The Ethical Barometer

This was an AOL headline that pops up as one skulks through the click-bait to the real goal: e-mail. The headline itself was stunning because:
1. It was a positive statement about a famous person.
2. There was no ridicule of the relative of a famous person.
3. It did not say, “Despite her politics . . . ”
4. It was not COVID-19 data.
5. It did not label anyone a racist.
6. It did not say, “Despite having to live in this country . . .”
7. She was not wearing a mask.

In short, here was a story that was not negative or an attack. A story that brought back memories of the talent of Lucille Ball and her incredible comedic timing. It was a reminder that despite the problems and challenges we face, that there is still the standby comfort of family. And while we all have limited time here, we do leave behind those who carry memories of us and some of our characteristics.

In short, Lucille Ball and her granddaughter brought hope — hope that there are still good things and good people in the world. Hope that our lives go on even when we lose our loved ones. Hope that we see those loved ones in those they left behind. Hope that kindness and compliments remain in our fiber. Hope that we need not always be finding flaws. That’s not a bad haul on the way into the e-mail.

Hope is the thing with feathers
That perches in the soul
And sings the tune without the words
And never stops–at all–
And sweetest–in the Gale– is heard–
And sore must be the storm
That could abash the little Bird
That kept so many warm ….

Emily Dickinson

Lisa Gilbert, Public Citizen (a Washington,D.C. advocacy group). Ms. Gilbert was referring to the ethical downfalls of so many public officials, a downfall that begins with high-ranking officials asking members of their security detail or staff to pick up their dry cleaning. The act of having someone else pick up your clothes at the dry cleaners seems to be the gateway drug to misuse of pulic resources and funds.

The assignment of errands seems like such a small thing, but it constitutes, in the words of Robin Thicke (or New York Times, May 20, 2020, p.A22.

The critical lesson of blurred lines goes beyond just that dangerous first step. The dry-cleaning assignments are evidence of a character flaw. These officials are asking professionals to be flunkies. The ease with which an official can assign tasks well below the experience, education, and training of a staff member shows an insensitivity to human dignity. They are asking staff members to do things those staff members would be fired for doing.

How we treat those who wield no power over us is a measure of character. Ironically, staff members actually wield the ultimate power; they have information that public officials do not want public. So, the moral of the story is to use caution in how we treat those who we perceive cannot harm us. They hold the trump card.

The Digital Millennium Copyright Act (DMCA) was well intentioned legislation designed to protect websites from copyright infringement claims when the site owners are not the ones doing the infringing. For example, colleges and universities have entire student bodies pirating copyrighted music and films. They are not held liable for infringement if they take good-faith steps to stop the little darlings. So, warnings, monitoring, and the banishment from using the universities’ servers do the trick.

Likewise, Google and its YouTube and other sites have to follow a process when someone copyrighted material shows up on their sites. The process is the copyright owner or representative contacts Google and says, “Take it down. It’s infringement.” Google then takes it down.

The loophole in the process was that Google is not required to verify the authenticity of the party requesting the take-down. As a result, the diabolical among us have figured out that the way to get rid of negative stories, information, and opposing political views is to pose as their authors and request the take-down. So, those irritated with a Wall Street Journal editorial pose as the WSJ and write to the site linking or posting the editorial. They demand a take-down. Not wishing to lose the DMCA protection, the site asks no questions — it goes right for removal.

There are even fake law firms sending letters requesting take-downs. If the stationery is good enough, well, you get your wish. The WSJ did a story on this diabolical activity, using its own experience. Working with Google, the Journal restored 52,000 links that Google had removed pursuant to official requests.

Bad actors are a creative lot. The moral of the story is follow your links — see if they are still there. Until the U.S. Copyright Office finds a solution, we are responsible for policing the rogues.

Elon Musk is a visionary who makes a status car whilst running a company with a net worth greater than Ford and General Motors. He also has a child named X AE A-12. No word on pronunciation for that one. And his Tweets bring on the wrath of the SEC and frustration among the company’s lawyers.

Mr. Musk tweeted to his 34 million followers that they should take the red pill when it comes to the corona virus. The red pill advice, the red pill online groups, and the Silicon Valley red-pill movement come from the film, “The Matrix.” The Barometer knows nothing of the films or Neo, but research reveals that Neo (Keanu Reeves) is given the option of taking a red pill so that he can see society as it really is. Seems to be borrowed from Lewis Carroll’s “Through the Looking Glass,” and Alice’s trip to wonderland.You can see a different world with pills. Alice saw a hookah-smoking caterpillar and the druggies of the sixties thought they could fly. Even Advil takes away a headache, but it cannot address the underlying cause of those headaches.

