Policing in the United Arab Emirates

Comparisons with the United States

I had the opportunity to visit Sharjah Police Research Centre recently on my February visit to the Dubai in the United Arab Emirates (UAE). My purpose was to better understand policing in a predominantly Muslim country but one that is diverse in ethnicity and religion in its population. How different is policing or similar is policing?

A Brief History
Sharjah sits between the better known Emirates of Dubai and Abu Dhabi. It has the 3rd largest city in the Emirates. The Emirates are a loose confederation of seven states each governed by a sheik. The Emirates are positioned to take advantage of trade sitting at the mouth of the Persian Gulf running into the Gulf of Oman and then to the Arabian Sea. Up until 1968 the Emirates were sleepy little places where pearl diving was a major source of income as well as a little trade. In 1968 oil was found. In 1971 the Emirates won their independence from Britain and instituted their own constitution. Dubai was already transforming itself as a major mid-east hub for tax free trade, tourism, and most recently for healthcare while Abu Dhabi, the Emirate with the most oil, was becoming the hub for the oil industry. Sharjah sits in between these two major hubs.

Today, the country is a very wealthy, highly urbanized country from Dubai to Sharjah to Abu Dhabi. Women work and drive and wear western to traditional clothes. Male Emirate citizens often wear the traditional dress, a white flowing robe called a dishdashah. Alcohol is served at restaurants. Beaches are filled with those wearing western style bathing suits. And the country has a typical American problem: too many cars. While I was there Dubai was testing out an automated monorail system to alleviate traffic.

Law
The Emirates are monarchies governed by codified criminal and civil law. According to Shane Sayers and Kennedy, a British law firm, the codes draw from Egyptian and European law. If there is no relevant law, the judge relies upon Islamic law particularly the Mejelleh, a 19th century codification of Islamic law. Civil courts were created in Sharjah in 1971 to handle commercial, labor disputes, and some criminal matters. The remainder of cases are handled through a federal system that includes a supreme court.

Unlike the US system, there are no jury trials. There is a practical reason for it. Only about 20 to 25% of the population are actually citizens of the Emirates. Court decisions by judges is not unlike some European countries such as Italy in which judges handle more of the work of the courts from investigation of criminal matters to rulings.

Law Enforcement
Research on community policing including my own research has shown that the public perceives one of the major problems, if not the major problem for law enforcement, to be speeding. Citizens want speeding controlled, although perhaps not their own speeding. For law enforcement in Sharjah and the Emirates as a whole, traffic related problems are also a major problem. Law enforcement has a particularly difficult time because residents come from so many different countries with different degrees of enforcement and the extended family of the sheiks are often given special treatment. Since this is Ramadan, they also face citizens who may be fatigued from fasting and officers may be fatigued as well. Muslims do not eat or drink between sun up and sun down when until they “break fast.” Officers may choose to break the fast while they work just as officers take meals in this country or if they have family obligations, they may switch a shift with another officer.

At the other end of the spectrum are more complicated problems that require the use of technology and more sophisticated policing techniques and strategies. Because most of the working population are “expats” as legal residents are called, immigration problems are a constant issue. Many construction and related workers come to UAE by paying a company to secure a job. Upon arrival, the worker may find his or her passport stolen, underpaid for work, or without work. Without a job a worker cannot stay in the country beyond six months, but without money, the worker cannot return home. Law enforcement must try prevent and deal with the perpetrators of the scams as well as the resulting illegal aliens. Further, because UAE is a wealthy country, law enforcement must deal with financial scams, banking fraud, and drug trafficking. At the federal level this means upgrading computer technology to work with other countries.

Planning
In the UAE, planning for excellence is an important part of society. The Sheik of Dubai, for example, invites companies to develop a university or a hospital after having identified those excellent companies or organizations. Planning often involves clustering similar businesses or services. (Whether this is a wise idea to cluster all similar services depends upon your point of view. I went through an area in Dubai that was all auto repair functions and an another area that was all health care functions.) Many emirate universities are clustered in one location creating a different relationship from the typical town-gown relationship in the United States. Both the Sheik of Dubai, His Highness Sheikh Maktoum Bin Rashid Al Maktoum and the Sheik of Sharjah, His Highness Dr. Sultan bin Mohammed Al Qassimi mandated clusters to promote higher education partnering with excellent universities in Europe and the United States.

Law Enforcement and Universities
In the case of Sharjah, this education cluster includes the newly built police academy and research centre and a teaching hospital. The Sharjah Police Academy and Research Centre are newly built. The four year academy to train law enforcement, both women and men, is more similar to a college and sits in the same area as other universities. (Unfortunately, housing for students is not available on the campus.) The Academy recruits students who speak a variety of languages, but they must speak either Arabic or English as well. Instruction is in Arabic, but students who speak only English receive a translator.

