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Does Economic Insecurity Make Employees Less Innovative? You Bet – And Here’s Proof.

November 13th, 2017

In a fascinating new research paper “Does Economic Insecurity Affect Employee Innovation,” three American economists offer up some cautionary advice  for those advocating that firms – and economies – must spend much more to foster innovation.

Unless those actually doing the innovating personally feel economically “safe,” warn the authors, the quality of their innovations will significantly suffer.

In the 7 years since my book SPARK came out, detailing the economic costs to companies of poorly-considered and far-too-often counterproductive layoff decisions, I have spoken at a lot of MBA schools and to groups of CEOs and executives from Newfoundland to California.

Especially from students, and increasingly over the years, I get questions along the lines of “what’s the big deal with your emphasis on steady work? It’s disappearing and we all just have to live with it.

Of course, these MBA students may “get it” at the personal level, to some extent, because many have experienced layoffs within their families and have seen the incredible pain and trauma that layoffs create.

But as executives-in-training, they seem to be increasingly internalizing layoffs (with the resulting economic insecurity) and the ebb-and-flow of their employee base as simply part of doing business in …. call it what you  want …. a 21st century economy of the precariat, an AI world, the gig economy, job-sharing for all, Uberization and on and on.

I sense they find it all pretty quaint when I put up this quote from 1944 by James Lincoln, co-founder of Lincoln Electric (the incredibly successful and profitable Fortune multinational that I profiled in my book, which, by company policy, hasn’t laid an employee off in nearly a century.)

It is no part of management responsibility to be merely kind to workers. Managers are  responsible for efficiency in their industry .. efficiency depends on human cooperation .. cooperation (demands that) the fear of losing income will be eliminated … this can only be done by guaranteeing no layoffs.

Lincoln was no social reformer. He was a tough businessman, entrepreneur and innovator. And he was convinced that the economic security of his employees was one of the key determinants of his firm’s successful growth and profitability.

The other key was relentless technological innovation. Lincoln also believed the two were inextricably linked.

Much of the focus on spurring economic growth these days emphasizes the need for firms, broad economic sectors and even nations to invest more heavily in innovation.

But what happens to innovation if the employees in those firms are overly worried about losing their jobs? Keeping up mortgage payments? Saving for retirement?

Innovation suffers. Significantly.

This new incredibly detailed analysis looks at the changes in an employee’s economic security (with the value of his home used as a proxy) over the past two decades in the US (through the 2008 financial crisis) and the changes in the rate of patents (i.e. innovations) granted to that employee. It indicates that the more employees are worried about their economic well-being, the less they innovate for the good of their employer.

In a nutshell:

* The larger the drop in the value of an employee’s home during the crisis, the fewer patents she or he earned and the lower the quality of those  patents.

* Those fewer patents were less likely to be in new technological areas for their firm and were less likely to reflect wider technological changes in their industry.

* Those patents were less likely to be in innovative and potentially high-impact new fields where a firm’s future might be guaranteed.

When innovation appears in the media these days, it almost invariably quotes the new VP-for-Innovation in a firm announcing a multi-million dollar commitment for research spending.

As the authors of this paper make clear, that VP would be well-advised to focus just as much on ensuring that her lower-ranked employees are feeling safe about their individual economic futures –through strategies including better compensation and increased job security.

Because these are the people actually doing the innovating.

Do Layoffs Encourage Quitting in The “Next” Job that a Worker Gets? Yes!

April 17th, 2017

  This is important new research by Paul Davis at Cornell’s Industrial Labor Relations School (and colleagues) that both quantifies and emphasizes how damaging layoffs are far beyond the company where a layoff occurs – with the damage spilling across our economy and our society as a whole.

Obviously, workers who are laid off suffer. As do their families

And as I wrote in SPARK, the evidence that layoffs are smart effective strategic decisions made by CEOs facing tough times is  – to say the least – weak at best. In the vast majority of these sad situations, a layoff is powerful evidence of a massive failure of management and corporate vision.

Paul Davis’s research looks at what happens when laid-off workers eventually get new jobs – i.e. how they perform for their new employer.

(Great to see this new work because since the Great Recession, there has – amazingly –  NOT been a lot of research on the impacts of layoffs compared to the previous two decades.)

In a nutshell, they are far more likely to voluntarily quit that next job (compared to others in their new workplace who have never experienced a layoff) due to, in large part and to no surprise,  the “psychological spillover” from that first layoff and the resulting loss of an employee’s trust in management anywhere, fueled  by the increasing perception that job security is a bygone dream.

This is not good for our economy, as Davis stresses, given the growing prevalence of layoffs across so many sectors. And especially, given widespread doubts that the gig economy can offer a viable sustaining replacement for steady work.

“The influence of layoffs on voluntary turnover is substantial and persistent.  

   Quitting is 56 percent more likely in a laid-off worker’s next job (relative to the individual’s propensity to quit prior to ever having been laid off).  

   Among those who are laid off multiple times over their careers, each additional layoff increases the likelihood of quitting in subsequent employment.  

  For those who do reach six layoffs in their work history (FK’s note: this is not as rare as you’d think), the decision to quit voluntarily is about six times more likely (than for workers who have not experienced a layoff.)

