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Waterboarding for Fun and Profit:

The Washington Post reports on another court case involving allegations of torture.

No one really disputes that Chad Hudgens was waterboarded outside a Provo office park last May 29, right before lunch, by his boss.

There is also general agreement that Hudgens volunteered for the "team-building exercise," that he lay on his back with his head downhill, and that co-workers knelt on either side of him, pinning the young sales rep down while their supervisor poured water from a gallon jug over his nose and mouth.

And it's widely acknowledged that the supervisor, Joshua Christopherson, then told the assembled sales team, whose numbers had been lagging: "You saw how hard Chad fought for air right there. I want you to go back inside and fight that hard to make sales."

What's at issue in the lawsuit Hudgens filed against his former employers -- just as in the ongoing global debate over the CIA's waterboarding of terrorism suspects -- is the question of intent.

Prosper Inc. maintains that what the supervisor did, while unauthorized, overzealous and misguided, falls far short of torture, and in fact was not nearly as bad as Hudgens makes out in his quest for damages.

"We're not the mean waterboarding company that people think we are," said George Brunt, general counsel for the firm.

FC:
Waterboarding will continue until morale improves.

Now to put that on a t-shirt...
4.13.2008 4:54pm
Bender (mail):
A volunteer for a stunt that his employer neither authorized nor knew about is suing his employer because the volunteer did not enjoy the stunt for which he volunteered. Wouldn't a cast member of the television series "Jackass" have a better case if he sued his employer for injuries received on the job? At least in the latter, hypothetical case the employer would have had knowledge and given approval. And by the way, the "torture" does not appear to have had any serious impact on Mr. Hudgens until he fell under the influence of a scheister ambulance chaser.
4.13.2008 5:00pm
VastRightWingConspiracy (mail):
Personally, I think that the use of enhanced sales techniques is exactly what we need to get our economy back on track in the fight against Islamofascism.

I'm sure that Barack HUSSEIN Obama will be attempting to restrict the use of these effective sales techniques as part of his covert jihadist attempt to subvert our economy and restore the caliphate. He is clearly out of touch with the mainstream of America that is not bitter, and demands god, guns, and torture. Only the two other patriotic candidates can really address this issue.
4.13.2008 5:03pm
jackpot:
No one who sees this will take claims of waterboarding as torture seriously. Here in Philadelphia, the local morning radio crew on WMMR had a special segment where they waterboarded an intern volunteer. Your average listerner will take from these stunts the feeling that if its okay to do to an intern, what's the real problem with doing it to a terrorist.
4.13.2008 5:22pm
Glenn W. Bowen (mail):
If everybody had an one gallon jug
Across the USA
Then everybody'd be boardin'
Like the CI-A
You'd seem 'em swearin' and gaggin'
Like captured rascals do
A Bushy Gitmo type torture
Boardin' USA.
4.13.2008 5:30pm
GWLAW:
Hey Bender, you're letting your ideology cloud your reasoning here. You make up facts by stating that the employer "neither authorized nor knew about" the activity. And yet you ignore the fact that the article clearly states the "supervisor poured water from a gallon jug over his nose and mouth" during a "team-building exercise."

So what you have is a person in a position of authority, at a company-sponsored activity, engaging in the activity in question. By definition, that is activity that the employer knew about, as the actions of the supervisor become the actions of the employer.

In addition, torture (the Federal Court system clearly views waterboarding as torture - search waterboarding w/p torture on Westlaw) does not become "torture" (or as you put it, a prank) just because the person volunteered for the activity.

The question, as the article noted, is one of intent of the employer in engaging in the activity. The fact that the employer could reasonably be seen as using coercion ("You saw how hard Chad fought for air right there. I want you to go back inside and fight that hard to make sales.") will not help the employer's case here.
4.13.2008 5:30pm
Glenn W. Bowen (mail):

Your average listerner will take from these stunts the feeling that if its okay to do to an intern, what's the real problem with doing it to a terrorist.


this was established in the '90's on the Executive level.
4.13.2008 5:33pm
Toby:
Heck, I'd rather be waterboarded than attend many activities sponsored by management and/or HR at a major University. Especially if it got me out of the next event as well.
4.13.2008 5:34pm
PC:
No one who sees this will take claims of waterboarding as torture seriously. Here in Philadelphia, the local morning radio crew on WMMR had a special segment where they waterboarded an intern volunteer. Your average listerner will take from these stunts the feeling that if its okay to do to an intern, what's the real problem with doing it to a terrorist.


