“Unions are not unique. . . . You can’t train people to be ethical. It’s just access to money.”

Professor Peter Henning, Wayne State University and former federal prosecutor. The Barometer realizes that prosecutors develop a certain cynicism over the years. However, the good professor is just wrong. Even if we accept his premise that you cannot train people to be ethical, we can deny the second part — the access to money.

Unions have had a run of money from its tills — in the millions. Yes, it is access to money that allows embezzlers to do their thing. We in the field of ethics and compliance get the internal controls going so that those so inclined cannot find a way to do their stealing.

As one peruses the list of union embezzlements, there is a common thread. Local union officials teamed up, as it were, with outsiders to get their scam going. That area of third-party contracting is where most internal and external auditors are at their best. They know how to get at their access, their documentation, and the missing funds. In short, the union schemes are not creative nor difficult to detect. If you can’t train ’em, you can prevent their activity. Weak internal controls is more likely the cause of the union blues. And that, dear Professor Henning, is the access, and that we can control.

Now that we have settled the second part, back to the first part. The unethical will always be among us. However, there are degrees of unethical propensity. The born-thieves probably cannot be helped by training, but the fence-sitters can be persuaded (sometimes with fear) and the ethical can be inspired to report and/or prevent theft, and to remain dedicated to integrity. WE can’t save them all, but we can persuade a sufficient army to deter those who steal because the money is there and available.

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The Grade-School Phenomenon of Doing Nothing To Help

Dr. Christian Miller, a professor of philosophy at Wake Forest University has a new book, “The Character Gap: How Good Are We?” The book tackles the testy issue of getting ourselves to behave better in many situations, including those in which someone is being harmed. We know from the long list of Hollywood folks, political figures, sports figures, figures in academia, figures in auto plants, and, well, you name it, in sexual harassment that a standard litany has emerged, “We all knew about it,” or “We joked about it.” There are expressed regrets, “I knew enough to do more than I did.”

Professor Miller offers some insights on the bystander effect of doing nothing. He notes that our tendency to do nothing goes back to grade-school days when we feared being embarrassed for getting involved when others were not doing the same. But, Professor Miller brings in research that concludes if just one person steps up and expresses concern about someone being harmed, others are more likely to join. The one brave soul can make a difference.

He also notes that those who have just listened to a discussion of the ethics and importance of helping others who need it are also more likely to get involved and get the necessary help.

It’s the reminders that trigger better behavior. If we are reminded to help those in need, we do it. Students cheat less if they sign honor codes before taking tests. The training, the codes, the little discussions of ethics, the courage and example of one person, are all forms of nudges that help us be better.

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Right and Wrong in 1907: Help For Us Today

In his book “The Ethics of the Dust,” John Ruskin has a series of essays that consist of a teacher’s discussions with school girls about ethics. In the essay entitled, “Crystal Virtues,” one of the young women asks, “Well, but if people do as well as they can see how, surely that is right for them, isn’t it?”

The reply:

“…right is right and wrong is wrong. It is only the fool who does wrong, and says he, ‘I did it for the best.'”

The student:

“But surely nobody can always know what is right?”

The reply:

“Yes, you always can, for to-day [sic]; and if you do what you see of it to-day [sic], you will see more of it, and more clearly to-morrow [sic].”

We get better at ethics with each choice of right over wrong.

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When You Know the World Will Go On: The Teacher Who Made Scarves for 650 Students

Jeffrey Thomas, in his first year as a special ed teacher in Indianapolis, was taken aback when he saw some of his students wearing only a sweatshirt in freezing Indianapolis weather. Some men see things and ask why. Other men, like Jeffrey Thomas, find a solution. Using his own money, coupons, and Black Friday sales, teacher Thomas purchased fleece fabric and made 650 scarves for the students at Lew Wallace School 107.

His project went through 100 yards of fabric in order to make the 8-inch wide scarves. He had 50 patterns for the students to choose from because he wanted them to feel special.He lined them up on a tale in each class and allowed the students to “shop.”