  The study results are consistent with a “psychological spillover” explanation in which a layoff by one employer negatively influences employee expectations (e.g., obligations owed to an employer) and perceptions (e.g., job security) surrounding post-layoff employment. 

  Given that layoff victims represent an increasingly large proportion of the workforce (and thus the talent pool upon which virtually all other organizations rely) and given that voluntary turnover is notoriously expensive  …….. the findings indicate that layoffs are relevant not only for the organizations that engage in them, but for all organizations.”

And thus across our economies as a whole.

More from US Historian Dan Carter .. Reflections on Trump’s Cabinet and The Chaos to Come

January 2nd, 2017

Many of you enjoyed my friend Dan Carter‘s wonderful post here a few weeks ago about sailing into the uncharted waters of a Donald Trump-led America. A distinguished historian of US politics and a wonderful writer, Dan has just posted a detailed look at Trump’s cabinet-to-come. It ain’t pretty. To wit:

“If anyone thinks this collection of billionaires, bigots, Ayn Rand fanatics and con artists … who share the belief that money corrupts the poor but elevates the moral character of the rich ….  will protect average Americans or “Make America Great,” my sister has 42 acres of prime swamp land on my family’s South Carolina farm.  It fronts Lynches River; in fact it is only inches above the river. Don’t be a loser.  You can build huge, terrific, classy condos that will make you a winner.  Bigly.”

Here are two versions of Dan’s latest essay .. a short version on CommonDreams … and Dan has shared the longer version below with me. Go for the longer read … well worth it, albeit very troubling.

What Do  President-Elect Trump’s Cabinet Choices Tell Us About His Future Policies? By Dan Carter

Those who supported Donald Trump have expressed indignation over criticism of  the President-elect even though he hasn’t even taken office.  It’s true he won’t be sworn in until January 20, 2017 (although you wouldn’t know it from his tweets.)    And, barring unforeseen circumstances, in four years we will be able to judge his record more clearly.  But we already have a glimpse of the future in his choice of staff and cabinet members.

It’s not very encouraging.

Steve Bannon will be chief adviser.   While Bannon has been careful to avoid explicitly racist statements in public, a film-maker who worked closely with him recalled his comments that only property owners should vote.  And he often mused about the “genetic superiority” of “some” people, she recalled.  He certainly had no hesitancy in openly expressing his contempt for feminists and the LGBT community. (In one radio interview he dismissed liberal women as “a bunch of dykes that came from the Seven Sisters schools.”)  But it was as the publisher of Breitbart News that he gained his reputation for promoting the worst elements of American society.  Bannon has boasted that he made Breitbart.com the main outlet for the Alt-Right Movement, an open sewer of anti-Semites, racists, homophobes, xenophobes and women-haters.  He famously advised Trump followers to “turn on the hate.”  It worked; he should fit right in the Trump White House.

Here are some of the rest:

Michael Flynn, Trump’s National Security Adviser.  Outstanding combat officer in Iraq and Afghanistan (although he was reprimanded for passing secret information to Afghan officials without authorization.) Named head of the DIA (Defense Intelligence Agency) under Obama, but fired for reasons ex-Secretary of State Colin Powell summarized in a leaked email:  “abusive with staff, didn’t listen, worked against policy, bad management.” At that point, said Powell, he went “right-wing nutty.”  Secretly took money from Russian and Turkish interests. Promoted a video insisting that it was sound policy to fear Islam as a whole, since Muslims want “80 percent of humanity enslaved or exterminated. . . .”  Spread rumors Hillary Clinton was a money launderer and child molester.  Not the kind of organized, thoughtful individual you want giving advice to a President with ADD  and a very long finger inches from the nuclear button.  (“My fingers are long and beautiful as, has been well documented, are various other parts of my body.” Donald Trump)

Mike Pompeo has been picked to head the CIA.  The Kansas Republican rejected the findings of five non-partisan congressional investigations on Benghazi that dismissed the multiple accusations against Hillary Clinton.  In an interview with right-wing radio announcer Frank Gaffney, Pompeo accused President Obama of adopting policies and statements that supported the cause of Muslim terrorists. Opposes abortion, even in cases of rape and incest.  Insists that the US personnel who used waterboarding, electric shocks, dogs, nudity, hypothermia and mock executions” were “true patriots”.  Brilliant (first in his class at West Point), but often seems unhinged by his hyper-partisanship.  It is difficult to imagine Pompeo will weigh intelligence issues on a non-partisan basis.

Mick Mulvaney—Office of Management and Budget, a critical agency shaping the federal budget.  Supports the repeal of Obamacare and its replacement by block grants.  (See below).  Dismisses claims of climate change.   While a South Carolina legislator he introduced bill to require women to watch an ultrasound of the fetus before they could obtain an abortion. A brilliant student in finance (Georgetown) and law (UNC Chapel Hill)  Mulvaney is a passionate climate denier who seems convinced he knows more than the 97 per cent of climate scientists who accept the overwhelming evidence that humans are playing a major role in global warming.

