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If Joe Paterno had heard an account of rape or any sort of sexual harassment from a witness then it would have been wrong for him not to report it to a supervisor, and if nothing came of that then to not report it to the police.
However, I don't believe Joe Paterno heard an account which described anything illegal. Apparently all McQueary told Paterno was that he saw something inappropriate occur in the showers. Now I don't know the details of that statement but if this is the case, then Joe Paterno had no idea that any crimes had occured and did the right thing by telling his supervisors and nothing more. I mean when I hear 'something innappropriate' I think that maybe this guy was saying something lewd to the boys while they were showering or he was yelling at a kid or he was rat-tailing them with a towel, or maybe he was just showering at the same time but in a different shower (which is all fucked up and questionable and worthy of further investigation for sure but not molestation/rape). Something 'inappropriate' could mean a lot of things. Also remember that Paterno had coached with Sandusky for 31 years and barely knew this graduate assistant. I bet the thought that Sandusky was raping these children or even molesting them didn't even come across his mind. And yes I understand that he was, but everyone seems to be forgetting how the situation differs with full hindsight. Furthermore, we're all forgetting how terrible it would be if Paterno had gone to the police and accused Sandusky of sexual abuse and Sandusky was innocent but his whole career, name, repuation, etc. was ruined even though he was innocent (yes I know this wasn't the case, but Paterno didn't have full knowledge at the time so this could have been a possible outcome).
Paterno did report the incident and Isince nothing came out of it, Joe Paterno figured Sandusky did nothing illegal.
I think that hearing the accounts of what Sandusky did is so fucked up and unexplainable that people need to find a scapegoat and all that anger and lack of understanding and wish for this to never occur again is soaked up in the Paterno controversy. Unfortunately, there still doesn't seem to be enough anger for Sandusky, McQueary, Curley, and Schultz and maybe instead of being so angry at these people, someone should actually rationally focus on how to prevent sexual abuse of minors from occuring rather than letting emotions get in the way.