A Day of New Beginnings

6 04 2010

 

Yesterday, Easter was a great day.  Even though it was a bit on the dreary side, I felt a real presence.  The church service was uplifting and challenging.  At lunch the Olson’s all gathered and ate ourselves silly and afterwards the silliness really began with the women and kids all sitting around the table laughing and telling stories while we men went to the darkness of the den, turned on golf and promptly went to sleep. 

 After everyone left, I reflected on the blog and what has been accomplished and what we might want to do with it in the future.  Looking over the articles from the last month, I realized that I have been getting pretty negative about the human condition and the general state of ethics.  Even though we are facing some real challenges in the economy, politics and personal behavior I know that the world is a different place when it comes to lifting up ethical behavior.  In the field of business and professions there are new ethical standards that are required in order to practice those professions and they’re not all mandated by government.  There is a self policing mechanism that most professions now have to adhere too. In many businesses there is a sense that ethics are important, if only because there are legal mandates making it important.  In government, even though we have a long way to go, there is a new sense of accountability and transparency that we have not had in the past.  In the area of religion there’s a new sense of personal responsibility towards looking outward in our faith, that God is ever present and that religion and faith are not just something personal and internal.  Faith is to be lived out and runs deeper than superficiality. 

 And with the Easter experience we know that we worship a God of new beginnings.  We are neither total free agents without being held accountable but we’re also not depraved creatures without hope of salvation.  But before we think that we are evolving towards some state of perfection, let us also remember the reason for the Easter experience.  We are all imperfect and we all need the redemptive power of God in our lives.  And the Easter experience keeps us aware of our humanity, both the good and the part that needs to confess, be forgiven and begin the new day knowing that we are still loved and lovable.  

 Prayer of Confession:  “Almighty God:  New life stirs and springs up all around us, but we are earthbound still—disabled, held down by doubts, kept back by fears, ashamed of what we fail to do, appalled by what we’ve done.  Forgive us Lord.  Renew in us the resurrection light as once it shone for Peter, John, and Mary Magdalene.  Transform our weakness by your strength that we may be alive to Christ and to the lives of those you’ve given us to serve.”

 The prayer of confession, which was a part of our Easter Sunday worship makes us aware that we all have our weaknesses and blind spots.  Whether it is in the business arena, government, or personal life we can never reach a point of perfection.  To some, that is either a sign of weakness or we live in denial.  To keep from holding ourselves accountable, we often surround ourselves with people that do not hold us liable for our actions.  But we need to have people who are willing to risk losing our relationship who will say, that’s not right or you crossed the line.  Instead, when we have the opportunity to hold one another accountable, we back off in fear or we assume that it just doesn’t matter. 

 Covenant calls us to be in a relationship where accountability and transparency are meted out in a loving way and that helps to at least lift up our perceived or real imperfections.   We may not agree with those perceptions, but at least they’re out there for us to reflect on and talk about.  It can be painful to look at one’s imperfections, but the empty cross and he empty tomb show us that we can survive those imperfections and move into the light of a day of new beginnings.


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Is My Bonus too Big?

2 03 2010

Over the past year we’ve all been inundated with articles about large executive compensation packages and in particular about compensation packages to executives in companies that received bail out money from the government.  And this at a time when those same companies were laying off thousands of lower level employees to cut expenses.  Of the eight banks bailed out, Citigroup, Inc.  seems to be the most beleaguered and along with Goldman Sachs and AIG has received the most criticism for their high executive compensation packages.  One of the major arguments in favor of these high salaries and bonuses is that in order to keep good talent you have to pay high salaries.  Some might say and have said that if these are the best minds to run the business, that American business and in particular banking is in big trouble.  The disparity between the top and lower level Citi employees is huge and the anger among the rank and file is well documented.  A blog run by Indeed, Inc., an executive employment website documents numerous postings about Citigroup’s wage levels.  Here’s just one:

 “A Citigroup recruiter called me for a  SENIOR Accountant position @ Citigroup. I was told that the position maxed out @ $35k. For a SENIOR level position. I would hate to see what they pay their entry level people.”   

 From Zacks investment research           “Citigroup Inc.  may cap cash bonuses for 2009 at below $100,000. The 2009 bonus pool at the company is expected to be similar to the 2008 level, which was low compared to the other years. Citi may pay a large part of the bankers’ and traders’ bonuses in stock that cannot be sold for a number of years.

Citi may pay up to 40% of bonuses in the form of deferred cash and stock and the balance in the form of non-deferred cash and IOUs, which will turn to common stock in April.

Currently, Citi is working out the details of its bonus plan. Recently, New York Attorney General Andrew Cuomo asked Citi and 7 other of the largest banks in the nation that received significant federal aid under the Troubled Asset Relief Program (TARP) to provide information on the amount of 2009 bonus packages and their structure. Cuomo also asked the banks to explain the effect the bonus pools would have had if the banks had not received the TARP funds.

 According to Cuomo, the full disclosure and transparency of the bonus information are essential as recent government actions have given rise to public accountability issues, and TARP banks are struggling with these actions.

