Financial Truth Saying

Financial Truth Saying

( An introductory note – I reread this the next day after I wrote it and I’m sure to many it comes as shrill and angry. Some years ago, I asked a fellow academic to add a link to my web site, he said he wouldn’t because he had read articles from my web site and they were were shrill. He suggested I moderate my views and seek comments to balance my writing. I never asked anyone to link again.

I wanted to ask him what his blogging had accomplished, who his moderate, restrained and academic language had influenced to do what was right and avoid what was wrong but I was sure he would find that shrill.

If you read the article below, you will get some of my anger, perhaps more than you consider appropriate. I am writing about the legal responsibility of personal financial advisers to tell the whole truth to their clients, –  in most cases, retirees who have spent their lives accumulating resources so their final years might have some degree of comfort. Instead of a fiduciary duty which, for instance, attorneys, have to their clients, these “advisers” have a lower level of responsibility which they use to influence their clients to take actions in favor of the adviser and against their clients best interest.

In my simple naive world, devoid of the “buyer beware” of Friedman style economics, I find adhering to a lower standard of duty to misuse your customers dishonorable, a failure in the duty of a lady or a gentleman, a failure of the legal duty of fair dealing, a failure to adhere to the standards of religion be that faith: Christianity, Islam, etc., and a disregard of the tenets of virtually every Western philosophy up to Ayn Rand and our contemporary worship of greed.

I guess that’s shrill.)

Before I begin talking about the personal financial advising industry, I want you to know that if you write for a while, you begin to develop an admiration for the clever writer. When you are just a reader, it is easy to overlook a clever title or an eloquent lead in, but when you write – it’s different. And here is a lead in that flies right up to the angels:

Congress wants to make your retirement worse.

That’s not what House Republicans are saying, of course. Our elected representatives are trying to save our retirement, they claim. Americans are under threat from “a government scheme,” as Rep. Phil Roe of Tennessee put it—one that will likely “intimidate the new investors” and “discourage them from saving,” according to Rep. Virginia Foxx of North Carolina. The threat is so severe, “we are at war,” roared Missouri Rep. Ann Wagner last month in an appearance before an insurance brokers convention.

Don’t believe it.

All this hyped-up, martial verbiage involves an ongoing attempt by the Department of Labor and the Obama administration to expand something known as the fiduciary standard, the legal requirement that financial advisers and brokers put your best interests ahead of their own, to cover retirement accounts.

(The selection above is from Helaine Olen writing for the online magazine Slate.)

The feds want to change the standards for advising customers in the personal financial advising industry. Olen explains it in more detail but the story is pretty straightforward. Most in the personal finance industry do not have to adhere to the fiduciary standard, that is, to act as your agent by fully informing you of your choices. They live by the suitability standard, a less stringent standard, which means they can advise you to do things that bring them extra profit while concealing from you information that might lead you to make a different decision.

Financial Truth Telling

The critical issue here is rollovers. Your adviser desperately wants you to take you money and move it into something else (like an IRA) where he can collect fees and be rewarded by his friends in the financial industry. One of the things, the adviser isn’t telling you is how much he makes from advising you to make these kinds of decisions.

So, here is the fight in Congress in a nutshell. The personal financial advising industry says if they have to tell the truth this could cost many millions of dollars and some could go out of business. They want Congress to protect them from the crazies in the Labor Department and the Obama Administration who have this bizarre fetish for the “truth.” After all, “What is truth said jesting Pilate and did not stay for an answer.” On the other side of the issue are the great American people who are not aware that this particular industry’s profit model involves giving the kind of advice one would give to one’s enemies to them.

Financial Truth Saying

So, some in Congress are lining up with the financial industry to preserve the right of non-disclosure to the clients. Think of it like cigarettes. It must have pretty unfair in the minds of tobacco companies to have to tell people their product was dangerous. They must have been furious. And it is just the same in the personal finance. Can you feel the rage? -“Why should I have to tell some old couple that I’m advising them to make me money and them more financially insecure. I mean, hell, they’re adults right. We don’t need the government sticking its nose into our business and acting like truth telling is important. What are these people? Twelve? This isn’t grade school. We’re adults now. If I can convince them to give me money, I should get the money. The government should mind its own business.”

And there are those in Congress who feel the truth in those words and wonder why it is when things are going so well for the industry that the government has to come in and mess it up.

