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In some recent conversations, a question emerged as to the impact in our secular, desire-driven cultures of today of the demands on character being made by fears and restrictions coming upon us as a result of the jump from animals to humans of the coronavirus. Has our culture empowered us as individuals to have inner resilience under these conditions? Or are many of us too prone to passive self-absorption, resentful dependency, ennui or even anomie in response to our social isolation and the stress of coping with disappointments and dissatisfactions?

I happen to be going through old files as we prepare to move our office to find a list of good mental frameworks for making the most of times such as this and of life in general, even in good times. The list is ascribed to the Dalai Lama, but I can’t confirm that.

In any case, I wanted to share his Instructions for Life with you.

An implication of the ethics of sustainability and concern for stakeholders is to question the reasonableness of having too much debt or fiat currency in the marketplace. The old wisdom of Benjamin Franklin was that “A penny saved is a penny earned.” The ethics of saving and building personal equity – the way to wealth, Franklin said – were once unquestioned in my family and many others.

But when negative interests place the value of money at below zero, who can benefit from saving? Furthermore, cheap money is a market incentive to borrow and incur debt, reducing the safety net provided by equity for companies, families and individuals. Very cheap money expands the scope of moral hazard, does it not?

Please also note this chart, also of some years ago:

There was a story in yesterday’s Wall Street Journal that major American retail companies are struggling to survive under current circumstances due to heavy debt obligations. Boeing was chastised for eating into its cash reserves and leaving itself very vulnerable when losses from the 737 Max 8 debacle arrived.

Equity provides a buffer against fate to protect what has long-term value. Debt is not such a helpful asset; it is accounted for as a liability.

Is very cheap money really in the best interests of all? Over the past 12 years, the provision of liquidity and quantitative easing have gone hand and hand with rising nominal prices for financial instruments. Qui bono? This increase in liquidity and rising market prices have also gone hand in hand with the increasing share of wealth held by the top 1% and 10% of all of us.

If the purpose of capitalism is to provide for the well-being of humanity, might we ask what is the well-being calculus which so favors debt over equity and savings?

The concept of equity in financial accounts derives, I believe, from the commitment to equity in the old courts of England. Equity was added to the law by courts to recognize the moral claim of a person to fairness under the law. In protecting a person’s equitable interests, the courts were protecting not only his or her moral dignity, but also his or her material empowerment.

Fairness in economic arrangements should not overly favor debt and so undermine the advantages provided by equity.

Our affiliate, the Convention of Independent Financial Advisors, has just released this statement calling into question public policies which seem risky and hostile to sound ethical principles.

I recommend it to your consideration.

The global affliction caused by the coronavirus is, as some would say, of Biblical proportions. Does something so natural, but so consequential carry any moral meaning for us?

That question directed me back to the Book of Job, one of the wisdom books of the Judeo-Christian Old Testament.

The story of Job and his God was, to me, always somehow out of sync with the rest of that scripture, but, even so, it gave one grounds to ponder.

With the help of some friends, I have reflected some on how to benefit intellectually and perhaps spiritually from this old text. My own take on the story – and how it ends – can be found here.

I welcome your thoughts on this small essay.

John Buettner, an engineer now retired from the Donaldson Company here in Minnesota (but not from the esprit d’corps of the Marines), had a thoughtful response to the policy recommendations of Professor Togo, previously posted here.

John’s response can be found here:

Dear Steve:

I thought Professor Togo’s rather short article was exceptional. Japan is the land of judo and having been into judo in my younger years, it’s about balance and using your adversary’s weight in your favor. I see this possibility in the coronavirus pandemic. Professor Togo writes, “COVID-19 may be opening up a critically important opportunity.” This opportunity might very well take hold. It is in everyone’s interest to have policies that are simultaneously best for the home country and the rest of the world. This is revolutionary. It’s a far cry from the win/lose strategy of doing what’s best for oneself at the expense of others. A change will come, but what will change?