Tom Price—Health and Human Services.  Another Tea Party favorite, Representative Price (R-Ga)  has sponsored legislation to abolish the Affordable Care Act and   replace Social Security and Medicare  with  block grants.  His legislation also would have repealed the 2013 expansion of Medicaid and sharply reduced the funding for existing Medicaid recipients as well as CHIP (the Children’s Health Insurance Program.)  On the eve of the passage of the Affordable Care Act, more than 43 million Americans—17 per cent of the population—were uninsured.  By November of 2016, the number had declined to less than 10 per cent or 28 million Americans.  According to the Congressional Budget Office, the passage of the bill proposed by Representative Price (and endorsed by House Speaker Paul Ryan) would save approximately $50 billion a year (about 3.2 per cent of the federal budget), but it would also lead to a 100 per cent increase in the number of uninsured, most of whom will be low-income Americans.

Rex Tillerson—Secretary of State.  Exxon CEO.  Net Worth: $250 million.   The British newspaper, The Guardian, recently published documents showing that he was the secret director of a US-Russian oil firm based in the Bahamas.  In 201l he became Vladimir Putin’s good friend when Moscow dangled a $500 billion oil exploration partnership with Exxon.  The US joined western countries in imposing sanctions after Russia’s annexation of Crimea and that put a hold on the deal, but most political observers believe that Trump—with Tillerson’s support—will end these sanctions.

Jefferson Beauregard (“Jeff”) Sessions—Attorney General.  Currently junior senator from Alabama.  Denied appointment as federal district judge because of a history of racist comments. Called the ACLU and the NAACP “un-American” and “communist-inspired.”  As Alabama attorney general he relentlessly (and unsuccessfully) sought to convict civil rights activists for voter fraud.  Dismissed the 1965 Voting Rights act as “intrusive legislation” on the rights of the states.  He has opposed every immigration bill, including those put forth by fellow Republicans. Has said he will reject any judge with a “secular mindset.”

Steven Mnuchin – Treasury. Net Worth: $40 million plus.   Ex-Goldman Sachs investment banker; then hedge fund manager. Purchased a failing bank in California in 2009 that became profitable by aggressively foreclosing on home owners.  Strongly opposes regulation of financial industry.  Friends who know him well say he is not ideological, just ruthlessly ambitious.

Wilbur Ross—Commerce Department.  Net Worth: $2.9 Billion, Known as the “King of Bankruptcy.  Made his fortune buying distressed companies.  While he sometimes managed to salvage firms, his main path to profits has been to use the bankruptcy laws to terminate pension obligations and dump them onto the taxpayers by leaving the workers to depend upon much smaller pensions paid by the US  Pension Benefit Guaranty Corporation.  His other tactic has been to liquidate a firm’s valuable assets, leaving workers jobless and (again because of bankruptcy laws) with only a reduced government funded pension. One of his acquisitions was the Sago Mine in West Virginia.  A non-union operation, there were more than 200 safety violations in 2005 alone and, over the years, miners suffered three times as many injuries as the industry average.   Managers concluded it was cheaper to pay the Mine and Safety Administration’s fines than remediating the violations. In 2005, a methane explosion led to the death of 12 miners. While Ross denied he was part of the operating management, he admitted to investigators that he was aware of the practice of paying fines, rather than correcting safety problems.

Andrew Puzder—Labor Department  Net worth: $80 million.   CEO of Hardees/Carl’s Jr. Fast Foods.  Over the last four years, Department of Labor investigations have found labor law violations in 60 percent of Carl’s Jr. and Hardee’s restaurants, most for paying workers less than the minimum wage or for refusing to pay time and a half for overtime. Politically known for his attacks on minimum wage increases or protective legislation for workers. A passionate reader of Ayn Rand.  When criticized for his company’s use of nearly naked women in Hardee’s ads, he seemed bewildered.   “I like beautiful women eating burgers in bikinis,” he told a reporter.  “I think it’s very American.” A perfect choice for Trump.

Elizabeth (“Betsy”) Devos—Department of Education.  Net worth (with husband): $5.1 billion. Wealth gained from Amway, America’s most profitable pyramid scam. Her long-range goal?  Replacing public education with Christian or corporate-run schools funded by tax-payer funded vouchers without any oversight.   Heavily influenced by the 19th century Dutch ultra-conservative theologian and politician Abraham Kupyer who  tried to prevent the establishment of non-religious schools, colleges and universities in the Netherlands.

Scott Pruitt—Environmental Protection Agency.  A classic case of the fox being placed in charge of the hen house.  Oklahoma Attorney General and passionate climate change denier.  Heavily funded by the Koch Brothers and other fossil fuel and polluting industries.  Worked hand in hand with his patrons in lawsuits against EPA that would end regulation of their industries.  A leading environmental researcher summed it up:  “It’s a safe assumption that Pruitt could be the most hostile E.P.A. administrator toward clean air and safe drinking water in history,”

Rick Perry—Energy Department. Yes, he’s the one who couldn’t remember the name of the Department he wanted to abolish in 2011.  Perry complained that the department has promoted alternative and non-polluting energy technologies while neglecting the fossil fuel industry which has financed his political career.  Perry was apparently unaware that the majority of the Energy Department’s budget is for the production, management and disposal of nuclear materials with much of the rest of its budget supporting basic scientific research.  As Donald Trump said of Perry:  “He put on glasses so people will think he’s smart. And it just doesn’t work. . . .”

Ryan Zinke – Interior Department.  Montana congressman.  The non-partisan League of Conservation voters found that he had voted against environmental protections 97% of the time, at the same advocating more coal, oil and gas development on public lands.  Rejects role of humans in global climate change.

