Facebook Defies Markets: No Accountability for Unethical Managements

When Facebook announced a record $6.9 billion profit for the final quarter of 2018, up 61% from the last quarter of 2017, the company’s management could also boast of an estimated 2.7 billion users of Instagram, WhatsApp, Messenger and Facebook each month, 1.52 billion of whom used Facebook every day.[1] This was particularly surprising at the time because the company had “earned the ire of users and regulators [in the E.U. and U.S.] for a growing list of privacy issues, including the Cambridge Analytica data scandal and a massive security breach.”[2] Cambridge had improperly used information on tens of missions of Facebook users, and hackers had accessed the telephone numbers and email addresses of 30 million users. Even though Facebook’s CEO, Mark Zuckerberg “touted the steps taken by the company [in 2018] to deal with the missuse of the platform,” his company had been criticized on the eve of the announcement for being in violation of the agreement with Apple regarding an iOS app (Facebook Research) distributed to employees and customers through Apple’s “Enterprise Development Program.”[3] That program prohibited distribution to customers and accessing “information such as private messages, web searches and location data.”[4] How could users not have reacted negatively, hence bearing on Facebook’s stock-price and profit-level? How could a company’s unethical management—a point I had documented in Taking the Face Off Facebook in 2015, prior to the scandals—not be punished by the market?

The full essay is at "No Market Accountability on Ethical Companies?"

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[1] Seth Fiegerman, “Facebook Posts Record $6.9 Billion Profit Despite privacy Scandals,” CNN Business, January 30, 2019.

[2] Ibid.

[3] Kaya Yurieff and Ahiza Garcia, “Apple Says Facebook’s Controversial Market Research App Violated Its Policies,” CNN Business, January 30, 2019.

[4] Ibid.

The Right in European and American Politics: Disentangling Right from Right

The far-right in Europe has been quite different than the right-wing in American politics. Putting aside the usual caricature of “people in pointy hoods and the Ku Klux Klan,” Marine Le Pen said she still believed “the American right [was] much more to the right than the National Front.” She may have agreed with those who wanted to manage American frontiers more effectively and prevent massive illegal immigration, but she was also a big believer in the state’s ability and obligation to help its people. “We feel the state should have the means to intervene,” she said. “We are very attached to public services à la française as a way to limit the inequalities among regions and among the French,” including “access for all to the same level of health care.”[1] This statement implies that survival is a human right--something the American right has tended to eschew in favor of a survival-of-the-fittest mantra that conflates the state of nature with the interdependency in a developed economy. 

The full essay is at "Disentangling Right from Right."

1. Tracy McNicoll and Christoper Dickey, "What a Tea Party Looks Like in Europe,”  Newsweek, September 6, 2010.

The Ministerial Exception: A Religious Right to Discriminate

In early 2012, the U.S. Supreme Court recognized, for the first time ever, a “ministerial exception” to employment discrimination laws, saying that churches and other religious groups must be free to choose and dismiss their leaders without government interference. In his written opinion, Chief Justice Roberts wrote, “The Establishment Clause [of the First Amendment to the U.S. Constitution] prevents the government from appointing ministers, and the Free Exercise Clause prevents it from interfering with the freedom of religious groups to select their own.” The wrench in the works here concerns the matter of delimiting the exception, given the inflation in what constitutes “ministerial” in terms of tasks.

The full essay is at "The Ministerial Exception."

Can an American Member-State Exit the Union?

A war was fought over it. In early 2013, the White House made it explicit in replying to a petition. Yet still there was a sense among at least some Texans that something was amiss. Following U.S. President Obama’s re-election in 2012, citizens of Texas, Louisiana, Alabama, and five other member-states in the U.S. signed petitions for the White House to allow their respective states to secede from the Union. At the time, few people other than the secessionists themselves took the petitions seriously. Yet the underlying contending principles deserve more serious reflection even if no "exit" is anticipated. Most importantly, the matter concerns how and whether the rights of member-states (and majorities of the people, therein) are to be circumscribed in a federal union that leaves said republics semi-sovereign and with residual sovereignty.

The full essay is at "Can an American Member-State Exit?"

North-Pole Air in Illinois: An Effect of Global Warming

On January 30, 2019, Phoenix in Arizona was comfortably 90 degrees (F) warmer than it was in Northern Illinois. The respective highs predicted were 73 and -15 degrees (windchill at -35, so there was a 110 degree difference in how the respective temperatures felt). I had experienced -40 degree wind-chill (combining the effects of the temperature and wind speed) early on two mornings one January in Northern Illinois; to think that wind-chills would flutter around -40 for 24 hours while Minnesota had experienced a  -60 wind-chill (and Montana, -70!) is even more astonishing. Records, all, by the way. So why? Is all this comportable with global warming from carbon and methane accumulating in the Earth's atmosphere?

The full essay is at "Arctic Air Spills South."  

Is God the Invisible Hand?

A Baylor University survey on religion and economics in 2011 revealed something that may be distinctly American, culturally speaking. The results indicated that about “one in five Americans combine a view of God as actively engaged in daily workings of the world with an economic conservative view that opposes government regulation and [advocates] the free market as a matter of faith.”[1] Specifically, those Americans believed that the “invisible hand” of a competitive market is actually God at work. Put another way, the assumption is that the economy “works” because God wills it to by intervening directly in the market mechanism itself. Government regulation, in diverting economic supply and demand from “the invisible hand,” is thus sinful. Regulating the economy challenges God’s omnipotence (i.e., power) by interfering with God’s intervention in our daily lives via the operation of the market mechanism. 

The full essay is at "Is God for Regulation?"

1. Cathy Lynn Grossman, “Religion Colors Money Views,” USA Today, September 20, 2011. 

Secession E.U.-Style: Beyond the Economic Implications

Financial markets place bets on political outcomes, such as how or even whether the E.U. state of Britain would secede from the Union. Leading up to the March, 29, 2019 secession date, the shifting odds moved stock, bond and foreign exchange markets, especially given the instability in the state government in general and more particularly on reaching a deal with the federal government in Brussels on just how the state would secede. Of course, the political magnitude of a state seceding from a Union such as the E.U. or U.S. is not captured by how markets anticipate the risks. To reduce secession to the end of a trade treaty does the secession and the Union itself a grave injustice. More generally, political changes do not reduce to their economic anticipations or effects. Nor is it wise to assess the political viability of future political events by the economic assessments in financial markets.

The full essay is at "Secession E.U.-Style."