Capitalism will change. The current model of laissez-faire capitalism doesn’t work well, at least in terms of a pandemic. While many businesses are moral, all are self-serving to varying degrees. Worrying about the status of one’s competition is seldom, if ever, an issue. Worrying about the status of “non-customers” is also not an issue. These concepts will have to change. Rewards systems inside a company will have to change. Individuals who cannot buy one’s products or services are indeed important to the well-being of a company. That’s new. Just ask any firm whose value has been decimated and whose markets are, at best, suspended for a while and might never recover.

Health care will change. The health care system in the U.S. is particularly worth looking at. In a country with the highest worldwide GDP and with the highest worldwide percentage of GDP in health care, health care during this pandemic is abysmal. This should not be surprising. Health care focuses on expensive and unique treatments of predictable sicknesses and health care problems. The U.S. generally does this quite well. However, it gives only lip service to prevention. The result is that “the world’s best health care in the world” is not working. To address unpredictable and intermittent health care problems such as the coronavirus doesn’t make business sense if prevention is ignored. While there certainly is some work done in the area of prevention, research in this area is dwarfed when compared with research on treatment of existing health problems. Focusing on expensive drugs, treatments and specialists is more about money and power than it is about health care. We need a prevention-focused model. The coronavirus pandemic has clearly demanded it. In addition, the rich and powerful countries of the world had better be watchful and helpful to the large segments of the world population who have little, especially in health care.

By the way, the “prevention” focused model has been in manufacturing for many, many decades. It has yet to genuinely take hold in health care. Having spent most of my profession in process development in manufacturing, absolutely no one could compete if their primary focus was not in prevention. Health care is a very complex system. Pandemics are even more perplexing because they are intermittent, largely unpredictable and don’t believe in borders. They also come and go with a vengeance, well outside of the timing abilities of for-profit pharmaceutical companies. The current model of health care doesn’t work and will have to change.

Attitudes towards other countries and other peoples will change. Does MAGA (Making America Great Again) make sense when most of our manufacturing is offshore and the health care systems of many other countries are notably better? If we are not willing to help others, others will not help us. Attitudes toward money, the stock market and our leaders will also have to change. While we tend to think that paying a lot gets a lot, our health care system says otherwise. Similarly, the quality of our senior leadership says otherwise. Money doesn’t necessarily buy quality. The stock market, once touted as a very stable place to fund start-up companies, is little more than a roulette table. The gig is up. Our financial leaders have made it very emotionally driven and self-serving. Everyone knows this in spades and we can thank the coronavirus pandemic for that. Leadership will no longer be about being glib, well connected and pedigreed. It will move towards being competent, honorable and doing what is right.

Sam Cooke said it best, “It’s been a long time coming, but I know a change is gonna come.” The fact that an inanimate virus is the impetus behind it, rather than our intellect and compassion, is somewhat disconcerting, but a change is going to come.

Semper Fi,

John

As a boy, I contracted the polio virus and was hospitalized. I was lucky the infection did not lead to paralysis and so I was not put in an iron lung, as were two other children in my hospital ward.

Thus, when I read the short essay below written by my colleague Richard Broderick on his friend who had polio about the same time I did, I thought Rich’s words captured an important reality, which I want to share with you:

End Times at Play

by Richard Broderick

His name was, ironically enough, Jimmy Walker – ironic in that at an early age he’d been inflicted with polio during one of the waves of contagion that spread across the country – and world – from time to time.

Polio’s most famous American victim was FDR, but Jimmy was the polio survivor I knew best. He lived a few doors down from my house on Rainbow Trail. And while he had not suffered a case of the disease severe enough to doom him to life in an iron lung, his right leg was withered from the knee on down and he was hobbled with a limp that was impossible to overlook. It’s an ill-wind, of course, that blows no good and with Jimmy, that good was the tremendous upper body strength he’d acquired from years of walking on crutches and canes. By the time we got to know each other, the crutches and canes had disappeared, but his formidable musculature remained.

He and I played on the same baseball team in the Hub Lakes League and it was always remarkable to watch this limping 12-year old drive a ball 400 feet into the woods beyond left center field, then trot awkwardly around the bases as members of the opposing team scrambled through the trees in search of the ball. They rarely found it and the one time they did retrieve it in time to relay the ball to home plate, Jimmy simply charged through the catcher causing him to drop the ball and earn Jimmy another round-tripper.

