“Well written and an interesting perspective.” Clan Rossi --- “Your article is too good about Japanese business pushing nuclear power.” Consulting Group --- “Thank you for the article. It was quite useful for me to wrap up things quickly and effectively.” Taylor Johnson, Credit Union Lobby Management --- “Great information! I love your blog! You always post interesting things!” Jonathan N.

Saturday, June 4, 2011

The Corporate Apology

In classical literature, an apology can mean a defense, such as Plato’s Apology. In modern parlance, an apology is known as an expression of genuine sorrow and an acceptance of responsibility for having caused harm to another person. Consumers should be on guard lest a company use the semblance of an apology for marketing purposes.

Robert Bacal advises that an apology be used as a strategy to use “along with other techniques” (italics added, p. 19). According to Bacal (p. 19), “perfunctory or insincere apologies are worse than saying nothing at all.” Accordingly, he advises that a “sincere apology can help calm a customer, particularly when you or your company has made an error. You can apologize on behalf of your company.” However, how can an apology be both sincere and geared to manipulating a customer?


The full essay has been incorporated into (or swallowed up by) On the Arrogance of False Entitlement: A Nietzschean Critique of Business Ethics and Management, available in print and as an ebook at Amazon.

Source:

Robert Bacal, Perfect Phrases for Customer Service, 2nd Edition (New York: McGraw Hill, 2011).


The European Council and the U.S. Senate: Intergovernmental Institutions in Modern Federalism

As part of comparing the U.S. and E.U., pointing to similarities between the U.S. Senate (especially as originally designed) and the European Council is particularly valuable because both institutions constitute the intergovernmental, and thus international, aspect of their respective unions. By contrast, both the U.S. House of Representatives and the E.U. Parliament constitute purely governmental, or “national,” bodies irrespective of the state governments. Hence both the E.U. and U.S. governments are hybrid governmental/intergovernmental, and thus neither national nor international.

The complete essay is at Essays on Two Federal Empires.


Conflicts of Interest: A Kantian Explanation

In a conflict of interest, either two duties conflict or a duty conflicts with self-interest—whether the “self” be an individual or an association of individuals (e.g., a department or an organization). Where two duties conflict, that which corresponds with the wider “constituency” is presumed to be ethically superior to that which is relatively narrow. For instance, a duty to society is typically thought (admittedly by the public) to ethically supersede a fiduciary duty to stockholders. This assumption is problematic because property rights are not charged with putting society first. Therefore the question of which duty is superior ethically-speaking may come down to one’s vantage-point. To be sure, the duty that is further from one’s self-interest can be said to be superior in most ethical theories with the notable exception of egoism. That theory defeats the typical ethical take on conflicts of interest even where a duty is pitted against self-interest itself.


The full essay is at Institutional Conflicts of Interest, available in print and as an ebook at Amazon.


Corporations as Citizens: A Right to Donate to Candidates?

In Citizens United, the U.S. Supreme Court held that corporations and unions “should have the same right as individuals to pay for election ads and other electioneering,” according to The Wall Street Journal. Not addressed in the court’s decision was whether corporations and unions also have “the same right as individuals to donate money directly to candidates for Congress or the White House.”

After the ruling, the U.S. Court of Appeals for the 8th Circuit upheld the ban on direct donations, “saying the [U.S.] Supreme Court recognized Congress could enact such restrictions as a way of deterring corruption.” Given that corporations and unions can contribute to political campaigns through "independent" groups that air commercials favoring certain candidates, one might wonder whether the restriction on direct donations is of any importance whatsoever. Moreover, one might wonder whether any potential restriction could even channel the influence of powerful corporations in Congress and over regulatory agencies (even their own!). That is, the underlying problem is that the large concentrations of wealth and property in corporate form may be inconsistent with democracy. 

Even the ban on direct donations has been challenged. Specifically, Federal Judge James Cacheris of the Eastern District of Virginia ruled on May 27, 2011 that corporations and unions can donate directly to political candidates. In his decision, he wrote, “Citizens United held that there is no distinction between an individual and a corporation with respect to political speech. Thus if an individual can make direct contributions within [campaign-finance] limits, a corporation cannot be banned from donating the same thing.” At the time, federal law limited an individual’s donations to a particular candidate at $2,500 per election. Corporations could donate $5,000 per election to candidates through political action committees, which are funded by voluntary donations from employees.