I teach business ethics and I am going to come down on the side of truth telling. It is my belief that if you can’t sell something without some serious non-disclosure, you should not be selling it. Of course, the industry has well financed ties to some members of Congress while the great mass of the American people have little or no contact with members of Congress. Thus I am not optimistic.

James Pilant

A Simple Business Ethics Problem

A Simple Business Ethics Problem

A Simple Business Ethics Problem

AT&T advertised unlimited data plans that weren’t. That sentence tells you everything you need to know in terms of business ethics. Telling someone you are going to provide a service and then not is wrong.

And it is not wrong in just one way. It’s fraudulent misrepresentation. AT&T lied to get customers to pay for a service that wasn’t going to be provided. That’s fraud. It’s a basic violation of contract law.

Usually this would be cured by a lawsuit but since the Supreme Court has made class actions suits very difficult to bring, that leaves as the only sheriff in town the FCC. The word is they are going to fine AT&T a hundred million dollars.

I don’t think that’s right. My first problem is that as far as I can tell no one knows how much money they gained by the illegal act. Punishment should as much as possible be proportionate to the crime. (Take the Charleston church shooting – in that case there is simply no proportionate punishment possible. But this is a business crime.) This is about money and money is quantifiable. Perhaps a multiple – five times or ten times what was taken?

And what’s more I am curious. Who in AT&T thought this was a good idea? I think when a business does something wrong, those making the wrong decisions should have their name in the official documents and thus in the newspapers, the television, the Internet, etc. Public shaming is a useful tool. More importantly, when a corporate executive is climbing the ladder, an internet search showing a few little bumps in the road might slow that process to a crawl – it’s called justice. And it might actually discourage people in these brackets from breaking the law. As long as the only calculation is whether or not you make money and can afford the fine, breaking the law is just another corporate strategy to be used whenever applicable. But putting people in a bad light because they do illegal things, that’s not part of the game and they’re not going to think it’s fair because after all, “It’s just money!” No, it’s not. Lawbreaking violates morality and there should be punishment for this, public punishment.

It is time to change the rules. Because it is obvious that corporate criminality is never going to be stopped by fines. There has to be more.

James Pilant

A&T Loses Big In First Net Neutrality Case | ThinkProgress

The Federal Communications Commission is expected to fine AT&T $100 million for misleading customers with unlimited data plans.

An FCC investigation found that AT&T violated the transparency requirement under the 2010 net neutrality rules by offering “unlimited” data plans and surreptitiously throttling, or slowing, customers’ mobile internet access without telling them. The case does not involve the FCC’s newly published net neutrality rules passed earlier this year.

“Consumers deserve to get what they pay for,” FCC Chairman Tom Wheeler said in a Wednesday news release. “Broadband providers must be upfront and transparent about the services they provide. The FCC will not stand idly by while consumers are deceived by misleading marketing materials and insufficient disclosure.”

via AT&T Loses Big In First Net Neutrality Case | ThinkProgress.

A Class Assignment For Business Law

A Class Assignment For Business Law

Extra Credit Class Assignments

James Pilant’s Business Law Class

014-1All these are voluntary for extra credit. If you do one, it has to be turned in both in hard copy and as an attachment to an e-mail.

Each of these assignments is worth 10 points. Watch the film and then answer the questions attached to the link.

I want you to watch the entire film

Each link is to an online video of the film which is totally free. If you have a service like Netlfix or Hulu and you can get the film there that will be fine.

The question I want you to answer is listed beneath the film.

How much should you write? Okay, look, you’re not twelve. A yes or no response followed by a single sentence will get you nothing. Write it so that if you were another person reading it, you would realize that the author has seen the whole movie and had given serious thought to the questions.

Love Affair

Charles Boyar has two choices in the film, he can marry a rich socialite and live a life of ease or he can pursue a relationship with a woman without independent means and spend the rest of his life trying to make a precarious living as a painter. Which does he choose and why? Now, explain what decision you would make (choose whichever character you wish). How does his decision and your decision stack up against modern economic thought as expressed in the media?


Once upon a time, a well placed woman of wealth and breeding is persuaded by her friends and family to not marry a handsome captain from the navy. Ten years later he is wealthy and her family’s fortune has dissipated.