Though friends, he and I still enjoyed bouts of pre-teen male rivalry. When off the field, we’d spend hours sitting on the bed in his room arguing about such profound topics as which was better, the American League or the National League. Living 35 miles outside of New York City, we both were avid fans, he of the Brooklyn Dodgers, I of the New York Yankees, where the die-casting company that employed my father had season tickets just behind the first base dugout. This, during the Golden Years of the Yankees, when Maris, Mantle, Elton Howard and Yogi Berra stepped to the plate and Whitey Ford and reliever Juan Gonzales took the mound.

But Yankee prowess was not the crux of my argument on behalf of the American League. In one of the most clever, yet absurd rejoinders imaginable in answer to Jimmy’s passionate fandom, I would remark, with shrewd bravura, “Yeah, well at least we know what country the American Leagues is from. The National League could be from anywhere.”

Game and match to Mr. Broderick!

It’s been a lifetime since Jonas Salk created a vaccine against polio, but those days feel eerily similar to the COVID-19 pandemic sweeping the world today. I remember one truly lamentable occasion when my family happened to be on vacation in Quebec City and a sudden polio outbreak led officials to ban swimming in public pools. Today, owing to COVID-19, I would not even be able to cross the Canadian border, let alone dip a toe in one of the country’s public pools, but the apocalyptic feeling was very similar, magnified by the equally terrifying prospect of the nuclear war we were guaranteed would wipe out half the American population – about the same mortality rate as the Black Death – and schools like mine held weekly air raid drills in which we students had to crouch beneath our desks as the nuns (members of the aptly named Sisters of the Sorrowful Mother) lovingly described how when the shock wave that shattered the wall of windows, we would all be slivered into bite-sized pieces before being burned to a crisp by the ensuing waves of intense heat. It was many years before I stopped waking in the middle of the night at the sound of a fire siren, my heart pounding, my breath caught in my throat.

The lessons we should have learned then are the same as the lessons we should apply today. Don’t panic. Take reasonable precautions. Remember – as in 1918 and then in subsequent epidemics of polio – we are, for better or worse depending upon how we conduct ourselves, all in this together, including not just political and business leaders, but also those rare individuals like Jimmy Walker, who turned what seemed like a curse into a costly, though lifelong advantage.

Our Japanese colleague, Professor and former Ambassador Kazuhiko Togo, has written me with his thoughts from an East Asian perspective on implications of the coronavirus pandemic for international, state-to-state relations.

Professor Togo has convened several workshops in Japan on ethical principles from China and Japan which could contribute constructively to a shared global understanding of moral obligations. From Japan, he is suggesting use of yawaragi or seeking harmony through moderation and mediation of different interests for mutual collaboration. Professor Togo has just co-authored a book in Japanese on res-assessing conventional norms for evaluation of public policies.

I would be very interested in your thoughts and feedback.

As we in the U.S. end the second week of a national emergency due to the imperative of stopping the spread of COVID-19, the virus seems to have been checked in China, but here, we now have more cases than occurred in China, a nation with roughly four times our population and, globally, all of us now confront the emergence of the virus in poor countries without funds and facilities to respond in depth to the spread of the infection.

A time of difficulty and crisis brings on uncertainty, fear and missteps in our lives. Having to carry within us such psycho-social burdens can tempt us to sink, to lose hope and self-confidence. And we can let those burdens complicate our relationships with family, friends and co-workers. Or …

Or, as it is too easily said, we can rise above our personal anxieties and our concerns for the economy, politics or when stock markets will recover or our gainful employment will return. Crisis is an opportunity for becoming better as people – to make a good difference and find redemptive value in our being here.

Our colleague John Dalla Costa, now retired in Italy, has written a very sound and helpful comment on our time of troubles which you can read below.

John has written some of the best books I have read on ethics and business. He lived in Canada until he and his wife moved to Italy.

I think you will take heart in reading his reflections.