Seeking, finding, and then seeing truth is a tall order. Sometimes we do not know the truth. Analytics and models give information, but until events unfold, they are not truth. Predicting the future is not the stuff of truth. We know from politics that what is said on television is not the same as what is said when the same folks are under oath. Truth comes through vigilant study, healthy skepticism, and an open mind. You can spot a truth-seeker among those who challenge conventional wisdom. Views and opinions are not truth, even when Elon Musk is the one opining. Mr. Musk may be correct; he may be wrong. A truth-seeker does not attack Mr. Musk for his views but explores the source, foundation, and basis of those views.

‘Tis an odd position to be defending Elon Musk. The Barometer is still trying to figure out how Tesla can be worth billions and still be so cash-poor.

However, truth is vital despite the ongoing slog to find it. So, sally forth, drug-free, and pump those neurons in seeking the truth. No pill can do the work.

Ken Osmond, the actor-turned-police-officer who played Wally Cleaver’s best friend on the TV series, “Leave It to Beaver,” died at age 76. The series ran from 1957-1963. The character Mr. Osmond played, an obsequious, duplicitous snake, Eddie Haskell, was so memorably etched that Mr. Osmond could escape the typecasting. He became part of the thin blue line.

Eddie was a charmer, offering, “Good evening, Mr. and Mrs. Cleaver,” but that was quickly followed by his day-to-day demeaning chatter to the Cleaver boys, “Look Sam, if you can make the other guy feel like a goon first, then you don’t feel like so much of a goon.” Sometimes Wally was “Gertrude,” or “Chief.”

Mr. and Mrs. Cleaver were on to Eddie: “Your father gave me a funny look when I came in… like I’m a teenage werewolf or something.” In answering Wally as to why he believed Ward Cleaver did not like him, Eddie offered, “On account of the way he looks at me when he opens the door. Sometimes I think he’d be happier to see Khrushchev standing there.”

We laughed at Eddie’s pseudo-charms and behind-the-back barbs because we know Eddie Haskell is alive and well. We went to school with Eddie Haskells. In their book, “Developing and Reporting Systems for Student Learning,” Thomas R. Guskey and Jane M. Bailey discuss the “Eddie Haskell effect” in describing the manipulative students who earn “brownie points” (from the junior Girl Scout organization called “Brownies) with teachers in order to earn a good grade. Today’s generation has a far harsher phrase than “brownie points,” but you get the idea. The brownie points are, in the experts’ words, “crucial in the grade commodity market.” (p. 19) We sloggers just studied, too shy or too respectful of authority to work the system.

We work with Eddie Haskells. They brag. They create the appearance of being loyal, hard-working employees. We are on to them; the boss is not. They come in and leave a jacket or sweater on their chairs and then disappear for hours. We do hear from them in their extended absences. They call in or text to have us go into their offices to re-activate the motion-sensor lights. When they are not dodging, they are doing the brownie-point thing. Or taking credit for others’ ideas.

Some of us have had Eddie Haskell children. Angels at home and hellions at school. There is even a checklist for determining whether you are dating an “Eddie Haskell.” “http://newsonrelevantscience.blogspot.com/2011/11/10-ways-to-tell-you-are-dating-eddie.html. Who has not listened to an obsequious politician with flattering words only to find them voting the opposite of those promises and compliments once in office? If you are really looking for duplicity, study foreign relations.

It is the duplicity. And duplicity’s heart is dishonesty. A CEO once commented that the greatest test of integrity is whether a person behaves the same way around everyone. Officers in a board meeting are not the same people as those officers in a meeting sans the board The language is different, the bottomline is different, and the deference is gone. How those officers treat their staff members is yet another story.

One of the great challenges in life is learning to treat everyone the same way as you would treat Ward and June. Ken Osmond, thanks for bringing us one of TV’s most memorable characters, thanks for teaching us to be on the lookout for the duplicitous and obsequious, and thank you for dedicating your life to honorable public service. You did escape the typecasting after all. You, sir, are no Eddie Haskell, RIP.

Adam Neumann, one of the co-founders of WeWork has filed suit against SoftBank because the bank backed out of a deal to pay up to $3 billion for shares in WeWork, $970 million of which would have gone to Mr. Neumann as part of a plan to get him out of the company. SoftBank backed out because the civil and criminal investigations into the company were not resolved by the deal’s April 1 deadline.

Who would have been responsible for the conduct the resulted in the civil and criminal investigations? The conflicts of interest. The sloppy finances. Well, Mr. Neumann was the CEO. Staggers the imagination that Mr.Neumann fancies himself a plaintiff.