Mr. Thomas wore out two cutting boards and more scissors than he recalls. He did all the work over a period of several months.

Mr. Thomas is a shining example of a life being lived well in the dedication to others. The Barometer suspects that he has no idea the number of lives beyond the 650 that will be impacted by his selflessness. We are in awe.

For the full story see Arika Herron, “Teacher Makes Scarves For Almost 650 Students,” USA Today, December 22, 2017, p. 5A.

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Michael Milken: He’s Back

Front page — Wall Street Journal (December 23 2017) — Michael Milken, he of the 1980’s junk bond wave fame and resulting reduced federal prison time for becoming a cooperating witness against his fellow junkers — has proved to have an uncanny ability to make stock donations to charities just prior to steep declines in the value of that stock. For example, in 2003, he donated LeapFrog Enterprises stock to a charity, and its value fell 25% in just one day. Mr. Milken was a company he funded from the beginning. Serendipity? Perhaps, but in September 2013 he donated $27 million in K12 Inc. stock to a charity. Just 26 trading days after this beneficence, K12 stock dropped 38% in one day.

The Wall Street Journal reviewed the Milken donations and concludes that Mr. Milken’s timing was better than 99% of all insiders and shareholders who reported charitable donations of stock for the past 14 years. Mr. Milken’s brother and some associates from the 1980s also made their donations at about the same time as Mr. Milken.

Mr. Milken’s lawyer said that his client and his associates were not officers or directors of the companies whose stock they donated. Just your average investors who “meticulously avoided ever being in a position where they can learn nonpublic information.”

One professor called the donations events of “uncanny timing ability.” No comment.

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A Two-Day Wave of Corruption

The past few days have not been kind to government leaders:

Peru’s president is facing impeachment over graft charges.

Ethics Commissioner finds, in a 66-page report, that Canadian Prime Minister Justin Trudeau broke ethics laws by accepting a vacation on a private island owned by billionaire philanthropist Aga Khan. The ethics commissioner chastised the prime minister stating that he must be certain that his private affairs do not conflict with his public duties and that he live up to his promise to run an administration “beyond reproach.”

Royal Dutch Shell, Eni SpA (and its chief executive), and other oil industry executives will face corruption charges on a 2011 Nigerian oil deal. The allegations are that the companies paid $1.3 billion to the Nigerian government in exchange for drilling rights. The charges also allege that the Nigerian president at that time received a portion of the money paid.

Kuwait announced that it was investigating a military helicopter deal with Airbus SE. The deal was for 24 helicopters for a price of over $1 billion. Other countries investigating the military contracts of Airbus include the U.S., France, and Britain.

The Saudi government announced that the clawbacks of graft paid to government officials now under Ritz-Carlton arrest (i.e., they were arrested, rounded up, and house at the Ritz-Carlton) would be put into the Saudi treasury. The funds will be used for government programs included in a stimulus package developed by Prince Mohammed as part of his new administration.

All of this was over the course of two days. Not a bad couple of days for graft and corruption all over the world. Not a good couple of days for those subjected to a government of quids and quos. Corruption in deals means costs go up, quality goes down, and speed of projects and products slows down. Corruption benefits a few at the expense of many.

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Meryl Streep: “I didn’t know. . . . I didn’t know.”

Actress Rose McGowan took Meryl Streep to task for remaining silent about the Harvey Weinstein revelations. Ms. Streep assured us that she does not “tacitly approve of rape” and that she does not “like young women being assaulted.” She repeats that “She did not know.”

What did Ms. Streep think the Seth McFarlane jokes at the 2013 Academy Awards were about? She was a presenter, coming off her 2012 win, so we know she was there. There was a cultural undercurrent on Mr. Weinstein’s conduct. His conduct was alluded to by Gwyneth Paltrow on the “Late Show with David Letterman,” joked about in the “Family Guy” and “Entourage,” with a character named Harvey Weingard.

