January 30, 2006

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  Drugs and Drug Testing http://www.latimes.com/news/printedition/opinion/la-op-welch29jan29,0,4424570.story?coll=la-news-comment From the Los Angeles Times INSIDE THE TENT His cup runneth over with annoyance By Matt Welch Matt Welch is assistant editorial page editor at The Times. January 29, 2006 THE NEWSPAPER you are reading has been lovingly compiled by hundreds of humans who urinated into plastic measuring cups for the privilege of bringing it to you. I gather this is not widely known among readers, judging by the reaction from those I’ve told. “Why would the L.A. Times care whether you’ve smoked pot?” goes the typical response. It doesn’t help with the comprehension that it’s not immediately evident that anyone here actually does. Yet it’s been company policy for at least 18 years that every new hire excrete on command while a rubber-gloved nurse waits outside with her ear plastered to the door. Those who test positive for illegal drugs don’t get their promised job, on grounds that someone who can’t stay off the stuff long enough to pass a one-time, advance-notice screening might have a problem. (And yes, it has happened in the newsroom a handful of times.) This despite the fact that we generally don’t operate machinery heavier than a coffee pot, aren’t likely to sell our secrets to blackmailing Russkies and are supposed to be at least theoretically representative of typical Americans. Because guess what? The typical American — and just about every journalist I’ve ever asked — has already tried marijuana at least once before the age of 25, according to the government’s National Survey on Drug Use and Health. What’s more, despite 35 years and billions of dollars’ worth of taxpayer-financed propaganda to the contrary, most of those who’ve inhaled didn’t collapse through the “gateway” into desperate heroin addiction or “Traffic”-style sex slavery. George W. Bush turned out all right (at least on paper), as did Al Gore, Arnold Schwarzenegger, Bill Walton, Michael Bloomberg and millions more. These complaints are familiar; I’ve made them several times myself (for instance, this self-shaming line from 1998: “I didn’t get into this racket so I could … submit to insulting urine tests”). I’m generally the kind of smart-ass who bristles at being told what to do (like registering for the “Selective” Service at 18, which I selected not to); and for the last few years I’ve worked at the libertarian Reason magazine, the kind of place where senior editors write books called “Saying Yes.” Yet there I was two weeks ago, handing my warm yellow beaker to the urine analyst (“Your temperature is nice,” she said, clearly trying to soften the blow). So, presented with the lure of an interesting job, did I abandon my libertarian principles even faster than the Gingrich revolution? Well, yes, but it wasn’t for lack of trying. First came the bluffing (“Is there a drug test? Because I won’t take one.”) Then the bargaining — I offered to pay more for health insurance, or sign a sworn affidavit detailing my laughably tame drug history … to no avail. A real punk rocker, or at least a dedicated fan of Mojo Nixon (he of “I Ain’t Gonna Piss in No Jar” fame from the mid-1980s, when drug testing was still controversial among newspaper employees), would have played chicken with the human resources department to see who blinked first. Instead, I folded like a cheap tent. Worst of all, I didn’t even have the basic decency to fail. As is infamous among friends who’ve known me long enough, a single hit of pot is enough to reduce me to a whimpering fetal crouch for several incommunicative hours at a time. During my last such tempting of fate, several years back, my crippled brain could not decipher whether the trailer for “A Mighty Wind” indicated a comedy or horror film. When it comes to every substance except red wine and Pacifico, I’m basically a Mormon. Which is why, among other things, our milk-slurping pals from Utah are famously overrepresented in sensitive government jobs that require higher levels of drug screening, like at the CIA. But do we really want our spook work handled by guys who blush at PG-13 movies? What kind of country would we be when most jobs require such ritual humiliation? The answer is: The country we already are. Since Ronald Reagan introduced federal government drug testing in 1986, workplace screening, egged on by Washington, climbed quickly to about 50% of all jobs and has remained basically static since then. The republic has managed to survive. Like airport security, open-air smoking bans and drunk-driving checkpoints, drug testing is an insulting annoyance that was met with much initial grumbling (particularly from journalists), then quickly became part of the accepted background noise of modern life. We instinctively compensate for these setbacks by exploring new freedoms elsewhere, before the buzz-killers find out. At least that’s what I keep telling myself.