Ben Carson—Housing and Urban Development.  Outstanding pediatric neurosurgeon. Will long be remembered for his claim that the Biblical Joseph built the pyramids for grain storage.  His only experience in housing comes from having lived in one.  Carson’s skin color had nothing to do with Trump’s desperate attempt to show “diversity” in his cabinet.  Nothing.  Absolutely nothing. Positively nothing.  Still, choosing Carson to lead HUD is like asking a plumber to remove a tumor from your brain because, after all, both plumbers and neurosurgeons are skillful in using tools.

Nikki Haley—Ambassador to the United Nations.  Once toured the UN on a high school trip; otherwise zero experience with the UN.  Be grateful for small favors.  No-one has accused her of being stupid.  Not yet.

And then there is the lagniappe:

 David Friedman nominated to be ambassador to Israel.  Friedman supports moving the Israeli capital to Jerusalem, rejects a two-state solution, supports further settlement expansion and seizure of even more West Bank land from the Palestinians—all direct violations of UN resolutions and long-time US policy.  Called President Obama an anti-Semite; repeatedly made the false claim that Hillary Clinton’s aide Huma Abedin was tied to the Muslim Brotherhood.  His attitude toward those Jews who favor a negotiated peace between the Palestinians and Israelis?   These liberal Jews, said Friedman, were “far worse than kapos” – the Jews who were forced to operate the gas chambers in the Nazi death camps.

So how can we sum up Trump’s choices?  Like every President before him, he has sought to placate various groups within the coalition that supported him and they do not always agree, except in the refusal of all but Defense Department nominee James Mattis to accept the overwhelming scientific consensus that our planet is warming at a dangerous rate.

But there are other underlying attitudes and assumptions that characterize (again) most of the appointments of President-elect Trump.  They certainly do not represent a “draining of the swamp.”  Tillerson, Mneuchen, Puzder and DeVos are all extraordinarily wealthy individuals closely tied to the nation’s banking and corporate elite.  Most of the other appointments lack comparable wealth, but they all seem to share two interlocking passions.

The first is that money corrupts the poor but elevates the moral character of the rich. By making the lives of working Americans and the marginal middle class more precarious and insecure and giving them less money, they will respond by becoming more productive and resourceful workers, returning benefits to society as a whole.  At the same time allowing the wealthiest Americans to become even richer will lead them to be “job creators” that benefit society as a whole.

As Harper’s Magazine editor Lewis Lapham  observed some time ago, the second unifying principle has been the unbending conviction that the word “public” in “all its uses and declensions (public service, citizenship, public health, community, public park, commonwealth, public school, etc.,) connotes inefficiency and waste,” a condition that could only be improved by relying upon the unrestrained market, freed from the  unnecessary burdens imposed by government bureaucrats,  labor unions  and assorted liberal busy-bodies.

Let’s at least call it by its correct name: trickle-down economics, or—as I prefer to describe it— dog-eat-dog capitalism.  By and large their words and actions support the cynical viewpoint of the 17th century English proverb:  “Every man for himself and let the devil take the hindmost.”

Of course there are perfectly defensible appointments like General Mattis for Secretary of Defense.  But if anyone thinks this collection of billionaires, bigots, Ayn Rand fanatics and con artists will protect average Americans or “Make America Great,” my sister has 42 acres of prime swamp land on my family’s South Carolina farm.  It fronts Lynches river; in fact it is only inches above the river. Don’t be a loser.  You can build huge, terrific, classy condos that will make you a winner.  Bigly.

The Passing of An Inspiring and Caring Business Leader – Donald Hastings

December 30th, 2016
 “The only way we’ll have any kind of widespread job security in today’s business environment is if we change our thinking as to what makes good management. Instead of praising corporations that downsize, we need to look at their actions as admissions of failure. We don’t need layoffs – we need creativity.”
 Don Hastings, the man who wrote these inspiring words, died this week.
 I will miss him a great deal.
 For over 40 years, Don worked at Lincoln Electric, ending up as President and Chairman of the great Cleveland-based multinational manufacturing company that from its founding in 1895 to the present day, has embraced the values in Don’s words; the firm conviction that people matter as much as profits and the only way for any organization to ensure the latter is to honour the former, every day.
 Lincoln Electric remains a beacon of hope in these hard economic times for its formal corporate no-layoff promise to its employees. A policy that remains unbroken for nearly three-quarters of a century and in no small part because of that, the company remains a global success story.
 Don was also a gentle and friendly man and he changed my life.
 22 years ago, when I was a journalist at CBC (Canadian Broadcasting Corporation,) I happened to catch a speech of Don’s on radio where he talked about Lincoln Electric and its amazing no-layoff policy. It took only a couple of phone calls for me to find myself deep in a long and fascinating conversation with the CEO of a Fortune 500 company. Don didn’t have to do that – I was calling from another country! – and believe me, very few others at his rarefied level of the business world would ever consider talking to a journalist at the drop of a hat.
 A few years later I moved to Washington as a foreign correspondent for CBC, where I often needed help in covering business and economic stories. I took a gamble one day in calling Don – who had just retired – about some story I was stuck on, and again, he answered in a flash and soon became an invaluable resource for me.
 10 years ago, the idea of writing a book about the devastating social and economic effects of layoffs entered my mind and I decided to use Lincoln Electric as the spine of the narrative. Once again it was Don to the rescue, not only through sharing more insights and stories from his years with the company, but even more importantly, Don introduced me to his successor at the helm of Lincoln Electric. I will never forget walking with Don into his old boardroom to meet the new senior management team and hear him tell them “you should listen to this guy from Canada!”
 My book SPARK, which was published 2 years later, would never have happened without Don Hastings and I will always remember him with gratitude and great fondness.
 I’ll leave the last words to Don … “People are important as people and jobs are important to their families’ well-being, and that’s important for the long-term success of a company. That’s why we don’t lay people off.”