The bystander effect grabs everyone, even Oscar winners with 19 total nominations. You know something is there, but what you know is awkward. You assume someone else will speak up. You figure it is none of your business. You are not directly involved. And the rationalizations and justifications stream forth. But in the end, after all the damage is revealed through the inaction of many, the protests of ignorance ring hollow.

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The Husband Seeking Love Elsewhere with His Wife’s Permission

The Barometer will simply recite the facts from a New York Times “Ethicist” column (November 19, 2017, p. 30) and end with one comment:

A 60-something husband’s wife is in ill health. The ill wife has given her 60-something husband permission for conjugal visits with a non-conjugate. The husband describes the proposed affair/relationship as “friendly but not competitive.” (One comment: Hell hath no fury …). The 60-something husband turned to a dating website and described his situation thereon with full disclosure (One comment: We could expect no less from a married man proposing permissive infidelity) and was met with scorn and accused of “cheating.” (One comment: Is this incorrect?) The 60-something husband labeled these responses as “immoral” and “unfair.” (One comment: Said the kettle to the pot and vice versa)

So, the 60-something husband requested a solution to his dilemma for, in his words, “… there seems to be no pathway to address the ageism and biblical [sic] rigidity of a society that spends billions on youthfulness and eroticism and nothing on thought.” (One comment: So, society is to blame for this dilemma? For better, for worse, in sickness and in health … — we have not added footnotes to the vows to cover one 60-something who self-describes as a “very sexual person.”) (One more comment: One need not spend a bitcoin on thought; they are free and ours for the taking — one need only contemplate the consequences of actions to be drawn into another world of depth and self-development.)

(One last comment:The problems that even permissive affairs create have been given, sadly, less thought than Biblical rigidity. Perhaps love from afar and devoted help and assistance to his bride could help the 60-something understand that he has been given a test of character that demands more from him than he can imagine. Every worthwhile act of service demands sacrifice as it builds the strength and character of those who give despite personal costs.)

That was a total of seven (or so) “one comments.” The dilemma demanded as many.

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When the Research Is Retracted: Whom Can We Trust?

Social psychologist Brian Wasnick has had his work referred to by Nobel economist Richard Thaler as “masterpieces.” However, social psychology has had its reputation tattered a bit. In 2015, the Center for Open Science (COS), located in Charlottesville, Virginia, began its Reproducibility Project, and psychology was its first subject area. COS attempted to replicate 100 past studies. A team of 270 researchers picked a project to replicate. Sadly, the scientists could only replicate the result in 39 of the 100 studies. For the other 69, the scientists found they could not get to statistical significance. Of the 57 social psychology studies, only 25% could be replicated, which was the worst field.

Mr. Wasnick published a study that concluded that if you put an Elmo sticker on an apple that the kids will choose the apple over the cookie. The results were published in Journal of the American Medical Association Pediatrics, but were retracted when JAMA received a letter from a reader, Nick Brown, that pointed out inconsistencies between the methodology and the data. The editor retracted the article. Mr. Wasnick responded that the data were indeed incorrect, but the mistake was inadvertent. Mr. Brown then responded:

Having read the cover letter that accompanies the retraction, my reaction would be to question just how chaotic a lab has to be to “inadvertently” submit an incorrect report of the study design and sample size to a journal with an impact factor of over 10. I also wonder how a misleading figure “inadvertently” came to replace a considerably less misleading one that was apparently in a draft of the article less than three months before it was published, as detailed in my blog post…

Mr. Brown also wondered how chaotic a lab has to be that it sends out the wrong data for publication.

The retraction is the third that Mr. Wasnick had made. There is a great deal of federal funding available for research into making kids eat what’s good for them. Slap a few Elmo stickers on food, claim you have a solution for healthy kid choices, and the funding will keep coming. The integrity of the data is not the only issue here. The integrity of researchers suffers when these highly visible errors appear.

The Barometer wonders how many “Nudges” Richard Thaler got governments to adopt that were based on faulty Wasnick and other social psychology studies. Those who believe the research and rely on it in their actions and policies are like the rubes who purchased miracle cures from the traveling-wagon-salemen. They were making stuff up too. The times changes but the strategies of those who scam never do.