  BEN STEIN Philip Anderson January 29, 2006 Everybody’s Business When You Fly in First Class, It’s Easy to Forget the Dots By BEN STEIN ONE of the best conspiracy movies ever made is the perfect British classic, “The Third Man.” In the most haunting scene, the villain, played adroitly by Orson Welles, takes Joseph Cotten, the good guy, up in a Ferris wheel. The villain, named Harry Lime, has been selling adulterated penicillin in postwar Vienna, making a fortune and causing children to become paralyzed and die. Mr. Cotten’s character, a pulp fiction writer named Holly Martins, asks him how he could do such an evil thing for money. The two men are at the top of the Ferris wheel, and the people below them look like tiny dots. Mr. Welles’s villain looks down and says, “Tell me, would you really feel any pity if one of those dots stopped moving forever? If I offered you £20,000 for every dot that stopped, would you really, old man, tell me to keep my money, or would you calculate how many dots you could afford to spare?” This scene comes to mind when I think of Glenn F. Tilton and other executives of the UAL Corporation and the hapless employees of its primary business, United Airlines. Its history is a perfect text for the ethical morass in which American business often finds itself. United is one of the proudest names in airline history. It has long been a synonym for fine service and extensive, convenient routes. In the early 1990′s, when some investment bankers were casting around for a way to make tens of millions of dollars, they came up with a doozy: the employees of UAL would give up some of their salaries and benefits in exchange for stock in UAL, eventually becoming UAL’s largest owner through an employee stock ownership plan. The deal went through — with staggering compensation to Wall Street — and in 1994 the American employees of UAL, as a group, became its largest owners. Within a few years, overseas personnel were allowed the privilege of tossing their life savings into UAL, too. Trouble was not far behind. The employees found management demanding pay cuts, big (and, for passengers, inconvenient) changes and cuts in scheduling and services, and even silly changes in their once-great flight attendant uniforms. Then came the blows of 9/11 and a recession, and then rising fuel costs. There were demands for more cuts in pay and benefits and more layoffs. That was not enough. About three years ago, UAL was “forced” to enter bankruptcy to stay alive. This step meant that UAL could drastically cut workers’ pay — and it did. Pensions were simply jettisoned and made the burden of the federal government’s Pension Benefit Guaranty Corporation, which meant cuts of close to two-thirds in some pilots’ pension payments. And, of course, the bankruptcy simply eliminated all of that equity in UAL that the employees had bought with their hard-earned savings. Thus, in a series of evil events, management of UAL basically ruined the lives of the employee-owners, if that is not putting too fine a point on it, by taking away their savings, incomes and pensions. (I am indebted to my pal, Phil DeMuth, for much of this research.) All right, you might say. What else could management have done amid high fuel costs and a deregulated, supercompetitive market? That’s “creative destruction,” and it’s good for the economy, some of my fellow Republicans and admirers of the free market might say. But what about the rules of law and common decency? Because, you see, there is a bit more to the story. Now UAL has been reorganized. It is preparing to emerge from bankruptcy. It will soon have a stock offering. This offering is expected to raise very roughly $6 billion. It is presumably worth that because UAL now has such low labor costs that it may actually make a profit of some size. (I’ll believe it when I see it.) Here comes the good part: management has asked the bankruptcy court to let it have — free — roughly 15 percent of the stock in the new company, or about $900 million. Mr. Tilton, the chief executive, who plays the Orson Welles character in this drama, would get about $90 million personally for his hard work shepherding UAL through bankruptcy (for which he was already paid multiple millions of dollars). The bankruptcy court, instead of ordering Mr. Tilton’s arrest, instead cut the management share to about 8 percent, so he will get more than $40 million, more or less. That is more than Lee R. Raymond, the chief executive of Exxon Mobil, one of the most successful companies of all time, was paid in 2004 (not counting Mr. Raymond’s 28 million shares of restricted stock). So here it is in a nutshell: employees are goaded into investing a big chunk of their wages and benefits in UAL stock. They lose that. Then they lose big parts of their pay and pensions. They become peons of UAL. Management gets $480 million, more or