They may seem harmless, but in business and personal lives a white lie can take on a life of its own. In this Tough Things First podcast, Ray Zinn looks at what qualifies as a white lie, and, if done by accident, what to do about.
Rob Artigo: I’m Rob Artigo, your guest host for this edition of the Tough Things First podcast. I’m a writer and investigator in California. Here with me is Ray Zinn, the longest serving CEO in Silicon Valley history. Hello, Ray.
Ray Zinn: Hello there, Rob. It’s good to be with you today.
Rob Artigo: Good to be back, Ray. You recently wrote about your feelings on what is known commonly as the white lie, and you’re not really a fan of white lies, are you?
Ray Zinn: No. Well, no matter how white we try to make a lie, a lie is still a lie…
Ray Zinn: …and it’s just a matter of what was the intent when we committed that lie or we said that lie. For example, the current issue with the lawsuit with Donald Trump in New York City over his ballooning, as they say, his application for a loan, that he committed a lie in the sense that he overestimated the value of his respective properties. And while what was expected, I mean, according to the court, was that they expected him to use the tax valuation and not the market valuation. So it’s a technicality, it’s a small technicality, depending upon what was the expectation of the person receiving that loan application.
And it looks like based on what we’ve been hearing is that the banks said, well, everybody takes the high end of what their value of their properties are, and it’s up to us as the bankers to figure out what the real value of that property is, at least according to what our appraisers tell us. It’s kind of what we refer to as a white lie, depending, again, how far you’re exaggerating your story, as you would, or your application.
As I said, a lie is still a lie no matter how white we try to make it. But again, what was the intent of the lie? We can lie to ourselves. We can say, well, I can watch pornography, or I can do this, or I can cheat on my spouse or my family, or I can steal from the store because I don’t make enough money, and I need this, or the Jean Valjean, I’m hungry and need something to eat. And so according to a recent survey, we lie twice a day, we do a lie.
And so we could say, well, but I can lie to myself whether it be our diet that we’re on or whether it be exercise or whatever, we can lie to ourselves. We can tell ourselves, well, I’m not going to exercise today because I don’t feel good or my leg hurts, or my foot hurts, or whatever. And use that as our excuse for not exercising. We try to whiten all of our lies. We try to say that what we’re doing is really not going to be harmful, whether it be an actual theft stealing a car or whether it be not living up to our obligations in our work. Maybe we’re spending too much time on social media when we should be doing our job or whether it’s yaking with our fellow workers at the plant, or whether we’re just not trying very hard and producing what we’re supposed to be producing for our company.
Lies all start out white as you would, and so we tend to try to excuse everything. We don’t want to take responsibility. We don’t take the blame for anything. And so what we do is we say, well, that’s okay this one time. If I do this just this once. But I’ll tell you what a bad habit you can start instantly. A good habit takes a long time to develop and you can kill a good habit instantly with a bad habit. And one of the worst habits we can do is start out with lying. I’m going to give you an example of a lie that I created. It was pretty simple. It was pretty inadvertently in the sense of word. I was filling out an application to go public called an S1 registration and you have to list all your job, where you worked and who you worked for and what years and so forth.
And then also your education. When it came to my master’s degree, which I got from San Jose State, I put down that I had an MBA and then the date was 1968 is when I got my MBA. And so I put that on the registration and then I submitted the application. Well, it took about three weeks. Then I said, well, what’s going on? How come it’s taken so long to get this application cleared? And then finally I got a call from my attorney saying that our application had been rejected by the SEC because of a false misstatement you made on your application. And I said, what was a false statement? And they said, well, you said you had an MBA from San Jose State in 1968. So when they called San Jose State and ask them if they could verify or validate that you had an MBA from San Jose State in 68, they just said, no, we never offered MBAs back in that timeframe.
