Just the Facts: Empirical Social Science Overplayed

Tilburg University in the E.U. is known to have an emphasis on empirical studies in the social sciences (including business). With this bent, the university is typically considered to be closer to the American academic tradition than that of Europa. So when Dr. Diederik Stapel, a psychology professor at Tilburg, acknowledged to having committed academic fraud in several dozen published articles in academic journals, the academic status of empirical research itself was thrown into question. Experts point out that Stapel “took advantage of a system that allows researchers to operate in near secrecy and massage data to find what they want to find, without much fear of being challenged.” Indeed, it is rare even for peer-reviewers of potential articles to demand to see the raw empirical data supporting a given study’s conclusions. According to Dr. Jelte Wicherts, a psychology professor at the University of Amsterdam, the problem of data being misused by the scholars who collect and analyze it is widespread in the discipline of psychology.

The full essay is at "Empirical Social Science."

Greed Eclipsing Ethical Awareness

Lest it commonly be assumed that greed facilitates or results in unethical policies out of conscious choice, I submit that a focus on maximizing revenue can eclipse even the recognition of a policy being unethical. To the extent that this is so, correcting for unethical policies in business (and government) is more difficult that typically thought. I have in mind as a case in point the policies of bars regarding karaoke singing. 

The full essay is at "Greed Eclipsing Ethical Awareness."

Nike Takes a Controversial Stand on NFL-Player Protests: A Foray into Unnecessary Risk

“Nike became Nike because it was built on the idea of rebellion,” Jemele Hill, a sports journalist wrote. “This is the same company that dealt w/ the NBA banning Air Jordans. They made [Michael] Jordan the face of the company at a time when black men were considered to be a huge risk as pitch men.”[1] Just days before the 2018-2019 NFL football season got underway, Nike threw “its weight behind one of the most polarizing figures in football, and America: former San Francisco 49ers quarterback Colin Kaepernick.”[2] He had been a leader in the black players’ movement to protest, by kneeling during the national anthem, the recurring abuse of power by police. The element of financial risk in Nike’s decision to include Kaepernick in an advertising campaign brings up the question: should businesses take sides on political issues—particularly, on contentious ones?

The full essay is at "Nike on Race, Police, and the National Anthem at Football Games."

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1. Nathaniel Meyersohn, “Nike Takes Sides, Tapping Colin Kaepernick for New ‘Just Do It’ Ad,” CNN Money, September 4, 2018 (accessed same day).

2. Ibid.

Justice’s Last Resort: Accountability in the Roman Catholic Church Sex Scandals

A pattern of deeply violent acts of power-aggrandizement, followed by the efforts of “organizational men” to cover up the atrocities in the interest of the organization and even the offenders at the negligent expense of the offended, cannot but have ripple effects, or make waves, once the stories are revealed to the public. It is sad, very sad, when an offending institution, or “club,” refuses to enforce accountability on its offending functionaries—members of the club. In early August, the Pennsylvania Attorney General’s office released to the public an 884-page report finding that six Roman Catholic dioceses in Pennsylvania had covered up sexual abuse—molestation and even rape—by 301 “predator priests” over 70 years in the twentieth century.[1]

The full essay is at "Justice as Accountability: The Roman Catholic Church Sex Abuse Cases."

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1. Hayley Miller, “Indiana Priest Beaten Unconscious, Allegedly Told ‘This Is for All the Little Kids.” The Huffington Post, August 22, 2018.

On Leaving Coal Emissions to the States: Implications for American Federalism

With the transportation (i.e., fuel) and power (i.e., coal) sectors accounting for a majority of the carbon emissions in the U.S., according to the EPA, the Trump administration’s moves to freeze his predecessor’s fuel efficiency standards and relax pollution rules for power plants needing renovation put at risk the declining trend of emissions in 2018. The implications for climate change (e.g., hotter summers) were stark, according to Janet McCabe, who had been Obama’s EPA air chief.[1] The Trump administration’s proposal to allow the states, including West Virginia, to set their own rules for regulating coal was, according to the New York Times, “the administration’s strongest and broadest effort yet to address what the president has long described as a regulatory ‘war on coal’.”[2] An implication is that carbon emissions from coal in the U.S. would likely increase as a result, even though large states like California and New York could be expected to tighten the rules. The interesting point about turning the regulations to the states revolves around federalism. Constitutionally speaking, should the states regulate the carbon emissions from coal?

The full essay is at "States Regulating Coal."