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Oliver Schmidt, former general manager of engineering at VW, sentenced to 7 years

Mr. Schmidt explained at his sentencing, “A script or talking points, I was directed to follow for that meeting [with the California Air Resources Board] was approved by management level supervisors at VW, including a high-ranking in-house lawyer, Regrettably, I agreed to follow it.” He added that his loyalty to VW led him to be “misused by my own company.”

Pressure clouds judgment and makes bad decisions palatable. The Justice Department countered that Mr. Schmidt helped write the script.

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“Conyers’s Son Was Accused Of Stabbing His Girlfriend”

John Conyers, leaving the House for various reasons (all denied), endorsed his son, John Conyers III (just like Britain), to succeed him. Then, the above headline appeared in the New York Times.

John Conyers’s III (27) side of the story:”She says I stabbed her, which makes no sense. I didn’t do this. She and I had a verbal altercation and that escalated. She pulled the knife on me. She was chasing me. I tried to take it from her. There was a struggle. I pinned her to the wall. She kept swinging and she cut herself.”

Ah, the old self-inflicted wound in a domestic disturbance. The scuttlebutt is that John Conyers III is now out of the running for his father’s seat. Not sure why. From the reports emerging over the past few weeks about our Congress, sounds like he might fit right in.

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“I have never seen a case where there were so many bad things done like Uber has done in this case.”

Federal Judge William Alsup, presiding over the trial in the suit by Waymo against Uber for alleged theft of intellectual property, on learning of the existence of an employee whistleblower letter received by Uber regarding intellectual property issues at Uber. Uber also did not disclose that it had paid the now former employee whistleblower $4.5 million and his lawyer $3 million to settle his retaliation claims.

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A Conflict Is a Conflict Is a Conflict: Our Federal Government At Work on Ignoring Them

Ignoring party affiliations, a conflict is a conflict is a conflict. Since June, those conflicts have been cascading here and there in the federal government without much coverage, less outrage, and no action.

Mick Mulvaney is the new acting director of the Consumer Financial Protection Bureau (although not without a bizarre court battle in which a discombobulated federal judge had to ask a lawyer whether he had the authority to tell the president he could not appoint a government official because the departing director’s authority was autonomous, supreme, and over all the galaxy). The CFPB, as it is known, regulates consumer loans. Until his appointment (by President Trump without the court battle but certainly with the usual Senate battles) Mr. Mulvaney was a member of the House of Representatives. Mr. Mulvaney received $31,700 during the 2015-16 federal campaign cycle from payday lenders — the subprime, high interest, low tolerance lenders. Mr. Mulvaney was #9 in ranking for the most contributions from the paydays. Now, he is in a position to regulate (or not) those lenders. When asked if he saw a conflict he said, “I don’t think so because I am not in elected office anymore.” True enough, but that does not erase the conflict. A conflict exists when an individual’s interest are torn between competing loyalties. A conflict is not an evil thing; a conflict must be managed. You either disclose the conflict or you recuse yourself from one of the jobs that creates the conflict.

Payday lenders are playing a suit against the CFPB because of the issues of constitutionality of a one-person headed commission (all other federal agencies have 5 commissioners who make decisions). The fact that Mr. Mulvaney is the sole decision-maker for the CFPB makes the conflict more actor. Managing this conflict cannot be resolved by restructuring the agency quickly. That action would take congressional action, and glaciers move more quickly than that body, except, apparently, when pursuing staffers for purposes other than bill mark-ups. Mr. Mulvaney could recuse himself from any decisions related to consumer lending, but, then again, that is his job. Giving back the money seems to be the logical (and only) option.