The captain can now choose younger, prettier women with better social status. Who does he choose? Why do you think he made that choice? Once again, tell me whether or not under current popular romantic ideas, who should he marry and why?

Jane Eyre

Does beauty allow women to change social class, to move up in the world, so to speak? And if so, what if the woman is plain? Does that make a difference? Can a woman marry up in social class based on ability? Why or why not? Does the story strike you as realistic? Could that really happen? Would you do what they did?


Rebecca is given a place in high society. How does she adapt? Would you have made the same decisions that she made? Do you believe her husband’s story? Why or why not?


Watch the film and answer this question, would it have been better if Higgins had left her in the gutter?

Cyborg She

Our hero uses time travel to solve his problems in the past. What is more important to him, love or money? But what of his cyborg love interest, what is most important to her? And remember she isn’t always what you think she is.

Japan Sinks

(This one is in parts.)

In the film, the Japanese react as a people (as a whole) to the upcoming disaster but are saved by an individual’s sacrifice. Is there a conflict between solidarity of the population and the importance of the individual? Also what if he had acted with the morals of a Wall Street Banker, shouldn’t he happily abandon his country and his friends while cashing in on the underwater salvage of Japanese treasures?


At the time the film was made, there was little really known about the Soviet Union, but you know a lot about capitalism from having lived in the United States. Is capitalism portrayed accurately in the film? Why or why not?

Father Brown, the Detective (1954)

Why isn’t Father Brown exclusively focused on stopping the theft? What are his motives in this movie? Please explain.

Young Mr. Lincoln

What is Lincoln after? Where does his ambition take him? Watch the film and from what Henry Fonda playing Lincoln says about himself and what he wants to do, describe his ethical motivations.

The Mark of Zorro

(This one is silent.)

Why doesn’t our hero remain in Spain? After all, there are many women there and he has plenty of money.

Watch the film and discover from what he says, what his motives are.

Why would anyone want to be a hero? Wouldn’t it be better  to be rich? Why or why not?


Take a look at Korean culture through the lens of this film, and tell me the differences between America and Korea when it comes to capitalism?

Why Pay Women Less?

Why Pay Women Less?

The Equal Opportunity Employment Commission has filed a lawsuit against ten oil companies for paying women less than men for the same job. Take a moment and look at this quote with a link to the source – which I will follow with my own thoughts.

These Companies Are Paying Women Less Than Men, According To Lawsuit | ThinkProgress
Why Pay Women Less?

The company, which has employed at least 37 clerks since 2010, has also been paying female clerks less than men over that time, according to the complaint. Yet the agency says both genders were doing “substantially equal work under similar working conditions.”

For example, a male clerk with one year of accountant experience and 11 years as a store manager with some bookkeeping experience was paid a starting wage of $17.74 an hour in 2010 and eventually paid $21 an hour, according to the complaint. Yet a woman hired at the same time as him who had 17 years of accounting experience made just $15.07 when she was hired and only ever got up to $16.93, more than a $3 per hour pay gap. Another woman with 10 years experience running her own business and five years bookkeeping experience was also hired at a lower starting wage and only made it to $17.91 an hour by 2013.

via These Companies Are Paying Women Less Than Men, According To Lawsuit | ThinkProgress.

Okay, why?

These companies undoubtedly use computers to calculate salaries and benefits and obviously paying women less than men is going to show up statistically and must be well known in the company. There are fields in which it is possible to claim that men “deserve” more than women, although I have serious doubts about those claims. But what is the field of endeavor here in which women are paid less – accounting. Are numbers subject to physical strength? Can the figures on a page be subject to testosterone influence? Can male posturing move an apostrophe in a large number? I think not.

So, if there is no performance based reason for paying women less, what is it? I have three theories: greed, hatred or custom. If it is greed, you pay women less because it is profitable, there’s money in it. And while that does make logical sense, I’m not really comfortable saying that is the reason. What about custom? The practice of paying women less is quite common and often done throughout entire industries. We can say with assurance that throughout American history women have been paid less (or not allowed to work at all). So, both custom and greed make sense. Greed provides motive and custom provides justification.

