The Ethical Barometer

Tesla is a struggling company. That simple statement needed to be made, but no one seems willing to make it despite headlines such as “Tesla Squeezes Its Suppliers, and Investors Squint at Its Profit Plan.” Tesla cannot raise more money because its liquidity is -$2.27 billion. A year ago that number was $780 million. Tesla needs cash for its troubled production line. So, just ask for money back from your suppliers. The Barometer has found this financial tool to be a valuable one, to wit, “Dear Utility, The Jennings household is a tad short on cash this month, so we were wondering if you could send back our payment from June just to see us through August and then we can catch up on all that we owe you.” The Wimpy tool of financial management, “I will pay you on Tuesday for a hamburger today.” Or we could go with the old Henny Youngman joke: One man asked another man to loan him $10 until pay day. The potential lender asked the borrower, “When’s pay day?” The borrower responded, “How should I know? You’re the one who’s working?”

With Tesla, everyone should be asking, “When’s pay day?” And Musk would probably reply and get away with it, ‘How should I know? You are the ones doing the heavy lifting.” The company’s devotion to outer space travel and unrealistic autos needs to be subordinated to the reality of its finances. This company is struggling. Those who hold the $303 shares should be doing some serious study and perhaps some serious selling.

Olympic swimmer Ryan Lochte, he once of blue hair fame and fabricated gasoline station heists in Brazil, posted a video of himself in a Revival IV Lounge in Gainesville, FLA receiving an IV drip (hence the name of the joint). Getting vitamins via IV is perfectly legal. However, Olympic swimmers have a ban on certain IVs and this was one of them. Mr. Lochte has been banished from competition for one year. As one of the Barometer’s students once asked, in all seriousness, “Can it really be considered cheating if you do it in front of everyone?” Yes, yes it is still cheating.

Then we have the Uber and Lyft driver (working for both companies and making $350-$400 per night) who videotaped his passengers. Initially, he said it was for safety. But somewhere between original intent and outcome, the driver posted the livestream videos of his passengers on Twitch, selling subscriptions to this service. And all without passengers’ consent. The driver made $3,500 over the past five months from viewer subscriptions for the videos, and all of this was done also done without a stitch of consent of his passengers. Some of the comments posted on the site were vulgar and some summed it up quite nicely, “This is creepy.”

Uber and Lyft terminated the driver upon learning of the videos. Now all the driver has is his Twitch site. But, without the passenger videos, how can that survive?

Be careful what you post and what you comment. It all counts. And it can bus used against you.

Walker Stapleton, who holds a Harvard MBA and has been Colorado’s state treasurer for two terms, is running for governor. His grandfather, Benjamin Stapleton, served a Denver’s mayor for five terms. However, Benjamin Stapleton was a member of the Ku Klux Klan. The Stapleton name is a, well, staple around Denver. However, activists have been working to remove the name from schools, parks, airports. Teachers who teach is a school with the Stapleton name have encouraged students to study Stapleton history and to participate in a movement to change the school’s name.

Mr. Stapleton is now facing press inquiries about his personal history. That is, his grandfather’s activities are being used as a proposed screening mechanism for voters. Mr. Stapleton has thus far refused to speak about his grandfather

The activities and legacy of the Ku Klux Klan were horrific. Shame on Benjamin Stapleton for being a part of that group. However, the sins of the grandfather should not be heaped upon his grandson.

There is one American value that is cherished – the ability to be judged on our own conduct and not be condemned because of our family name. To allow DNA to determine our futures is wrong, whether used for false, as opposed to meritorious advancement, or as a barrier to advancement. Still, the New York Times could not resist a full=page story on the Stapleton name, with this headline, “Liability for Republican in a Close Race: His Family Name.” Shame on that newspaper for even writing the story. Double shame for making it seem as if it is a legitimate or real voter concern.

Emma Pister tells a story of exemplary integrity. Competing for one of five slots that would fine her in the state golf competition, a high school senior found herself experiencing the natural stress and pressure a game of golf with so much hanging in the balance would bring. On one whole, a shot missed the hold by two inches. Frustrated, she failed to take the time to line up the putt, and missed the hole again, by one-half inch. No one had seen the second miss. Yet, she reported yet another stroke for the half-inch miss. The same thing happened on another hole — a second double-miss, but she reported those strokes as well.

She regained her composure enough to have much success on the back nine. Still, when the final scores posted, she was #6, just two strokes higher than #5. You know what they say, ethics and integrity are what you do no matter how much is at stake and even when no one is watching or would know.

John Schiller, former CEO of Energy XXI Ltd., has settled an SEC investigation by paying $180,000 and agreeing to a five-year ban as a corporate officer of a public company. The SEC, in announcing the settlement, alleged that Mr. Schiller had failed to disclose that he traded business contracts in exchange for personal loans from contractors and a portfolio manager at a fund that held 8.4% of Energy XXI’s stock. The SEC summary also alleged that Mr. Schiller pledged $23 million against his shares in Energy XXI to fund “an extravagant lifestyle.” If that was insufficient, the allegations also indicate that Energy XXI failed to disclose “at least” $1 million in perks and personal expenses for Mr. Schiller.

Energy XXI declared bankruptcy in April 2016. The board ousted Mr. Schiller in February 2017. Better late than never.

The families of nursing home residents, many of the homes rated quite high by the federal government, had long complained that staffing levels were inadequate. Residents were not being turned to prevent bedsores. Baths were being skipped. Medications missed. But, the nursing home administartors insisted that the staffing levels were just fine.

Enter a simple wage study. The federal government took a look at the pay records for the nursing homes. If you want the truth on staffing levels, you look at the daily payroll records. Kaiser Health News took a look at the records from 14,000 facilities. Staffing levels were dangerously low, especially on the weekends. The ratings were based on the staffing levels that the facilities self-reported. It turns out that the data were not correct. That data differed from the payroll data.

There is almost always a means for checking self-reported data. On safety, check worker’s compensation claims to verify reported injuries and lost work days. With staffing, check payroll, particularly when there are mandated staff-to-patient ratios. On claims of earnings, check the cash. The cross-checks are where truth percolates.

Temple University hired the Jones Day law firm to conduct an investigation of the school’s Fox Business School. The investigation concluded that under the leadership of the dean of Fox false information had been sent to at least one of the rankings organizations. Temple’s Fox had held the number one slot in the U.S. News & World Report rankings for its online MBA programs. Temple self-reported the problems to the rankings services and fired Dean Moshe Porat.