2016 Ends at Lincoln Electric, No Layoffs for, now, 68 years and 83 Years of Amazing Profit-Sharing Bonuses

December 9th, 2016

Lincoln Electric, which I profiled in my book SPARK, just announced its 2016 employee profit-sharing results, backed by the firm’s now 68 years-long unbroken no-layoff promise.

It was another impressive year in difficult times for a company that with hard dollars, not  with rhetorical niceties, puts its employees on an equal platform with its customers and its investors. As a result, all three groups do well as does our society at large. This remains a powerful economic model for sustainable work that benefits everyone.

2016 details (2015 in italics) with my comments further on.

83     =  uninterrupted years paying an employee profit-sharing bonus (Lincoln has been profitable every year since 1934.)

$  24,111  =  average 2016 bonus / permanent U.S. employee (approx. 2,800)       (2015 $29,261 )

$  72,323  =  average 2016 total earnings per employee  (wages/salary + bonus)    (2015  $73,543 )

$  68 million  (approx.)   =  pre-tax profits shared among employees (32% of pretax corporate profit)   (2015  $ 80 million (approx.) )

 0  =  number of layoffs in 2015    (68 years layoff free)

Lincoln Electric (Nasdaq: LECO) remains #1 in the global marketplace for welding technology and materials.

The Guaranteed Continuous Employment Policy remains unbroken since at least 1948.  (The no-layoff track record may go back to 1925.)  No one has been laid off for lack of work at Lincoln Electric in the US through the Great Depression, wars and the Great Recession.

Notes for 2016:

These continue to be challenging times for manufacturing globally: Lincoln is no exception.  I have no special knowledge of the company’s finances, but annual sales for 2016 seem to be heading 10-12 % lower than in 2015 (somewhere around $ 2.4 billion.)

So the average bonus is smaller this year. BUT …  no one was laid off.

Looking back, in mid-2015, Lincoln’s US production employees saw their work-week reduced from the normal 40 and often more hours; many began working just 32 hours per week (the minimum guaranteed by the corporate  no-layoff policy/promise.) There were similar slowdowns in Lincoln facilities around the world. Salaried employees – from administration to R&D and all executives – also faced significant pay reductions.

In 2015 (as in 2009/10) the company introduced a voluntary early retirement incentive program, stopped new hiring and brought some externally contracted work back inside. As a result, and with natural attrition, Lincoln’s US workforce shrank from 3,000 to 2,800 employees.

Also in 2015, Lincoln suspended its 401K matching contributions for the retirement plan (similar to employer-matching RRSP retirement programs in Canada.)

And the company’s pension plan was converted from a defined benefit plan to a defined contribution plan. (Like so many others in the US and Canada.)

This has represented a significant and painful sacrifice for all employees and their families.

But … no one was laid off!

THE GOOD NEWS

Most hourly workers (as of late-October, 2016) are back up to 40 hours per week of paid employment. Part of this is due to demand picking up for welding products, part is due to the smaller workforce.

This January 1, 2017, the 401K matching contributions will begin again. More importantly, Lincoln has promised that in any future economic downturns,  these vital matching retirement contributions will continue uninterrupted. An important and positive policy change.

Lincoln Electric is an American-based Fortune 1000 multinational. In other countries where it has production facilities, it tries – under often very different legislative, labor and regulatory regimes – to treat its workers with the same respect and employment structure that US employees earn. In Canada, Australia and Mexico, profit-sharing and steady work has remained as close as possible to that in the US itself; further afield, local factors have forced many accommodations.

But the essential contract within Lincoln Electric remains ….. shared sacrifices by everyone in the firm in tough times will be rewarded fairly through significant profit-sharing and guaranteed steady work over the long term. 

Lincoln Electric has done its best to earn the trust of its workforce by keeping its people on the job through thick and thin – while remaining technologically innovative,  and thus highly profitable,  for more than a century.

This goal continues to be one which many more private sector firms should embrace in fact, not just with vague rhetoric. Public policy makers at all levels should make efforts to support these initiatives.

The pain from layoffs, all-too often unnecessary, and from the resulting unemployment is extraordinarily damaging to the fabric of our society, and extends far beyond the awful economic impacts. We need to do much better at keeping people steadily employed in productive jobs and thus keeping our communities strong and vital.

“Resist the Beginnings: Consider the End” – A Distinguished American Historian’s Take on Donald Trump

November 30th, 2016

 One of the privileges and delights of being a foreign correspondent for CBC was to get to know very smart people who helped me to understand their country in ways that I could never discover for myself.  