I have to agree. Taking your line of reasoning further, there are people that pay good money to have electrodes attached to their genitals and have the juice applied. Clearly if people are willing to pay for that, it can't be that bad to do to terrorists.

Or how about people that decide to mutilate their own bodies? Genital mutilation, amputation, etc. If people are willing to do this to themselves, it can't be that bad if we do it to terrorists. Or at least people we think are terrorists.
4.13.2008 5:34pm
Sean O'Hara (mail) (www):
Here in Philadelphia, the local morning radio crew on WMMR had a special segment where they waterboarded an intern volunteer.


I remember when a local radio station in DC had a marshmallow race, in which people placed marshmallows in a certain unsanitary part of the body, ran a certain distance, and then ate them. If an employer asked workers to do that, even on a volunteer basis, I'd reckon an employee would have grounds for a suit, even if not on grounds of torture.
4.13.2008 5:35pm
Mark in Texas (mail):
The issue is not whether or not torture is going to be administered to employees but what kind of torture is going to be administered.

If offered a choice between water boarding and sitting through another one of those compulsory EEOC reeducation classes, I'll bring a change of dry clothing.
4.13.2008 5:52pm
Harvey Mosley (mail):

If everybody had an one gallon jug
Across the USA
Then everybody'd be boardin'
Like the CI-A
You'd seem 'em swearin' and gaggin'
Like captured rascals do
A Bushy Gitmo type torture
Boardin' USA.



I nominate this for next Sundays song lyrics.
4.13.2008 5:55pm
Glenn W. Bowen (mail):

I nominate this for next Sundays song lyrics.


did you see this Sunday's?

I vote we usurp&replace.
4.13.2008 5:58pm
J_A:
I'd be curious to know if any of those commenters that flippantly are offering themselves as volunteers to waterboarding will be as flippant after being indeed waterboarded.


The fact that someone volunteered to do it, doesn't mean it's not torture, it just means that the volunteer (and the enabler) did not know how bad it could be. They might just have read too many flippant comments about how waterboarding was better than sitting through an HR seminar.

Please let me know when someone volunteers for a SECOND time. Then I might consider that it might not be such a big deal after all.
4.13.2008 6:01pm
Oren:
Any sane BDSM practitioner (so rare on the Conspiracy) understands that consent is not consent without a safeword*. If the "volunteer" was not free to terminate the exercise at any point in time then he cannot be said to have consented.

*Safewords need not be verbal. The only requirement is that the waterboardee be able to communicate his intent clearly and immediately.
4.13.2008 6:29pm
Glenn W. Bowen (mail):

Any sane BDSM practitioner (so rare on the Conspiracy) understands that consent is not consent without a safeword*. If the "volunteer" was not free to terminate the exercise at any point in time then he cannot be said to have consented.


mine is "YEOOOOOOOOOOOOOOOOOOOOOOW!!"

yours?
4.13.2008 6:38pm
GV:
There's also a huge difference between the waterboarded alleged terrorist (who does not know if he will survive the waterboarding) and the volunteer (who knows that no one involved is truely trying to kill or harm him).

This is like saying raping a woman is okay because other women have volunteered to have sex.
4.13.2008 6:40pm
Oren:
yours?
"Banana" or, if gagged, humming the first few bars of Beethoven's 5th.
4.13.2008 6:44pm
Glenn W. Bowen (mail):

humming the first few bars of Beethoven's 5th.


Classy- that's why I frequent the place:)
4.13.2008 6:47pm
CK:
Anybody else thinking of Michael Scott from "The Office"?
4.13.2008 6:47pm
Oren:
This is like saying raping a woman is okay because other women have volunteered to have sex.
Not exactly. More like she agreed at first but then said no and you didn't listen. AFAIK, that is still the crime of rape in virtually all states - when someone says "stop", you must respect their wishes.
4.13.2008 7:06pm
gattsuru (mail) (www):
Somehow, Oren, I don't see that particularly bit of scrutiny becoming part of the judicial record anytime soon.

