The Ethical Barometer

Three events over as many weeks have put the Barometer over the edge on the texting epidemic. Whilst traveling with family down from Arizona’s Rim Country to the magnificent Phoenix Valley of the Sun, all travelers in the car noticed a small gray car ahead at the stoplight in Payson. The gray car sat motionless during a green light. A honk to awaken the driver came too late. The light turned red. We pulled out from behind the gray car and alongside it in the right-hand lane. Its young female driver was busily texting. She managed to look up in time to awaken to the next green light. She took off like a bat in a scary movie when the heroine has entered the premises. We lagged behind, not wishing to be anywhere near the gray car.

We watched as she traveled in the left lane, swerving off the road three times, once so much so that she kicked up dirt because her car had strayed off the pavement. We pulled along side the gray and rolled down our windows with the hope of catching her attention. For her own safety and that of others, we were going to yell, “Stop texting.” Our plan was thwarted because she was so busy texting that she did not see our waving arms. We dropped back with sadness, offering a prayer that she might make it the 75 miles down to the Valley in safety. We kept our distance.

The following week in the Indianapolis airport, the Barometer was on the right side of the long walkway headed to her gate. However, considerable darting and weaving resulted as an approaching 30ish business man deep into texting was walking as if he were three sheets to the wind. The Barometer sensed a collision in the air. Finally, the Barometer had no place to weave to avert his weave to the wall. Here are the words offered to the distracted traveler, “I have nowhere else to go. You may have to look up from your phone.” He finally looked up and offered a meek, “Sorry.” Still, he went on his merry, albeit weaving way continuing to text, as other travelers did all sorts of dosey-does and/or river-dances to avoid the heads-down teeter.

Now this week. The close-call phenomena ended. Alexandra Mansonet, the CEO of a nonprofit, was texting whilst driving her black Mercedes-Benz to work. Her sister-in-law had texted her about choices for dinner, “Cuban, American, or Mexican. Pick one.” Ms. Manoset’s cell phone indicated that she had typed the letters “m” and “e.” At that point, as Ms. Mansonet testified, she looked up and saw a Toyota Corolla in front of her but could not stop in time because of her proximity and speed, the laws of physics still in effect even in New Jersey. Ms. Manoset hit the Toyota, which struck and killed Dr. Yuwen Wang, a young scientist out for a morning walk.

Ms. Mansonet was charged with reckless vehicular manslaughter. She testified that she had looked down to turn on her rear-window defogger, and then saw the Toyota. She did turn over her cell phone to police at the scene. Investigators found the text and her unsent response of “m” and “e.” Ms. Mansonet testified that she was not texting at the time of the accident because she decided that it was best to just call her sister-in-law later because she was not sure what she wanted for dinner. The jury was not persuaded, and she was convicted of reckless vehicular manslaughter.

After the verdict, Dr. Wang’s stoic husband said, “I hope more people could realize the consequences of texting while driving.”

What more need be said? The life of a young scientist who had just celebrated her sixth wedding anniversary with her husband the night before was ended.

Texting is a self-absorbed and self-absorbing activity. Apart from that shallowness is its dangers to others. There is a world out there of living, breathing, walking (or attempting to do so) human beings. For their sakes and your own, all you textures: STOP!

In June, the Barometer expressed concern about then-Baltimore-mayor Catherine Pugh because of her book sales. “Her former Honor has a series of books, known as the Healthy Holly series (children’s books), that help children learn about healthy living. The books are self-published, leaving out that pesky step of editors, reviews, distribution, etc. No need for all that rigmarole, Her Honor also found bulk purchasers for her books. The also former state senator served on a number of nonprofit boards, and the organizations would purchase large numbers of Healthy Holly books. The University of Maryland Medical System was one of of the book purchasers ($500,000 for 100,000 books), and the then-Senator Pugh went on to sponsor legislation that would have benefited the System (had it passed). In fairness to Mayor Pugh, there were 9 board members of the System that had contracts with the System. However, when Mayor Pugh took office (and let us not forget that Mayor Pugh was elected to replace the former Baltimore mayor who was convicted of embezzlement in 2010) contracts with the city were closely timed to book sales.Kaiser Permanente purchased $100,000 in books, and then received a $48 million contract from the city. Whoa, Nellie, that Baltimore/Maryland area is treacherous ethical territory.”