 Dan Carter, one of the most distinguished historians in the US, is one of those people and we’ve remained friends since I left Washington a decade ago. His specialty is the history of the South, from the Civil War to the present day. His prize-winning biography of George Wallace, “The Politics of Rage,” is an amazing introduction to the transformation of modern US political conservatism and the importance of race.   

 Dan  just shared with me his  thoughts on the roots and portent of Donald Trump’s election, an op-ed inexplicably unpublished in the US. I am proud to put it up on my blog for sharing as widely as possible 

RESIST THE BEGINNINGS: CONSIDER THE END

For nearly 50 years I have written and taught about modern American politics and I’ve often been asked to comment upon contemporary as well as past events.  Even when I wrote an “opinion” piece, however, I have always tried to step back emotionally and write with as much objectivity as possible.

I cannot do so in responding to the election of Donald J. Trump.

Like millions of Americans, I fear the damage likely to our environment, to the poor, to women and to religious racial and sexual minorities and I shudder when I consider the long-term damage that will come from President Trump’s judicial and political appointments.  Even more dangerous are his proposed advisers on foreign affairs.  No wonder the rest of the western world is shaken.  And God help the Palestinians.

To a far greater degree it is the same disappointment I felt upon the election of Ronald Reagan and George Bush.

But even though I have sometimes been disappointed in the outcome of Presidential elections, I have never felt that the Republic was in jeopardy.

That is not the case with the election of Donald Trump.

Over the last two decades, I have read and re-read Milton Mayer’s They Thought They Were Free, a haunting book about Germany during the rise and fall of Nazism.  In 1951,  Mayer—a journalist, a Jew and a World War II conscientious objector—lived in a small town outside Frankfurt  where he conducted lengthy interviews with ten former Nazis, none of them directly involved in war crimes, all of them “good” Germans.

A sympathetic listener, Meyer seldom challenged their efforts to excuse their actions, capturing their defensiveness and their sense of shame and bewilderment as they looked backward.  How did it happen, they asked themselves? How did an era begin with hope and faith in a dynamic—if  crude—leader  end in the ruin of a nation and the smoking death camps of Dachau and Buchenwald?

The one thing upon which they agreed was that the decline came gradually as political leaders—supported by their passionate followers—abandoned the self-imposed restraints that underlie any real democracy.  Step by step the German people embraced a charismatic but psychologically damaged individual,  acquiesced in the demagogic creation of Jews as scapegoats, accepted the vilification of political opponents and ultimately the substitution of naked force for the rule of law until what was once unthinkable had become the norm.

Donald Trump is no Adolph Hitler.   He is by the evidence of his own words and actions, a particularly American type:  a shamelessly amoral hustler who prides himself on his ignorance of complex problems, a blowhard television personality, a vicious misogynist, a racist, a bully and a narcissist whose moral core revolves only around his personal glorification and his dominance over others.  But he has ridden the wave of economic frustration and the fears of an overwhelmingly white electorate that is uneasy in the presence of powerful women and feels dispossessed as religious and racial minorities move from the shadows toward a majority in our nation.

Above all, Trump grasped the fundamental weaknesses of our current political culture. He has repeatedly bullied opponents and lied with the kind of brazen disregard for truthfulness, and for civilized norms of political debate.  Instinctively he understood that most of the media—particularly the broadcasting and cable networks—would simply broadcast these lies in the name of journalistic objectivity, the more outrageous the better.   And in a political environment in which complex issues are reduced to 30 seconds of: “She’s a liar”/“No, she’s not”/ “She’s a crook,” “No she’s not,”/  democratic debate was reduced to the 140 characters of the tweets he used so effectively.

As Leslie Moonves, CBS chief executive told his stockholders, the presidential race “may not be good for America, but it’s damn good for CBS.”  For his network and for FOX, CNN, MSNBC, ABC and NBC—in Moonves’ words, “the money’s rolling in.”  And so, in the media world dominated by President-elect Trump, life and death issues have been transformed into a shallow, exciting and vulgar game show that brings in more revenue.

In the coming weeks, the chattering classes will endlessly explain what has happened either by pointing to the weaknesses and miscalculations of the Clinton campaign or the grievances that Trump so successfully exploited.   Reporters and pundits will parse the exact meaning of his appointments.  Does naming GOP Party head Reince Priebus chief of staff indicate a conventionally right-wing course?  Or is the appointment of white supremacist Stephen Bannon as chief counselor the real key to understanding his coming administration?   Priebus and his like will become “steady hands” and Bannon will be transformed from an overt racist, sexist and anti-Semite into a “right wing media provocateur.”  We will all analyze Trump’s tweets and contradictory statements like Roman seers poring over the entrails of dead chickens, breathing a sigh of relief when he decides to deport only three million Latinos instead of eleven million and pushes through some flim-flam healthcare fig-leaf to justify the destruction of the Affordable Care Act.

And step by step we will normalize Trumpism.

What had he learned from the rise of German fascism, Milton Meyer asked a German high school teacher who lived through rise and fall of  Nazism?  Remember the classic warning by the Roman poet Ovid, replied Henrich Hildebrandt: “Principiis obsta: Finem respice: Resist the beginnings: consider the end.”  That is a difficult task, he admitted, for “one must foresee the end in order to resist, or even see, the beginnings.”

