to engage in more financially prudent behavior.”
• Some critics of the move to block or confiscate bonuses argue that interfering with the payments constitutes an unlawful violation of contract. Maclean’s Ottawa bureau chief John Geddes makes that argument in his blog, disputing President Obama’s contention that while there may be a legal claim to the bonuses, there are “moral and ethical” aspects that have to be considered. “In other words, withholding the bonuses would have been an unlawful violation of contract rights, and so carried with it a penalty,” writes Geddes. “Does Obama seriously believe some nebulous ‘moral and ethical’ considerations might trump the rule of law in this case?… No matter how hard it is to face angry people, elected politicians in democracies must first affirm the law.”
• A Gallup poll indicates that more than three out of four Americans want the government to take action to recover the bonuses that AIG paid to its executives after receiving bailout funding. A separate Gallup poll found 50 percent of Americans saying they were personally “outraged” by the bonuses. Those views essentially cut across party lines, according to the pollster.

Sources: AP, Mar. 23 — AFP, Mar. 22 — Maclean’s, Mar. 20 — Washington Post, Mar. 20 — New York Times, Mar. 19 — Gallup, Mar. 18.

For more information, see: Related Newsline Commentary, Mar. 9 — Related Newsline story, Mar. 9 — Related Newsline story, Mar. 2 — Related Newsline story, Mar. 2 — Related Newsline story, Feb. 23.

Lawmakers say third-party inspectors notified peanut plant that they were coming and then wrote glowing reviews

WASHINGTON
The U.S. Congress last week examined ethics issues relating to oversight of the nation’s food supply — not just in terms of moral responsibility to protect the public, but also regarding potential conflicts of interest.

According the Atlanta Journal-Constitution, lawmakers expressed outrage when they learned that inspectors notified the Peanut Corp. of America in advance of when they were coming, informed them of the need to prepare for an inspection, and then “gave its plants glowing reviews.” The inspectors also were paid by the company, notes the paper.

Peanut Corp. is alleged to be at the center of a contamination outbreak that has sickened hundreds and killed at least nine, according to the Journal-Constitution.

Hearings revealed that it is common practice for companies to hire third-party inspectors, rather than being subjected to independent government scrutiny, according to legal publication Attorney at Law.

The U.S. Food and Drug Administration (FDA) says there are too many plants scattered across the country for it to inspect each one itself, according to the report. Forbes reports that the FDA inspects only about 5 percent of the nation’s 150,000 food processing plants.

According to the Baltimore Sun, the FDA polices billions of dollars in food, drug, and vitamin sales, and is responsible for monitoring a third of all imported goods, but its budget has fallen far behind its growing list of responsibilities.

Sources: Atlanta Journal-Constitution, Mar. 20 — Forbes, Mar. 19 — Attorney at Law, Mar. 19 — Baltimore Sun, Mar. 15.

For more information, see: Related Newsline story, Feb. 16 — Related Newsline story, Feb. 9 — Related Newsline story, Dec. 8, 2008 — Related Newsline story, Nov. 10, 2008 — Related Newsline story, Oct. 20, 2008.

Israeli soldiers claimed that excessive force was used; defense minister, while saying Israel has “most moral army in the world,” vows to take claims seriously

JERUSALEM
Israel’s government is probing allegations of human-rights abuses in Gaza after Israeli soldiers spoke about the use of excessive force in the conflict which erupted earlier this year.

According to the Christian Science Monitor, infantry veterans of the three-week war said in a military academy seminar that lax rules of engagement allegedly led to the deaths of civilians.

TIME magazine reports that while past criticisms of alleged human rights abuses in Gaza were sometimes dismissed as driven by pro-Palestinian bias, the allegations by the six soldiers, whose names are being kept confidential, led to the military’s pledge to investigate the claims.

Defense minister Ehud Barak said charges of unwarranted killing of civilians will be examined “with all seriousness,” although he also contended that Israel has “the most moral army in the world,” according to the Israeli newspaper Haaretz, which originally broke the story of the soldiers’ remarks.

The New York Times notes that the war-crimes accusations hint at a growing rift within the Israeli military itself, with religious nationalists on one side and secular soldiers on the other. As right-wing religionists gain higher positions in the military, graduating from religion-heavy military academies, some say they are casting conflicts as righteous battles.

Sky News reports that the anonymous soldiers expressed concerns about racist attitudes toward Palestinians, with one saying the army had “fallen in the realm of ethics.”