It is also treacherous legal territory. Ms. Pugh was indicted on federal charges of wire-fraud and, of course, the inevitable tax problems that go hand-in-hand. The indictment alleges the book sales brought in $500,000 even though many of the books were not delivered or were double-sold. The tax charge indicates that Ms. Pugh reported $31,020 in income in 2016 and the indictment alleges actual income was $322,365. Heck of a difference, and a heck of a lot of detail. The Feds must have had cooperation from those who purchased the book.

Professor Bruce Bagley was charged with money laundering as part of a network used to get money from bribery and corruption in Venezuela laundered and all fresh for use in the USA. The total amount laundered was $2.5 million and the professor’s take is alleged to be 10%. Commission, you know, for bribery and corruption assistance.

Professor Bagley, University of Miami, edited a 2015 book, “Drug Trafficking, Organized Crime, and Violence in the Americas Today.” Another book on organized crime and interrelationships among countries was released in May 2019. His biography lists consulting clients as the United Nations, the FBI, DEA, and several Latin American countries (one presumes Venezuela).

Those who can do, and those who can’t teach. Maybe not. Maybe it is possible to do both.

Facing removal of his patronage activities from the websites of charities, Prince Andrew has stepped back his royal public duties. His Epstein connection and bizarre responses in a BBC interview were too much. Describing Epstein’s conduct as “unbecoming” was an eye-roller.

The media shall resume their dogged pursuit of Meghan Markle stories following this brief respite into the underworld, they are back to gossip.

The CFO has left, the PricewaterhouseCoopers audit partner assigned to the company has been placed on administrative leave. So, what happened? Here are the steps:

1. Weak holiday sales in 2018
2. Mattel rejects a takeover offer from Hasbro
3. Mattel’s shares lost half their value over the one-year period that followed.
4. There were problems with the accounting for the company’s Thomas the Train & Friends show.
5. When the valuation issues emerged, the discussion was initially fixing the valuation problem and restating earnings.
6. A earnings restatement was not what Mattel needed at that time and stock price.
7. Senior executives and the PwC audit partner decide to change the accounting treatment without telling the board or CEO what had happened.
8. This is a mess.

Both the SEC and the Department of Justice are investigating accounting practices at Under Armour. The focus is on revenue recognition. UA has been missing sales targets since 2016, and since 2016 has had three of CFOs, two of whom left with the usual “personal reasons” explanations.

There have been some unusual cultural issues at the company– including the expensing of strip club visits and inappropriate behavior by male executives. Although CEO and founder Kevin Plank has vowed to do better, he will be stepping down as CEO on January 1, but will remain as chairman of the board.

The pattern is always the same: tremendous growth that cannot be sustained, a wild yee-haw culture, executives rotating in, out, and through, and the inevitable questions about accounting. Groovy company, groovy leaders, followed by groovy accounting. This one will not end well.

Some quotes from Prince Andrew’s interview about his contacts with the late sex offender, Jeffrey Epstein, with BBC journalist Emily Maitlis, and the quotes speak for themselves, although the Prince probably should not have:

“Do I regret the fact that he (Epstein) has quite obviously conducted himself in a manner unbecoming? Yes.”

Of the photo of him standing with accuser, Virginia Roberts Giuffre, then 17,

““Oh it’s definitely me, I mean that’s a picture of me, it’s not a picture of… I don’t believe it’s a picture of me in London because… when I go out in London, I wear a suit and a tie. . . The photograph was taken upstairs, and I don’t believe I ever went upstairs. . . “I am not one to, as it were, hug and public displays of affection are not something that I do. So that’s the best explanation I can give you and I’m afraid to say that I don’t believe that photograph was taken in the way that has been suggested.”

On regrets about his relationship with Jeffrey Epstein:

“As far as Mr Epstein was concerned, it was the wrong decision to go and see him in 2010. As far as my association with him was concerned, it had some seriously beneficial outcomes in areas that have nothing to do with what I would describe as what we’re talking about today.”

Okay, one comment: WHAT?

One can understand the mental pressure of solitary confinement. Washington State Prison officials have done their part when prisoners are so confined. They are given a pamphlet entitled “101 Ways to Relieve Stress.” Here are some of the kindly tips for the solitary prisoners (with Barometer comments):
1. “Plant a tree.” (Check with the warden first)
2. “Go on a picnic.” (If this is the plan, notifying the warden first may not be a good idea)
3. “Put air freshener in your car.” (Ask the warden if a family member can do this for you.)
4. “Avoid negative people.” (That’s a tough one in prison, but will be relatively easy during solitary, so enjoy the solitude.)
5. “Relax, you have the rest of your life.” (And your plans are pretty much in place for that)

Cruel and unusual punishment come to mind, or at least a cruel and unusual joke.

