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transparency and the public interest: the sec, citigroup, and judge rakoff November 28, 2011

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Refusing to approve the SEC’s and Citigroup’s settlement of proceedings Judge Rakoff affirms the court’s right to determine whether a n injunction is in the public interest and rejects the idea that the SEC is the sole determiner of the public interest in the context of consent judgments. He goes further:

when a public agency asks a court to become its partner in enforcement by imposing wide-ranging injunctive remedies on a defendant, enforced by the formidable judicial power of contempt, the court, and the public, need some knowledge of what the underlying facts are: for otherwise, the court becomes a mere handmaiden to a settlement privately negotiated on the basis of unknown facts, while the public is deprived of ever knowing the truth in a matter of obvious public importance….Finally, in any case like this that touches on the transparency of financial markets whose gyrations have so depressed our economy and debilitated our lives, there is an overriding public interest in knowing the truth. In much of the world, propaganda reigns, and truth is confined to secretive, fearful whispers. Even in our nation, apologists for suppressing or obscuring the truth may always be found. But the S.E.C., of all agencies, has a duty, inherent in its statutory mission, to see that the truth emerges; and if fails to do so, this Court must not, in the name of deference or convenience, grant judicial enforcement to the agency’s contrivances.

mixed up world January 22, 2011

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In the UK, a driver who (truthfully) flashes their lights to warn other drivers of a speed trap can be found guilty of wilful obstruction of a police officer in the course of her duties. But the police seem to think it is OK for police officers to pretend to be demonstrators, and for their superiors to lie about this after the event. It is OK for undercover policemen to have affairs with the people they are investigating, but not OK for a policeman to have an affair with the wife of a politician he is charged to protect.

a need for public truth-telling August 14, 2009

Posted by Bradley in : lies , comments closed

This week I am very troubled by the willingness of public figures to mislead the public about facts (I suppose I should be used to this by now, but I’m not). The debate about health care here in the US isn’t focusing on how to achieve the best care for most people at the lowest cost, but on telling lies about what the government’s proposals involve. It’s bad enough when journalists tell lies (for example the IBD editorial which argued that Stephen Hawking wouldn’t be alive today if he had had to rely on the UK’s NHS). Although given that journalists claim to be subject to ethical standards, perhaps it is that bad.

The IBD’s follow-up to that story provides selected information suggesting that the UK health system is worse than that in the US, referring to OECD data. But the story doesn’t say that, although the US spends more than the UK on healthcare, life expectancy in the US is 78.1 years, almost one year below the OECD average of 79.0 years, whereas in the UK life expectancy was just above the OECD average. In the US, infant mortality was at 6.7 deaths per 1 000 live births in 2006 (higher than the OECD average) whereas the UK was at 4.8 deaths per 1 000 live births in 2007.

But it’s not just about health care, and it’s not just in the US. The UK Food Standards Agency’s statements about the conclusions of a review of organic foods (that “there is little, if any, nutritional difference between organic and conventionally produced food”) seem to be another example. And discussions of the financial crisis also involve manipulations of the facts. For example, Sheila Bair is reported as saying that “the ability to choose between federal and state regulatory regimes played no significant role in the current crisis. But the OCC’s efforts to pre-empt state control of predatory lending was surely a factor in the generation of unsustainable mortgage loans which were used to back securities which turned out to be less reliable than their ratings would have predicted, undermining confidence in asset-backed securities generally and banks’ willingness to lend to other banks.

Of all of these manipulations, those which involve government agencies seem to me to be the most troubling.