Cacheris is on solid ground concerning drawing out the logic in Citizens United. Even so, it is the premise of that case that is vulnerable to critique. To claim that there is no distinction between an individual and a corporation (or union) with respect to political speech is to commit a category mistake regarding citizen and free association thereof. In spite of the faddish “corporate citizenship” slogan, a group of citizens is not itself a citizen. To claim otherwise is to engage in anthropomorphism. In other words, having a right to freely associate with other citizens does not give the ensuing group itself the rights of citizenship; only citizens, which are human beings, can have the rights of citizenship.

As retired Justice John Paul Steven pointed out in suggesting that the U.S. Supreme Court would need to clarify its reasoning in Citizens United, "it will be necessary to explain why the First Amendment provides greater protection to the campaign speech of some non-voters [i.e., domestic corporations] than to that of other non-voters [i.e., foreigners who were barred at the time from making campaign contributions]." In referring to corporations as non-voters, Stevens is saying that they are not citizens, and thus the rights of free speech, petitioning the government, and making political contributions do not apply. Relatedly, from the “legal person” judicial doctrine, which limits stockholders’ own liability, has come the spurious notion that money is somehow speech (another category mistake). With certain collective legal persons being deemed citizens, the right to free speech at the corporate level translates into spending money. In short, we as a society seem blind to some rather blatant category mistakes, and this lack of awareness just happens to be in the interest of the large corporations and banks. I'm reminded of the "church lady" who was a character on Saturday Night Live. "Well, isn't THAT convenient!" she used to say rather sarcastically to any given guest on her "talk show." 

It is perhaps beyond coincidence that in a society and polity wherein large corporations are powerful, they have been deemed not only legal persons, but citizens as well—and with the rights of free speech, petition, and campaign contribution. I suspect that beyond the sheer power exists a pro-business ideology in the society, which enables this double-counting of citizens who associate in corporations and unions. A manager, for instance, can exercise rights of citizenship not only individually, but also in directing an organization (association) in its public affairs department.

Rather than worry about whether relaxing particular restrictions might enable corruption, we might examine whether our fallacies (i.e., category mistakes) are both a result and facilitator of it. Our parents and grandparents willfully created an organizational world, such that organizations could gain such assumed legitimacy that they have been able to become citizens having much more wherewithal than the human kind. Merely to write “the human kind” demonstrates how warped the default has become. One might wonder if it is still possible to wind back the line to contain the absurdity from becoming the accepted logic.


Sources:

Brody Mullins and Brent Kendall, “Court Lets Corporations Give to Candidates,” The Wall Street Journal, May 28-29, 2011, p. A4.

Mike Sacks, "Citizens United Attacks from Justice Stevens Continue," The Huffington Post, May 30, 2012. 

Federalism Facilitating Self-Preservation

The rights to life, liberty and the pursuit of property (Locke) or happiness (Jefferson) can all fit within a federal system that enables its two systems of government—that of the federation itself and the republics  or (member) states—to check and balance each other. The alternative, at least for a federal empire, may be a return to the state of nature.



The complete essay is at Essays on Two Federal Empires.

Friday, June 3, 2011

Tornado Victims and the Unemployed: Tough Luck?

In the fall of 2010, the following was said on Fox News: “The government should spend more on the war in Afghanistan in order to fight terrorism. The problem is that the government has gotten into entitlements.”  The latter presumably includes food stamps, public housing, Social Security, Medicare, and Medicaid.  To say that government ought to be engaged in defense and not in supplying needy citizens with food, shelter and health-care is distinct from saying that the federal government should concentrate on foreign policy and defense, while entitlements are formulated and funded by the state governments as their domestic programs. In other words, advocacy for a certain priority in government and for less government is distinct from advocacy for restoring balanced federalism.

Most Europeans in the E.U. undoubtedly view the redistributive right for sustenance resources as founded on human rights and thus as a legitimate part of government.  In contrast, Americans do not typically apply a human rights justification to entitlements for other Americans even as foreign aid may be justified in part on this basis.