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1. Lisa Friedman, “Trump’s Plan for Coal Emissions: Let Coal States Regulate Them,” The New York Times, August 18, 2018.

2. Ibid.

On the Methodist Complaint against U.S. Attorney General Jeff Sessions on an Immigration Policy

Assessing whether a Christian denomination’s formal discipline is being used for religious or politically-ideological purposes is fraught with difficulty. Certain governmental policies, such as genocide, clearly violate Christian teaching, such that government officials charged with implementing such policies could legitimately be sanctioned on religious grounds without it being thought that a political or partisan difference is the actual basis of protest. As the harm to others in a given policy lessens, the specter of ideological opposition as the actual motivator increases as a possibility. In 2018, 640 United Methodists filed a complaint to their church charging U.S. Attorney General Jeff Sessions with having violated the Church’s Book of Discipline, its code of laws and social principles, on account of the alleged “child abuse, immorality, racial discrimination, and ‘dissemination of doctrines contrary’ to those of the United Methodist Church.”[1] Sessions had been tasked with implementing the U.S. immigration policy of separating children from their parents at the border. At the time of the complaint, over 2,000 children of illegal aliens were being held by the U.S. Government as their parents were being prosecuted.

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1. Daniel Burke, “More than 600 Members of Jeff Sessions’ Church Just Charged Him with Violating Church Rules,” CNN.com (accessed June 19, 2018)

The full essay is at "Methodist Complaint on Immigration."

Ethical Leadership in the Roman Catholic Church: The Case of the Chilean Abuse Scandal

Leaders taking an ethical stance, even en masse, may find themselves risking their very positions, including the associated perks. In May, 2018, “all Chile’s 34 [Roman Catholic] bishops offered to resign en masse . . . after attending a crisis meeting with [Pope Francis] over allegations of a cover-up of sexual abuse” in the South American state.[1] The pope could have accepted all of those resignations. Instead, he accepted the resignations of three Chilean bishops, including Juan Barros of Osorno, Cristian Cordero, and Gonzalo Garcia, a month later. The ethical leadership, I submit, was not evinced in the pope’s decision to get rid of the three sordid clerics, but, rather, in the other bishops who had been willing to take a stand even at great personal loss. Indeed, the pope admitted he had made “grave mistakes” in the Chilean sexual abuse scandal. Had he been guilty of protecting his friends?

The full essay is at "Christian Leadership." 

See: Christianized Ethical Leadership, available at Amazon

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[1] Reuters, “Pope Francis Accepts Resignation of 3 Chilean Bishops Following Sex Abuse Scandals,” The Huffington Post, June 11, 2018.

Judge Allows ATT Purchase of Time Warner: Vertical Integration Escapes Anti-Trust Objection

Typically horizontal mergers, as when one company merges with another that makes similar products, have trouble when it comes to anti-trust, restraint of trade, objections. The go-ahead of the ATT merger with Time Warner in mid-2018 suggests that vertical combinations, such as when distributor buys a content-creator, survive on anti-trust grounds. Even if trade is not restrained, another problem is present—that of conflicts of interest. Anti-trust law is oriented to preventing restraint of trade rather than such conflicts. Accordingly, just because the ATT merger survived on anti-trust grounds does not mean that a regulatory gap did not exist at the time.

The full essay is at "Vertical Integration and Anti-Trust Law."

Slovak Resistance to Expanding the E.U. Bailout in 2011

Richard Sulik, Parliament Speaker of the Slovakian legislature, argued that the only real solution to the debt crisis in the E.U. was rigorous enforcement of the E.U. regulations on budget deficits and public debt. He had been particularly angered by his state, the second poorest in the E.U., having to bail-out a richer state that had consistently violated the E.U. regulations. Additional debt, he insisted, was not a way out for the PIGS. Slovakia, after all, had to adhere to strict limits on everything from budget deficits to inflation rates in order to be able to adopt the euro. “Now when I see what is being allowed for Greece and Italy, it really makes me angry,” Sulik admitted. “We have to pay because of this double standard. It’s a real injustice.” Indeed it was. Bailing out Greece so the state would not default effectively rewarded that state government for profligate spending and tax avoidance in violation of the E.U. regulations.  

The full essay is at "Slovak Resistance."