I think the man probably has a damned good claim for unlawful assault and a good number of other charges, but calling this particular example of waterboarding torture still strikes me as demeaning to folk who actually suffered noteworthy physical damage or felt more than nineteen seconds of fear.
4.13.2008 7:08pm
AntonK (mail):
Thank you for that, Jonathan! A more beautiful example of how silly the waterboarding-as-torture meme is would be hard to manufacture.
4.13.2008 7:12pm
DaSarge (mail):
Sigh, ....

From a legal standpoint, in my state (WA), assumption of the risk would likely bar the claim.

That is said, what a stupid thing.

That said again, I was waterboarded in training many years ago. No fun, but not the end of the world.
4.13.2008 8:04pm
Smokey:
Can someone please split a few hairs for me? How is this different from a police cadet volunteering to be tasered or pepper sprayed?

Also, was it against company policy to say, "No, thanks." Or, "Show us how, boss!"
4.13.2008 8:13pm
frankcross (mail):
Numerous former highranking military officers have clearly stated that waterboarding is torture, AntonK.

Why do you so disrespect the military?
4.13.2008 8:18pm
dre (mail):
The "sales force" of AQ Inc. are laughing at your idiocy.
4.13.2008 8:19pm
Craig R. Harmon (mail):

The fact that the employer could reasonably be seen as using coercion



My first thought was:


Coercion? On a volunteer???? Can you coerce a volunteer? Isn't his volunteering for the stunt rather speak against the stunt being, in any way, coercive?


My second thought was, the volunteer was held down. That is, he was not free to get up and away from the water at any time he wanted to. It seems highly likely to me that he wanted to get away from it before he was able to get away from it. Therefore, to me, his having volunteered for the experience does not mean that there was no coercion involved.
4.13.2008 8:57pm
Paul Milligan (mail) (www):
"A volunteer for a stunt that his employer neither authorized nor knew about" is a meaningless statement, and demonstrably false as well.

A ) His employer DID know about it, and authorize it. In fact, it was his employer, as represented by their appointed supervisor, who did the waterboarding.

B ) Had an employee 'volunteered' to go up to the roof of the office and be pushed off, after which the supervisor in fact pushes him off, is that somehow 'not actionable' civilly or criminally just because 'he vollunteered' ???/ Get serious.
4.13.2008 8:58pm
NI:
This is slightly changing the subject, but what I want to know is why are companies so stupid as to put in supervisory positions people who are so stupid as to engage in waterboarding at company functions. The Dilbert principle -- that companies seem to be run by morons -- does not lack for real life examples.

I read somewhere that Andrew Fastow, the former Chief Financial Officer at WorldCom, didn't know that you can't hedge loss with more loss. I who have never been to business school a day in my life know that, and I never would have been considered for his job.

Is there a reason that dumb-dumbs like that seem to have no trouble finding all the good jobs?
4.13.2008 9:41pm
DeezRightWingNutz:
didn't know that you can't hedge loss with more loss


I'm not sure I know what you mean. Can you explain?
4.13.2008 9:59pm
Dave Hardy (mail) (www):
"when someone says "stop", you must respect their wishes."

I suppose the problem here is how you say "stop," with a mouth full of water.
4.13.2008 10:03pm
Curmudgeonly Ex-Clerk (www):
I suspect that there would be a plausible consent defense regarding this sort of voluntary waterboarding fact pattern in many jurisdictions. In Texas, for example, consent can be a valid defense to criminal assaulative offenses. Section 22.06 of the Texas Penal Code provides in relevant part that:
(a) The victim's effective consent or the actor's reasonable belief that the victim consented to the actor's conduct is a defense to prosecution under Section 22.01 (Assault), 22.02 (Aggravated Assault), or 22.05 (Deadly Conduct) if: (1) the conduct did not threaten or inflict serious
bodily injury . . . .
Section 1.07(a)(11) defines "consent" as "assent in fact, whether express or apparent." Section 1.07(a)(46) defines "serious bodily injury" as "bodily injury that creates a substantial risk of death or that causes death, serious permanent disfigurement, or protracted loss or impairment of the function of any bodily member or organ."