Thanks to Mike Baker at the New York Times for this fascinating story. November 18, 2019, p. 14.

Allegedly trying to mimic art, two chemistry professors at Henderson State University have been trying produce methamphetamine. On October 8, the Reynold’s Science Center had to be closed because of an odor that turned out to be benzyl chloride. No one is saying whether the incident was the clue, but benzyl chloride can be used to make meth. The Science Center reopened on October 29. That’s some serious clean-up.

Benzyl chloride is pricey — is it possible that Henderson State was subsidizing the two alleged entrepreneurs? One of the alleged entrepreneurs made bail. Their arraignment is pending. Both have been on leave since October 11.

The FAA nearly grounded 38 of Southwest’s 737 fleet on the grounds that the planes had incomplete maintenance records. Inspectors on the ground said immediate action was necessary. The FAA’s head of the office of audit and evaluation said urgent action was necessary and that some of the records for the planes had not yet been translated into English. Southwest has called the situation one of “regulatory compliance” not an “elevated safety risk.” Got that? The regulations on inspection and records are not necessary for safety. Either the inspections and records are in compliance or they are not. Why are the regulations there? Why the inspections? There is some circular reasoning going on here.

In May, Intel released a fix for a series of security weaknesses in its processors. Users assumed the problem was fixed. However, some Dutch researchers found that the problem was not fixed, and six months later (November), Intel released another patch. The problem is not a new one to Intel. The company lived through a debacle in 1993 when a math professor found a computing error in Intel’s new Pentium chip. Intel continued to ship the chips despite knowledge of the problem and offered fixes, but only for those computer owners who need to do computations. When IBM quit using the chips until there was a fix, Intel finally undertook a real fix. Sometimes the lessons in the past are forgotten in the future.

Kudos to the Wall Street Journal for good old-fashioned journalism. The Journal uncovered that McDonald’s was investigating its former CEO, Steve Easterbrook, for weeks before the announcement of his departure. The company’s general counsel had conducted an investigation and reported to the board that Easterbrook had a short-term consensual relationship with an employee. However, the board concluded that Easterbrook’s judgment was in question. The board reached that conclusion because this was not its first rodeo.

Before Easterbrook became CEO he had a relationship with Denise Paleothodoros, staff member at Golin, a PR subsidiary of Interpublic Group, a company that contracts with McDonald’s. Ms. Palothosdoros did work on the McDonald’s account. Easterbrook disclosed the relationship to the board, the board approved it if Ms. Paleothosdoros was removed from the account. Easterbrook was separated from his wife at the time he became CEO of McDonald’s and is now divorced. The relationship with Ms. Paleothdoros is also now over.

This is the stuff of soap operas. How do thees folks get any work done? Just have a Happy Meal and do your job. Dating, marriage (and not the same person), and CEOing do not mix.

There McKinsey is, right in the middle of that PGE mess of a bankruptcy. And there the Feds are doing interviews at Alpha Natural Resources and SunEdison and McKinsey’s work in their bankruptcies. The bankruptcy judges in both of those cases suggested that the Justice Department was best equipped to handle the conflicts questions related to McKinsey’s involvement and possible conflicts in those cases. McKinsey has had legal opinions and has been insistent that investments by its investment fund, MIO, did not require conflicts disclosures for its position in the companies. MIO is listed as a McKinsey subsidiary and an investment vehicle for retirement funds for McKinsey’s employees and partners.

A curious question in the SunEdison bankruptcy relates to McKinsey pulling back unpaid invoices for its work for SunEdison after SunEdison filed for bankruptcy. Those invoices were then revised and resubmitted to four profitable subsidiaries of SunEdison. An e-mail discloses that project managers in those companies were miffed about absorbing the costs. Whoa! Little bit of gaming the system there.

Unclear where this will go, but it ain’t over until it’s over.

Titans (I believe Tennessee?) offensive lineman (who knows what that is), who leads his team with 9 penalties in 6 games.

The Barometer is grateful for this NFL player’s well said standard for avoiding penalties in football. Stay as far away from the line as possible — don’t interpret, don’t push the envelope, and don’t give any regulator any reason to call a penalty. From the world of sports, a wonderful analogy.