Citi received $45 billion in bailout money from the TARP at the height of the credit crisis. Later, around $25 billion of that was converted into common stock, representing nearly 34% of its stake held by taxpayers. The company repaid the remaining $20 billion in bailout money in December 2009, freeing the obligatory pay restrictions on its key executives.

  Citi’s plan to cap cash bonuses is to save the bank from people’s fury over the TARP banks’ 2009 bonus plans. However, the bank says may still find it difficult to keep its top employees.”

 From Reuters      “Regulators, lawmakers, and others are trying to determine how changing compensation packages might reduce the chances of future financial meltdowns. The Federal Deposit Insurance Corp is considering charging lower rates for deposit insurance to banks with pay practices that it deems superior.

According to a July report from New York Attorney General Andrew Cuomo, Citigroup as a whole paid $5.3 billion of bonuses for 2008.

 Officials at rival companies told Reuters that Citigroup employees will essentially receive at least 60 percent of their bonuses in cash or stock that can quickly be sold. That level is high compared to some rivals, which could help the bank retain employees.  But some Citigroup employees groused at the relatively low portion of the bonus that will come in cash.

 Loren Steffy in the February 26 Houston Chronicle reports on executive pay for the General Motors Ceo, Ed Whitacre and past interim CEO Fritz Henderson.  Whitacre’s package includes $1.7million a year plus $7million in stock.  Fritz Henderson who for all practical purposes was fired is being given a $60,000. per month consulting agreement plus an expense account.  He is required to work at least 20 hours a month on the job.  Steffy suggests that Whitacre take the job for $1. per year since he received $158million from AT&T when he retired.  The interest on the $158million is about four times the $1.7million he’s receiving now.  By contrast Ford CEO Alan Mulally agreed to accept a $1. salary if Ford needed a federal bailout.  That was not necessary and Ford has gained market share and is expected to soon be in the black.  Mulally’s salary is slightly more than Whitacre’s at $2 million.  Last year GM received about $50 billion in bailout.  And as a result of that bailout you and I are now Whitacre’s employer. 

The media, the public, government regulators and congress are going through their hand wringing dance asking what should we be doing with all the bad guys.  Much of what has happened in the past few years was a long time in coming.  Questions of whether employment contracts should be honored in companies that are either bankrupt or being kept afloat to keep from going bankrupt are being used as a defense of big severance packages.  Arguments about high paid executives going elsewhere if they aren’t paid huge pay packages seems a bit contrived.  Where will they go?  Hedge funds which have shut down over 200 shops in the last two years?  Or, Europe which hasn’t had the bottom fall out yet?  Probably the best place for many of them to get employment would be with lobbyists who deal with the Washington bureaucrats, regulators and politicians who will probably not make any substantive punitive changes except as it may affect those companies and executives who played the game ethically and by the rules. 

My observation is that most relational issues such as this begin as ethical issues and because a minority acts unethically, new laws and regulations are passed in order to close loopholes or deal with unintended consequences.  But the sad truth is that those that want to circumvent the law will find ways to do so, and in so doing will effect the ability of the rest of us to carry on ethical business dealings.


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Undercover Boss

14 02 2010

Undercover Boss After the Super Bowl game last week, I watched the new show, Undercover Boss. The COO of Waste Management was that week’s undercover boss and he spent the week working in the field doing what his line employees did. He picked up trash at the dump, he went on a garbage run, and he sucked out port-a-potties. As a result of this experience he had an epiphany about his company’s operations. The employees did not know that he was the COO of the company. He was just a prospective new hire that the company was trying out. Among the things he learned was that for every minute an employee was late they were docked two minutes. Women drivers had to urinate in a can just like the male truck drivers and employees were reprimanded if they did not finish their runs on time. As a result of this experience he called in his staff and told them of his findings and told them that there were changes that needed to be made. Many of those changes were the result of unilateral policies that he had enacted to get better production. In the TV presentation we didn’t see much interaction between him and his staff. It was pretty much another form of unilateral action. Most of the staff seemed uneasy being in the meeting and I wondered what they were thinking being put on the spot for TV. Work place policies can involve ethics. There’s been a lot of progress on accommodation of persons with disabilities in the work place. But what of the female driver as well as the male drivers who had to urinate in a can? When a person works for a company, they usually are an employee at will. They don’t have much to say about working conditions. That’s pretty well spelled out by the employer. The goal of the COO of Waste Management was to maintain and/or increase productivity. We don’t know how those work rules were developed but we saw from the show that it appeared that it was determined from above without a lot of input from the rank and file. Many companies have found that listening to other voices can improve productivity because employees have a say in what happens. Dr. Edward Deming developed the idea of quality circles that used employees to identify problems in the production cycle and to come up with solutions to those problems. This methodology was first used in 1962 by Nippon Wireless and Telegraph and later became a mainstay of Japanese industry. Deming’s methodology revolutionized industry in Japan. It was much later that American companies began to use the system; however not with some resistance. Many American managers felt that it would not work with American workers because it was believed that American workers did not share the same loyalty to authority and enterprise that Japanese workers exhibited. But over time, many American companies have decided that giving workers the opportunity to buy into changing the system and being able to see financial benefits not only to the company but to them, has had positive results. But is this really about ethics? In many cases it is. Ethical behavior is seldom unilateral. The ethics that we abide by are most often covenantal and are seen by all parties involved as important to the well being and fairness of the system. Over time, ethics tend to seek a level of workability and if not, the system becomes dysfunctional and may even cease to exist. If people don’t believe in the ethical standards that are set out as being the accepted norm and that are important for the viability of the organization, they will find ways to circumvent those standards. And that circumvention can be from top to bottom in the organization. So, the question that I pose to you is what has been your experience of ethical standards in organizations that you have been a part? Have they been unilaterally decreed and if so what was the effect on how well they worked? Was there any effort to create a situation where there was buy in and input from the parties involved? If you were in a position to develop ethical standards for an organization that you were a part, how would you go about doing it? Please make comments below, so others may see your ideas expressed. What you have to say is important to the conversation.