This is merely one state's law, and criminal as opposed to civil law at that. But often civil law treats basic assault in much the same fashion as criminal law. (I recall this being the case with respect to Texas and California law when I looked into it a few years back, for example.) And I would guess that the law is similar in other states.

Consent woundn't be an airtight defense by any means. But it seems like a plausible one, certainly one a jury might accept depending on the some of the details and the credibility of the various witnesses. I don't necessarily think that is an unreasonable result.
4.13.2008 10:41pm
picpoule:
I'd rather be waterboarded than having my fingernails pulled out, being hung by my hands, which are handcuffed behind my back, thereby having my shoulders popped out of their sockets or having my head chopped off.
4.13.2008 11:09pm
Gaius Marius:
Chad Hudgens sounds like he should be nominated for the Jackass of the Year Award.

Just for the record, I totally disapprove of torture because I believe it should be the policy of the U.S. military to take no prisoners and execute all enemy combatants who attempt to surrender on the battlefield.
4.13.2008 11:12pm
NI:
DeezRightWingNutz, since a company can't always predict with complete accuracy which of their activities will gain and which will lose, they will engage in some activities that are risky (but have the potential to pay off big if things go well) while at the same time engaging in other activities that, while perhaps less lucrative, are sure bets. That way if their riskier activities don't work out for them, they at least have the sure bets to fall back on. It's the same principle as a money market account, where the fund manager invests in lots of different businesses so that if some of them lose money, hopefully the others will make money. It's also known as "not putting all your eggs in one basket."

One of the many reasons WorldCom failed is that Fastow, their chief financial officer, apparently didn't understand the basic principle that if you're going to invest in risky stuff, you need to protect yourself by also investing in less risky stuff as a backup. He put everything in risky stuff, and all of it turned out badly.

Like I said, with no business background whatsoever, even I would have known better than that, and I suspect that intuitively you would have as well, even if you didn't know the proper terminology. Well, WorldCom's chief financial officer didn't. So my point is, how does someone that stupid manage to land that kind of a job? (And why can't I?)
4.13.2008 11:22pm
cat's paw (mail):
And it's widely acknowledged that the supervisor, Joshua Christopherson, then told the assembled sales team, whose numbers had been lagging: "You saw how hard Chad fought for air right there. I want you to go back inside and fight that hard to make sales."
I think Christopherson was saying "You saw how desperate Chad was to keep his job. If you value your present standard of living, you will go back to work and do whatever it takes to keep your job."

What's at issue in the lawsuit Hudgens filed against his former employers -- just as in the ongoing global debate over the CIA's waterboarding of terrorism suspects -- is the question of intent.
I think Chad's intent when he volunteered may have been that he wanted to expose a "Dabney Coleman" type sadistic supervisor. We don't know how long Chad had worked for the company--probably long enough to see a fellow employee humiliated in the name of motivation. I think Chad should receive only enough compensation to live and retrain--perhaps for a career in some service field--like teaching public school, where he will be safe from humiliation.
4.13.2008 11:24pm
Fastow:
Andy Fastow wasn't WorldCom, he was Enron.
4.13.2008 11:41pm
NI:
Fastow, I stand corrected, but my underlying point still stands.
4.13.2008 11:47pm
Dave Hardy (mail) (www):
"I'd rather be waterboarded than having my fingernails pulled out, being hung by my hands, which are handcuffed behind my back, thereby having my shoulders popped out of their sockets or having my head chopped off."

I guess you read of their NEXT team-building exercises. "You saw how he fought to get off the rack when we put the pressure on, I expect you to fight for sales the same way!"

I suppose this is a reminder that private sector managers can be ALMOST as insane as those in the government sector.
4.13.2008 11:55pm
Oren:
Can someone please split a few hairs for me? How is this different from a police cadet volunteering to be tasered or pepper sprayed?
For those things that can reasonably be said to be "instantaneous" actions, consent once given is good. For continued actions, the ability to withdraw consent is essential.

I suppose the problem here is how you say "stop," with a mouth full of water.
If I were doing it, I would have the waterboardee hold some object in his hands and drop it when he'd had enough. Either that or have him firmly grasp someone's hand and let go when he's had enough.