According to Dr. Mamdouh A. Abdelmottlep, my host, a professor of criminal justice, and senior researcher at the Research Centre, students receive training in the law, forensics, national security, leadership, protection for the safety of the community, traffic enforcement, and search, fire and rescue techniques. Although students learn about community policing concepts, the trend since 2001 has been to place more and more focus on security issues. This is also, in part, due to the fact that most Arabic countries including the UAE do not have the different levels of policing as in the United States. For some Arabic countries informal policing of communities may be established by a village elder. For the Emirate of Sharjah, the Sharjah police is the primary police presence.

Community policing may take the form of a special project in the community that may or may not have police involvement. When there is a security problem, police do try to get to know the community, particularly important since they must build trust with people from many, many countries. “Expats” may be from India (and may be Hindu, Muslim or of other religions), Bangladesh, Iran, Kenya, Malaysia, Oman, Pakistan, Philippines (predominantly Christian), Yemen, and many European countries.

The reduced emphasis on community policing is unlike Maine and Vermont’s academies (and possibly all) that continue to focus of community policing. But even in New England, the curriculum is beginning to change to reflect the new emphasis of all levels of law enforcement on security. Connecticut, for example, has added a section on terrorism and suicide bombers and immigration law.

The Police Research Centre researches current issues and publishes a regular academic refereed journal relevant to the students at the police academy and to law enforcement officials. It is published in Arabic but the titles of the article and summaries are published in English so that parties who may not speak English can have them translated. They are published on the web and in print to make them more accessible. And the topics may sound familiar to those who work in public safety on university campuses, such as public attitudes towards police, theft crimes, and domestic violence.

The research staff is composed of senior researchers from Egypt, Russia, and Oman who have advanced degrees. The research assistants, all women from the Emirates, have degrees from leading universities including the University of Michigan. All speak Arabic and English with various degrees of fluency plus additional languages of their home countries.

Surprisingly, police officers are unlikely to be citizens of the country. The UAE recruits students from throughout the mid-east to enter the academy and serve as police officers. This puts enormous pressure on the academies to inculcate students in the culture of the UAE and in understanding the culture of so many “expats” who reside there. A solicitor for a person accused of a crime is more likely than not to be an “expat.” Still, this is slowly changing. The research center director is a citizen of the United Arab Emirates and a police officer. Most UAE citizens do not need to work because the country is so wealthy but the sheiks are increasingly encouraging citizens to take professional positions to help direct the country.

Future
The Constitution of the UAE places paramount importance of the safety and security of its citizens. As Dr. Mamdouh points out, policing at the administrative level has changed fundamentally in Arabic countries as it has in the United States since 2001. Arab law enforcement agencies are upgrading computer systems at the behest and with the assistance of the United States, Saudi Arabia, and Egypt. The US Department of Homeland Security as it affects the citizens and law enforcement of this country also affects the politics and law, the professionalism of law enforcement, and the community of Arabic states, including the UAE. Dr. Mamdouh writes that Arabic police agencies are and should focus efforts on 1) protecting the safety of citizens, residents, and visitors, 2) building trust, confidence, and communication with the community, 3) encouraging residents to report crimes to make safer communities, 4) improving police performance through technology and science, 5) using research to improve police strategies, and 6) obtaining equipment and physical structures for law enforcement. Campus public safety professionals certainly understand these latter concerns for infrastructure as they educate administrators who in the past might have downplayed the needs of campus public safety.


For further information
Abdlmottlep, Mamdouh. “Fear of Police. Public Attitudes Toward the Police.” Sharjah Police Research Centre Journal. 136 (2007): 1-131.

Abdlmottlep, Mamdouh. “Arabic Police.” Sharjah Police Research Centre Journal.” 139 (2008).

Ball, Carolyn. “Accommodating Islam in Law Enforcement.” Law Enforcement Executive Forum. (May 2005): 29-34.

_____ and Akhlaque Haque. “Diversity in Religious Practice: Implications of Islamic Values in the Public Workplace.” Public Personnel Management. 32 (June 2003): 315-331.

_____ and Akhlaque Haque. “Accommodating Islamic Religious Practices in the Workplace.” PA Times. November 2003, p. 5.

Ball, Carolyn and Kenneth Nichols. “Domestic Violence at the Top of New England: Law Enforcement Incident Reports from Aroostook County, Maine.” New England Journal of Public Policy. 17 (Spring/Summer 2002): 39-54.

