Clemens v. McNamee: Who’s Lying?
In 60 years of watching television, I never saw anything like it.
At one end of the witness table facing the House Committee on Oversight and Government Reform sat perhaps the greatest pitcher in baseball history, Roger Clemens, winner of seven Cy Young Awards. With short haircut and dressed in a conservative blue suit and rust-colored tie, Clemens was articulate, forceful, and sounding wounded and angry.
At the other end of the table was sports trainer Brian McNamee: thin, with small eyeglasses, small mouth and projecting thin chin. He answered the questions from Congress in a monotone.
It was a contentious, nasty hearing. At one point, Clemens’ two lawyers leapt to their feet and started shouting down the congressmen. From the testimony:
McNamee: And make no mistake: when I told Senator George Mitchell that I injected Roger Clemens with performance enhancing drugs, I told the truth. I told the truth about steroids and human growth hormone. I injected those drugs into the body of Roger Clemens.
Clemens: McNamee was good at what he did—helping me exercise, diet and stay in shape. We shared an interest in grueling, military-style workouts, but I never asked him, nor did he ever give me, steroids or human growth hormone.
Clearly somebody was flat-out lying under oath.
I suddenly remembered a column I wrote last October about a machine that could recognize voice stress and detect when someone was lying with 94.7% accuracy—the Dektor PSE® 5128 Psychological Stress Evaluator. It could pick up lies over television, radio and the telephone, as well as when the person was in the room.
A client of mine had wanted to use this machine as the focal point of a newsletter, The Truth, to tell subscribers whether public officials were lying or telling the truth. How I wish I had this machine aimed at the TV during the Clemens v. McNamee v. Congress melee. I said in my original column that I was sure there was a business there. Now I am surer than ever!
Business Common Sense: “The Pinocchio Toy”
Transcript of the Clemens-McNamee Congressional Committee Hearing
The Dektor PSE® 5128 Psychological Stress Evaluator:
Key Takeaway point from the original story: Pre-Internet business models may be worth resurrecting and testing using the Web instead of print.
Closing the Loop on 2007
This e-zine focuses on people, corporations and countries whose actions have implications for all of us in business and life. I tell people that what I do is connect dots.
During the last three weeks, a blizzard of new information has come out that updates several of the most important stories:
Subprime Mortgage Mess
One of the sidebar stories from the Subprime mortgage debacle is the possibility that municipal bond insurers could collapse.
Business Common Sense: “The Secrets of Successful Investing”
This month, financier Warren Buffett offered an $80 billion rescue package, putting up $5 billion of his own. However, Buffett announced he would relieve these niche insurers only of their obligation to safeguard municipal bonds—which never default—thus leaving MBIA, Ambac and Financial Guaranty Insurance Co. to twist in the wind with a trillion-dollar sword of Damocles of high-risk loans hanging over their heads. Warren Buffett is one canny dude, which is why he is so rich.
“Warren the Munificent”: http://online.wsj.com/article/SB120294829488866761.html
Key Takeaway Point from the original story: “Never invest in any idea you can’t illustrate with a crayon.” —Peter Lynch
Our Journey by Rail
In October, my wife, Peggy, and I took the overnight train from Washington, D.C., to Chicago for the DMA Conference, and I waxed ecstatic over the joys of rail travel, its efficiency as a mode of transportation and the sad state of America’s railroads.
Business Common Sense: “17 Hours in the Real America”
Happy news! A page-one story in The Wall Street Journal detailed how $10 billion has been spent since 2002 to expand tracks, build freight yards and buy locomotives, with another $12 billion in upgrades planned. —“New Era Dawns for Rail Building”: http://online.wsj.com/article/SB120179835382432337.html
Key Takeaway Point from the original story: Why not reconnect with your country, and its people—the real America? Take an overnight train. You might even reconnect with yourself.
Big Pharma’s Many Phrauds
Last March we looked in on Big Pharma and listed the gazillions of dollars paid out in fines, lawsuits and the creation of reserve funds by the likes of Bristol-Myers Squibb ($839 million), GlaxoSmithKline ($150 million), Hoescht ($80 million), Eli Lilly and co. ($1.2 billion), Pfizer ($430 million) and Wyeth ($20 billion). Meanwhile winding their way through the courts are 1,400 lawsuits from Vioxx users, because the company withheld information about the possible “increased risk of cardiovascular events (including heart attack and stroke)” from the arthritis drug.
Business Common Sense: “The PR Disasters of Big Pharma”
To follow up, Merck & Co. is set to pay another $650 million to settle lawsuits for pricing fraud. –The Wall Street Journal, February 8, 2008: http://online.wsj.com/article/SB120239872627350891.html
On a widely disseminated TV commercial, artificial heart inventor Dr. Robert Jarvik proclaims: “When diet and exercise aren’t enough, adding Lipitor significantly lowers cholesterol.” It turns out that in the scene where Jarvik is seen rowing for exercise, it ain’t Jarvik. The ad agency hired a stunt man. Is this not fraud? —The New York Times, February 7, 2008: http://tinyurl.com/26btud
On February 14 came a report that Baxter International was importing an ingredient from a Chinese chemical company for its blood-thinning drug heparin that may have resulted in 350 allergic reactions including four deaths. —The Wall Street Journal, February 14, 2008: http://online.wsj.com/article/SB120293808086766253.html
One in every 10 patients admitted to six Massachusetts community hospitals suffered serious and avoidable medication mistakes. —The Boston Globe, February 14, 2008: http://tinyurl.com/33g86n
Last Sunday, “60 Minutes” ran a horrific report about Bayer’s Trasylol, used in operating rooms to control bleeding. The company suppressed reports for two years that the drug caused renal failure and continued to market it aggressively, causing an estimated 22,000 additional deaths over that two-year period. – “60 Minutes,” February 17, 2008: http://tinyurl.com/29ehe3
Key Takeaway Point from the Original Story: As we know from recent scandals in federal government going back to Watergate, it’s not the original misdeed that gets people into big trouble; it’s the cover-up.