I'd rather be waterboarded than having my fingernails pulled out, being hung by my hands, which are handcuffed behind my back, thereby having my shoulders popped out of their sockets or having my head chopped off.
Relevance?
4.14.2008 12:41am
BruceM (mail) (www):
This guy won the jackpot of political incorrectness and is taking full advantage of it. It wasn't real waterboarding, he just had some water dumped on his head. It's like saying every football coach who wins a championship game and gets gatorade dumped on his head has been "waterboarded." Do it for a few hours with people screaming at him to give up information, and then it may approach waterbording.
4.14.2008 12:45am
Eli Rabett (www):
Defining deviancy way down.
4.14.2008 1:17am
Brian Macker (mail) (www):
BruceM,

I suggest you read the actual article. It's apparent that you didn't. They guy volunteered for a "training exercise" not torture. Both he and the guy who water boarded him claim not to even have known what the term meant at the time the incident occurred. Nor was there any mention of the term, "waterboard" or "torture".

According to the plaintiff he didn't really know what he was in for until the water hit his face and at that point they weren't letting him up. Seems believable. Read the story.
4.14.2008 1:21am
GatoRat:
Yet another argument against so-called "team building exercises" which are nothing more than an excuse by management to appear they have the remotest clue what they are doing (and to blame lack of teamwork by team members for project failures instead of their own incompetence.
4.14.2008 1:40am
Elmer:
Waterboarding makes you feel that you are drowning. When it stops, you probably feel better fast. The art of coercion is to make resistance feel bad, and cooperation feel good. I saw a mild version of the principle used to sell vacuum cleaners.

Now imagine sitting through a whole morning of bad speeches and skits on Quality Day. This isn't a sales job, so you thought you were paranoid to imagine show tunes with Quality lyrics, but the tunes are performed as badly as you feared. By then you have deep misgivings about the organization you've worked in for a year. Finally, the showstopper: The Greatest Love of All, horribly oversung with company lyrics. By itself, that would be quite painful, but when you notice your coworkers eating it up, you wish you'd never been born. It stops, but without really ending, leaving you with a sore spot inside that never quite heals.

I do not know what Chad Hudgens experienced. In his position, I would not have trusted the supervisor and helpers to be competent in waterboarding or anything else, so I might have feared actual drowning, in which case any coworker within reach would have been bitten. Of course, with that level of distrust I might not have volunteered. I also may have figured that I could hold my breath longer than a gallon jug could cover my mouth with water, perhaps to be proven wrong. Either way, I would have been highly motivated by the experience- not to sell, but to get another job.

Yet that's what most people do in a psycho sales environment: quit, as I quit the vacuum business after two weeks. Those who remain do not behave as I do, so my argument is self-refuting. Think of the time we could save if that became the general pattern, on VC and in life! Yet this is a legal blog, peopled by lawyers and others who like to argue, so I have two levels of failure here. Damn.
4.14.2008 3:05am
Ricardo (mail):
This guy won the jackpot of political incorrectness and is taking full advantage of it. It wasn't real waterboarding, he just had some water dumped on his head. It's like saying every football coach who wins a championship game and gets gatorade dumped on his head has been "waterboarded."

So dumping water on someone's head when he is standing up is the same as pouring water on a person's nose and mouth as he is lying down with his head lower than his feet and is being kept pinned to the ground by helpers. That's your claim?

Do it for a few hours with people screaming at him to give up information, and then it may approach waterbording.

Most people subject to actual waterboarding during training crack in less than a minute -- for many it probably only takes a few seconds. Khalid Sheik Mohammed supposedly lasted two or three minutes.
4.14.2008 4:44am
Happyshooter:
A volunteer for a stunt that his employer neither authorized nor knew about is suing his employer because the volunteer did not enjoy the stunt for which he volunteered.

An employee does not volunteer for an assignment when he is 'asked to volunteer' by his supervisor.
4.14.2008 9:50am
BruceM (mail) (www):
Waterboarding is scary because it simulates drowning. While I'm far from an expert in carrying out torture, I would assume part of a professional waterboarding is to make it seem like drowing is a likely possibility, and imply death if the person doesn't talk (to get it to stop). That psychological aspect of it, i'd imagine, is a large part of its deviancy. What happened to this guy is no worse than getting a little water in your nose while you're swimming.