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Tit for Tat Ethics

11 02 2010

 

In past posts, we have considered factors influencing ethics without much consideration of the structures that effect person’s responses to those behaviors.  This post deals with one way of responding to another person or institutions behavior.  Game theorist Robert Axelrod set up a competition to see what strategy would be most successful in an iterated prisoner’s dilemma game (remember the prisoner’s dilemma).  Solutions were submitted by a large number of competitors with the object being to see who would be most successful.  Two hundred rounds of the game were played with the winning strategy and surprisingly simple solution being Tit for Tat.  The strategy was as follows:

In the first round, one player cooperated and after that did whatever the other player did the previous round.  In other words, if the other player cooperated, player one cooperated.  If player two defected, then player one responded in a like manner.  What’s fascinating is that Tit for Tat never won a round.  The best it ever did was a tie, but over two hundred iterations, it had the best score. 

The features that make the game work is that it is “nice because the player using it never betrays first.  It is provokable in that it quickly and reliably punishes the other player’s betrayal.  It is forgivable because it can quickly return to cooperation even after defection and it is straightforward because it is simple enough that other players see that cooperation is the best choice.”  ( Games People Play, The Teaching Company, 2008)

Whether this system is workable in all situations in real life is debatable but I think there are situations that it applies.  Remember our discussion about putting children in timeout and parents saying that it didn’t work.  The fact was that in most of those situations parents were inconsistent in carrying out of consequences and threats.  In foreign relations we see that with dictators and demagogues it is difficult to deal with them if they see that when they push against other nations and those nations acquiesce to their pushing the belligerent nation pushes even more until either they get what they want or someone places serious sanctions against them.  North Korea and Iran are current examples of this.  And we saw this same response with Hitler in WWII.  On the other hand, we have seen that Israel has taken a very aggressive posture towards aggression towards it and have used the Tit for Tat strategy very effectively.  You attack us and we will immediately retaliate.  On the other hand they have not always done a very good job with their own citizens as it pertains to illegal building of settlements on the West Bank. 

For individual Christians who believe in forgiveness Tit for Tat may seem severe.  We believe that everyone should be given another chance and that is as it should be.  But we also know that in both the old and new testament there was the concept of consequences and even though forgiveness may flow out of a broken relationship, consequences still occur.  So the question that I ask you, the reader, to consider and comment on are:

  1. How do you see Tit for Tat working or not working?
  2. What situations might you use Tit for Tat in your own relationships?
  3. What better ways might you engage persons that you feel have broken ethical covenant?

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Ethical Tipping Points

7 02 2010

                                     

Early in my business career my brother and I were commercial real estate developers.  As in all phases of life, there were lessons that we learned.  When you build a project such as an apartment project you go through a procedure to get it up and running.  You have the plans drawn, you find financing, make a cost estimate and then buy out the project.  In the years that we were building, Houston was in a tremendous building boom that often created a shortage of both materials and labor.  This latter shortage was the one that was most problematic.  The number of sub contractors available to bid on projects was limited even as we worked to bring the project in at the projected cost.  And therein lay the problem.  We often had to employ subs that we had never worked with and knew little about.  In many cases, subs were somewhat itinerate in nature so we couldn’t do much of a check on them.  At any rate, we would contract with them on an agreed price and proceed with the construction.  But then the next shoe would drop.  A few days into the subs work he would come back in and state that he was losing his “ass” on the job and needed to have more money.  Our position was that he had made a deal and that we were going to stick with the agreement.  After grumbling some, he would go off with us thinking that was the end of the issue.  However, within a few days he and his crew would not show up.  This created a problem with everyone else who depended on him to be at a certain point in the project.  This made them angry and the whole project would slow, sometimes to a snails pace.  Because we were financing the construction, it meant that every extra day that it took to complete the job cost us interest, not to mention pushing back the opening date of the project.  Then we would send out compliance letters stating that if the sub did not staff the job adequately, that we would cancel the contract and withhold his retainage.  After all, we had our ten page contract with him that gave us all sorts of power.  We generally did not have to do this, in as much as that would delay the project more, while we went to court and looked for a replacement sub.  So, we muddled through until completion.  Unfortunately this scenario was not that uncommon, not just with us but with other contractors. 