I don’t know if those are sufficient reasons. A couple of years ago, I was working on an article about the Fukushima Nuclear disaster. There is a Japanese web site that covers continuing developments and the owners are kind enough to translate a good part of it into English. They said that there had been a change in the birth rate between males and females in the area. I thought that was interesting and might be a good lead. So, I did an Internet search. I never did find out if the numbers had changed. I was swept into a world of Internet misogyny, the likes of which I had no idea existed. The first thousand search results were male oriented web sites explaining how men were oppressed by women, how stupid women were and how to manipulate women. I’m pleased to say that the search engines have changed and those web sites no longer come up on a neutral search. If you want to read that kind of thing, you’ll have to look for it more directly.

I have come to suspect that many males consciously and probably many unconsciously resent women in the workplace and a salary differential is only one aspect of that disdain. Obviously this is just my theory attempting to explain why paying women less is so common.

Business ethics like any discussion of morality and human decisions sometimes leaves you pondering the mysteries of the human heart. Why do we do the things we do, especially when they seem to make little sense.

The corporate format is a human creation that exercises enormous power but sometimes it seems as if our understanding of what is right and wrong has not risen to the same level as our organizational talents.

James Pilant

How Do They Get Caught?

How Do They Get Caught?

One of the joys of teaching is how clever students can be and I have been and continue to be very fortunate in the students who have come to my classes. One day I was explaining how it is illegal to fire someone based on race or sex and a hand goes up. My student goes, “Professor Pilant, since we live in a fire at will nation, how would anyone ever get caught firing someone over sex or race when they could always say they fired them for something else?”

How do they get caught?
How do they get caught?

And I got to tell them the truth, businesses get caught because when they fire someone it is not unusual for them to tell them directly or put it in writing why they did so even when it is illegal. My class was bewildered by this. After all, aren’t these defendants often large corporations with their own lawyers? So once again I told them the truth, many managers fire without ever consulting with the legal department or in the case of small businesses without consulting with an attorney even if they have one on retainer. This didn’t help. They became even more bewildered.

So, I said this – “We live in a nation where businessmen are thought well of. They are given an automatic level of respect whether or not they deserve it. They appear on the covers of magazines. PR firms write endless text glorifying their lives and they are considered to be authorities on everything from education to government to foreign policy. I saw a few weeks ago where a community college’s future plans were made by a set of businessmen (referred to as community leaders) with the help of the President of the school and no one else, not a student, not a professor, not a public official, not an expert in the field of education, just businessmen. That’s how high that respect can go. And they believe it. And believing it they feel they understand the world in a way that others cannot. So, they do things without checking because they believe they already know what is right and correct.”

I would like to note that I ran the search “firing pregnant women” on Yahoo-search. The first search result said this subject falls into employment discrimination law and the second one listed the congressional act making firing women for being pregnant illegal. So, the story with its quote below is astonishing since even the thinnest internet search uncovers the correct answer.

That people who run companies especially small businesses deserve respect is in my mind, a foregone conclusion. It must be hard to do a lot of the tasks involved in creating and maintaining a business. But we need to remember the lesson of the ancient Greeks of the dangers of hubris, overwhelming pride. It is good to have confidence in what you are doing, except that according to the Greeks living an examined life also meant knowing when you’ve found your limits and going no further. Many a Greek story revolves around people destroying themselves because of their pride.

There are real limitations in the training and experience of those in the field of business. They are certainly valuable citizens but there are many kinds of knowledge, kinds of experience and valid ways of looking at the world and its problems that are outside the world of business.

James Pilant


Nonprofit Ordered To Pay $75,000 Over ‘No Pregnancy In The Workplace’ Policy | ThinkProgress

United Bible Fellowship Ministries, Inc., which provides housing and care to people with disabilities, will have to pay a former employee $75,000 for firing her after she became pregnant to settle a lawsuit brought by the Equal Employment Opportunity Commission (EEOC).

The organization has had a “no pregnancy in the workplace” policy in place that meant it fired anyone who became pregnant and refused to hire anyone applying for a position while pregnant. It admitted that the former employee, Sharmira Johnson, performed her job as a resource technician providing care to residents well and didn’t have any medical restrictions that would keep her from carrying out her duties. Yet it fired her, arguing it was justifiable in order to ensure her safety, that of her unborn baby, and the safety of its clients.

via Nonprofit Ordered To Pay $75,000 Over ‘No Pregnancy In The Workplace’ Policy | ThinkProgress.

Four Years of Weed?

Four Years of Weed?