We cannot know for certain where our story ends and we are certainly a more resilient society than Germany in the 1930s.   But we are sailing into uncharted waters, guided by a sociopathic captain who has no understanding of, or respect for, the institutions and the values of a democratic society and the first thing we need to do is to stop pretending that this is simply another election.

Dan Carter 

Professor Emeritus

University of South Carolina

 

 

 

 

 

Paul Adams Responds on CBC’s Ombudsman, Neil Macdonald, Journalism, Opinion and The Future

June 20th, 2016

Paul Adams is a former CBC colleague who went on to write for the Globe and Mail, reported from around the world,  and now teaches at Carleton’s journalism school – in other words, owner of a distinguished career in journalism in Canada. Paul sent a very thoughtful note after my blog last week which looked at the CBC Ombudsman’s recent comments about Neil Macdonald and the differences between journalism, reporting  and opinion-making. I am  happy, with Paul’s permission, to re-post it here.

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Frank,

I just think we disagree fundamentally on a number of things, and that’s fine. There are also a couple of things we agree on.

The CBC’s model, like that of the New York Times, and many other similar outlets has produced some of the best journalism on earth. But that tends to blind us to the fact that the traditions of “balance” and “objectivity” obscure the ideology behind that particular culture of journalism from both consumers and for the most part journalists themselves. It works pretty well in a universe with very broad social consensus, shared values and widely supported social institutions.

It also fit perfectly a particular political and economic moment when news organizations had financial or political incentives to appeal to a very broad swath of the public, and were able to find methods to do so successfully.

But the “news from nowhere” model doesn’t work as well in the fragmented media universe we now live in, nor in communities where social consensus is breaking down.

We have seen this most obviously with Trump, who managed to de-pants much of the mainstream media for the entire primary season. Only now are many journalists finding new tools (and gumption) to confront his attacks on core humanistic values and literal truth.

Trump, far from being sui generis is characteristic of a phenomenon in many Western societies, if less so here in Canada. A journalistic model that struggles so ineffectually to handle him is not a journalistic Swiss Army Knife that will work in every situation as the old model was expected to do.

Journalism is rooted in the Enlightenment, an evidence-based craft whose core is a belief in human dignity and the capacity of the rational mind to see evidence, and recognize appreciable truth. There is a real danger to losing sight of this and allowing ourselves a mushy indifference to the truth of what we report, so long as someone actually said it.

The recent report by the CBC Ombudsman, Esther Enkin, on a Neil Macdonald column, demonstrates the degree to which this proud tradition has degraded into a set of unreflected-upon mechanical procedures.

When Enkin protests against Macdonald calling creationism a superstition, she is essentially saying that journalists are not in the company of scientists, living in a palpable world of evidence, but in a kind of post-liberal world in which every statement or claim is just an “opinion” to be equally valued. Like, I suppose, flat-earthers: Bob McDonald can presumably insist the world is round because he is on contract, and not required by the CBC to observe its rule against expressing an opinion embodied in its Journalistic Standards and Practices. If he were a staffer, like Neil, he’d have to keep his opinions to himself.

And where does that end? Faking the moon-landing? 9/11 conspiracy? Maybe the ISIS view that God says it is OK to take Yazidi women as sex slaves is just another valid opinion out there that as journalists we have no tools to evaluate.

But Enkin’s pronunciamentos and the existing journalistic code are not the actual policy of the CBC. Let’s just say for the moment that Macdonald had strayed into the realm of opinion. Why is that so wrong?

The CBC has decided (wisely in my view) that its future must be deeply engaged in digital. Digital requires substantial elements of commentary (as does news television btw). What has happened is that senior news management has decided to change practice before changing the code.

Neil Macdonald is doing what he is asked to do by his bosses — what columnists everywhere are expected to do: generate interesting and sometimes insightful comment and controversy, as well as news from time to time. And traffic. He does all this.

It is just that because he is a poor staffer, he gets to be pummeled in public by the Ombudsman, which Rex Murphy and a gazillion (paid) panelists on the news network are spared. And of course Neil has no way of responding publicly. No doubt he is forbidden to do so.

But what the reader/viewer/listener needs is transparency; not a ban on staffers doing what contract contributors are able to do. How is a news consumer supposed to divine someone’s contractual status and then infer what rules they operate under?

What consumers on CBC.ca need is the transparency we see in other media. Clear labeling that would signal what role a particular piece is playing. Newspapers do it all the time. Lawrence Martin and Jeff Simpson appear on the same page in the Globe and Mail, with the same labelling as opinion columnists. (What matters is not their contractual status.)

The ability to provide readers with such transparency is constrained by the fiction that CBC news management wishes for political reasons to maintain that some practices are the same as they ever were. That’s why I favour changing the code. I understand there is a review underway, but that the bar on CBC staff journalists expressing opinions is likely to remain.

Finally, I confess I do not understand your refinement on the term journalist. You seemed to be using it as synonymous with “reporter”. That has never been the case. Nor has the distinction ever been as sharp between reporters and opinion writers as you seem to suggest. John Ivison breaks news all the time in his column in the National Post, as does Paul Wells, who seems committed to blending the two in his new role at the Toronto Star. John Ibbitson writes news, analysis and opinion in the Globe and Mail, which the newspaper tries to distinguish by labeling.