            One day, I was having lunch with a friend of mine who was one of the largest and most successful apartment builders in Houston.  He had built and owned over 5000 units in the Houston area.  He was noted for being able to begin moving tenants into one of his large new projects within ninety days.  This was almost unheard of and I asked him how he was able to get that kind of production.  He allowed that he had good subs.  So, how do you get and keep good subs I asked?  His answer was simple.  He said that he did a lot of work, but more importantly he paid them well and expected them to be on the job and to do good work.  He stated that the time saved by being able to start moving tenants in quickly and being able to start getting cash flow and stopping the interest clock more than made up for the extra cost of labor.  

            As I reflect on this now, I realize that in addition to paying more, he also had a long standing relationship with these subs.  He had worked with them for a number of years and not only did they work well with him but they also had a relationship with one another.  There was a mutual trust between them.  I’m sure they had a written contract and did the paper work required by the lenders and the legal statutes.  But having iron clad contracts doesn’t always get the job done.  My friend and his subs had made a covenant that went beyond the written documents. 

It’s also about ethics and trust.  In my case the ethical questions were two sided.  From my side, the ethics question was, is it ethical to squeeze the sub to where he couldn’t make a profit?  And from his standpoint, was it ethical for him to come back and try and play the “poor me” game.  Looking back on those incidents, I’m not sure what I would do today.  But I do know that sometimes ethics are two sided and that parties play destructive games that impede the resolution of problems.  Additionally, there are tipping points to ethical situations.  There are degrees of ethics and we don’t always know the boundaries associated with decisions.  Even if one party has the power to dictate to another party is it ethical and does it make sense?  I’ve been on both sides of these kinds of contractual issues and I know that at times it’s important to change the rules a bit in order to move forward. 

Currently, our country is faced with the sub-prime mortgage crisis.  Homeowners are defaulting and giving back their homes by the hundreds of thousands.  And our politicians and pundits play the blame game.  Congress is at fault, the lenders are at fault, or the homebuyer is at fault.    But, some loans are being renegotiated in order to help the home buyer but to me even more importantly to keep someone in the home to keep it from deteriorating and losing more value and effecting the surrounding neighborhood.  That’s a pay off for the lender.  The point being in these two scenarios is that ethics are not always black and white.  Situations change and rigid ethics don’t get the job done.  Ethics are also about the self interest of the parties.  Just because one party has the power over the other does it make it right to wield that power or does it make more sense to find an answer that creates a win-win situation?


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Ethics of the Expedient

1 02 2010

A friend and I were discussing ethics and he told me a story of when he was in high school.  He was on the track team and one day after practice the boys on the track team found that the Coke machine was broken and that they were able to get Cokes out of the machine without paying.  My friend along with a lot of the other track team members took Cokes.  The next day the track coach found out about the incident and questioned all the boys as to whether they had taken Cokes.  My friend was the only one to admit to taking a Coke.  As a result of his confession he was kicked off the team for the rest of the year.  As far as he remembers, he was the only one that was disciplined.  Was this just?  Should he have kept his mouth shut?  Was there another way for the coach to handle the issue?

In game theory, there is a classic game called the Prisoners Dilemma.  The scenario is as follows:

Two thieves are believed to have robbed.  They are split up into separate rooms and given the chance to confess.  The specified consequences are as follows.  If one confesses and the other doesn’t the one that confesses gets off for his testimony while the other gets ten years.  If both confess they each get a five year sentence.  If neither confesses they get a one year sentence for possession of fire arms.  It would seem that confessing would be the desired outcome except that he doesn’t know whether the other thief is confessing or not confessing. 

 In this scenario, it would be in both thieves self interest not to confess, even though they neither one know what the other will do.  If they both do not confess, they will only receive a one year sentence.  What my friend experienced is a variation of the Prisoners Dilemma.  Unfortunately for him, he didn’t know what the consequences of a confession meant and he did not tell on others that he knew had also taken Cokes.  He bore the whole consequence.  What do you think would have happened to him and the track team if he had not confessed and no one else had confessed?   My guess is that it would have resulted in a much lesser consequence for the whole team.  Would the track coach have suspended the whole team for the season?  I doubt it.  Maybe harder workouts and some form of group consequences, but not as severe as what my friend experienced.  In a sense he became the scapegoat.  He did what he thought was right.  I imagine that’s what he was taught. 

 In the last few years we’ve seen business persons, professionals, clergy and politicians go to jail for breaking laws or acting unethically.   This is as it should be.  But as a result of the actions of a few, those who are innocent are also implicated by association.  New laws and regulations get passed or implemented to ensure that future infractions will be avoided.  Intuitively though we know that those who will be unethical and unlawful will find ways to circumvent the law and go on doing whatever they deem to be in their interest. 

 The Prisoners Dilemma and other game theory games are based upon rational and mathematical constructs rather than what’s ethical or moral.  Ethics and morals sometimes come into play in game theory but the games tend to be independently determined only by logic, reason, and mathematics.  It brings to mind the crucifixion and resurrection of Jesus.  He could have probably avoided crucifixion by “going over the hill”, so to speak which was a theme in the book and movie, The Last Temptation of Christ.  Not only could he have avoided death, but he might have even been able to continue his ministry in some minor way.  No matter what your belief is concerning the atonement, most Christians would agree that what happened on Calvary and at the tomb is a cornerstone of what we believe.  The Romans and the Pharisees probably believed that by killing Jesus, this new radical movement would end.  After all, all his disciples had deserted.  Jesus bore the burden of death and defeat but showed us the power of God in the resurrection.  And for centuries we have embraced this God of new beginnings and hope.  We believe that the Kingdom exists both now and in the future.