Ball, Carolyn. "Rural Perceptions of Crime." Journal of Contemporary Criminal Justice. 17 (February 2001): 37-48.

El-Sadig M, J.N. Norman et al. “Road Traffic Accidents in the United Arab Emirates: Trends Of Morbidity And Mortality During 1977-1998” Accidents Analysis and Prevention. 34(July 2002):465-76.

Sharjah Police. United Arab Emirates. http://www.shjpolice.gov.ae/en/index.html

Shame on Sotomayor, Shame on the Supreme Court

Shame on Sotomayor and her colleagues. Judge Sotomayor and her fellow appeals court judges did indeed dodge a bullet in the debate over how we create equal opportunity of employment in the United States. The appeals court on which she sits wrote a short paragraph approving of the district court’s decision. That decision agreed with the district court that the City of New Haven was correct to throw out test results that supported the promotion of white firefighters (and one Hispanic) but no black firefighters. To do so would have a disparate impact on minority firefighters when other types of testing are available.

But shame on the Supreme Court as well. Courts do indeed make policy even if Sotomayor stated in her hearings that she simply interprets the law. In fact, at times courts are ahead of public opinion, behind public opinion, and even at odds with Congress. In fact, Congress amended the Civil Rights Act in 1990 after a series of Supreme Court decisions appeared to change proof of discrimination.

But on behalf of Judge Sotomayor and her colleagues, to rule for the white firefighters would be equally a problem. That is because many of the most important employment and related civil rights cases result in a divided opinion by the Supreme Court. The Supreme Court has continually left employers up in the air about how to actively recruit and promote minorities but at the same time not discriminate against majority members. The mixed signals have led the public to be hostile to affirmative action fearing that that affirmative action creates “reverse discrimination,” a term not used by the courts.

The Supreme Court has now overruled the court on which Judge Sotomayor sits ruling that the white firefighters (and one Hispanic) were discriminated against when they did not receive their promotions. They took valid promotional tests, both oral and written tests. The Civil Rights Act prohibits “norming” the tests scores based on race so New Haven had two choices: to use the results or to not use them risking a court case by the white firefighters. The case will again return to a lower court for implementation in light of the Supreme Court decision.

Unstated in all the discussion is that New Haven has not been able to promote any firefighters in over five years. Captain and lieutenant positions are now being filled on a rotating basis (because of shift work) based upon seniority. These firefighters are, of course, receiving additional pay and additional payments into their retirement for their added work. Still this would not be an acceptable situation in most businesses.

In New Haven case Justice Kennedy gave the opinion of the court but there were two concurring opinions and one dissent. The press identifies this as a 5 to 4 decision. A concurring opinion is one that agrees with the majority opinion but has different reasoning. Again, this makes it difficult for employers to decide what is correct. Justice Kennedy held an employer may discriminate against the majority if “the employer [has] a strong basis in evidence to believe it will be subject to disparate-impact liability if it fails to take the race-conscious, discriminatory action.” Kennedy glossed over the fact that the City of New Haven actually did fear liability for disparate impact on minorities Kennedy held that the evidence presented on the process of developing and validating the tests superseded the concern of liability and so the City of New Haven violated the rights of the white figherfighters under the Civil Rights Act but not the equal protection clause of the Constitution.

The court leaves in place the guidelines that made it so difficult for New Haven to decide what to do. Disparate impact occurs when a test which on its surface appears fair is, in fact, discriminatory. The Equal Employment Opportunity Office (EEOC) states that any employment condition, hiring, firing, promoting, testing, terminating in which the balance of individuals is greater than 80% for one group than another group is a prima facie case of discrimination. That is exactly what happened in New Haven.

The trend of the courts has been to prohibit discrimination of the majority in favor of the minority, but always in a fashion that leads employers (and educators) to wonder what they should do. Perhaps, one of the most important cases related to the rights of the majority versus the minority is the Bakke case. Bakke, a white male, won the right to attend medical school after the Court (1978) ruled that setting aside openings for minority students violated the Civil Rights Act and the equal protection clause of the Constitution. In that case, there were six separate opinions with the “majority” opinion not totally by any other justice. The court ruled, that is one justice ruled, that race could be considered a plus factor in determining entrance for diversity purposes, but quotas or set asides were prohibited. Racial classifications are subject to strict judicial scrutiny to determine if there is a compelling reason for them. Otherwise, they violate the Equal Protection Clause of the 14th amendment of the Constitution. Still in 2003, a big 10s undergraduate and law school admissions methods were tested. The Court, again, ruled that race could be used as one aspect in deciding admissions to promote diversity for the law school without violating the equal protection clause or the Civil Rights Act (in an opinion again yielding 6 opinions for the nine justices, but admission points for race used in undergraduate admissions violated the Equal Protection Clause of the Constitution and the Civil Rights Act. This split in the court’s opinion created a majority of one with concurring opinions in part and 3 dissenting opinions.