A United Nations agency also has opened an investigation into claims of brutality against Gaza civilians.

Sources: New York Times, Mar. 21 — Christian Science Monitor, Mar. 21 — TIME, Mar. 20 — Haaretz, Mar. 20 — Sky News, Mar. 19.

For more information, see: Related Newsline story, Feb. 2 — Related Newsline story, Feb. 2 — Related Newsline story, Jan. 26 — Related Newsline story, Jan. 19 — Related Newsline story, Jan. 19.

Prominent Chinese artist criticizing government over last May’s earthquake; African National Congress says it will not tinker with laws to protect its presidential candidate, who is accused of corruption; graft is hobbling Bosnia, according to report; Pope urges Africans to reject corruption

VARIOUS DATELINES
Corruption issues figured in worldwide news last week. Among the top stories:

• One of China’s most prominent artists is challenging the government to end what he claims is a cover-up of corruption and incompetence that contributed to the deaths of thousands is last May’s Sichuan Province earthquake. The International Herald Tribune reports that artist Ai Weiwei, who helped design Beijing’s Olympic Stadium, contends in posts on his blog that officials are covering up the fact that lax inspections and shoddy materials, which were allowed because of corner-cutting fueled by bribery, contributed to the collapse of many buildings, including schools. The Herald Tribune notes that it is very unusual for such criticism to be allowed to remain posted on the Internet, and speculates that Ai’s prominence may be behind the unexpected lack of censorship.
• From Johannesburg comes a report that the African National Congress, poised to win the national election in six weeks, has pledged not to tamper with laws in order to protect its presidential candidate, Jacob Zuma, according to Voice of America. Zuma has been under investigation for allegedly taking bribes, and opposition leaders have voiced concern that if his party remains in power, the South African Constitution could be changed to protect Zuma. Party leaders have characterized the charges against Zuma as politically motivated, but have pledged that Zuma will step down if convicted, the VOA reports.
• Bosnia is being buffeted by corruption claims, according to a report from BusinessWeek. Bosnia’s police, political parties, and government officials have been cited for corruption by anti-graft agency Transparency International, reports BusinessWeek, and activists in Bosnia say the country’s reputation for graft is crippling its ability to attract investment.
• Pope Benedict XVI, on a weeklong tour of Africa, appealed to Africans to rid the continent of corruption once and for all. According to a report from the BBC, the 81-year-old pontiff said Africans needed “a firm determination to change hearts and finally put a stop, once and for all, to corruption.”

Sources: International Herald Tribune, Mar. 20 — BBC, Mar. 20 — BusinessWeek, Mar. 17 — Voice of America, Mar. 16.

For more information, see: Related Newsline story, Mar. 16 — Related Newsline story, Mar. 2 — Related Newsline story, Feb. 23 — Related Newsline Commentary, Feb. 16 — Related Newsline story, Feb. 16.

The moral advice: Remember you are dealing with people, not transactions

LOS ANGELES
The Los Angeles Times last week looked at an ethics issue sure to hit home during turbulent economic times — the moral implications of firing household help.

According to the report, while Southern Californians have come to rely on cheap hired help — often undocumented nannies, gardeners, and handymen — cost-cutting is the new pastime.

The Times interviews Fordham University theologian and ethicist Tom Beaudoin, who contends that it’s a hard question. “We have built an economy that allows us to lie to ourselves about how much we exploit human beings who don’t show up on the radar screen,” Beaudoin told the paper. “This situation forces that front and center, and that’s why we feel ethically confused.”

He suggests that one possible solution is to think creatively: Find other homeowners who might like to share the costs of the hired help, or perhaps pay in other ways, with food and services.

Beaudoin says that in the balance between cutting a worker and giving up a $4 latte, it’s important to factor in the notion that you are dealing with humans, not commodities.

“If we employ folks who clean our houses or cut our lawns or haul our garbage for us,” Beaudoin said, “and we are thinking about cutting them off to save money, I would say: Think about the ethical responsibilities. These are relationships we have. They’re not just transactions.”

Source: Los Angeles Times, Mar. 21.

For more information, see: Related Newsline story, May 21, 2007 — Related Newsline story, Sep. 5, 2006 — Related Newsline story, June 12 2006 — Related Newsline story, Apr. 10, 2006 — Related Newsline story, Apr. 3, 2006.