less. “Creative destruction?” Or looting? Wait, Mr. Tilton and Mr. Bankruptcy Judge. The employees were the owners of UAL. They were the trustors, and Mr. Tilton and his pals were trustees for them. How were the trustors wiped out while the trustees, the fiduciaries, became fantastically rich? Is this the way capitalism is supposed to work? Trustors save up, and their agents just take their savings away from them? If the company is worth so much that management has hundreds of millions coming to them, shouldn’t the employee-owners get a taste? Does capitalism mean anything if the owners of the capital can be wiped out while their agents grow wealthy? Is this a way to encourage savings and the ownership society? Or is this a matter of to him who hath shall be given? I know that this is basically the same story I described recently concerning the Delphi Corporation, where something similar is going on. But that’s exactly the point. Management is using competition, higher fuel costs and every other cost complaint to cut the pay and pensions of its own employees while enriching itself. And I can well imagine what goes through Mr. Tilton’s mind as he does it: “Hey, I’m a great executive. Great executives in private-equity firms make more than I do. Why shouldn’t I get the moolah? Basically, I’ve worked it so UAL is now a private-equity deal anyway. That’s what it’s all about now, isn’t it? Who’s got the most at the end of the day at Bighorn or the Reserve or whatever golf course I choose to retire at? And, anyway, wouldn’t you take $48 million for a few of those dots we used to call our employees and owners to stop moving?” Ben Stein is a lawyer, writer, actor and economist. E-mail: ebiz@nytimes.com. Copyright 2006The New York Times Company ..

  Pixar and Disney January 29, 2006 How Pixar Adds a New School of Thought to Disney By WILLIAM C. TAYLOR and POLLY LaBARRE SURE, Disney’s deal last week to acquire Pixar is about big money — how Steven P. Jobs turned a fledgling outfit that he had bought for $10 million into a juggernaut valued at $7.4 billion. And, yes, it is about a big strategic shift at the Walt Disney Company, as Robert A. Iger, the chief executive, exorcises the ghost of his predecessor, Michael D. Eisner. But it is also about the potential for big changes in how the entertainment business operates — specifically, in how major studios organize talented people to do their best work. Since 1995, with the release of “Toy Story,” Pixar’s films have reinvented the art of animation, won 19 Academy Awards and grossed more than $3 billion at the box office. But the secret to the success of Pixar Animation Studios is its utterly distinctive approach to the workplace. The company doesn’t just make films that perform better than standard fare. It also makes its films differently — and, in the process, defies many familiar, and dysfunctional, industry conventions. Pixar has become the envy of Hollywood because it never went Hollywood. More than a few business pundits have drawn parallels between the flat, decentralized “corporation of the future” and the ad-hoc collection of actors, producers and technicians that come together around a film and disband once it is finished. In the Hollywood model, the energy and investment revolves around the big idea — the script — and the fine print of the deal. Highly talented people agree to terms, do their jobs, and move on to the next project. The model allows for maximum flexibility, to be sure, but it inspires minimum loyalty and endless jockeying for advantage. Turn that model on its head and you get the Pixar version: a tightknit company of long-term collaborators who stick together, learn from one another and strive to improve with every production. Consider the case of Brad Bird, writer and director of “The Incredibles,” who spent the first decades of his career shuttling around the business as an ever-promising, never-quite-recognized animator. (He worked on “The Simpsons” and directed one feature, the critically acclaimed but commercial dud, “Iron Giant.”) When Pixar recruited him, Mr. Bird went to work immediately on “The Incredibles,” which went on to win two Academy Awards and a nomination for best original screenplay. Unlike a typical Oscar-winning director, however, Mr. Bird is not a free agent with his sights set on the next big-budget negotiation. He is an employee of the studio. Indeed, he is part of a group of directors and technical talents at Pixar — including Andrew Stanton and Lee Unkrich, the creators of “Finding Nemo,” and Pete Doctor, the director of “Monsters, Inc.” — who have staked their reputations on their work at Pixar. Again, in contrast to convention, these professionals have traded one-time contracts for long-term affiliation and contribute across the studio, rather than to just their pet projects. According to Randy S. Nelson, who