What in the world: AOL exec's 'million dollar baby' gaffe

 
AOL Chief Executive Officer Tim Armstrong at a conference on May 23, 2011. AOL CEO Tim Armstrong's baby line caused big headaches

Last week AOL head Tim Armstrong announced some cost-cutting moves that adversely affected company employee retirement plans. The initial reason he gave was that the move was due to the higher costs of medical insurance thanks to President Barack Obama's health care reforms, citing a $7.1m (£4.3m) hit the company was taking.

The exact number raised some eyebrows.

"What is Armstrong talking about?" writes Michael Hiltzik of the Los Angeles Times. "He didn't specify, which is reason itself to believe he's blowing smoke. As a large employer, AOL doesn't face any new healthcare mandates under the Affordable Care Act, except to allow employees to keep children on their health plans up to age 26."

During an employee question-and-answer session, Mr Armstrong gave another reason for his cost-cutting measures: two "distressed babies" born to AOL employees, which cost the company "a million dollars each".

Well if you criticise "Obamacare", you're sure to get a lively debate, with many conservatives rallying to your side. Singling out the parents of premature babies, however, seems like a case study in bad corporate PR - a "flub for the ages", writes Alex Planes of the investing site the Motley Fool.

On Monday Slate published an article by one of the mothers in question, and it's about as bad for AOL as you could imagine.

Deanna Fei recounts how five months into her pregnancy she went into early labour. Her 1lb, 9oz (0.7kb) baby was born hours later, clinging to life. After three months in neonatal intensive care, she writes, they were able to take their baby home.

"Yes, we had a preemie in intensive care," she writes. "This was certainly not our intention. While he's at it, why not call out the women who got cancer? The parents of kids with asthma? These rank among the nation's most expensive medical conditions. Would anyone dare to single out these people for simply availing themselves of their health benefits?"

She concludes:

Our daughter has already overcome more setbacks than most of us have endured in the span of our lives. Having her very existence used as a scapegoat for cutting corporate benefits was one indignity too many.

Over the weekend Mr Armstrong released a letter to employees saying he "made a mistake" and rescinded the retirement plan change.

And so ends the tale of how not to announce employee benefit changes.

France

Obama and Hollande: A renewed alliance - US President Barack Obama and French President Francois Hollande mark the latter's visit to the US this week with a jointly written opinion article in the Washington Post. It seems the days of Iraq War disputes and Freedom Fries are in the past, as they tout the close working relationship the two nations have on a variety of global issues - such as Iran's nuclear programme, African poverty, anti-terrorism efforts and economic growth. "Now we are meeting our responsibilities not just to each other - but to a world that is more secure because our enduring alliance is being made new again," they conclude.

Tunisia

Trouble brewing beneath the surface - While Tunisia is praised as being one of the few democratic success stories in the Arab Spring, the truth is that the country's future is still very much in jeopardy, writes Walter Russell Mead on his blog for the American Interest. Even though the country isn't making headlines, reports of attacks and assassinations are coming in daily, and the fight is far from over.

China

Preparing for an Antarctic land-grab - Lily Kuo writes for Quartz that China is playing catch-up in Antarctica with the unveiling of its fourth research station. While the base sits on a goldmine of resources from oil to fresh water, China doesn't have access to any of it until 2048 due to the Antarctic Treaty. Instead, the motivation to build is likely tactical, with leaders hoping to place China in a good position when the region opens up.

Turkey

A great Turkish firewall? -- The internet law passed by the Turkish Parliament is the first volley in a political skirmish that will hurt the nation's economy and clamp down on individual freedoms, writes Mustafa Akyol for the Hurriyet Daily News. While there is definitely an Internet-based war going on between the government and opposition, he worries that this law is just the first of many restrictions on the rest of the population.

Saudi Arabia

Rein in the religious police - There's a growing controversy in Saudi Arabia over the mutwaeen, or religious police, a commission formed in 1940 to enforce Islamic law. As smartphones document numerous examples of abuses, writes Manal al-Sharif in the New York Times, the public is increasingly angry. "A broad-based, grass-roots show of anger against the mutaween may be the push the government needs to finally weaken and perhaps eventually dismantle the religious police," she writes.