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SEEING ANEW IN 2020
John Dalla Costa
Founding Director – The Centre for Ethical Orientation
Sansepolcro (AR) Italy

That Was Then:

Three months ago – when few had heard of COVID-19 – many of us were attempting to assign significance to the past decade as the new one approached. While the economy had prospered for some and markets were buoyant, the ten or so years then ending were in many ways still unravelling the harsh costs of the 2007-2008 financial crisis. Inequality became much more pronounced. Work became much more precarious. And social institutions – including the church, election procedures and the Boy Scouts – lost incalculable amounts of social capital via scandal.

If the metrics used by economists showed a decade of growth, the actual social prosperity was paper-thin. Indeed, the fissures papered-over by the market figures were already producing destabilizing populism and protectionism in our biggest and wealthiest democracies. In 1988, the German philosopher and social theorist Jürgen Habermas observed that the “rationality crisis” produced by an economic meltdown invariably leads to a “legitimation crisis” for the public. In other words, when markets fail, suspicion boomerangs, undermining public confidence in its larger political and social institutions.

This suspicion becomes that much more toxic – as happened – when the recovery privileges the status quo; when those in positions of responsibility are exempted from accountability, leaving those largely powerless and most impacted by the crisis to fend for themselves. For several decades, we have watched public trust erode, always favouring the expedient over the necessary, seeking gratification and growth regardless of costs. That neglect of the public trust to satisfy self-interest has made our social immune system that much more fragile.

The global pandemic is now imposing its harsh measures on a world that mistrusts basic facts and that has lost faith in its experts, moral leaders and public institutions. Governments and policy makers had embraced globalization as a competitive necessity, but, as we’ve seen with the numerous failures to make good on climate change initiatives, there has been little to no investment in capacities for cooperation. Having created global structures for extracting personal advantage, we are now in the existentially disadvantaged position of having to deal with a viral threat which none of us can diffuse alone.

The View from Here and Now:

When the year began, (my wife) Lucinda and I told friends, with whom we were exchanging new years greetings, that our hope and prayer would be for us all to realize clear vision. The metaphor of 2020 from optometry has both practical and spiritual dimensions for us. Orthodox icons and Renaissance paintings of Jesus often depicted his eyes with a slightly different cast, intending to signify an ability to see both the temporal and the eternal. Most religions and all our traditions of wisdom teach this dynamic-seeing – looking at both the short-term and the long-term; recognizing what is needed to thrive practically, while recognizing what is needed to fuel the dreams, hopes and higher aspirations that are core to our being human.

In only a few weeks, 2020 has brought into focus many things that we preferred not to see or were too busy to glimpse. One is that we cannot escape our creaturely vulnerability. Another is that we are intimately interconnected. There are no walls or laws that can prevent us from breathing the same air or drinking the same water. For the sake of efficiency, we have created just-in-time supply chains and for the sake of cost-cutting, we have built just-in-time health systems, both of which have no capacity for the emergency we now face. And while our economy is now dammed by fear, the institutions we once relied on for solutions remain divisive or marginalized – therefore without credibility.

In only a few weeks, 2020 has also clarified many of the qualities we will need to go forward together. Rather than according preferential option to shareholder value, we must learn – as leaders, executives, managers and teachers – to develop and nurture the capacities to share. As researchers have long shown, trust is never simply an outcome from consistency or competence. It also requires demonstration of care – proof of character, which means being willing to sacrifice one’s self for the sake of principle.

Fear is understandable, but what few leaders understand is that the only effective antidote to such fear is generosity. On the day that President Trump unilaterally closed the U.S. borders to travelers from the E.U., a cargo plane from China landed in Torino, Italy with 2,300 cartons of much needed surgical masks. People here in Italy still remember the Marshall Plan and many could not but note that on the day in which the country that taught nations to hope turned inwards, an ancient trading partner gave proof and substance to its commitment to a new silk road. All to say that decisions we make in the heat of this emergency will undoubtably have consequences for decades.

In Italy, we are now entering our third week of ever-more restrictive quarantine. Most of us had been observing self-isolation – or cancellations of work and other activities – for several weeks before that. The crisis has by no means peaked, let alone passed. So, in addition to their understandable worries, people are also experiencing the paradox of growing fatigue with growing grief. An already fragile and uncertain reality is becoming more indeterminate and precarious.