Ben Stein is opposed to making college free because “college is just a chance to get high.” (A small part of the reporting article is quoted with a link below the essay. jp) This is a kind of journalism, but only a kind. It was on  a news program and it’s designed not to inform, not to enlighten but to shock and, in this case, denigrate millions of American who go, have gone or will go to college. I assume this will be good for ratings but it doesn’t add much to the discussion of what should be done about rising tuition and student loan burdens.

I teach college classes. Most of my students work and many have families. Regular attendance in both my classes and at their jobs tend to suggest that they are not spending an inordinate amount of time using drugs. Among certain circles there is an amazing delight in denigrating young people today calling them entitled, talking about helicopter parenting, talking about how lazy they are, etc. etc. and on. There are differences between today’s students and those in the previous generations. I did some teaching in the distance past and those students (1993) were more questing and intellectually curious about the world than my current students but that’s pretty easy to chalk up to the current addiction to standardized testing. This generation is quite good at sucking up facts and giving them back to you. Their high school education pushed them in that direction. I can’t blame them for that kind of radical re-programming.

I have some familiarity with Ben Stein and I think he sincerely believes what he is saying. And what’s more, I think he enjoys saying it. He sees himself as a provocateur telling difficult truths to a “politically correct” society. But while what he says is shocking, that doesn’t mean that it has any validity and since taking verbal potshots at the current generation seems to be massive public sport in this country, I don’t see political correctness acting as a defense in any way.

It would have been nice and ethical business for there to have been an intelligent discussion of the serious issue of free college or even an intelligent discussion of college drug use. Be we didn’t get either one here.

In a society professing democratic values, the presentation of ideas in conflict is important. But here we have a news program catering to a particular demographic by denigrating and slandering an entire generation of Americans. This is not ethical.

James Pilant

i_224Addicting Info – Ben Stein Against Making College Free: Poor Kids Only Care About Getting High (VIDEO)

Stein ended his rant by saying that although discipline and education seem to be the only things (according to him) that stand in the way of poor people securing middle-class status, he doesn’t like the idea of education being free because college is mostly just “four years of smoking the neon-green chronic.”

Noting that the interview was taking a turn for the worst, Cavuto jumped in and said, “Look at the time here. Look at the time!” Stein completely missed the verbal cue, and added that for many kids, “college is just a chance to get high! Why are we going to subsidize it?”

via Addicting Info – Ben Stein Against Making College Free: Poor Kids Only Care About Getting High (VIDEO).

Psychological Hostage by Kelsey Palmer

(Writing a guest column today is Kelsey Palmer.)

Psychological Hostage

Abuse, malefaction, molestation, violation, physical, mental, trauma, Rape. This is not an unknown word among us. Often we would hear it being yelled by teenage boys in the crowded halls of high school, but what was fun for them to yell is not fun at all. Sadly, it is not an unknown action to too many of us. Usually women. Many many women that really mean “yes” when they say “no”.  Really mean “continue” when they “stop”. No! Some say they deserved it. Others say they led the guy on. Call them Femi-Nazis for trying to bring to justice a criminal act against them! How dare you. How dare you all for thinking in the slightest that this is a small matter. No! Rape is a criminal act or is it? It leaves scars, physical and emotional. Then there are women who think they can cry wolf when there are so many who actually see it.

!!@@#dddddd444193mIn light of rape, it is a criminal act. When someone (usually male) chooses to molest another (usually female) it is not out of the kindness in their hearts. It is not them looking out for the other. It is someone deciding to take away the freedom and rights the other has. That is why it is a crime! It is in violation of the rights we hold as humans, but you would never guess that from the way the law enforcers handle it. Thousands of unsolved cases and why? Because they are too expensive and time consuming. What about what this person had to go through? What about the turmoil this person has to face, the fear that their rapist is still out there lurking in the shadows. I would like to say I am proud of congress for finally doing something about this, but this should have been worked through years ago. Before the rape kits began piling up to extreme heights. Of course, like many other things America was slow to realize that this was an important matter and because of this many have suffered.