Now, on the other side of the aisle is FBI agent Peter Strzok. Mr. Strozok was removed by Robert Mueller from the special counsel staff because the Office of the Inspector General, looking into the FBI’s handling of the Hillary Clinton e-mail investigation, found that Mr. Strzok was sending anti-Trump text messages to an FBI lawyer with whom he was having an affair. Some additional information about Mr. Strzok:

1. He worked on the Hillary Clinton e-mail investigation (or whatever Loretta Lynch told then-FBI director James Comey to call it).
2. He interviewed Mrs. Clinton’s top aides, Cheryl Mills and Huma Abedin, and was present for the interrogation of Hillary Clinton.
3. He helped to alter the Comey July 2016 exoneration of Mrs. Clinton by changing the original wording from “grossly negligent” behavior in managing her e-mails (which was the language of the federal statute that would have allowed prosecution) to “extremely careless.”
4. Mr. Strozok signed the documents that opened the FBI investigation into Russian election interference.
5. Mr. Strozok participated in the interview of Michael Flynn.
6. He has not appeared before congressional committees investigating all of this despite the requests of several committees.

Mr. Mueller was correct in managing these various conflicts. Mr. Strzok had to go, and he did in July 2017, but this information was not made public until the rumblings of the forthcoming OIG report hit the streets.

Yesterday, pursuant to a federal court order requiring the release of FBI documents, Judicial Watch, the group that made the Freedom of Information Act (FOIA) to the FBI found e-mail from Mr. Mueller’s deputy on the special counsel investigation, Andrew Weissmann. Mr. Weissmann sent a congratulatory e-mail to then-acting Attorney General Sally Yates for her refusal to enforce President Trump’s immigration order, “I am so proud. And in awe. Thank you so much. All my deepest respect.” A conflict is a conflict is a conflict, and there is evidence of impartiality here. There are two choices — manage the conflict (too late for that) or withdraw. No action yet. The clear political affiliations of two members of his staff should be addressed by Mr. Mueller.

Both sides of the aisle. No matter where you sit politically, the conflicts are real in both cases and in neither case was there solid management of those conflicts.

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The Harassment Settlements and Payments in Congress

The Congressional Office of Compliance has released the following data on its settlement of sexual harassment claims against members of Congress. Visit the site yourself: https://www.compliance.gov

Since 1997 (through 2017), there have been 264 settlements for a total of $17 million disbursed to pay claims.

The worst year? 2007, with 25 complaints settled for over $4 million in settlements, followed by 2002 with 10 complaints settlement for almost $4 million. 2017 is almost $1 million as of November 16.

Wait! There’s more!

If a staff member wishes to file a harassment complaint, he or she must first trot through an Office of Compliance process (from the office’s website):

“Counseling” is the name given to the OOC’s intake process. To file a claim of harassment (or any other violation of workplace rights under the 13 statutes incorporated by the CAA), you must request counseling within 180 days of the date of the alleged violation.
Although the OOC counselor does not provide you with advice about the strength or merits of your case, upon receipt of the counseling request, she considers the information that you provide and gives you information on your workplace rights and the administrative procedures under the CAA.

Wait! There’s more!

The whole process is secret. After counseling you go to mediation. Here are the rules on mediation:

At the beginning of the mediation process, all parties sign an agreement to keep confidential all communications, statements, and documents that are prepared for the mediation. Information obtained, exchanged, or imparted during mediation may not be disclosed by the mediator or any party to the mediation. This means that you can’t discuss what was said during mediation or share information you learned for the first time through mediation. The purpose of this limited confidentiality obligation is to encourage the parties to share information in order to seek resolution of the claim.
Wait! There’s more!

Here are the rules on settlement.

Whether and how to settle a claim are matters for the parties to decide. The OOC does not have any standardized language that parties are required to include in their settlement agreements, and it does not require parties to include nondisclosure provisions in those agreements. The contents of settlement agreements— including any provisions governing disclosure—are solely determined by the parties and their representatives. The only statutory requirement for settlement agreements in the CAA is that they be in writing.

Wait! There’s more!

No names or actions are revealed. You wlll never know which elected officials did what and when. Again, from the website:

Under current law, the OOC is not authorized to release information about individual awards and settlements.

Wait! The last straw!

Tax dollars paid for everything!

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