Bad Week for Ethics

Four years after launching the Business Ethics Pledge campaign, and five years after publishing my book, Principled Profit: Marketing That Puts People First, that shows that ethical businesses can more easily succeed, the goal of making future Enron scandals unthinkable seems very distant this week. One dismal news story after another!

A little sampling of the depressing headlines:

Democratic Governor Rod R. Blagojevich of Illinois, arrested on corruption charges, manages to paint himself as more venal and small-minded, and more focused on personal gain, than even Richard Nixon. When the news of his arrest hit earlier this week, I first thought it must have been some last-minute scheme by the outgoing administration. but then I found out the prosecutor is none other than Patrick Fitzgerald, an ethical crusader who took on Scooter Libby and other Bush heavies. This morning, I listened to some of the press conference, and even I was shocked. If even a quarter of the allegations turn out to be true (and Fitzgerald says they’re all documented by phone taps, etc.), this is a man who reminds us of the time-honored tradition of tarring-and-feathering. When a governor thinks that a Senate vacany is a commodity for sale to the highest bidder, there’s a BIG problem.

Here’s Fitzgerald:

It’s a very sad day for Illinois government. Governor Blagojevich has taken us to a truly new low. Governor Blagojevich has been arrested in the middle of what we can only describe as a political corruption crime spree. We acted to stop that crime spree.

The most appalling conduct Governor Blagojevich engaged in, according to the complaint filed today or unsealed today, is that he attempted to sell a Senate seat, the Senate seat he had the sole right under Illinois to appoint to replace President-elect Obama.

Let me take you back eight weeks ago to set the allegations in context. Back eight weeks ago, we the following environment. There was a known investigation of the Blagojevich administration that had been going on for years involving allegations of “pay to play” conduct and corruption. There had been a recent trial of an associate of Governor Blagojevich in which allegations were aired, where people testified that Governor Blagojevich was involved in corrupt conduct. And there was an Ethics in Government Act that was pending, that would go into effect January 1 of 2009, that would bar certain contributions from people doing business with the state of Illinois.

You might have thought in that environment that “pay to play” would slow down. The opposite happened. It sped up. Governor Blagojevich and others were working feverishly to get as much money from contractors, shaking them down, “pay to play,” before the end of the year. […]

A bug was placed in the campaign offices of Governor Blagojevich and a tap was placed on his home telephone. And that tap and that bug bore out what those allegations were.

I’ll give you two examples set forth in the seventy-six-page complaint. One involves Children’s Memorial Hospital, a hospital that obviously takes care of children. At one point, the Governor awarded funding, reimbursement funding to that hospital to the tune of $8 million. But he also indicated privately that what he wanted to get was a $50,000 personal contribution from the chief executive officer of that hospital. In the ensuing weeks, that contribution never came, and Governor Blagojevich was intercepted on the telephone checking to see whether or not he could pull back the funding for Children’s Memorial Hospital. […]

In addition to the “pay to play” allegations, which are described in greater detail in the complaint, we also were surprised to learn of an extortionate attempt against the Chicago Tribune newspaper. The Chicago Tribune had not been kind to Governor Blagojevich, had written editorials that called for his impeachment. And Governor Blagojevich and defendant Jonathan—John Harris, his chief of staff, schemed to send a message to the Chicago Tribune that if the Tribune Company wanted to sell its ballfield, Wrigley Field, in order to complete a business venture, the price of doing so was to fire certain editors, including one editor by name. In the Governor words—Governor’s words, quote, “Fire all those bleeping people. Get them the bleep out of there. And get us some editorial support,” close quote. And the bleeps are not really bleeps. The defendant Harris tried to frame the message more subtly to get the point across to the Tribune that firing the editorial board members would be a good thing in terms of getting financing to allow the sale to go forward.

But the most cynical behavior in all this, the most appalling, is the fact that Governor Blagojevich tried to sell the appointment to the Senate seat vacated by President-elect Obama. The conduct would make Lincoln roll over in his grave. The Governor’s own words describing the Senate seat, quote, “It’s a bleeping valuable thing. You just don’t give it away for nothing,” close quote.

Another quote: “I’ve got this thing, and it’s bleeping golden. And I’m just not giving it up for bleeping nothing. I’m not going to do it, and I can always use it; I can parachute me there,” quote. Those are his words, not our characterization, other than with regard to the bleep.

The tapes reveal that Governor Blagojevich wanted a number of things in exchange for making the appointment to the Senate seat: an appointment as secretary of Health and Human Services or an ambassadorship, an appointment to a private foundation, a higher-paying job for his wife or campaign contributions. At one point, he proposed a three-way deal, that a cushy union job would be given to him at a higher rate of pay where he could make money. In exchange, he thought that the union might get benefits from the President-elect, and therefore, the President-elect might get the candidate of his choice.

I should make clear the complaint makes no allegations about the President-elect whatsoever, his conduct. […]

And finally, we should also note that the Governor talked about appointing himself to the Senate seat for reasons not having to do with the better welfare of the citizens of Illinois. He wanted to do it to avoid impeachment in the Illinois legislature for his conduct. He wanted to do it to have access to greater financial resources, if he were indicted. He wanted to do it to see if he could help his wife work as a lobbyist. He wanted to do it to remake his image to run for office in 2016. And he wanted to do it to see if he could generate speaking fees.

At the end of the day, the conduct we have before us is appalling.

But wait…there’s more. Lots more, unfortunately.