In continuation of my sentence before, many have suffered. No one can truly understand the psychological difficulties that come with a scene such as this until they have lived through it themselves. The trauma that comes with it at times can be more than one can bear.  It makes a person want lock themselves into a dark room, curl into a ball, and never allow anyone to come near them again. One could never understand the power of the mind until years after an event something as simple as a scent could bring it all hurtling back. Stuck in your mind till you forcibly distract yourself. It can cause a perfectly normal person to feel like a monster because of the horrible thoughts and ideas that come to their mind. To do to others what was done to them. Some are lucky enough to bypass these mind games and others have to shove them out until they are gone. Suffering in every step of the process because they have been broken just because some man decided it would be fun. And because of that man one could think that they will never be worthy of another because they have been used and abused like some dog’s toy with no soul, life, or future. Definitely no ability to make decisions for themselves. There are scars that exist far beyond the eye can see and the victims of a crime like this have them. So they go to the police in the hopes to find some peace of mind, but instead they are greeted by the high prices of rape kits. You might as well stamp a sign on the door saying “Have you been raped? Sorry, we won’t help you.” Even if a girl has the ability to do a rape kit all that will happen is it will be thrown into the back of a lab to collect dust until years later a bored detective decides to give it a shot. It still might not be that girl’s kit though, since there is a pile of these kits from over the years. To conclude, I feel that if America would get a grip and find a heart this would have been solved already because they would understand the pain that came with these crimes.

My last thought for this paper is that women should not cry wolf unless they see one. What I mean by this is that if a woman has sex and then regrets it they should not file rape. If a teen has sex, but does not want to get in trouble they should not file rape. If a woman is not raped, they should not say they are. I am not saying this is always the case because it rarely is, but it should not happen. When this happens, people are less likely to believe those who are actually raped. When women who are raped go unnoticed all of the psychological issues I spoke of before only progress because they need help! If there are so many cases of true rape that we already “do not have time for” we definitely do not have time for those that are not rape at all.

To conclude my paper, rape is a horrible thing that must be stopped in some way or another or at least diminished. Women going unnoticed and criminals continuing to be free is not the American dream I had in mind and I know that many people feel the same. These women need peace, help, and the ability to recover from the pain that has been forced upon them. This is not an easy task to undergo due to the fact that there are so many victims, but I know that if we just try to help them and solve their cases not only will they have more peace, but we will show the men that there WILL be consequences for these actions. In this way they will hopefully think twice before making such a damaging and idiotic decision.

Kelsey Palmer

Slate is Tedious

Slate is Tedious
Slate is Tedious
Slate is Tedious

Today, I just gave up. I looked at the endless columns and Jackson Pollack arrangement of files, and said “Screw it, I’ll just read something else.”

That was my morning visit to the web site for Slate. I refer to it as a web site but that is overt praise for it. A proper nomenclature for the Internet would have some term for blindingly inaccessible sites, some short hand phrase that means “We hate you. Go away.”

Slate has some of the best writing on the Internet. Rebecca Schuman is magnificent. Few writers have ever had such a grasp of the contradictions and weirdness of the academic world. Dahlia Lithwick knows the law and can write about it with power and intelligence. Amanda Marcotte and her take on women’s issues is provocative and fun. And so on. But they are in different spots all over the web site, often multiple times.

Slate is a checkerboard designed by a madman, a psychopath with a hatred for good writing and humanity in general. The squares are colorful and, I’m sure, eminently satisfying for a four year old. As you go down the page, the squares change in order and size and importance and your eye tires of looking from side to side, up and down, and diagonally trying to make sense of this rubric’s cube’s disorder.

Before I read Slate each morning, I read the Guardian and Salon. Salon is my favorite. The writing isn’t better but going down the single column of offerings I see everything I want and pick out what I find important. But the Guardian is gold. It features a very high level of complexity and a wide variety of topics. Yet, they are presented in an intelligent, compelling format which is a joy to navigate. If I were one of the exalted royalty publishing at Slate, I would choose something like that.

But I have faith that they will continue on their present course and that it will only change with the people running the magazine are changed. That site cost a lot of money to set up and they’re not going to “waste it,” although they already have.

Will I read Slate tomorrow?

Yes. Rebecca, Dahlia and Amanda’s writing is calling for me and I will not resist the pull. And I have discovered that if I drink an extra cup of coffee, something iced and sweet, it improves my mood enough to get through the site. So, tomorrow, I go with full knowledge, once more, to the abyss.

James Pilant


Bruce Weinstein’s New Book

Bruce Weinstein’s New Book

Bruce Weinstein is also known as “The Ethics Guy.” I consider him a friend and enjoy and approve of his work. He has a blog which I recommend you visit, favorite, and return to often.

