Inspector Generals and Auditors

What do Enron, Healthsouth, Adelphia and Tyco have in common? All were found guilty of fraudulent activities. And, each were misled by CEOs and even CFOs. The names Kenneth Lay and Richard Skilling of Enron (accounting and tax fraud), Richard Scrushy of HealthSouth (accounting fraud), John and Tim Rigas of Adelphia (fraud, corruption and theft) and Dennis Kozlowski and Mark Switz of Tyco (massive theft) will not be remembered in a good light. The Enron scandal even brought down one of the largest accounting firms, Arthur Andersen.

Because of their activities, the SEC passed a rule stating that the Board of Directors’ Audit Committee must be given greater authority and independence. In short, the Audit Committee must be independent of the Executive Committee and cannot include the President or Treasurer. It also must:

– Not include anyone employed by the organization or the audit firm
– Have at least one “ financial expert ” who is familiar with the audit process
– Avoid conflicts of interest.

In the federal government, the Inspector General’s office imbedded in each of the departments of the Executive branch serves like an auditor. The equivalent Board oversight is the Congress of the United States, not the president. It is a very important role that keeps America running like a democracy and not an autocracy. When this oversight is compromised, America’s democracy is diminished.

I raise this now as the president of the United States seems to be at war with the Inspector Generals in the Executive branch. Friday night, the president sent a letter that he was firing Michael Atkinson who did his job and reported to Congress the veracity of a whistleblower complaint. To Atkinson’s credit, he publicly defended his role and encouraged whistleblowers to still come forward.

This week, the Glenn Fine, the appointed IG overseeing the $2.2 trillion coronavirus stimulus fund, was removed and will be replaced by a Trump appointee. Fine was well regarded in this role coming out of the Department of Defense. Something seems fishy here.

If that were not enough, the president was critical of a US Department of Health and Human Services IG report led by Christi Grimm. The report was critical of the hospital preparedness for the coronavirus, which is not a surprise, since hospitals and governors are begging for help.

What does all of this mean? Why is the president at war with the Inspector General’s office? Is he hiding something? Are they saying things that run counter to his own storytelling which is well-known to be less than truthful? If this were a publicly traded company, these actions would raise a red flag with the Audit Committee. They should do the same with Congressional oversight.

In short, the US is not a kingdom. It is not an autocracy. The president has never reported to anyone before his swearing in, except for his father. He is highly accustomed to not being questioned. In fact, he does not like being questioned, which is apparent on a daily basis. Yet, he must answer to Congress. I urge Congress to do their job. They must represent Americans, not a political party.

Ain’t no sunshine when (he’s) gone

Bill Withers died a few days ago at the age of 81. If you don’t know who Withers is, you may know one or two of his songs. The one that is getting the most attention, and should is “Lean on me.” More on that later. The one that also should get attention is the soulful song of loss called “Ain’t no sunshine.”

The next lyric is “when she’s gone,” but we can use this title to remember Withers with the replacement word “he’s.” This song has been used in at least one movie to share the sense of loss. I also liked that Booker T. Jones produced it and Donald “Duck” Dunn played bass with Stephen Stills on guitar.* Here is the first stanza.

Ain’t no sunshine

“Ain’t no sunshine when she’s gone
It’s not warm when she’s away
Ain’t no sunshine when she’s gone
And she’s always gone too long anytime she goes away.”

“Lean on me” deserves attention. It keeps coming back in new strains and served as the title song to a movie in the late 1980s. In my view, given its words and simple heartfelt melody and delivery, it is one of the finest pop songs every written. It is not a surprise that it is an anthem for healthcare workers today. Here is the first stanza and chorus.

Lean on me

“Sometimes in our lives we all have pain
We all have sorrow
But if we are wise
We know that there’s always tomorrow

Lean on me, when you’re not strong
And I’ll be your friend
I’ll help you carry on
For it won’t be long
‘Til I’m gonna need
Somebody to lean on.”

A song that is a little out of character with the first two is “Use me up.” In short, he knows he is being used by a girlfriend, but he is enjoying his time too much to change her poor behavior toward him. Here is the first stanza.