For example, on June 3, 2011, Donald Trump told a forum in Washington, D.C.: "A certain Republican representative, two nights ago -– I watched on television -– Representative Cantor, who [sic] I like, said we don't want to give money to the tornado victims, . . . (a)nd yet, in Afghanistan we are spending ten billion dollars a month but we don't want to help the people that are devastated by tornadoes -- wiped out, killed, maimed, injured. We don't have money for them but we are spending ten billion dollars a month in Afghanistan. We are spending billions of dollars in Iraq where they have the second largest oil fields in the world … and we can't help people that got flooded in Mississippi that got hit horribly by tornadoes." The U.S. House Majority Leader was holding up funds for basic necessities at home as leverage in debt-ceiling negotiations with the Democrats, while allowing billions of dollars to continue to flow in foreign aid (and to the U.S. military in Iraq and Afghanistan).  Canter’s antipathy toward government aiding citizens who would otherwise be left to the state of nature represents a rather warped understanding of a social contract.

People such as Eric Canter believe that the market mechanism trumps any right to have one’s basic needs satisfied. Resources are viewed as commodities produced and distributed by private enterprise, even though the market does not guarantee that every citizen’s basic needs are met. Even so, it can be asked whether the right to survival (i.e., life) is part of the American social contract. If so, then relying on the market mechanism alone is not sufficient.

If life is not part of the social contract, then the hungry and homeless, as well as the untreated sick, are (and can legitimately behave as if) in the state of nature. As much as some of the rich do not want to be taxed so the least fortunate can survive, the prospect of the latter behaving as if in the state of nature must surely be even less palatable.

James Madison writes in Federalist #51, “the weaker individual is not secured against the violence of the stronger” in the state of nature. Nor is the weaker secured against starvation and sickness.  Without the police to protect their property, are the rich sufficiently strong to ward off the hungry and homeless? Who is the strong and who is the weak in a dog-eat-dog contest between two human beings—one with a bank account and the other with a left hook? Life, Thomas Hobbes writes, is “solitary, poor, nasty, brutish and short” in the state of nature are all equal in the sense that any one of us can be killed in our sleep. Suddenly having some of one’s tax directed on a human-rights basis may not sound so bad.

What keeps those whose survival is so tenuous from simply taking from the rich is of course the funded social contract that protects property with police force even as there is no guarantee for survival. Such a warped social contract is an aberration in terms of social contract theory.

  The social contract undergirding a political society is meant to alleviate the fear of the want of necessities (and self-defense) while working for the happiness of the members.  In other words, there is a right to shelter, food and medical care. Otherwise, the society is only marginal or partial in obviating the insecurity that exists in the state of nature.

Therefore, to say that government should merely defend citizens from the insecurity of foreign invasion does not go far enough from the standpoint of why government is instituted as part of a social contract that takes people out of the state of nature. However, to say that an empire-level government ought to be charged with protection from foreign invasion, while the individual republics are tasked with ascertaining their citizens with protection from starvation, the elements, and sickness. Without anxiety, foreign or domestic, every citizen—rich or poor—would be freed up from a basic insecurity that without a viable social contract is simply part of life.

Click to add a question or comment on basic needs in a social contract.

Sources:

The Federalist, ed. Jacob E. Cooke, Hanover, N.H.: Wesleyan Press, 1961.

Sam Stein, “Trump Takes Aim at Cantor, Krauthammer, U.S. Foreign Policy,” The Huffington Post, June 3, 2011.

Ignoring Institutional Conflicts of Interest

I submit for your consideration the thesis that people, particularly in American society at least, tend to have keen radar for conflicts of interest specific to individuals while institutional conflicts of interest tend to go undetected. The reason may be that a conflict of interest in which a specific person benefits is more tangible (e.g., receiving a bribe of $50,000) than is the on-going pressure on a department or organization to pursue an unethical policy or decision from an institutional conflict of interest. It may also be that we, as human beings, are more envious when another human being enriches oneself unethically than when an institution profits at the public’s expense—even if the ethical and financial damage of the latter is greater.

 
The full essay is at Institutional Conflicts of Interest, available in print and as an ebook at Amazon.





Wednesday, June 1, 2011

The Basis of American Aristocracy: Wealth & Property

In the constitutional convention of the United States in 1787, the property-interests were well-represented. Even so, a fear of a plutocracy was voiced by those property-protectors as well. While one might conclude at first glance that the wealthy delegates were duplicitous, their position is not self-contradictory, even if the bias toward wealth is discomforting for those of us who value representative democracy.

The full essay is at "Basis of American Aristocracy."

Wall Street Banks: Price-Making and Law-Breaking?