The Continuing Chinese PR Morass
Two stories will dominate international news over the next decade and beyond: the militant Islamic crusade and China—a country on which the U.S. is as dependent as an addict is on meth.
Over the course of 2007, four issues of Business Common Sense were devoted to the massive problem child that is China, its turbocharged economy and its utter inability to generate positive PR:
Business Common Sense: “Is It Time to Stop Doing Business with China?”
Key Takeaway Point from the original story: If you outsource manufacturing to a Chinese company, expect your product to show up all over the world under different names and far cheaper than you can sell it.
Business Common Sense: “The Worst PR Debacle in History”
Key Takeaway Point from the original story: It’s imperative that every business has a plan for PR crisis management: a team ready to assemble on a moment’s notice with lines of predetermined responsibilities, one person in charge, and one calming, reasoned voice that speaks for the company.
Business Common Sense: “Mattel Competes With China for the World’s Worst PR”
Key Takeaway Point from the original story: “When in doubt, do the obvious.” —Franklin Watts, children’s book publisher
Business Common Sense: “Unintended Damage in Business and Geopolitics”
Key Takeaway Point in the original story: Test everything. When it is impossible to test, it is imperative to go through two exercises before making a decision: (1) Study everything available on the subject and reach back in memory (and your files) to draw on experience and common sense. (2) Play “What if?” Think through every possible scenario that can result from the decisions you are about to make, and look everywhere for the possibility of unintended damage.
In the last three weeks, the media has been awash in stories about China—virtually all negative.
China seems powerless to put a positive spin on anything. As the Beijing Olympics approach, the media spotlight will shine brighter on China and stories will proliferate.
Business people should follow coverage of China and watch firsthand the utter failure of PR and reputation management.
The challenge: put yourself in the shoes of the Chinese authorities and figure out how to convert PR disasters into opportunities. Or is putting lipstick on the pig the best anyone could do?
For example, check out the stories below—including Stephen Spielberg’s resignation as Olympic artistic director (Feb. 12), Beijing’s ham-handed response (Feb. 14) and how the Chinese media (with Beijing’s blessing) piled on to humiliate Spielberg (Feb. 18). How would you have responded?
* Three firms indicted over Chinese poison pet food exports. –The Wall Street Journal, February 7, 2008: http://online.wsj.com/article/SB120233065073748531.html
* Disposable chopsticks destroying Chinese forests. —The Wall Street Journal Online, February 8, 2008: http://online.wsj.com/article/SB120243065514952215.html
* Chinese chicken and meats are so full of steroids and illegal veterinary drugs that the U.S. Olympic Committee will ship 25,000 pounds of lean protein to the Olympic training center to feed the 600 American athletes. —The New York Times, February 9, 2008: http://tinyurl.com/25zfa9
* The British Olympic Committee has been forced by China to require that its athletes sign a contract promising not to speak out about China’s human rights record, or face banishment from the Beijing Games. – The Times (UK), February 10, 2008: http://tinyurl.com/yu3epz
* China, long an exporter of coal, is using so much coal that it’s now importing it, driving the price up worldwide. —The Wall Street Journal, February 12, 2008: http://online.wsj.com/article/SB120275985736359763.html
* Stephen Spielberg resigns as Olympic artistic advisor to protest China’s involvement in the Darfur crisis that has left 200,000 dead and 2.3 million homeless. —The New York Times, February 13, 2008: http://tinyurl.com/2x2ug9
* China Olympic Organizers respond to Spielberg. —Associated Press, February 14, 2008: http://tinyurl.com/2rk9cl
* Panama released a report detailing 115 deaths and 59 illnesses from counterfeit cold medicine exported by an unlicensed Chinese chemical plant. –The New York Times, February 14, 2008: http://tinyurl.com/2h3juk
* Beijing will close 153 gas stations and oil depots in an attempt to improve air quality for the 2008 Olympic games. –Associated Press, February 15, 2008: http://tinyurl.com/2gxfk6
* China’s trade surplus is up 22.7% in January compared to 1 year ago. —The Philadelphia Inquirer, February 15, 2008: http://www.philly.com/philly/business/15696732.html
* China mounts an assault on dissidents before games, including the house arrest of a 2-month-old baby girl whose parents are accused of “inciting subversion of state power.” –Telegraph.co.uk, February 16, 2008: http://tinyurl.com/2habqp
* Chinese media piles on and mocks Spielberg. –AFP, February 18, 2008: http://tinyurl.com/2ps2ld