When I was at the Globe, I wrote mostly news, but plenty of analysis. For a time I wrote a weekly satirical column about politics on the Hill. All clearly the labelled. I don’t remember anyone ever being confused or complaining: because the frame of each piece was clear.

I think this is an important debate. But I fear that you are clinging to a culture and a code that worked pretty well at a certain time in history as if they were eternal verities. More challenging by far is migrating to a new place, preserving what was valuable but amending what is not working (or perhaps never worked as well as we liked to suppose).

Paul

CBC’s Ombudsman Reminds CBC News That Its Job Is Journalism, Not Opinion

June 14th, 2016

Esther Enkin, CBC’s Ombudsman, has just reminded CBC News that the job of CBC’s journalists is …. journalism, not opinion-making.

Enkin was responding to a formal complaint from a CBC.ca reader about what he felt were “inflammatory & divisive & discriminatory” comments that CBC journalist Neil Macdonald recently made about Donald Trump’s supporters.

In her formal opinion, the Ombudsman makes it clear that “expressing opinion is prohibited by CBC policy” and that Macdonald’s remarks read “like opinion” and were “unnecessary in the context of this piece.”

A key line here comes at the  end of her opinion: “If Mr. Macdonald were a columnist or an outside commentator …..”

In recent years, I and others have expressed concerns that CBC News  has been having a hard time realizing that some of its most high-profile employees are most assuredly NOT columnists or outside commentators, but journalists who fall under the Corporation’s very specific and clearly-written policies on opinion making and, not a tangential issue, on conflict of interest.

To wit,  the controversy more than a year ago over CBC journalists taking large amounts of money from the private sector for public speaking  events.

Last winter, I wrote about the increased blurring of the important line between journalism and opinion making on my blog (Dec. 9, Dec. 14th) and on Huffington Post (Dec. 10, Dec. 15th.)

CBC responded with a somewhat convoluted defense which you can read here (Dec. 15, 2015.)

Now, it’s good to see CBC’s own Ombudsman reminding the Corporation of its vital journalistic responsibilities.

(As a former journalist, I can’t help but note that the title of Esther Enkin’s opinion is “Trump & The Republican Party” when in fact it is really about a CBC journalist’s policy-breaking  opinions about Trump and his followers. Headline writers! Always messing things up!)

Megyn Kelly’s Master Class In Bad Journalism

May 17th, 2016
  One question in a Republican debate last fall about Donald Trump’s attitudes towards women – and his angry misogynistic tweet soon afterwards – instantly transformed Megyn Kelly into … a tough journalist.
 Now she is being sold as the new face of rigourous journalism on Fox and perhaps for American journalism as a whole. See the New York Times piece in last week’s business section.
  15 minutes tonight in a much-heralded one-on-one with Trump  and Kelly reveals herself as little more than an enthusiastic enabler of, and collaborator in, Trump’s (ever closer, sadly) ascent to the most powerful job in the world.
  Hard to watch. But you should give it a try.
  And this interview should be required viewing in every journalism school.
  Not one question about how Trump might actually use the immense power of the Presidency to deal with the US’s – and the world’s – many challenges.
  Just softballs questions about campaign silliness with no structure or followup, cute one liners, innuendo and smiles.
  What an awful squandered opportunity.
  But for Megyn Kelly   …… a master class on how to make a new friend. 

Mike Duffy Was Not Exonerated!

April 23rd, 2016

Am I the only one reading the Globe and Mail on a Saturday morning and feeling very very queasy about the almost overnight near re-hagiografication of Mike Duffy in the media and the punditocracy?

Unless I am missing something, Duffy was only “exonerated” regarding a series of legal charges in a court of law. And yes, that exoneration should/may result in a rethink of a whole bunch of issues regarding … gosh, it is a very long list …. the Senate, its structure, its rules, the role of appointments, the PMO, its ability (under direction of a PM)  to skew/shape/distort governing processes, the rabidity of the press when it finds a juicy story,  and on and on and on and on  ….

But good heavens,  let’s not all of a sudden turn our backs on something fundamental here.

Duffy’s behaviour was personally reprehensible .. and that in no way is now exonerated by a court decision.

It is not something that deserves to be simply forgotten or downplayed because …. first, a court of law has “exonerated” Duffy of formal legal charges ……second, because he clearly operated (as do other Senators)  well within an opaque, imprecise, purposely-designed and politically-self serving set of Senate appointing and  operating rules …..  and third, and please! spare me the damn crocodile tears seen in article after article over the past few days, because Duffy’s health is in a bad state.

Would any of us suggest that the pattern of practice that Duffy  happily engaged in is something that offers a positive example to anyone in Canada of how to behave in public life? And particularly in a role when you are being paid by the public?

Do we actually think that “an evil PM and his PMO thugs made me do it!” plea has ethical merit to be accepted, let alone embraced or excused or even now deserving of some weird kind of sympathy?

We discourage children from using that excuse in the playground, don’t we?

When you eagerly belly up to a trough as a sentient being, well-versed in who filled it and for what purposes, and then you energetically partake of its contents …  you take your chances.

I am glad that the trough may be being rethought.

But let’s not exonerate from personal, ethical and “passing-a-public-smell-test” responsibility someone like now-poor Duffy who happily stood around that trough.