India

Narenda Modi is the wrong kind of leader - Author Pankaj Mishra writes that there's growing support for Narendra Modi bid to be prime minster in the May elections. That would be a mistake, he says, as Mr Modi is a Chinese-style capitalist, "adept at cutting through regulatory systems, seizing land, building infrastructure and offering other concessions to big industrialists".

South Africa

Judging Aids - South Africa's Mail & Guardian has published an excerpt from Judge Edwin Cameron's Justice: A Personal Account, in which he describes in detail his battle with HIV and grappling with whether to go public with his disease when he became a judge. "I was a vigorous campaigner for rationality and justice in the epidemic, but only a handful of family and close friends knew that I was campaigning for more than just the public issue," he writes. "I was campaigning also for myself."

BBC Monitoring quote of the day

Sochi Olympics opening ceremony: "The colourful ceremony in Sochi revealed a lot of things. The opening of the Olympics showed what heights we can reach if we want something very much and put all efforts into achieving the goal. The opening of the Olympics showed what a large number of Russians are passionately willing to be proud of their country and with what impatience they are waiting for a reason for this pride. And finally the Olympics opening highlighted the striking contrast between Russia that really exists and Russia reflected in the mirror of the Western media." - Mikhail Rostovskiy in Moskovskiy Komsomolets

One more thing…

An unanswered call from space - A spacecraft is hurtling toward Earth. Scientists are racing to try to make sense of the signal it is transmitting. Unfortunately the conversation will be all one-sided, according to Emily Lakdawalla of the Planetary Society. The US launched the International Sun-Earth Explorer (ISEE-3) in 1978 to study the Earth's magnetosphere, then sent it out into the solar system to observe two comets. It's on its way back now, but the US scrapped the only transmitter capable of speaking to it in 1999.

Lakdawalla writes that scientists at the Deep Space Network were able to dust off old technical documents to figure out how to communicate with the ISEE-3, but constructing a new transmitter would be so above their budget that they didn't even put together a cost estimate.

She concludes: "I wonder if ham radio operators will be able to pick up its carrier signal - it's meaningless, I guess, but it feels like an honorable thing to do, a kind of salute to the venerable ship as it passes by."

(Wasn't this the plot of Star Trek: The Motion Picture? This carbon unit wants to know.)

 
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  • rate this
    0

    Comment number 5.

    4. Well put. Was a CEO and tasked with numerous heartbreaking personnel situations over the years that simply required a human response - it did not take but a second to do what was right. The bottom-line was always in sight but without compromising ethics (and my Board never commented). Wharton promotes an ethics program: https://lgst.wharton.upenn.edu/programs/academic-programs/ethics-program/

  • rate this
    +2

    Comment number 4.

    I'm a firm believer that 1 anecdote illustrating behaviour under moral challenge is all you need to know for some. Being in power equates to not being under observation. Betraying medical records must be actionable. Armstrong is in the running for "scumbag of the year" His contrition is surely to avoid deserved punishment. I would sever any AOL connection were it not going influence the employees.

  • rate this
    0

    Comment number 3.

    AOL is the Reader's Digest of the internet. At the outset, AOL made the corporate choice to present itself to the few and the conservative wealthy people, who initially were the majority of those who had access to the internet. Now AOL is as dated and as misrepresentative as the 'Silent Majority'.

  • rate this
    +4

    Comment number 2.

    Armstrong caught by pre-existing condition protection of newborns in distress? Worked in NJ - 2000/2002 and a child was born to an employee with a hole in the heart, that corporate medical insurance denied as a pre-existing condition! Some of us chipped in for the required surgery. I left that company disgusted at ownership (evangelical Christians) who turned their back on a newborn in distress!

  • rate this
    +1

    Comment number 1.

    Power, religion, abuse? Funny what vehicles are in use to advance an agenda of intolerance against reasonable personal freedoms. These universal human qualities make me suspicious and therefore intolerant of their existence. I could surmise that intolerance breeds intolerance. Corporate and government apathy for population bases have created a one way ticket to global human infestation.

 

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