Use me up

“My friends feel it’s their appointed duty
They keep trying to tell me all you want to do is use me
But my answer yeah to all that use me stuff
Is I want to spread the news that if it feels this good getting used
Oh you just keep on using me until you use me up
Until you use me up.”

The final song I want to highlight was released as duet with Grover Washington, Jr. about ten years later. It is called “Just the two of us.” Here is the chorus.

Just the two of us

“Just the two of us
We can make it if we try
Just the two of us
Just the two of us
Building castles in the sky
Just the two of us
You and I.”

If you only remembered the first two songs, that would still paint Withers in a good light. He had voice that resonated. His songs also had a good pacing, so that the words could shine through. He will be missed.

* Note: Booker T and the MGs were the studio band on many Memphis R&B recordings. Donald “Duck” Dunn was a member. Think the band behind John Belushi and Dan Akyroid in “The Blues Brothers.” Stephen Stills, of course, was with Crosby, Stills, Nash and Young and Buffalo Springfield.

Note: Here is a link to Jill’s post on Bill Withers which includes some song links.

♫ Bill Withers — A Tribute ♫

Be alive, but be truthful, calm, humble and thoughtful

In spite of everything, we need to remember to be alive. If we do not, then we may spiral down a rabbit hole of despair and uncertainty. Here, it is a good day to be outside. While I have yard work in my plans, it will be nice to exercise and breathe fresh air. I have a few random smidgens of musings to ponder around a common theme as we head out.

Since I have been writing of the need to listen to the truthtellers, I was reminded of a quirky colleague who was a joy to be around. He would leave vignettes on his voicemail greeting, changing them every few days. One of my favorites is “Always tell the truth. You don’t have to remember as much.”

An old leadership axiom is watch what managers do in times of crisis. The ones who can calm others in the face of adversity are the ones to follow. People take on the personality of their leader. If he or she berates people in times of stress, then others will follow suit. But, if he or she is calm….

The famous Atlanta Braves pitcher John Smoltz was applauded for how cool he was in the playoffs and World Series which contributed to great success. He said the key is to stay calm and achieve the same level of performance as you do when not as stressed. It is not that he elevated his performance, others got nervous and lowered theirs.

Like many, my grandfather was not a talkative man. He was a hard worker who loved to fish in his spare time. His best friend, my great uncle, was the same way. Between the two of them, the fish would never be scared away by sound. But, when he talked, you listened. We all know and need people like this in our lives.

One of the greatest college running backs and a very good pro football player was named Herschel Walker. When Walker scored a touchdown, he would not celebrate like players do today and many did when he played. He preferred to act like he had been in the end zone before. And, he was there a lot.

Finishing up with Walker, I have written before of the true story after he retired. He was out jogging and came upon a car that had crashed and the people could not get out of the car. Walker ripped the door off the car and pulled them to safety. After making sure they were alright and waiting until the police and EMTs arrived, he ran off with no fan fare. It was not until later that a reporter confirmed that Walker had saved the couple from the car.

The themes of truthfulness, calmness, humility and thoughtfulness are worthy attributes to deploy. Beware of those in leadership who do not exhibit such.

That truth stuff has never been his thing

This COVID-19 is serious stuff and we can no longer mess around. We missed six weeks when we should have been investing in things we would need rather than naysaying it and selling stocks like my Senator did. As for the whitewashing now going on that the president never did downplay the pandemic, we should not forget that the president has long had a problem with that truth stuff. So, even when it appears he is being more truthful than before, it is a deep hole to climb out of. And, one truth does not make up for an ocean of lies.

Per his biographers, Trump’s mentor Roy Cohn told him to never apologize and sue everyone. This is yet one more example of too many. Trump cannot say he was caught with his shorts down and downplayed the pandemic. He even denies saying he called it a hoax, when there he is on camera calling it a hoax.

But, on the latter Cohn teaching, Trump’s campaign has sued TV stations to not air the truthful ad that shows him downplaying the pandemic. This is modus operandi. Lie. Lie about the lie when the lie does not work. Sue anyone who says you are lying.