Balancing Budgets: Italy vs. Wisconsin

In what could be dubbed a tale of two states, Scott Walker of Wisconsin bragged about bringing the budget into balance without raising taxes while Silvio Berlusconi broke his pledge not to raise taxes in order to balance his budget for 2013. Walker relied on spending cuts and constricting the collective bargaining of government employees, while Berlusconi agreed to a package of tax increases, spending cuts and fewer labor protections to make up for $76 billion (54 billion euros) by 2013. The tax increases include raising the value-added tax from 20 to 21 percent and imposing a “solidarity tax” of 3 percent on state residents who earn more than $420,000 (300,000 euros). The latter tax would run through 2013. At a news conference in August, 2011, “Berlusconi acknowledged that he had pledged never to raise taxes, but that the attention of world markets had forced him to do so.” Was breaking his pledge a vice or a virtue?

The full essay is at Balancing Budgets

Was U.S. President Obama the Antichrist?

In the twentieth century, Christian apocalypticism thought it saw the end of days in the midst of baleful signs, including historical biblical criticism, the return of the Jews to the Holy Land, evolutionary science, and the United Nations. In the United States, the consolidation of power in the federal government at the expense of federalism (and, theoretically, liberty as well) was apocalyptically taken as a precursor to the end. According to Matt Sutton, “As the government grew in response to industrialization, fundamentalists concluded that the rapture was approaching.” The trajectory, in other words, was viewed as headed toward a global super-state under the thumb of a seemingly benevolent ruler. Franklin D. Roosevelt’s “consolidation of power across more than three terms in the White House, his efforts to undermine the autonomy of the Supreme Court, his dream of a global United Nations and especially his rapid expansion of the government confirmed what many fundamentalists had feared: the United States was lining up with Europe in preparation for a new world dictator. This “leader would ultimately prove to be the Antichrist, who, after the so-called rapture of true saints to heaven, would lead humanity through a great tribulation culminating in the second coming and Armageddon.”

The full essay is at "Was Obama the Antichrist?"

A Trader Dreamed of Economic Collapse

Call it over-confident bravado or perhaps a lapse into utter transparency; trader Alessio Rastani’s comments on BBC give the rest of us a glimpse of the power behind the world’s thrones and how prone “the system” is to collapsing without a sufficient force geared to the viability of the system itself. In other words, it is amazing that the financial/governmental systems go on without more attention to them as systems rather than to micro self-interests. One might ask whether powerful self-interests are sufficient to keep the system from hitting the rocks. Apparently the answer is yes, though this is astonishing nonetheless. It is like a car somehow making its way down the street with one person in the car looking at pedal, another at the steering wheel, and still another at the speedometer. It is amazing if the car does not crash, yet somehow it managing to stay on the road.

The full essay is at "Economic Collapse."

Bank of America: Downsizing From Smallness

Three years after the near-meltdown of Wall Street in September 2008, Bank of America announced that 30,000 jobs would be eliminated. That amounts to nearly 10% of the bank’s total work force. Over all, BOA was planning to cut $5 billion in annual expenses. The reason is transparent: continued losses stemming from the bank’s acquisition of Countrywide in January 2008 in spite of the fall of the U.S. real estate market and the related losses on sub-prime mortgage-backed CDOs. What could Ken Lewis have been thinking? At least in the case of his acquisition of Merrill Lynch, which was agreed to in principle in September 2008, the investment bank had already sold its $30 billion of toxic assets for over $7 billion in July 2008.

The full essay is at "Bank of America."  

Is Modern Banking Fundamentally Flawed?

Jamie Dimon, CEO of JP Morgan Chase and board member of the New York Federal Reserve (a banking regulatory body), advocates not only that financial regulation reform is not necessary, but also that deregulation is the best course for the American financial sector. Meanwhile, JP Morgan lost $2 billion in an effort to reduce risk. President Obama quickly pointed out that if one of the smartest bankers in the room can preside over such a massive loss, then a deregulated financial sector would likely present us with an unacceptably high level of risk to the entire financial system (and economy). Elizabeth Warren suggested that relying on bankers to regulate themselves would not reduce the systemic risk. The alternative would seem to be strengthening financial regulation, even though—according to Sen. Dick Durbin—“the banks own Congress.”

The full essay is at " Banking as Flawed."

Market or Government: Which Should Reduce Systemic Risk in the Banking Industry?

If the five largest banks—JP Morgan, Bank of America, Citigroup, Goldman Sachs, and Morgan Stanley—are too big to fail and yet substandard operationally on account of their respective complexities (e.g., investment banking added to commercial banking), might it be that the market-based decisions of investors will relegate the giants, which by the way had price-to-book value ratios of between .37 to .77 in May 2012, thereby solving the problem of systemic risk?

The full essay is at "Reducing Systemic Risk: The Market or Government?"