And now he has a new book called, The Good Ones: Ten Crucial Qualities of High-Character Employees. You can get it on Amazon, here.

His theme is that character is critical to success but it is not given priority in the hiring process. So, he gives guidance on what to look for in an employee that indicates high character.

He’s, of course, right, and since he has been dealing with these issues for some years, he has insights worth sharing.

Buy the book.

James Pilant

Business Ethics in the News 5/12/2015

Business Ethics in the News 5/12/2015

Reading the business news every morning as is my habit is a depressing experience. Every single day some business person is doing something illegal, immoral or stupid. And often it is not one or two stories but a half dozen.

Is there is a war between the ethical and unethical in the world of business, the news media tend to give the impression of a strongly successful offensive on the part of the vile and the cruel. The pursuit of the profit motive in the not so distant past often involved providing a service or selling a product. Today, you get a real sense of predatory practice.

For example:

House Republicans are again attacking measures aimed at protecting U.S. troops from predatory lending practices, two weeks after a similar GOP effort failed.

The military has been grappling with the financial impact of predatory lending on service members for years. In 2006, Congress passed legislation cracking down on some forms of high-interest credit, particularly payday lending. Lenders responded by exploiting loopholes in the law, and late last year, the Department of Defense proposed a new set of regulations designed to curb these creative workarounds that target troops.

Republicans have been working to kill those regulations before they can take effect. …

Feel nauseated yet? Certain companies (I wouldn’t want to tar all banks and lenders.) are lobbying Congress to make sure their ability to charge incredible interest rates to the troops goes unchanged. And the House of Representatives has already tried once and is trying again to nullify these regulations. I assume they’ll trot out the usual arguments about free markets and individual responsibility.

And how about this –

Blue Bell Creameries, the ice cream and frozen desserts maker that’s been tainted by a listeria crisis, had “strong evidence” that the bacteria was in its Oklahoma plant as of early 2013, the Houston Chronicle is reporting. According to reports the Chronicleobtained from the U.S. Food and Drug Administration, Blue Bell’s tests had turned up a “presumptive positive” for listeria on the floors, storage pallets, and other nonfood surfaces of its Oklahoma plant. In 2014, Blue Bell tests also found that the level of coliform bacteria in products exceeded the maximum allowed by the state of Oklahoma. On top of all that, the FDA said water condensation in the plant had been trickling into the company’s frozen sherbet containers and possibly its ice cream during production. So yeah. Gross.

So, when did they decide to do something? – When three deaths linked to their ice cream occurred. And now there are ten dead whose demise may be related to eating ice cream.

So, I ask you two questions.

First, how does our form of capitalism reconcile itself with patriotism? Perhaps, you could argue that business is value free, it’s only morality the dictates of the marketplace. And if that is true than selling pay day loans at very high interest rates is the correct thing to do. The ideas of duty and loyalty to a nation are obsolete relics of a time before the great revelation of free market fundamentalism.

Secondly, how does our form of capitalism reconcile itself with public safety? It is obvious that you can make a lot more money making food in unsanitary conditions. Keeping the premises clean and protecting the food from contamination is expensive, time consuming and often subject to failure through human, animal or insect action. What is more important, keeping costs low or protecting the public?

Here is an actual working example. The company knew that they had a problem for more than a year. That’s a lot of ice cream. So, how important was human safety to the decision makers? It appears to have been low on their list of priorities.

So, let me ask a third question. What human value, be it patriotism, be it the preservation of human life, honor, religion, or even love that cannot tossed casually aside in the pursuit of profit? Under free market fundamentalism, isn’t greed the only quality worth cultivating, the great motivator, the basic rule of objectivism?

i_236The proliferation of pay day loan stores around military bases is not an accident; it is the result of a philosophy that says making money is more important than the welfare of American serviceman. Selling contaminated ice cream for more than a year with the direct knowledge that you are doing it, is not an accident, it is not a miscalculation. It is again a result of a philosophy that put profits ahead of one of the most basic rules of humanity, thou shalt no kill.

So, tomorrow morning, I will get up and there will be new articles, new affronts to morality, new descriptions of stupidity and greed, and sometimes, I look at those headlines, those stories, those crimes and I wonder why I believe so firmly in the right in the face of so much evidence that doing wrong is profitable.