Remembering. What’s Needed and What’s Possible:

In all that’s happened, there are also everyday signs of resilience. Because Italian society still has memory of the war, there is a sense that what comes next will not be so much recovery as rebuilding. The post-World War II social compact has long expired. Globalization here has taken its toll on the middle and working classes. With the devastation now unfolding, there is a sense that business-as-usual and politics-as-usual are not up to the historic task ahead.

The government has already committed to a vast rebuild of the healthcare system. Here, as elsewhere, there is growing discussion regarding universal basic income, aid for small businesses and commitments to cultural institutions. Being so exposed and vulnerable, people are heeding these words with both skepticism and a recall of long-held values. The sense I get is of a growing desire, if not impatience for the radical change to develop what is possible together.

Now into 2020, it is important to remember that in two years, this country will mark one hundred years since Mussolini came to power. Fascism was created in Italy to sweep aside the political and economic powers, which had left the country in taters after the great sacrifices of World War I and after the tragic trauma of the Spanish Flu. Our challenge now – here and elsewhere – is to not allow fear to so fester as to create the conditions for tyranny.

From history and from this moment, we can discern several lessons.

First, before changing our policies, we need to change our imaginations. In his newly issued teaching-document on the social, environmental and justice issues facing the nations of the Amazon, Pope Francis introduced a methodology based on four dreams. Rather than analyze and recommend, he first sought to dare thinking in terms of what is most liberating, dignifying and unifying for people and their children. What is our dream?

Secondly, we are witnessing the now threatening gap between our expertise for globalized commerce and our ethics for global responsibility. The coronavirus is a litmus test for our ability to cooperate everywhere on everything, so as to build the shared structures for dealing effectively with shared problems. What are the values we hold or need for what is happening and what is next?

Thirdly, for all of us, but especially for our leaders, the qualities that will earn trust – and that history will judge – require modelling the highest forms of generosity and self-sacrifice. The question to ask is not “what did you do?” but rather, “how did you change?”

Finally, this is a moment when we can demand that our technologies and social media mature into a force for good. Corporations, as well as individuals, need to shed adolescent likes and avoid simplistic blaming. Our time and attention are precious and so need to focus on learning how to collaborate and dialogue. Being so vulnerable together beckons each of us to conjure and respect the solidarity that we will need to rebuild our lives. What ideas or habits do we need to give-up to make space for real transformation?

Ready-made answers are not going to work for the hard questions we’ve not yet asked. For now, most of us need to adjust to doing nothing. The gift in this imposed pause is that we can – if we choose to do it – reflect in depth about the new world that is now in our hands to imagine and create.

(The text in visual above reads: “While all the EU states are retaining surgical masks for themselves as Italy runs out, China has sent to Torino an Air China flight with 2,300 boxes of masks. [On each box] is written” We are waves on the same sea, leaves on the same tree, flowers in the same garden.”

Below the Chinese text in red on each box, the Italian message reads: “We are with you. Forza Italia! (which is the slogan fans use to cheer the national soccer team).

I was sorting through office files two days ago and found a copy of the paper by Mr. Ryuzaburo Kaku, former CEO of Canon Inc., on his ethical concept of kyosei. Kyosei was applied in the creation of our Principles for Business, along with the concepts of human dignity from Catholic Social Teachings and stewardship from the Protestant tradition.

Literally, Kyosei translates into English as “symbiosis,” how living organisms can find well-being through dependency on others – a living together. Kaku-san took this biological concept and applied it to companies as living organisms in social and economic ecosystems. He pointed out that companies are dependent on their stakeholders – customers for cash and employees for products and services – and reciprocally, such stakeholders have a “stake” in the success of the company.

Kyosei, thus, becomes an ethic for living well – we prosper in relationships where we contribute to the good of others and they contribute to our good.

While our current circumstances of self-quarantining, social-distancing, restrictions on travel and lockdowns of cities are isolating us as never before, this is also a moment to apply the ethic of Kyosei.

It is a time to recognize and be grateful for our dependence on others, either right now or by recalling our circumstances before the emergency when it was easier to overlook those who contributed to our success and happiness.

It is also a time to look out for others and be of help and good cheer to them.

Kaku-san’s paper can be read here.