joined the company in 1997 and is dean of Pixar University, a company-run education and training operation, this model reflects “Pixar’s specific critique of the industry’s standard practice.” He explains it this way: “Contracts allow you to be irresponsible as a company. You don’t need to worry about keeping people happy and fulfilled. What we have created here — an incredible workspace, opportunities to learn and grow, and, most of all, great co-workers — is better than any contract.” There is a tough-minded business strategy behind Pixar’s we’re-all-in-this-together workplace. A single animated feature takes four or five years to complete, the last 18 months of which feel like a breathless sprint. In such a high-stakes environment, even the most outrageously talented individuals are bound to suffer creative setbacks. One reason Pixar has produced such a string of hits is that the organization has learned how to hang together under the pressure. “The problem with the Hollywood model is that it’s generally the day you wrap production that you realize you’ve finally figured out how to work together,” Mr. Nelson said. “We’ve made the leap from an idea-centered business to a people-centered business. Instead of developing ideas, we develop people. Instead of investing in ideas, we invest in people. We’re trying to create a culture of learning, filled with lifelong learners. It’s no trick for talented people to be interesting, but it’s a gift to be interested. We want an organization filled with interested people.” Mr. Nelson, an energetic, colorful, 50-something artist and executive, is himself a wide-ranging talent. He has juggled knives on Broadway as a founder of the Flying Karamazov Brothers, acted in feature films and served alongside Mr. Jobs at Apple Computer and Next Software. But his real talent, and his agenda at Pixar, is coordinating how other talented people express their most creative ideas, collaborate with colleagues and meet deadlines. Pixar University is at the center of Mr. Nelson’s agenda. The operation has more than 110 courses: a complete filmmaking curriculum, classes on painting, drawing, sculpting and creative writing. “We offer the equivalent of an undergraduate education in fine arts and the art of filmmaking,” he said. Every employee — whether an animator, technician, production assistant, accountant, marketer or security guard — is encouraged to devote up to four hours a week, every week, to his or her education. Mr. Nelson is adamant: these classes are not just a break from the office routine. “This is part of everyone’s work,” he said. “We’re all filmmakers here. We all have access to the same curriculum. In class, people from every level sit right next to our directors and the president of the company.” At one class, the sixth session of a nine-week course called “Lighting and Motion Picture Capture,” the students represented an intriguing cross-section of Pixar employees: a post-production software engineer, a set dresser, a marketer, even a company chef, Luigi Passalacqua. “I speak the language of food,” he said. “Now I’m learning to speak the language of film.” The evening’s subject was highly technical — the use of dimmers in the lighting of movies — but the session was spirited. The Pixar employees were also learning to see the company’s work (and their colleagues) in a new light. “The skills we develop are skills we need everywhere in the organization,” Mr. Nelson said. “Why teach drawing to accountants? Because drawing class doesn’t just teach people to draw. It teaches them to be more observant. There’s no company on earth that wouldn’t benefit from having people become more observant.” THAT helps to explain why the Pixar University crest bears the Latin inscription, Alienus Non Dieutius. Translation: alone no longer. “It’s the heart of our model,” Mr. Nelson says, “giving people opportunities to fail together and to recover from mistakes together.” It is worth noting that the Pixar University crest has a second Latin inscription, Tempus Pecunia Somnum. Translation: time, money, sleep — three precious commodities in any high-stakes enterprise. That inscription speaks to the next challenge for the company, to sustain the energy of a business that has to keep up its string of blockbusters even as it ramps up its rate of production and adjusts to life with its new owner. There is no class on mastering that challenge. But so long as Pixar avoids going Hollywood — and Disney learns to appreciate how Pixar works — the company will continue to school the entertainment establishment in a productive and reliable way to get the best out of its creative talent. William C. Taylor and Polly LaBarre are the authors of “Mavericks at Work,” to be published this fall by William Morrow. Copyright 2006The New York Times Company

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