I'm not saying what they did was good. All of these "motivational" and "team building" exercises should be done away with. But it's only slightly worse than having someone fall backwards and be caught (or dropped) by a fellow employee.
4.14.2008 10:10am
JosephSlater (mail):
Following up on Gatorat's point, I teach employment law, and it's surprising -- or maybe not -- how many plausible lawsuits have arisen from these corporate "team-building" exercises.
4.14.2008 11:53am
Adam J:
DaSarge - I don't think that assumption of risk applies to intentional torts. And anyways, the employee has to know or should know of the risk... do you really think employees engaging in teambuilding exercises know there is a risk of being waterboarded during the exercise? If so, I'm pretty sure you will see a lot less volunteers in the future.
4.14.2008 12:09pm
David Chesler (mail) (www):
I don't know about Gitmo waterboarding. I don't know the particulars of this office, and thus don't know the merits of this claim.

I've taken part in exercises at company picnics that didn't even come with an object lesson. I've been the bottom center in a small human pyramid - the knees in my back hurt, and the grimace on my face was visible in the photo we submitted for the scavenger hunt. I was four limbs of a Vetruvian man (I just kept telling myself "It's not gay if you don't make eye contact, not that there's anything wrong with that.")

JosephSlater, just above, is no doubt correct that plausible lawsuits can and should result from some exercises; but on the other hand just because it hurts doesn't mean there was harm. I'm not much of a jock, but even I know that if it doesn't hurt, you're not playing hard enough.
4.14.2008 12:19pm
JosephSlater (mail):
Adam J.:

Assumption of the risk is not a defense to intentional torts, but consent -- a related concept -- does. Not commenting on whether there was or was not consent in this case, just a Torts geek point.

Similarly, David Chesler, if A intentional hurts B, and B has consented to that sort of thing, it's usually not tortious. But if A hasn't consented to that sort of thing. . . .
4.14.2008 1:40pm
JosephSlater (mail):
Um, should have been, "consent -- a related concept -- is." That's what I get for posting right before class.
4.14.2008 1:41pm
neurodoc:
Waterboarding is scary because it simulates drowning. While I'm far from an expert in carrying out torture, I would assume part of a professional waterboarding is to make it seem like drowing is a likely possibility, and imply death if the person doesn't talk (to get it to stop). That psychological aspect of it, i'd imagine, is a large part of its deviancy. What happened to this guy is no worse than getting a little water in your nose while you're swimming.
My training as an Army Medical Corps officer included brief exposure to tear gas (CSX?) while learning to don our gas masks. It wasn't pleasant, but it wasn't that big a deal either. I was never treated to waterboarding, so have no firsthand experience to report, but then you don't either. You are satisfied, however, that what happened to the employee was surely "no worse than getting a little water in your nose while you're swimming;" I am not.

The company's general counsel maintains that the "waterboarding" lasted only 20 seconds, but that may or may not have been the case. He also says that the employee could have stopped it at any time by simply holding his hand up to signal he wanted it halted, though he was being held down by fellow employees. That's hard for me to picture, though some seem to think it plausible ("If I were doing it, I would have the waterboardee hold some object in his hands and drop it when he'd had enough. Either that or have him firmly grasp someone's hand and let go when he's had enough.")

Yes, "Waterboarding is scary because it simulates drowning," no question about that. And the apprehension it causes is surely not some at a distance intellectual notion that one could die at this. I think it may be a primal experience of the most immediate kind, allowing no chance to "think" about it. "No worse than getting a little water in your nose while you're swimming" in a pool or a few feet from the shore and taking some water up the nose while diving or having a wave go over your head? I expect it is as bad as taking a good deal of water up the nose and down your throat while you struggle with all your might to break free from a rip tide with everything you have within you, fearful that you are surely going to die.

Now, am I the only person to think it significant that what they were trying to sell was the wisdom of Donald Trump as taught through "Trump University"? Anyone here a Trump U alum?
4.14.2008 1:50pm
Oren:
"Waterboarding is scary because it simulates drowning." At the point where blood oxygen drops below half normal, the higher parts of the brain are shut-down both because they consume oxygen and because their utility at this point is questionable. Your lower brain thinks it's dying and that take precedence over anything else you might try to think.
4.14.2008 2:25pm
DeezRightWingNutz:
One of the many reasons WorldCom failed is that Fastow, their chief financial officer, apparently didn't understand the basic principle that if you're going to invest in risky stuff, you need to protect yourself by also investing in less risky stuff as a backup. He put everything in risky stuff, and all of it turned out badly.