The odds are astronomical, but Tara Reade’s allegations that former Senator, Vice President, and now presidential candidate (presumptive nominee) sexually assaulted her just got some street crew. Turns out that in 1993, when the events occurred (according to Ms. Reade), a woman from San Luis Obispo called into the Larry King Show on August 11, 1993 and asked the following question of King,”Yes, hello. I’m wondering what a staffer would do besides go to the press in Washington?” My daughter has just left there after working for a prominent senator, and could not get through with her problems at all, and the only thing she could have done was go to the press, and she chose not to do it out of respect for him.”

Ms. Reade’s mother, Jeanette Altus, lived in San Luis Obispo at the time of the call. She has since passed away, but Ms. Reade identified the voice as that of her mother and that her mother wanted her to go to the police when the alleged event occurred.

The odds are indeed astronomical that the tape would emerge, but these things just find a way, particularly in politics and potential Oscar hosts.

There were $349 billion dollars in loans sent out from the Feds to small businesses to help them through our analytic-induced coma now crippling the U.S. economy. However, the big banks, the bane of Main Street’s existence since about 2007 with their subprime, bail-out, and other interpretive shenanigans, stepped in and scooped up the loans for their biggest customers.

Many of the customers did not even have to do the loan paperwork — they just had to call. JPMorgan Chase, Citibank, and U.S. Bank approved the loans for nearly all of their big customers. Meanwhile the riff-raff small business folk struggled with convoluted forms, and netted a two out of 30 loan approval. That the money was never intended for the big guns was not an issue. Where there’s a loophole to exploit, count on the big banks exploiting away until the Feds catch up and try more regulation.You can’t regulate an amoral technician. They just find a way to get around laws for their own financial gain at the expense of others.

Other examples of amoral technicians? The mother in Illinois who turned her child over to a guardian so that she could qualify for financial aid. With zero income. that’s a sure thing. Then there are the Ivy Leagues who solicit applicants they know are not qualified in order to lure them into applying, thereby increasing your denominator (in the language of those health-care, plateau-seeking, now vaccine-seeking analytic experts). Increase the denominator and your acceptance rate us strikingly low, thereby enhancing exclusivity. It’s not real, but it does bring in the money. By donation or the back-door way through coaches paid to use their slots for the physically untalented of wealthy parents.

The ethical mind always asks, ‘What would happen if everyone did what I am doing, how would the world look? In the case of the bank, they all did it, there was no money left for small businesses, and they lost more business or trotted over to Chapter7 bankruptcy. ‘Tis a lovely world amoral technicians can create.

The Barometer and her husband had avoided the grocery stores and the great toilet paper drain, as it were, of 2020, until March 20. We are stockers, and had sufficient TP to decorate a house or two in the manner of our younger days. Until our adult children swooped in because of their millennial ways of, “What, me worry? My phone is down to 10% battery before I think about charging it.” So, off we went foraging that Friday for baked potatoes, milk, and TP.

The TP was being doled out, one package per family, at the manager’s desk. No pick-up from the aisles for this precious commodity. TP had become like Bose headphones at Best Buy. You must ask for them, they are locked in a cabinet, and only certain employees are trusted to dole them out to non-scruffy customers who must pay prior to handling them.

We approached the manager humbly, “Please, sir, could we have just one?” We mentioned that we were stunned that the Walmart Neighborhood Market had become so involved in rationing. Another employee stepped up, leaned forward, and whispered to us as only someone with inside information would, “You know they are sending in the marshal on Monday.” Visions of Matt Dillon riding into Mesa, Arizona came to mind.

However, research showed that there was an Internet rumor that the Feds were going to impose martial law that Monday. The old game of telephone is alive and well, all with the exponential power of technology. Around the country the rumor spread. The hang-up for the fearful was the spelling. Or was the hang-up that no one understood what martial law was? Whatever the reason, the blasted Internet, the tweeters, the flash-grammars, the chap-shatters, and the rest all fell for it and rushed in to get theirs. AH, the makings of a brutal Netflix series were there before our eyes. Have mercy on us through April 30 as people are locked up with their phones and computers. Who knows what showdowns at the corral are coming, or it it coral?

New Wells Fargo CEO, Charles Scharf, testifying before the House Financial Services Committee, regarding the findings of a House report on behaviors at Wells since the time of the discovery of the 3.5 million fake accounts, give or take a few thousand here and there.