            In this hope and belief, we also realize that we are sometimes called to pick up our cross too, not just because we want to be martyrs but because that’s a price of God’s freedom.  I don’t know the deeper motivation of my friend and the Coke machine incident. Whether it made an impact on his team mates, we’ll never know.  But even if they thought he was a chump is not important.  What is important is that he did what was right and suffered the consequences for the whole team, even when they abandoned him.  As Christians, we’re called to risk doing what is right in spite of the consequences.  That’s not always an easy thing to do, when we don’t know whether following ethical principles will make any difference.


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Cultural Isolation (part 5)–Languages and Lenses

30 11 2009

             We all know the effects of people speaking different languages on communication and understanding.  Even when both parties can speak the language and are from different cultures, there is still a distrust of the other, particularly if there are big differences in culture and ethics. There may be natural prejudices, but language can be just one more barrier to inhibiting trust.  In this piece, we’re not as concerned about those kinds of distrust and cultural isolation as we are language differences within our larger American culture. 

            We’re referring to language within professions and organizations that both give those members a sense of togetherness and mutual understanding but how that language impedes communication and may alienate others who don’t share the language.  Even though the following are somewhat nonsensical they make the point.  As you will readily see, these are terms that might be used in an educational setting:

  1. Reinvent metacognitive enrichment
  2. Leverage standards-based paradigms
  3. Orchestrate visionary functionalities
  4. Unleash meaning-centered goals
  5. Repurpose literature-based higher order thinking

Even though these terms are somewhat contrived, similar terms are used extensively by the education establishment.  I imagine the intent is to have clearer understanding of a word or phrase, but for most people it’s just gobbledygook.  (I bet you know what that means). 

            Have you ever tried reading a government grant proposal?  The following is information on an inquiry to grants.gov for grants related to ocean energy conversion.  This proposal was the highest level of relevance of all listed grants.  It was entitled “Teacher Quality Partnership Grants Program Recovery Act (ARRA) CFDA 84.405A,  This is the part of the proposal as to who is eligible.

Eligible Applicant: An eligible applicant must be an “eligible partnership” as defined in section 200(6) of the HEA. The fiscal agent of the grant may be any of the partners as described in section 200 of the HEA. The eligible partnership means an entity that– (1) Must include each of the following: (i) A high-need LEA. (ii) A high-need school or consortium of high-need schools served by the high-need LEA, or, as applicable, a high-need ECE program. (iii) A partner institution. (iv) A school, department, or program of education within such partner institution, which may include an existing teacher professional development program with proven outcomes within a four-year IHE that provides intensive and sustained collaboration between faculty and LEAs consistent with the requirements of Title II of the HEA. (v) A school or department of arts and sciences within such partner institution; and (2) May include any of the following: (i) The Governor of the State. (ii) The State educational agency. (iii) The State board of education. (iv) The State agency for higher education. (v) A business. (vi) A public or private nonprofit educational organization. (vii) An educational service agency. (viii) A teacher organization. (ix) A high-performing LEA, or a consortium of high-performing LEAs, that can serve as a resource to the partnership. (x) A charter school (as defined in section 5210 of the ESEA). (xi) A school or department within the partner institution that focuses on psychology and human development. (xii) A school or department within the partner institution with comparable expertise in the disciplines of teaching, learning, and child and adolescent development. (xiii) An entity operating a program that provides alternative routes to State certification of teachers.

Is this really about ocean energy conversion? I also almost need my magnifying glass to read it.   And this is just the first section of the explanation and doesn’t include the bid proposal package and the explanation as to how to fill it out.  I came away angry at the whole process of trying to get information on something that might be helpful to not only myself but to the world. 

            These are only two examples of the complexities of language in our culture.  It’s no wonder that parents, students and educators are frustrated with a system that is so difficult to understand and implement.  Not to mention that the system is constantly changing with more detrimental results.  We’re all aware of the blatant language barriers that the government puts in our way to communicate.  So, how do you think that these language impediments impact ethics.  Let’s consider two.

  1. Distrust from the reader and arrogance on the language provider.  Anything that impedes our ability to communicate effectively and respectfully leaves us subject to misunderstandings and feelings of being marginalized.  Those who produce these language differences live in a rarified oxygen rich environment that bears little relationship to most people’s reality.
  2. These kinds of language barriers encourage circumvention of the system.  The more you complicate a system the more ways become available to circumvent. 
  3. It often also requires an intermediary expert to communicate and interpret the language which further distances the two parties.