Michael Cohen, Trump’s attorney and fixer, said many egregious things under oath, which simply have been ignored by Trump sycophants. I quote often the main theme that he said “Donald Trump is a racist, he is a con artist and he is a cheat.” But, what Cohen also said under oath is he was instructed on more than 500 occasions to send cease and desist orders to entities that had less flattering information in its possession. They ranged from unflattering footage of “The Apprentice” to colleges or prep schools with bad grades to sexual assault accusations, etc.

But, the most egregious thing Trump attorneys did is sue people to avoid paying them for services rendered to his properties. This man of the people has screwed contractors, sheet rockers, painters, electricians, plumbers, etc. on countless occasions. Before the election, out of over 4000 lawsuits, over 200 were to screw the common worker. These folks had to take less money or file for bankruptcy.

Thomas Wells, another attorney who worked for Trump also said many things in an op-ed piece before the election. My favorite is “Donald Trump lies everyday, even about things of no consequence.” But, he also said Trump “always” claimed bad service to avoid paying people. To me, that shows Trump is a cheap SOB. But, don’t take my word or Wells’ word on this. I watched a contractor in a voter panel in 2016 tell the facilitator about working with Trump companies, “The word on the street is get your money up front.”

So, taking the president at his word is a fool’s errand. And, if you do work for him, get your money in advance.

For profit drug and medical supply companies are geared to maximize profits

This topic is not a new one and is one I first wrote of several years ago. The concern is the number of for-profit companies who make drugs and medical supplies are not geared toward fighting pandemic or new bacterial strains that keep cropping up. They are geared toward profit. What do I mean by this?

Think of all of the television commercials about new prescription drugs. It will not be hard as there is a growing number with new names that make you ask, now what does this do? Quite simply, a drug company makes more money creating a maintenance drug you take every day for the rest of your life than they do making cures for major diseases.

It is not unusual for the company to codify a new illness which is neatly packaged with this new pill. Or, the new pill may be a supplement to an existing drug to make it better or address the side effects. Did you know there is an anti-constipation drug that is sold to help alleviate the constipation caused by opioid painkillers? Please note this is not intended to slight anyone who is gaining benefit from one of these drugs.

Making a drug that will cure something, simply has a low or negative ROI. One reason is the company would look poor if they charge to high a price for a cure. This is where the CDC and NIH must garner funding to pay for the development of drugs before the pandemic catches fire. The other risk is the new bacterial strains that may develop beyond our ability to fight the strain. This is where I first learned of the funding deficiency for massive exposure problems.

The same can be said of medical equipment. The New York Times has a good piece on the recent history of ventilator production. Agreements have been made then voided by acquisitive companies. These acquisitions were either to protect a higher priced ventilator or a market share. So, there were a number of false starts. What is frustrating is how easily contracts can be voided after an acquisition. This is horribly unfair to the buyer of the service or product, especially when the contract could help many.

There are a couple of larger points to be made. This is a great example of where there needs to be a blend of financial responsibility on investment for the greater good. This is not new. Our country has a history of a blend of corporate, venture capital, private and government investment. This is a key theme of Pulitzer Prize winning author Thomas Friedman’s book “That Used to be Us: How America fell behind in the world it created and how it can come back.”

Per another economic advisor, David Smick (“The World is Curved”) who advised Republican and Democrat presidents, this blend of capital investment need not occur on every investment or in some set order. Sometimes government funding leads and sometimes it may trail. The point is we have way to many either/ or arguments when the right answer is a blend of both or multiple. This is known as the “tyranny of the or.” Our history is built on the blend of capital investment, especially for large infrastructure projects.

So, greater good investments need to be evaluated as soon as possible. When the risk is identified, that is when the spend is needed, if not before given what the challenge is. Not having a COVID-19 vaccine early on is one thing that should have been addressed a few months ago given the development time. Not having enough ventilators is something that should have been addressed well before given their need. Leaving certain things to solely a for-profit lens will mean that some needed investments may not get made or not made soon enough.