The e-mails and conduct in the report reveal a bank looking only to have its cap on growth eliminated. Here’s a classic quote from the now former chief risk officer,”If any of the $200MM [for customers injured due to unauthorized accounts] is left over, we promise to give it to charity—only after the CFPB and the OCC let us out of the consent orders. If they do not, no donation. Put the onus back on them.” Yes, that’s where the onus should be, after all.

So, to get out from under the cap and their consent decree, the chief risk officer used charitable donations as a bargaining chip. Remember all those ads Wells was running about its dedication to social causes and the extent of its donations? This is one scary crowd.

Here’s wishing Mr. Scharf well in his efforts at the bank. Between reading the baseball commissioner’s report on the Astros and this latest report on Wells Fargo, the Barometer has her head shaking like a baseball bobble figure on a dashboard.

Mercy! These CEOs. The Barometer is thinking of a new book — The Seven Things CEOs Do That Cost Them and Their Companies Dearly. Lack of candor would be one of them.

Here comes Yes Staley, CEO of Barclays. Do a search of this website and you will find the tales of his fines and troubles surrounding his actions to find out who a company whistleblower was. Now Barclays is grappling with a British investigation into whether Mr. Staley told the truth about his association with the infamous pedophile, Jeffrey Epstein.

While Scotland Yard (actually it is the U.K.’s Conduct Authority and Prudential Regulation Authority doing the work)is busy with its job, Barclays issued a statement that, for the first time, acknowledges that its CEO did indeed visit Epstein’s private Caribbean island, Little St. James, on two occasions. This was an island populated by many young girls, some as young as 11-13. However, Barclays assures that Mr. Staley was accompanied by his wife on both visits.

Barclays also indicated hat it was examining what Mr. Staley told Barclays about this issue when he was hired in 2015. The Conduct and Prudential folks have e-mails from both JPMorgan and Barclays that they are examining. JPMorgan turned its e-mails over, and the Barclays folks turned theirs over and are also perhaps perusing them as well.

Uh-oh. On so many levels.

There’s a headline that inspires confidence in the new leadership of a company that has been struggling with, well, candor with the public, with regulators, and with itself.

Alison Sider and Andrew Tangel, Wall Street Journal, March 9, 2020.

New CEO Dave Calhoun gave a quite remarkable interview with the New York Times. During that interview he said what those of us who are outside observers knew anyway.Just the title of the article reflects what many of us have been struggling to make clear, “Boeing’s Problems Are a Lot Bigger Than He Feared.” He must have gotten an earful from the powers that be, whoever they are. A few tidbits, candid though they may be, from the interview:

“It’s more than I imagine it would be, honestly. And it speaks to weaknesses in our leadership.”
He will be, “Hunting for bad news and acting on it.”

The one time in all of this that someone at Boeing gets something right, they rein him in. Would that they would have been so outraged at the e-mails the employees were writing for years. The Barometer’s hopes were dashed within two days of the surprising, but necessary, candor

Natalie Kitroeff & David Gelles, “Boeing’s Problems Are a Lot Bigger Than He Feared,” New York Times, March 6, 2020, p B1.

Newell Brands (Rubbermaid) has received a subpoena from the SEC following informal information requests. Uh oh!

Newell purchased a competitor (Jarden) in 2016 for $20 billion. That brought $8.3 billion in goodwill to its books and, as a bonus, quadrupled its debt. Then, by 2018, Newell had written down, yes, get this, $9 billion in goodwill. It is one of those, “Okay, we were wrong on the valuation thing.” Oops.

Goodwill is one of those accounting red-flag areas. When you see it, don’t believe it because, sooner or later, and more and more it is sooner, it is going away. When it leaves, the SEC arrives.

Newell is now the stuff of junk-bonds (S&P Global). And the SEC says that it is looking at “sales practices and certain accounting matters.” Raise your hand if you can figure out the components of “accounting matters.”

Analyst say investors do not care about goodwill, debt covenants, etc. Perhaps so. However, what you find in all of these factors that are ignored by analysts are the following:

1. The pressures at the company
2. The ethics of management (keeping your word is some small part of debt covenants)
3. Combine ethics with the squishy numbers in goodwill impairment and the highly subjective becomes highly material

Catherine Pugh made $800,000 selling her self-published children’s health books to those nonprofits and foundations that could benefit from the Mayor’s noblesse oblige in spreading around city grants and funding to those purchasing the books. There were issues with failure to deliver the books and tax evasion. And then there were the campaign finance violations — she used the book money in her campaign.

At her sentencing she said, “I apologize for all that has led me here.” Not sure what that means, but it seems a tad evasive. Creative graft would have been a better term to use with this scheme.