Along with the impediments of language is that people look at their reality through different lenses.  My experience in Spring Branch as explained in part 1 is only one  example of my not being sensitive to the realities of the Anglo’s living in that community to their anger, frustration and feelings of being threatened with the immigrant population that rapidly encroached on them.  Until I confronted them, I had no idea what they felt.  On the other hand, as I continued to work in that community I had numerous experiences with the Hispanic population and from them I experienced their reality through a completely different lens.  At one meeting, immigrant women from the community were sharing stories about their experiences in this new country.  One woman who spoke no English began telling her story.  She was holding her baby and as she talked tears began to roll down her cheek as she held the baby closer as she rocked the baby.  Even though I didn’t speak Spanish, I felt the pain of her story and my heart reached out.  I later learned that she was talking about incidents of shootings and other violence in her neighborhood and the lack of safety.  She was worried about her children and what might happen to them in this new environment.  In her story I witnessed life through a different lens. 

You might ask, so how does that impact ethics?  Much of unethical behavior is a result of either not knowing or not caring about the other.  We simply are engrossed in our story and our own self.  Our sense of mercy, justice and caring get all muddled when we don’t view life through others lens of experience. 

If we feel marginalized by institutions such as the government and the education system there is a tendency to treat those institutions with less respect.   Why report all your income or vote for school bonds when you feel alienated from the system.  There is a sense that these systems don’t really want input, that they’re only interested in perpetuating themselves and their interests and that there’s no way to change the system to be more responsive to common folk.  This is a tragedy.  For people to feel that they are subject to the tyranny of the expert, to obscure language and see reality through different lenses only creates an atmosphere that separates us from one another and that encourages unethical behaviors.


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Cultures in Isolation (part 3) Too Big to Fail

23 11 2009

          We will now explore the some reasons for cultures being in isolation.  I am currently reading Andrew Sorkin’s book entitled Too Big to Fail, which chronicles the rise and fall of wall street and the world economic meltdown in 2007-2008.  Even though the reasons for this fall have some unique qualities they also have common features of other cultures in isolation.  Some common qualities of these organizations are closed loop vision, lemming behavior, and a tight knit loyalty to either the organization, the principles or the leader.  Note that I did not mention greed, hubris, and unethical behavior.  These all contributed to the problem, but don’t really reflect the deeper contributors to cultural isolation.  In many cases they adhered to the concept that they were facilitating the greater good of the free market and its benefits to humanity as a whole. 

The sub-prime loan market and the over heated housing market are most notably blamed as the catalyst that almost brought the world economic market to its knees.   But who could be against putting millions of people into homes that previously could not afford a home?  But there’s little indication that the thinking went that deep.  In financial quarters it was not that altruistic or if it was the possible unintended consequences were not well thought out.   Without going into any great detail, the crux of the problem was a result of taking millions of sub-prime loans and bundling them into packages with better loans and then selling them as packages to investors.  Many of the large banks not only did the packaging, resulting in tremendous profits but also bought packages of these loans from their competitors, again making huge profits on brokering the packages to other investor groups.  Supposedly, by packaging good loans with riskier loans you made the packages into high quality instruments.  The rating agencies that told investors what the risks were to these packages, tended to rate them as triple A rated.  And to insure that the packages were highly rated, the sellers would buy insurance guaranteeing the packages.  Never mind that the insurance had very little behind it to pay off in case of default.  As it has become stated elsewhere, it became a house of cards.

            In most cases, these transactions were not illegal or even unethical.  But leveraged securities at 30-1, in hindsight do not seem prudent.  But everyone who was anyone on Wall Street was doing it, so it must be okay.  And anyway, the profits were tremendous.  In reading Sorkin’s book you quickly get the picture of a closed loop system that by its nature is myopic.  These were supposed to be some of the smartest financial brains in the world and yet even a high school economics student, given enough factual information could see the repercussions.  Money was certainly a factor and motivation for creating and perpetuating the system.  But I think it was more than that.  First they could not/ did not look out beyond the closed loop.  And two, there was nothing from the outside to give them a compass to follow.  And even though there were regulations in place to keep much of this from happening, many of the framers of the regulations were the ones reaping the profits.  And government was complicit  in facilitating legislation that would be a set up for eventual failure.

            Many years ago I was involved in commercial real estate development.  Because financing was always challenging for smaller developers, I was always looking for windows of opportunity to borrow at rates that made sense economically.  During one of the periods of high interest rates, I had a young man visit me offering to broker loan money for new commercial properties that I might want to build. He said that he had outlets for short term money at a floating rate of 2 points over prime.  Prime at the time was 14%.  At that time my rate would be 16% with a two point origination fee.  The usury rate in Texas had been raised to 22% from 18%, so you can see the mentality of the market.  I told him that we were out of the market since rates were so high and I couldn’t see how the economics would work.  He became somewhat belligerent and badgering, stating that this was the market and that rates were only going to get higher and I needed to borrow, since others were doing the same.  He pointed out that other companies were doing similar deals and flipping them to investment groups and making huge profits.  He even said that these kinds of loans were available on raw land, a non income producing property and people were staying in the project for six months and then selling to another investor.  I told him I just couldn’t see it; that it was too risky and sent him on his way.   In was not many months later that the real estate market tanked and billions of dollars were lost, savings and loans around the country closed, and banks by the hundreds either went under or were bought out by bigger banks. 