According to the New York Times, The U.S. Senate Permanent Subcommittee on Investigations found that “two Goldman employees, Deeb Salem and David Swenson, tried to manipulate prices of securities used to bet against mortgages. Both tried to help Goldman pile on larger bets against the mortgage market, and they wanted to be able to buy such negative bets more cheaply, the report said. Goldman, as a broker, was able to affect prices in the market through the bids and offers it gave out. Mr. Swenson wrote in May 2007 that the bank should try to ‘start killing’ prices on certain positions so that Goldman would be able to ‘pick some high quality stuff,’ according to the Senate report. The strategy, Mr. Swenson wrote, would ‘have people totally demoralized.’ The pair were [sic] unsuccessful in their attempt, and both denied making it to the Senate committee. Mr. van Praag said last week that the report had no evidence of manipulation. Still, the Senate report said that ‘trading with the intent to manipulate market prices, even if unsuccessful, is a violation of the federal securities laws.’”


The full essay is in Cases of Unethical Business: A Malignant Mentality of Mendacityavailable in print and as an ebook at Amazon.com.

Tuesday, May 31, 2011

FIFA: Weaving an Unethical Web

Soccer is the world’s most popular sport. Unfortunately, the Federation Internationale de Football Association (FIFA), the international association of soccer, has “repeatedly faced charges of corruption while operating with a lack of transparency and little oversight,” according to the New York Times. Even though corruption necessarily involves a proclivity among individuals, institutional processes and structure can come into play. In such cases, it is not sufficient to isolate and remove the sordid persons.
The full essay is in Cases of Unethical Business: A Malignant Mentality of Mendacity, available in print and as an ebook at Amazon.

Sunday, May 29, 2011

Fox News: Partisanship over Profit?

Roger Ailes “is the most successful executive in television by a wide margin, and he has been so for more than a decade. He is also, in a sense, the head of the Republican Party, having employed five prospective presidential candidates and done perhaps more than anyone to alter the balance of power in the national media in favor of the Republicans. ‘Because of his political work’—Ailes was a media strategist for Nixon, Reagan, and George H. W. Bush—‘he understood there was an audience,’ Ed Rollins, the veteran GOP consultant, [said]. ‘He knew there were a couple million conservatives who were a potential audience, and he built Fox to reach them.’”

“For most of his tenure, the roles of network chief and GOP kingmaker have been in perfect synergy. Ailes’s network has dominated the cable news race for most of the past decade, and for much of that time, Fox News attracted more viewers than CNN and MSNBC combined. Throughout the George W. Bush years, the network’s patriotic cheerleading helped to marginalize the Democrats. . . . The problem wasn’t that ratings had been slipping that much— [Glenn] Beck’s show declined by 30 percent from record highs, but the ratings were still nearly double those from before he joined the network. It was that, with an actual presidential election on the horizon, the Fox candidates’ poll numbers remain dismally low (Sarah Palin is polling 12 percent; Newt Gingrich and Rick Santorum, 10 percent and 2 percent, respectively). Ailes’s ­candidates-in-­waiting were coming up small. And, for all his programming genius, he was more interested in a real narrative than a television narrative—he wanted to elect a president.”

Analysis:

The last sentence is particularly revealing: “he wanted to elect a president.”  With Beck’s 30% drop in ratings still leaving him with a profitable rating, Ailes’ motive was not commercial, neither was it to improve the network’s journalism. Typically, news networks are criticized for sacrificing good journalism for commercial interests. Here, journalistic integrity and profit play second fiddle to partisan objectives.

To be sure, this case can be used to illustrate a point regarding stockholder (property) rights. Were Ailes’ political strategy that of the Fox owners, it would point to the right of property wherein profit is merely the default objective for corporate wealth. That is to say, a corporation’s owners can have their corporate wealth used toward any number of legal objectives. The owners of Ben & Jerry’s, for example, made selling ice cream not just about profits. Theoretically, a company could limit profit to that which is necessary for the company to continue—with the remaining profits to be spend on whatever aims the stockholders choose.

Even so, if a given company is presented as a news network only to use its situs to elect the next U.S. president, the duplicity is ethically squalid. If the objective of shareholders is to use Fox News in order to advance political partisan aims, that division should be presented as such rather than under the guise of journalism, for the subterfuge has a sort of gravitational pull on the news companies that would otherwise be content to manage journalistic integrity and commercial interests. In other words, American journalism itself may have already taken a hit in going down a slippery slope due to the duplicity at Fox News.

Click to add a question or comment (or view comments) on journalistic integrity and politics in the media and Fox News.

Source:

Gabriel Sherman, “The Elephant in the Green Room,” New York Magazine, May 22, 2011.