In the case of a city setting aside a certain percentage of contracts for minority contractors, the Court ruled (1989) against such a policy. There was no history presented of discrimination by the City. In this “6-3 opinion,” no judge supported the “majority opinion in toto,” with 3 other concurring opinions and two dissenting opinions. When a contractor sued the Department of Transportation over its set aside policies to hire minority contractors, the Court ruled (1995) 5-4 that any racial classifications used in hiring contractors for state work are subject to “strict scrutiny” and must be justified. This led the DOT to create a program to promote the provision of contracts to economically disadvantage contractors rather than use the wording women and minorities.

Perhaps, showing just how difficult it to balance the rights of majorities and minorities is a case that went to the Supreme Court but was settled by the parties before the case was heard. In Taxman v. Board of Education of the Township of Piscataway (1995), an appeals court ruled that a white teacher was not discriminated against when she was laid-off and a black teacher to continue. The teachers were hired on the same day, had equally favorable evaluations, and taught the same subject. What would you do?

Despite changes in the composition of the Supreme Court, the justices remain divided, and that is likely to continue to be true when Judge Sotomayor becomes Justice Sotomayor. Interpreting the law, that is making policy, is extremely difficult.

Choice and Healthcare

Managed care plans, pharmacy benefit management companies, behavioral health managed care, capitation rates-physician incentives to see more patients, to see fewer patients, pre-approval for second opinions, non-emergency "emergency" visits, hospitalizations, pharmaceutical company purchase of prescription lists to use for marketing, wellness incentives, diagnostic related groups (DRGs). These are a few of the layers behind your choice of health insurance.

The purpose is to attempt to control your behavior (such as wellness incentives for stopping smoking or losing weight) or your doctor's behavior. For example, insurance companies (also known as PPOs, IPAs, HMOS and assorted other names) reimburse doctors by setting a target to see more patients or to see fewer patients by limiting physician visits or laboratory and other types of outpatient procedures.

As we debate whether we want all citizens to be covered by health insurance including a choice of a government health insurance plan, it turns out that we are actually limited in our choices. The choice that all of us want is for a relationship with our chosen physician.

Political scientists, (particulary John Kingdon) have described policy making as a process in which three streams come together a problem stream, a solution stream, and a political opportunity stream. The problem stream includes many problems that deserve attention but only some get on the political agenda and there are many solutions out there but only some get on the agenda. With the many problems out there to solve, many solutions to problems available, a political opportunity must be available to create a policy. When a policy window opens, all three streams come together. The window in the case of health care reform is the beginning of the new term of a president. The problem has been defined as too little health insurance coverage, the solution, some sort of universal health insurance, and political will to make it happen from interest groups, Congress, and the major proponent, President Obama.

I'm not so concerned about whether I have private health insurance choice or a government run plan. These choices are minor. I'm concerned that the way we run health care now and undoubtedly will continue to run health care has created a huge health insurance bureaucracy all in the name of cost control moving more and more people and agencies between me and my doctor.

Sotomayor and Affirmative Action

Affirmative Action (AA) has long been a controversial topic. This is mostly due to the fact that it is very misunderstood. Affirmative action isn't even a law. At the federal level, it is an executive order that applies to the actions of federal agencies and any lower level government agency or private contractor (such as those that supply computers, any equipment, build roads) to government. What it requires is that gov't agencies have a plan to actively recruit qualified minorities and women. It doesn't require quotas but realistic goals to recruit those groups. It requires that agencies compare their workforce to the appropriate demographics for the job.

For example, almost all hospitals take federal money through Medicare (the health program for the elderly) and Medicaid (a federal program administered and partially funded by states to provide health care to the poor). As an affirmative action employer, a hospital must devise a plan to recruit those who are underrepresented in its workforce. In a hospital, that would be male nurses. About 95% of nurses are female. And about 95% of nursing graduates are female. So it is tough to recruit male nurses so a realistic goal might be to try to increase the numbers by a half-percent by a certain time. Since all hospitals are competing for this small pool of male nurses, one can see how difficult it would be. It might mean paying for current employees of the hospital to go to nursing school. Hopefully, a male employee might wish to attend. But the hospital can't discriminate. It can't discourage its female employees from applying.

The odd thing about affirmative action is that every president whether supportive or unsupportive of AA has had the power to rescind it since President Johnson signed the first one in 1965.