            We had not taken the bait and had survived.  At other times in my career, I was not quite so prudent and made financial mistakes because I followed the other lemmings into the sea.   We survived these financial crisis in the real estate market, but they required years to recover.

            The other factor to be considered in The Too Big to Fail scenario has to do with loyalty.  Successful organizations tend to generate great loyalty among its members.  We generally consider this to be a positive attribute of the organization.  There is a sense of togetherness and connection to have common goals and objectives.  But in creating this internal loyalty there is a tendency either to blindly adhere to the leaders wishes or become blind to the realities outside the group.  Sorkin relates an incident that could be generalized to any successful organization, whether the military, a government, the church, or business.  He states that in a meeting with executives at Lehman Bros., who were in an internal fight in the company and  before he died, Lewis L. Glucksman in order to maintain solidarity came to the meeting with a handful of number 2 pencils and gave each of them a pencil and told them to bread it.  Of course, no one had any difficulty in doing so.  He then handed a handful of pencils to Richard Fuld, who later became CEO of Lehman and instructed him to break them.  Because there were so many, he couldn’t.   Glucksman then said “Stay together, and you will continue to do great things.”  This is a story that has been repeated throughout history in one form or another and shows the power of loyalty to a cause.  But sometimes it’s necessary to step back and reappraise the situation, ask ourselves whether it make economic sense, or whether it’s legal, ethical, moral or responsible.  That takes great leadership and a sense by those under the leader that input and reflection are permissible and in fact are expected.


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Carly Fiorina-Personal Ethics and Hewlett-Packard

14 11 2009

This excerpt discusses Fiorina’s personal ethical standards.  Do you notice a consistant theme running through the presenters and Fiorina’s presentation?


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Confronting the Shadow Side

10 11 2009

06pDichotomy75

In the last year Americans have been appalled and angered by the actions of some on Wall Street.  But the anger is not held exclusively for Wall Street.  Washington and our legislature and agencies charged with the job of protecting persons’ life savings have also been viewed as culpable.  It’s as if our ethics and morality have been thrown to the wind and the forces of greed, ineptitude and incompetence have taken over.  And currently, to get out of the mess, we have to put our hope and faith in many of the same people who got us there in the first place.  As I write, it seems that most of those who were responsible for the financial debacle will go unpunished and in fact will come out whole and still in power.  There are a few exceptions to this such as Bernie Madoff and Allen Stanford, but they seem to be the exception.     

            Add to the mix, our need to overhaul healthcare, environmental concerns, education, immigration, the wars, energy independence, and a host of other important national and international issues and it’s no wonder that the average American is angry and has lost faith in both business and government. It’s as if we either don’t know the difference between good and evil or that we just don’t care. The elections of 2008 gave President Barack Obama and the Democratic congress a mandate to bring about change.  The President talked about a new age of bipartisanship and cooperation to change the way Washington did business.  To date, most of his initiatives have been met with petty bickering and political posturing with Washington and the average American more conflicted and angry than ever.  The forces of the Free market economy and those seeking more governmental involvement in every phase of human life and commerce, are more conflicted than ever as each seeks to carve out its territorial interests.  Some believe that more laws and more restrictions are the answer while others believe that less governmental intervention and more personal freedom is the answer. 

            Even in our churches there is rancor and discontent. Whether it’s the belief by many that the Church today is irrelevant to their lives or the ongoing conflicts over inerrancy, homosexuality, and abortion, the Church’s voice is often narrow and intolerant.  So, is there no answer to our plight? 

            I think there is, if we are willing to confront our shadow side and make a continuing assessment of our relationship with that shadow side and our relationship with God.

In his compilation on ethics, Dietrich Bonheoffer states that in humanity’s decision to know the difference in good and evil (through the Fall), the results is separation from God.  In Gen 3: 22 it says, “The man is become as one of us, to know good and evil.” “ In knowing good and evil he knows what only the origin, God himself, can know and ought to know.” (Bonheoffer)  We have separated ourselves from the Source.   Bonheoffer goes on to say, “the good and evil that humanity knows are not the good and evil of God but good and evil against God.  They are good and evil of man’s own choosing, in opposition to the eternal election of God.  In becoming like God, man has become a god against God.”

            When we dig deeper, we see that this is a trait that we all have and more often than not it hides itself in our psyche in the forms of denial, grandiosity, and self delusion.  Paul says in Romans 7: 18-20, “For I have the desire to do what is good, but I cannot carry it out.  For what I do is not the good I want to do; no, the evil I do not want to do—this I keep on doing.  Now if I do what I do not want to do, it is no longer I who do it, but it is sin living in me that does it.”   We just don’t think that deeply about it.  In today’s permissiveness, not many persons would see themselves as Paul did.  There are some good reasons for not sharing Paul’s feelings, since historically as Christians we have seen the overwhelming negative effects of religious guilt.  Today we see God, if we believe at all, only as a positive force and the creator of love.  These are all part of God’s nature, but the God of the scriptures also warns us to be conscious of the shadow side and that our disobedience of His law has consequences.  These are not consequences that a capricious God inflicts upon us, but the consequences of God’s natural law.