Thanks for the clarification. I think I understand hedging, but I wasn't sure what you meant when you said "hedge a loss with a loss."

I took you to mean someone had hedged against a potential loss with an even greater potential loss. In other words, they hadn't hedged at all, but instead had increased their exposure. For example, if I own a stock, and am worried about the price dropping, I may buy put options. I pay a little money to guard against the possibility of losing a lot. But if someone owned a stock and sold put options thinking they were hedging, they'd be wrong, as a downward movement in price would increase, not reduce their loss. Is this what you're saying Enron or Worldcom did?

If, instead of purchasing derivatives, I decide to diversify my stock portfolio by selling some of one stock and buying another, I haven't really hedged anything. Or, at best, I have an imperfect hedge, because maybe the stocks have historically moved in opposite directions (maybe one company owns mineral rights to platinum and one makes catalytic converters).

So, if I want to hedge against my commute become too expensive because of gas prices rising, I could

1) buy futures contracts for oil (an effective hedge, as I make money if oil prices rise)
2) sell futures contracts for oil (the exact opposite of a hedge, since I lose more money if oil prices go up)
3) invest in Toyota, who makes successful hybrids and would theoritically stand to profit from gas prices going up (a poor hedge)
4) invest in frozen concentrated orange juice futures (diversifying my portfolio by investing in a different risky asset)

Are you saying that management of the company in question did 2, 3, or 4, but should have done 1?
4.14.2008 2:33pm
Jiminy (mail):
AIR IS FOR CLOSERS
4.14.2008 2:50pm
BruceM (mail):
neurodoc, given the choice between 20 seconds of "waterboarding" (as described by the plaintiff employee) or being exposed to teargas, I'd choose the waterboarding.

Now, just to be clear, I'm not an advocate for torure, including waterboarding, as a means of interrogation. It's unethical and it's unreliable. Thus, there's no purpose to it (and I contend that a "ticking timebomb" scenario only happens in the movies, and never in real life).

Also - Andrew Fastow was with Enron, not WorldCom.
4.14.2008 3:25pm
ClosetLibertarian (mail):
DeezRightWingNutz:

Your definitions of hedging would be useful for classifying hedge funds. I think they started as (1) and moved into the other categories and also as unregulated mutual funds.
4.14.2008 3:26pm
JosephSlater (mail):
Jiminy wins the thread.
4.14.2008 4:06pm
gattsuru (mail) (www):
(and I contend that a "ticking timebomb" scenario only happens in the movies, and never in real life).


I'd contend otherwise. By their nature, most military or pseudo-military actions are ticking timebomb scenarios -- if an individual knows information, it's always only good for a given time period, and if it's worth knowing, lives are on the line.

Most IED situations, for example, have a known or unknown period before they'll be used. The same is true for the activation of car bombs and even some mortar attacks. Even stuff like the location of a terrorist financier can be a ticking timebomb situation -- not getting his location and stopping him can mean a thousand more bombs later.

Ticking bombs are unfortunately a bit too common in Iraq and Afghanistan right now, and no one is recommending waterboarding or even uncomfortable conditions outside those situations. The real question is whether it's acceptable to use this particular technique, and whether it's effective at getting the information.
4.14.2008 5:06pm
LM (mail):

"We're not the mean waterboarding company that people think we are," said George Brunt, general counsel for the firm.