Trumbo – a great movie about a dark time in America

Earlier in the week, I was watching the excellent movie called “Trumbo” about the black-listed screenwriter Dalton Trumbo starring Bryan Cranston and an excellent cast such as Helen Mirren, Diane Lane, Elle Fanning and John Goodman to name a few. I missed it the first time around in 2015 when it was released.

The movie was written by John McNamara and Bruce Cook, on whose book the movie is based. It was directed by Jay Roach. Trumbo was one of the Hollywood Ten who were blacklisted early on for alleged communist activities. He spent time in jail for being in Contempt of Congress for refusing to name names. Trumbo would go on to ghost write two Oscar winning screenplays for “Roman Holiday” and “The Brave One.” He would perpetuate an underground screenwriting group and eventually, Kirk Douglas and director Otto Preminger, would let him sign his name to the movies in 1960 with “Spartacus” and “Exodus.”

I was reminded of the House Un-American Activities Committee, which began in 1947 and was in exisentence until 1975, that started these investigations leading to Sen. Joseph McCarthy’s communist witch hunt efforts. It should be noted that 1975 is the year following Richard Nixon’s resignation. Nixon was a key ally of Sen. McCarthy. It should be noted Nixon kept an enemies list due to his paraonoia. Nixon did some good things, but he turned out to be a crook.

What is interesting is McCarthy’s attorney through this dark period was Roy Cohn. Cohn later became a mentor to a young real estate developer in New York named Donald J. Trump. Trump’s biographers wrote that Cohn told Trump to never apologize and sue everyone. Trump has followed these mandates for his entire career.

Bringing this full circle. Trump is the most corrupt and deceitful president in my lifetime, including Nixon. But, both me were influenced by Sen. McCarthy who led this dark period in American history who made up things to support his claims. It should be noted that both Nixon and Trump blame the press for not sufficiently kowtowing to them. As the Sec. of the Army asked famously of McCarthy, “have you no sense of decency, sir?” The same could be asked of the current US president.

So, we must protect America against those who wave the flag and tell people it does not stand for the things that it does.

All over the place

My favorite conservative pundit is David Brooks, who appears every Friday on PBS Newhour and NPR to recap the events of the week. I have found his voice one of reason, even if I do not agree with everything he says. I have also read several of his books on subjects like building character and community.

He has been an even-tempered critic of actions, decisions and behaviors of the US president. Last Friday, he used the word “inconstancy” of the president as a great risk in addressing COVID-19. The president will change his position within the hour, he consistently misinforms where it needs to be corrected, and he naysayed the severity of the coronavirus through the end of February, so we lost six weeks.

And, the misinformation continues today. So, much that NPR and other news outlets stopped covering his press conferences live. Building off Brooks’ term, I would say the president governs “all over the place.” He will change his tune due to criticism in the news or if he likes a message from one of his sycophants.

One of the better news shows happens to be a comedy show called “Last Week Tonight” starring John Oliver. The focus of this past Sunday night show is the danger people are being placed under by poor leadership, but also by sycophants.

Oliver notes this theme that danger to the American economy is far worse than people dying is beyond misguided. It is dangerous. He highlights words by the president, conservative host Glenn Beck and the Lt. Governor of Texas who downplay the health risk and speak of economic Armsgeddon.

As Oliver points out it is easy to talk big with others taking the risk with their lives. Then Oliver points out the economic fall out of overwhelmed hospitals and people dying. We are witnessing even now the cost of early inaction.

We must focus on the health of people first and foremost. I fully understand the need to help financially people who are in need due to layoffs or hours reduction.

Yet, while we missed opportunities to plan, we cannot miss any more. We must listen to the truthtellers and ignore those who are politicizing and trying to obfuscate the truth.

As Oliver addressed critics, he said he wants the president to succeed at helping fight this virus. But, he cannot be when his primary mission is how he looks. Perhaps Brooks comment a few months back is the more pertinent one – the president lacks common decency and a sense of empathy. That speaks volumes.