            It may be that what we continue to see in the unethical and greedy behaviors of persons in business, politics and all other areas of life, only reflect this permissiveness and assent to self will.   It also reflects our western idea of individualism and self reliance; that we are the masters of our fate and destiny.  Our beliefs in God also often reflect our prejudices and will to power.  We twist our belief system into thinking that if God is a part of the equation, it is us who really influence God’s actions through our belief that God is on our side, even though we may be imposing our self will on Him. 

            The question arises, if we admit our frailties and separation, won’t we be immobilized and guilt ridden to the point of inaction and self recrimination?   For most this is only a fleeting thought.  Too much navel gazing can get one in trouble.  In today’s world, not too many people are doing much navel gazing.  Even though many professions such as attorneys, engineers, doctors, psychologists, CPA’s and corporations are now requiring that members take periodic ethics courses, secularism tends to be ethically sterile.  Professional standards for ethical behavior are a step in the right direction, but more is required.  Our society relies heavily on secular laws that have become so complicated that it is almost impossible to interpret them without an army of lawyers.  In making laws so complex, it makes for whole industries that flourish on interpreting and finding ways to bypass those laws.  Just one current example is the over two thousand page proposed healthcare bill.  And no matter how many laws we pass some people will believe they are above the law.

But there is another aspect of the shadow side.  That is the creative nature that is within us all.  Humans have the capacity to turn their destructive and grandiose attributes into positive actions with positive outcomes for one another.  Our hidden motives may still be out of self interest, but the results can be different.  A person may work for a better education system, because they not only want others to be able to flourish, but at our core we still see that to have an educated populace and workforce, that it is in our best self interest.  Selfish or selfless?  Who is to say?  

There are many individuals, corporations, non-profits, and congregations that carry out their mission with integrity and compassion.  A business person can have as a goal of making a profit but also use their work to benefit the community at large, employees, and the customers served.  There are also many dedicated political and community leaders that give of themselves unselfishly.  Their dedication should be given proper recognition. 

            So how do we confront this shadow side?  How do we unleash the creative positive side of the shadow side?  First, the process is ongoing and one that we work on all our lives. We have to start by recognizing the existence of the shadow side.  And what is the shadow side and why is it so difficult for us to acknowledge its existence and then do something to change it?  Carl Jung believed that the shadow side was that part of us that we were afraid of.  It encompasses those traits and attitudes within ourselves that we do not want to acknowledge.  It’s that part of us that we want to avoid that exposes our deepest fears and inadequacy and our lack of meaning.  But it is also those creative qualities that have been responsible for human progress.  What then motivates us to confront the shadow side and to use those creative forces positively?   We have to conclude that what we’re doing and how we’re living is not the answer to happiness and we want our lives to be different.  We want to connect to the emptiness inside and the lack of meaningful human contact as well as a desire for transcendence.

 There are at least two primary ways that humans deal with their environment.  One is to live a life based only on self interest.   What’s in it for me?  How can I maximize my positive feelings both physical and emotional?  And the other way is to live ones life with compassion and concern for others and all of creation.  This is the message of the prophets and the messiahs.  But even this is done out of self interest.  I give of myself and risk being hurt emotionally and physically for the greater good or for a more meaningful existence.   This dichotomy is always held in tension.  The recognition that this tension exists is the first step in confronting the shadow side.  To deny it or to try and suppress it like Paul will only make it worse.  But acknowledge its existence, we must.  Ultimately, in order to be whole we must come to love the shadow side as being part of us and that it is a powerful source of creativity.     As a Christian, I believe there is hope and there is a way to confront our shadow side with a degree of honesty.  I say a degree of honesty because the shadow side is always trying to hide itself.  Even though I’m not much for formulas the twelve steps of AA is a system that has helped millions of people around the world. Instead of alcohol, insert the words “shadow side” or whatever negative influences dominate our lives.

1.) We admitted we were powerless over alcohol–that our lives had become unmanageable.

2.) Came to believe that a Power greater than ourselves could restore us to sanity.

3.) Made a decision to turn our will and our lives over to the care of God as we understood Him.

4.) Made a searching and fearless moral inventory of ourselves.

5.) Admitted to God, to ourselves and to another human being the exact nature of our wrongs.

6.) Were entirely ready to have God remove all these defects of character.

7.) Humbly asked Him to remove our shortcomings.

8.) Made a list of all persons we had harmed, and became willing to make amends to them all.

9.) Made direct amends to such people wherever possible, except when to do so would injure them or others.

10.) Continued to take personal inventory and when we were wrong promptly admitted it.

11.) Sought through prayer and meditation to improve our conscious contact with God as we understood Him, praying only for knowledge of His will for us and the power to carry that out.

12.) Having had a spiritual awakening as the result of these steps, we tried to carry this message to alcoholics, and to practice these principles in all our affairs.

            This process of confrontation, confession, self evaluation and the desire and act of change can make a difference in the way we see ourselves, our relationships, and God as the ultimate authority in our lives and in the world.  Changing the world begins by changing ourselves and by holding ourselves accountable for our actions.  Christians are called to love neighbor as one self and part of love of self is loving even our shadow side.  Only then can we turn outward and require accountability from others.


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