What courts rule on is not affirmative action but whether the action of an employer (or school, union) violated the Constitutional equal protection clause (14th amendment), right of due process, and the liberty interest of a government employee in his/her job, the Civil Rights Act of 1964 and its amendments, or the Civil Rights Acts of 1866 and 1871. Affirmative action is never the issue, yet underlying the court question is AA.

The Ricci v. DeStefano states very little. This is the case that appeared before an appeal's panel on which Judge Sotomayor sits. It simply affirms the lower court ruling agreeing that it was appropriate to stop testing of New Haven firefighters when few minorities were able to pass the test. But this by its very nature is inflammatory even if it says very little. And Judge Sotomayer is in for a rocky ride when she appears before the Senate Judiciary Committee.

The courts in the past have ruled as far back as Griggs v Duke Power (1971) that tests must be valid and job related. The 1991 amendment to the Civil Rights Act further indicated that tests cannot be norm based. That is tests cannot have different passing score for whites, for blacks, for others. If indeed, the New Haven test is a validated test by psychometrists according to the Equal Employment Opportunities Uniform Guidelines, then differences in passing rates may be justified. Alternatively, the courts can find seek an alternative that would be equally suitable and have less impact on minorities.

Since this case will now pass to the Supreme Court, the decision will rest on the larger question of whether New Haven violated the civil rights and constitutional rights of white firefighters, city employees. Again, to the layperson, this is a case of reverse discrimination. The courts never have used this term and are not likely to use the term.

For Sotomayor, this case will certainly tarnish the proceedings and incite a lot of talk radio discussion about affirmative action.

Too Big to Fail: Antitrust law

When I heard the words “to big to fail,” about AIG, I immediately thought of antitrust law. When an organization becomes so big that it controls a market, it is called a monopoly. The US government then regulates it or divides these “trusts” through the work of the Federal Trade Commission, Bureau of Competition or the Attorney General’s office, Antitrust division. The FTC and the Attorney General’s office promote competition by reviewing and approving mergers and by taking court action against companies engaged in prohibitive practices. These offices work through two basic laws, the Sherman Antitrust Act (1890) and the Clayton Antitrust Act (1914). Most of us know little about this rather esoteric part of law, but it actually affects us much more than Supreme Court cases about our civil liberties or rights. You may be vaguely familiar with the term trust busting from recalling the history of President Teddy Roosevelt’s effort to “trustbust,” break the monopoly power of the railroads. In New England we are seeing the result of anti-trust law as ExxonMobil divests itself of gasoline stations to other companies.

Monopolies can be caused by vertical or horizontal integration. In vertical integration, a company buys up all its suppliers or inter-related businesses. In horizontal integration, it buys up its competitors. The theory is that a monopoly can set prices and control the market. In a nutshell antitrust law determines if prohibitive practices are taking place. Some monopolies have been allowed in the past particularly in the utilities area (telephone, electricity) and banking. State laws contributed to monopolies of commercial banks, credit unions, savings and loans by regulating their practices to be contained within a state. Some competition existed between the three, but all in all they had distinct purposes: to provide financial services to companies and then to individuals, to providing checking, savings and loans to member employees of particular companies, and to provide savings and loan services to individuals primarily for homes, respectively.

What struck me as odd was the government involvement in creating the mergers of huge failing banks and private banks (banks that are unregulated and are not publicly traded). The government did not seek to divide these “too big to fail” banks but to merge them creating possible monopoly power.

What is the AG’s office and the FTC doing? The FTC’s website warns the public of “phising” emails from emailers pretending to be affiliated with these new banks, and the FTC provides information on deceptive mortgage practices. But only as of this week did it announce a crackdown on these practices. The Attorney General’s (AG) website has bank merger Guidelines (April 2, 1992) and an explanation of those guidelines given at a banking conference (1996). The AG’s office has primary responsibility for bank mergers. The site says nothing about the recent bank merger activities that have been reported in the press.

The AG’s office reviews banks in terms of the effect on local market competition, the share of deposits and loans, compared to other banks in the area assessing horizontal monopoly effects. So antitrust activity related to banks is stuck in an era when the location of a bank had more meaning. In the era of cross-state, international, and web banks; international private banks; and non-banks acting as banks (finance companies, mortgage companies, credit card companies), this is a limited means to assess competition.

AIG is a different antitrust problem and less clear. It is actually an umbrella of 130 businesses including insurance companies, retirement funds (VALIC), financial products (Financial Products ), mortgage underwriting company (Mortgage Capital) and an aircraft leasing company (International Lease). It’s possible that its many businesses create a vertical monopoly.

