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The systemic erosion of ethics and responsibility in business and individual decision-making has brought the world economy to a virtual standstill. Algorithmic risk management designed to ignore real world problems, short-term profit driven decisions, extremist free market fundamentalism, and shareholder primacy at the expense of other stakeholders, have divorced business leadership from standards of good faith, wise stewardship and care for the public interest.

Trust the essential element of credit-based market transactions has become a rare commodity. Indulgence in the race-to-the-bottom, profit-at-all-costs, instant gratification mentality of the entitlement culture, can no longer be cloaked in terms of capitalism and the free market. The blame for where we are can be shared by everyone in government and industry who acted only in their immediate self-interest and in apparent belief that the bubble would never burst. Is it any wonder that a recent Washington Post story was headlined, The End of American Capitalism?

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The Past is a Foreign Country:Old Rules+New Technologies = Surprising Risks

L.P. Hartley, the English author, once memorably wrote that “The past is a foreign country; they do things differently there.”


I am not yet old enough to collect Social Security retirement benefits. When I attended law school and entered into the practice of law, people appearing to talk to themselves as they walked down the street were considered deranged; Bluetooth was a temporary dental problem resulting from eating fruit; Blackberries were a fruit; Google was the misspelling of a very high number; cells were places in jails where criminal clients were detained; Shepardizing a case involved red paperback books; and Spam was a canned pink gelatinous substance that pretended to be meat.

Not long ago, I responded to a comment about fraud and misconduct not being reported, with reflections on the history of the defense industry and the Qui Tam amendments to the 1986 U.S. False Claims Act. This week, in ALLISON ENGINE COMPANY, INC., et al., PETITIONERS v. UNITED STATES ex rel. ROGER L. SANDERS and ROGER L. THACKER, the U.S. Supreme Court made news when it voted unanimously in favor of restricting the whistleblower provisions of the False Claims Act. The bottom-line appears to be that whistleblowers will not be rewarded, if they cannot prove the false claim was a key factor in the Government's decision to make payment.

Probably good law, but not good sense.

Pat Harned and Scott Avelindo provide important data and insights answering the question I had raised.

Over my twelve years as a business ethics consultant and Senior Fellow of the Ethics Resource Center it was my privilege to work with some 70 corporations as well as with the Ministry of Health of the United Arab Emirates. I worked with senior executives in drafting codes of conduct for more than a dozen large corporations including General Motors and Lockheed Martin. In addition to this direct work in description and evaluation of corporate cultures and the efforts to positively impact those cultures, I spent more than a decade managing clinical programs for general acute hospitals. Today I teach ethics to future health care professionals.

Good question from Hal about the concern that fraud and misconduct were not being reported due to the economic vulnerability of those who observed it. This concern was one basis for the Qui Tam amendments to the US False Claims Act in 1986. These provisions-- inspired by perceived problems in the defense industry -- provide both Rewards and Protections to certain Whistleblowers who in effect "stand in the shoes of the government".

I’ve just now been able to review the responses from Norm Augustine, Pat Harned, and Scott Avelino to your Dangerous Silence blog. Having served for twenty years as an ethics officer for Lockheed Martin, both for operating units in the field and at the corporate headquarters, I would like to share my perspective on the dangerous silence of employees who know of misconduct, but who choose not to report it.