Let's hope their outside counsel are a little better.
4.14.2008 6:02pm
JosephSlater (mail):
And LM gets the silver medal for this thread.
4.14.2008 7:02pm
Jagermeister:
Gee, what ever happened to the criteria of, "safe, legal, and rare"?
4.14.2008 11:30pm
neurodoc:
BruceM: neurodoc, given the choice between 20 seconds of "waterboarding" (as described by the plaintiff employee) or being exposed to teargas, I'd choose the waterboarding.
The plaintiff contends it went on for 20 seconds, or that's the defense's contention? If you were being held down while someone poured water over your face, I would imagine that it would be relatively easy to hold you breath and keep your mouth closed for at least that long, making the experience pretty much of a nothing. I doubt that it was that trivial an experience, however, in part because it would have had no "teaching" value then.
BruceM: Now, just to be clear, I'm not an advocate for torure, including waterboarding, as a means of interrogation. It's unethical and it's unreliable. Thus, there's no purpose to it (and I contend that a "ticking timebomb" scenario only happens in the movies, and never in real life).
By "unreliable" you mean it does not guarantee that the information obtained cannot be accepted as what the person may in fact know? One may elicit some truthful responses through torture, but they won't know what is the truthful and what is the untruthful, the latter so likely as to make the only enterprise a waste of time? You may wish to think that because it makes it easier to say "no" to torture by your side, but I think you are kidding yourself by thinking so. Somewhat analagous to lie detector tests, which don't produce invariably reliable results, but which do far better than mere guessing and remain a useful tool for the CIA and others.

The "ticking time bomb" scenario may be more common in movies than in real life, but I don't know where you get your certitude that it happens only in the movies, never in real life. (And torture has its uses in more than the putative "ticking time bomb" case anyway.) You haven't experienced waterboarding, you may never have experienced tear gas, and I very much doubt you have actual experience of torture or intelligence gathering generally, but you do have an impressive degree of certitude about these things.
4.15.2008 1:27pm
LM (mail):
I have no idea how many time, if ever, the ticking time bomb scenario has arisen. But it's not so implausible that we should just flat out declare it never will. We ought to be willing to acknowledge the costs and benefits of any action or abstention, and decide which ones we prefer and are willing to live with.

Putting aside the legal questions, it's never been obvious to me why torturing somebody is morally inferior to killing him, an assumption that seems to underlie much of the debate. If I were put to the grizzly choice for a loved one, I suppose I'd prefer s/he be killed, but retrospectively I'd prefer s/he had been tortured. (Could John McCain's family, for example, possibly feel otherwise?)

I think this is one of many subjects demagoguery and mutual distrust have made all but impossible to discuss intelligently. I understand why people on both sides consider even the asking of certain questions to be code for pernicious beliefs and agendas. I'm not saying that that kind of suspicion, and the slippery slope arguments that go with it, aren't often well-founded. It's just too bad they have to stop us from exploring and maybe finding better understanding and solutions.
4.15.2008 5:41pm
PC:
I have no idea how many time, if ever, the ticking time bomb scenario has arisen. But it's not so implausible that we should just flat out declare it never will. We ought to be willing to acknowledge the costs and benefits of any action or abstention, and decide which ones we prefer and are willing to live with.


If torture is such a reliable means of extracting information from a suspect, why don't we use it in domestic criminal justice cases?
4.15.2008 11:28pm
neurodoc:
PC:
Why is that in some cases the state must prove their case to beyond a reasonable doubt, whereas in other instances it only has to clear the more likely than not bar, and it still others a mere scintilla of proof might be enough? It's because we have decided we want just about the highest degree of confidence we can have before depriving someone of their freedom, while we don't require nearly so much persuasion before we decide for the state in most non-criminal matters, and sometimes we will declare the state the winner even with they come up with about the smallest possible quanta of evidence to support the discretionary decision they made? It is because we think that we should set the burden of persuasion according to what is at stake.

Torture might be reliable enough as a means of eliciting information to serve the purposes of intelligence gathering against those who threaten attacks against this country and its people, while being something we abjure when investigating crimes already committed to find the perpetrator(s). Lie detectors may be reliable enough for some purposes, e.g., when used as a "screening" tool, but not reliable enough for other purposes, e.g., to introduce as evidence in a criminal prosecution, reliability being no greater or less in one or the other.
4.16.2008 1:17am
Oren:
I have no idea how many time, if ever, the ticking time bomb scenario has arisen. But it's not so implausible that we should just flat out declare it never will. We ought to be willing to acknowledge the costs and benefits of any action or abstention, and decide which ones we prefer and are willing to live with.
If that's the case, then the interrogator should have to break the law and plead necessity (which is an affirmative defense against the charges).
4.17.2008 7:55pm