In both the banking and AIG cases, the FTC and AG have been quiet (although they may be involved behind the scenes). What the public does see is whether called banks or not, these entities are inter-related and as one goes down another goes down. In this sense, anti-trust laws and their regulatory rules need to be updated for the global world of banking. Or we need a better model that moves away from the fear of large companies and regulates where minimal competition exists. European countries, in theory, regulate the action of the monopolies rather than “busting” them. But it appears that the European model has failed as well with little oversight of the large banks of, say, England or Iceland.

What is transparency and AIG?

In the aftermath of Watergate in the 1970s, a number of laws were enacted giving the public greater access to governmental information, increasing the accountability of businesses, civil servants and politicians for their actions, and making decisions more open. These included the Freedom of Information Act (FOIA), the Sunshine in Government Act (1976), and the Presidential Records Act (1978) giving the press and the public access to many government documents on request, to most meetings, and to many presidential materials.

Today these pieces of legislation might be described as creating transparency. The President, state’s attorneys general (Connecticut/New York), the appointee to oversee the bank bailout (Neil M. Barofsky), Republicans and Democrats, and journalists call for greater transparency, particularly when it comes to banks and AIG. But what do they mean?

Transparency is a relatively common word in the parlance of nongovernmental organizations and supranational organizations (e.g., European Union, Organization for Economic and Co-operative Development, and the International Monetary Fund). It is a word used to convey an open process, a way of conducting business that is subject to public scrutiny to reduce the possibility of corruption.

Its institutionalization may have caught on by an accident of translation assuming that the German, French, and English meaning of Transparenz, transparence, and transparency are similar. But it also became prominent when during the early 1990s, Peter Eigen, a manager at the World Bank, became increasingly distressed by the Bank’s failure to address corruption in its loan-giving to nations. Mr. Eigen with a small group of individuals created Transparency International. The organization would examine the effects and consequences of corruption for citizens, report on it across nations, and advocate policy changes in global institutions to address corrupt practices. Today, the organization has affiliates throughout the world, publishes a Corruption Index, and has developed a National Integrity System promoting open structures in the media, business, government, and throughout all of society.

Transparency International’s mission may not mean much to the average American. Corruption is an issue, but not one at the top of the agenda. Instead transparency may mean a piece of film that you write on to project on a screen. Or it could mean accountability. Often politicians use accountability and transparency in the same sentence, not really distinguishing between the two. Legislation such as the Federal Funding Accountability and Transparency Act of 2006 and the Legislative Transparency and Accountability section of the Honest Leadership and Open Government Act of 2007 use the word transparency side by side with accountability. The Internal Revenue Service (IRS) enacted a new reporting form for nonprofits to increase accountability and transparency.

But more and more it is coming to mean ready public access to government, nonprofit, and business information. With the newness of the idea of transparency, the confusion over its many meanings, and the tug for privacy and secrecy, politicians, banks, and AIG ignored creating transparency. Congress, the Treasury Secretary, and bank officials and most recently AIG learned the lesson of transparency when Congress failed to put in legal requirements, the Treasury Secretary failed to provide oversight for reporting the use of bailout funds and employee bonuses, and bank and AIG officials were not forthcoming with that information. A chance to increase the trust of the public was lost. Transparency is different from simple accountability because it creates trust directly. AIG’s web site has its executive compensation committee, its annual report, but it fails in describing its most important relationship, its relationship to the public.

Maybe AIG is too big to fail as the press is stating, but certainly not invincible from shaming. But perhaps there is another problem that needs to be addressed. If AIG and some of the banks are too big to fail, when is the Federal Trade Commission or the United States Attorney General going to investigate these businesses in terms of anti-trust laws?

Planning a City: Dubai

I just got back from the ultimate planned city and country, Dubai, United Arab Emirates. The state received its independence in 1968 and began serious building in the mid '70s when it built a world trade center in the desert. Rotaries were built to nowhere planning for future growth.) Of course, we have a few planned communities and certainly in India and China new communities are springing up.

What would you do if you could build up from nothing?

Two conflicting views make planning cities difficult. One view is that a city is best that is diverse in people, in business, and in residences. In the world according to Jane Jacobs and others, we are safer when the factory, the deli, the park and our homes and apartments are in the same general location. We watch for each other. The other view of non-planners is that we don't want to live where we work.

Dubai has chosen the latter view but with a lot of planning. There are all sorts of special areas, for sports, for hotels, and for specific industries. I travelled through an area that was all automotive related with car parts stores, tires piled high, and places to buy rebuilt engines and auto parts.