So I said, that’s crazy, that’s nuts. And say, well send us a copy of your diploma. So I ran a copy of the diploma and I sent it to them and it said I had a Master’s of science degree in business. And so they came back and said, no, that’s not an MBA. I said, what my master of science and businesses, well, it’s the same thing. And they said, that’s not the same thing. Meaning even though you say it is an MBA, it’s not an MBA as far as the SEC or the registration called it out. So even though the coursework was the same, and I did have a master’s degree in business, it wasn’t technically an MBA. So that’s how fine line it is. So you could say, well, what was your intent when you put it down?
Well, I thought, well, it was simple for me to write MBA on there, and so I just put down MBA and no harm, no foul, meaning I still had the education, but I had committed a white lie in that I had written down on the application a falsehood, and it really struck me how important it is to be totally and completely truthful and honest. Now, I wasn’t intending to mislead anybody, but they took it as I was trying to mislead and it actually cost us some time in getting our S1 approved because of my little stupid white lie that I made, which was inconsequential in the reality of things, but it still was a white lie.
Rob Artigo: It was an inaccuracy to the letter of-
Ray Zinn: Of the law.
Rob Artigo: To the letter of the law, quote, unquote, air quotes, because clearly it’s semantics. If you change the name of a degree or you institute the exact same thing and you name the degree in MBA and you say, well, you didn’t get an MBA here because I understand that. But at the same time that technicality cost you time and all of that time is money.
Ray Zinn: Yeah, it was a stupid mistake, but it wasn’t intentionally. I wasn’t trying to mislead, I don’t know, I guess I got in the habit of saying I have an MBA and technically my master of science in business actually has more education, is more valuable than an MBA because mine took four years and an MBA only takes two. So I actually had more education applicable education with that degree that I had with that master’s science and business. But anyway, I just share that because here’s an example of unintentional lie as you would, but still was incorrect. If you make a mistake, that can be considered a lie, a mistake, whether it be that you use the wrong calculation in figuring out a check that you wrote to pay off of a bill or whatever, a mistake is effectively a lie for all intents and purposes, it is a lie.
So again, you have to look at what was the expectation. And that’s a problem that Trump has now, is that he has to convince the court that the expectation was that they used market value and not tax value to calculate the value or his net worth. Again, what was the expectation? It’s kind of like they say, well, okay, you can go five miles over the speed limit. That’s considered expectation. However, the law says you can’t do five miles over the speed limit, but what’s the expectation as you would? And so there is some leeway given depending upon what is expected. If you make a mistake and you weren’t expected to make that mistake, then that’s a problem. But if it is a calculation that you made incorrectly that ended up inconsequential, meaning it didn’t damage anything, then the consequence, they’re going to be less hard on you for that mistake or that lie.
The purpose of this podcast is to talk about how important it’s for your integrity to make sure that you are accurate in the way you speak and the way you act and the way you live your life. Your example that you set. For example, if you’re a very wealthy person and you dress up like a poor person, then are you deceiving? Well, technically you are because you’re not coming across a reality as you come across as a poor person sitting on the corner asking for handouts when you’re perfectly wealthy and can take care of yourself. It goes to your integrity. If you start messing around with your white lies as you would, you’re going to find your integrity is going to suffer.
Rob Artigo: Well, I think it comes down to honesty is the best policy.
Ray Zinn: Absolutely. And there’s no excuse for dishonesty. When I put down that my application in MBA, I wasn’t intentionally trying to deceive anybody, but it was still a mistake. It was still inaccurate, and it did in fact have an impact on the way I was viewed by the SEC and my integrity and my honesty, even though in reality I hadn’t caused any. I mean, there was no harm, as you would, no harm, no foul. It was still an error and I paid the consequences for that error. And we can say, well, that’s kind of stupid, but it doesn’t take very many little stupid errors to affect your integrity.
Rob Artigo: Well, you can join the conversation@toughthingsfirst.com. Your questions and comments are always welcome. Follow Ray Zinn on Twitter, Facebook and LinkedIn, and also check out his books. Tough Things First and the Zen of Zinn one, two, and three. You won’t regret it. Thank you again, Ray.
Ray Zinn: Thanks a lot Rob. And like our podcast.