I specifically visited Dubai Healthcare City, a planned area in which the state of art ideas, construction, and equipment will be used to make world-class healthcare available in the Mid-east. What's more it will be provided by a diverse array of professionals from all over the world. It is impressive. Yes, there will be a few shops for eating, obtaining prescriptions in the first phase, but it will largely be a place to go for excellent healthcare. Later there will be some housing and a mosque will follow. The state expects this "free zone" to devise the highest standards. To do so, Dubai Healthcare City created its own Center for Healthcare Planning and Quality (CPQ) to regulate the facilities and professions. One hospital is already in operation through Welcare, a South African company. And Boston University has enrolled its first class of dentists who will be getting advanced degrees and certificates in specialty areas. Harvard is working with DHC to build a teaching and research hospital.

During my time there, I met Indians, Pakistanis, Egyptians, Brits, South Africans, Filipinos, Iraqis, Palestinians, and UAE citizens all working to create the highest international standard of healthcare borrowing from the regulatory environment of the US, the Commonwealth Countries, and a few others. Twenty one countries have good enough programs in medicine, nursing and allied health to have professionals work in Dubai Healthcare City. Even then, some programs in these countries may not meet the standards being created. Nurses must, for example, have at least two years recent experience before they will be accepted for a job in healthcare city.

The other amazing part is that two languages are being used, Arabic and English and so employees must be fluent in one or the other, and most often both. In a predominately Muslim country, health professionals will likely be Catholic (from the Philippines), Hindu and Muslim (from India), and Christian (from the US and Commonwealth countries, and Muslim from states throughout the Mideast and Africa.

Still, there is a downside. Planning is always illusive. Separating out various industries from living areas means that cars and traffic are a major problem. Today, Dubai is building a monorail. The first test runs were being conducted as I visited.
And no bookstore area exists! I never did find a bookstore and I wanted desperately to get a book about their architecture, all of it built in the last 40 years. Even the hotels did not have kiosks with romance novels. Where were the bookstores?

Furloughs and Other Cost Savings in Government and Nonprofits

Governor Schwarzenegger made headlines announcing that state offices including the Department of Motor Vehicles would have to take every other Friday off to save money. No one can doubt the savings. The problem is the method. DMVs in many states have improved their customer service greatly, but others are known for their distinct lack of customer care. Finding the door closed every other Friday is going to anger the public. If two days off each month is necessary, and I have no doubt that it is a flexible furlough where employees choose the day they take off helps retain customer service and give employees some control over a very difficult time. (The governor may indeed be building in savings of reducing heating or air conditioning on those days.)

Governor Schwarzenegger is not alone in furloughing employees. In most service organizations, the cost of employees is the major cost of doing business. Furloughing is a very reasonable idea. The reduction in pay is relatively small for the state employee. If you assume that about 1/3 of the pay for every 8 hours is taken up in taxes, then for every $100 an employee earns, they are losing $66.00. And even then they are continuing to earn their vacation, health insurance, sick-time, pension and that the same rate they normally do. Benefits including mandated benefits such as worker’s comp and unemployment insurance constitute about 30% of the salary in the private sector (somewhat less for nonprofits) and 34% for the public sector according to the Department of Labor. That is for every $100 the employee earns, benefits may cost the employer another $30 to $34. So during those days off the employee is still earning.

But in the long run, governments and nonprofits may want to look at institutionalizing “furloughs.” In one hospital I worked in, it was called vacation without pay. Most offices have down times. That often occurs around the holidays when yes, employees would like more money to pay for Christmas and other gifts, but they also need time off to run errands. Institutionalizing vacation without pay or low need time policies makes good sense, particularly as we continue to worry about an aging, expensive workforce. Baby boomers are the individuals who might want to take time off voluntarily. Or this can be institutionalized as part of reverse seniority systems, asking the most senior people if they would like to take time off first. Again, benefits are still registered as though the employee was still working. Some organizations such as universities are slower in the summer, others in the winter. Employees can be encouraged to take “vacation without pay” during those times.

Another possibility that will save much more money is to change the workweek. Most of us work a 40 hour work week. There is no reason that the work week can’t be 39 hours, getting off one hour early on Friday, or 371/2 hours, or even 35 hours. I have seen the effectiveness of thirty-seven and one-half work weeks even in hospitals, organizations with shift work. The traditional shifts require a costly half-hour overlap, 7-3:30PM, 3-11:30PM, 11-7:30AM. In the 37 ½ hour scenario, employees do need to be responsible and call in early if they are going to be late or are ill, but this is not unreasonable. If there are real concerns that this would make salaries uncompetitive (probably not a concern during the economic downturn), then benefits can be computed as though the person worked the traditional work week.

In the end, these changes to wages and hours must be negotiated in unionized workforces as is the case for most government agencies and increasingly in nonprofit hospitals. But this is not insurmountable. And these ideas are much more palatable than the temporary reduction in pay mandated by Maryland state government. Union members want to keep their jobs and they want the organization to succeed. Fairness is the key and government, hospital executives, and other nonprofit executives may wish to demonstrate their support by taking vacation without pay or voluntarily cutting back pay to the equivalent of the 37 ½ work week.

Pay and Wall Street Executives

The news has been filled with discussion of Walt Street executive bonuses. Each of these executives received their bonuses even though their companies were failing and now receive special federal government funds. The executives have been attacked for the huge size of their bonuses, but the attack is probably misplaced. It is the boards of these companies that deserve our criticisms. They make the decision how to compensate executives. Once the form of bonus is determined and how it is to be earned, these boards are contractually obligated to provide these bonuses.

Of course, the boards could have tried to renegotiate, and, of course, the executives could have offered to not take the bonuses. But neither took place.

The reason for providing these bonuses, at least as portrayed to the public, is bonuses are needed to retain these executives. Many on Wall Street are underpaid, comparatively speaking, to other executives, and the bonuses make up for low pay. But there’s the rub. Bonuses are supposed to be a form of pay for performance. The better you do for the company the more money in stocks and cash you are paid. Thus, the more successful the company is, the more of a bonus the exec should be paid. So if a company is going under, then the exec should receive nothing.

The Board shouldn’t want to retain the executive. There is no need for a retention bonus nor a bonus to make up for lower pay. Surely, there are other employees in the company or in another company who might like the opportunity to bring back the company from this down time.

Bonuses or other forms of pay for performance do tend to make people work hard, at least initially, but then employees grow to expect them year after year. They become complacent. The bonus has to increase and increase spiraling well beyond what will motivate, if indeed it is motivating. Given that these bonuses seem to be largely unrelated to how well the company is doing, they are incredibly absurd as an incentive for these Wall Street executives.

It is time that boards begin to recognize what they are doing and take responsibility. They have a fiduciary responsibility to manage the company properly. Though those of us looking on must feel these bonuses are immoral and unethical, it is likely that the executives feel some guilt about receiving these bonuses, but after the guilt begins to diminish, I’m sure they are busy spending them and expecting to receive another next year. Given that we have not heard of boards taking responsibility for this financial mess and executives giving back pay, it may very well be that the future legislation must micro manage and figure out means to restrict bonuses. When a government agency does wrong a consent decree is established giving a court appointee representative the right to oversee the activities of the agency. This is an extreme response, but maybe we do need an appointee to work with these boards to help them understand their responsibilities to their shareholders and the public.

Change and President Obama

President Barack Obama campaigned on the idea of change. But really what is it? In his acceptance speech at the Democratic convention, he used the word change 12 times. He defined change as progress. Progress is something that can be measured—-jobs created, mortgages paid, new businesses starting. It is also specific actions of government: ending dependence upon oil in 10 years, tax code changes to favor small business and business that created jobs here rather than shipping them abroad, ending programs that don’t work, enabling equal pay for equal work. “Change comes to Washington” when people demand it, not from Washington.

At his inaugural, the word change did not really come up except in a grander sense. “For the world has changed, and we must change with it.” Still the idea of change was there. It still can be measured in jobs and in eliminating programs that don’t work. Oddly now change is more ill defined because we are in a crisis. One would think a crisis would require even more concrete ideas But the crisis has caused “[l]ess measurable but no less profound”…a sapping of confidence across our land - a nagging fear that America's decline is inevitable, and that the next generation must lower its sights.

As in the change of his acceptance speech, the change of President Obama’s inaugural speech requires a change in the character of politics so people can disagree without character aspersions. This may be laudable, but that is not how politics work. We choose parties and our representatives because they have different views of the world. Disagreement and attacks are the stuff of politics, at least the public side. Within Congress it is surprising how many senators and representatives are friends despite conflicting opinions. And those conflicting opinions often are the backbone of compromise. I’ll give you this, if you give me that. And, in truth, many, many bills are passed with bi-partisan support.

Each president is faced with new difficulties that require new policies—that is change. President Obama is not unique in calling for change. The change he speaks of is a change that public administrators love, one that can be measured. At the same time, he recognizes that politics will play hand. That is people’s opinions, their feeling of confidence for the nation and his leadership will affect what he can do to rally Congress to implement new laws and changes in existing laws.

http://www.umaine.edu/pubadmin/faculty/ball.htm