Pluralistic: 18 Mar 2021

Today's links

Help news, not news-barons (permalink)

More often than not, when I encounter a proposal to address monopoly power, I return to that old Irish joke: "If you wanted to get there, I wouldn't start from here."

Today, it's the proposal to save American news media by granting an exception to antitrust law so the news companies can form a cartel to bargain with the ad-tech duopoly represented by Googbook.

Let's start with the sleaziness of Googbook's ads. The ad-tech markets are rigged from asshole to appetite. Googbook defrauds buyers and sellers, collude to rig prices, and trouser billions for their trouble. It's not just sleazy, it's criminal.

Publishers are victimized by this fraud. The ad-tech duopoly uses funny accounting to shift billions from publishers of all kind to their own balance sheets (advertisers also suffer, but we're talking publishers at the moment).

The news industry deserves our sympathy for this, but they keep squandering it by saying stupid things like "Google steals from us by linking to our websites." These stupid things are credulously repeated by both the left- and right-wing press.

Google and Facebook don't steal from publishers by sending them traffic. They don't steal from them by including short snippets from their articles. Neither of those things are stealing.

Googbook steals from publishers through ad-fraud and price-rigging.

It is frankly baffling to me that the news media has decided to ignore the vast, multi-billion-dollar fraud that is ad-tech in favor of the nonsensical proposition that directing readers to your articles and engaging in fair use quotation are crimes.

Writing for EFF's Deeplinks blog, my colleagues Katharine Trendacosta and Danny O'Brien describe the flaws in the Journalism Competition and Preservation Act, which proposes antitrust exemptions to news organizations to help them push back against Googbook.

To understand why this proposal is before the Congress, you have to understand that the dominant school of antitrust enforcement in the west is the "consumer harm" standard, popularized by Robert Bork when he was serving as Ronald Reagan's court sorcerer.

Bork was the Qanon of antitrust. He insisted that if you read the US's four founding antitrust statutes closely enough, you'd learn that despite the explicit language saying monopolies were bad because they are monopolies, Congress only intended to shut down bad monopolies.

What's a bad monopoly? A monopoly that raises prices. If you can't prove that a merger will lead to higher prices, it should be permitted. If you can't prove that higher prices after the merger were caused by monopoly, they should be forgiven.

Of course, Bork determined whether high prices could be attributed to a monopoly through complex economic models that only he and his friends at the University of Chicago economics department could create and interpret, and the models always said monopolies were fine.

Thus monopolies began to form in every industry, taking over one part of the supply chain or another. Once that happened, that element of the supply chain started to gouge everyone else. Every other part of the supply chain had to monopolize in self-defense.

Bork's version of antitrust is pro-monopoly, but anti-cartel. If six companies form an agreement to insist on a certain price, the FTC will flay them alive. But if they merge into one company and fix the prices, the FTC is fine with it.

That's why the news industry wants the Journalism Competition and Preservation Act. Ad-tech is a duopoly and Googbook colludes to rig the ad market, stealing billions from publishers. Publishers, meanwhile, are highly concentrated, but not so concentrated as Googbook.

They want to form a cartel to collectively bargain for more money from Googbook, but they need an antitrust waiver first, or the FTC will chain them to a boulder and send an eagle to peck out their liver every day for 1,000 years.

We need an active, independent news media. But if you want to get there, I wouldn't start from here. The news industry today is not a collection of scrappy, independent businesses devoted to telling the truth. Those businesses are long gone, emulsified by Googbook's frauds.

Their assets were snapped up at fire-sale prices by "hedge funds, private equity ghouls, and giant media near-monopolies." They are debt-loaded zombies puppeteered by vulture capitalists and billionaire dilettantes with pretensions of saviorhood.

And while the beloved papers of yesteryear were finished off by the internet, they were easy pickings, thanks to Wall Street's financial engineering. Long before Craig started Craiglist and diverted the easy money of classified ads, the newspapers were being hollowed out.

The newspaper families sold out to corporate raiders in leveraged buyouts that left the papers drowning in debt. These corporate geniuses merged papers into chains and fired local reporters and local salespeople, consolidating them to realize "efficiencies."

They flogged off the papers' head offices and printing plants, often selling the presses themselves, leasing back the assets they'd once owned, exposing themselves to rent- and interest-shocks.

Then the internet came along, and an industry that had weathered innumerable technological shocks from the telegraph to 24-hour cable, from radio to satellites, was too sickly and starved to do it again.

The internet is good at providing classified ad alternatives, but firing the sales agents who'd spent a lifetime building relationships with local merchants left the papers with no home court advantage.

And switching from reporters with distinctive insights and audiences to wire-services meant that when the newspapers went online, much of what they published was word-for-word identical to their competitors.

If you want to get there, don't start from here. Saving the press by allowing the scumbags who bought the husks from the sociopaths that produced them is a fool's errand. We don't need collective bargaining for media companies: we need collective bargaining for JOURNALISTS.

And we need to fix the ad-tech market: unwind mergers, prosecute fraud, introduce competition.

That's what they edged towards in Australia with the news bargaining effort.

The Australian proposal mandated algorithmic transparency, a ban on retaliation against publishers that opt out of the duopoly, and other measures that were a welcome step to cleaning up the dirty ad-tech market.

But none of that came to fruition: instead, the Australian process turned into a pissing match between Facebook and Rupert Murdoch, and the two giants eventually struck a private deal that sidestepped any of these requirements.

As Danny and Katharine write, "Congress should focus its attention on making the sweeping changes to antitrust law we so desperately need. Figure out how to curb these oligopolies’ power."

Impunity for NYPD cops who brutalized BLM protesters (permalink)

Last summer, a bizarre war broke out over the NYPD's disciplinary records, long shielded from public scrutiny. The state legislature ordered these records published, the NYPD got a judge to block the order, but not before Propublica got a copy.

These records were pretty dismal reading, even though they really only served to confirm the obvious fact that the NYPD was completely out of control, incapable of applying even symbolic sanctions to cops who commited strings of violent crimes against the people of New York.

But of course, we knew that already. We knew about the string of police killings that went unpunished, no matter how egregious. To get a sense of how off-the-rails the NYPD is in Eric Umansky's expose of the ghastly 2019 murder of Kawaski Trawick.

Trawick was Black. The NYPD murders and maims Black people with especial, sadistic vigor. Despite a prohibition on the lethal choke-holds that killed Eric Garner in broad daylight, NYPD officer continue to choke, and choke, and choke Black men.

No surprise, then, that NYC was one of the focuses of last summer's BLM uprising. And no surprise that the protesters who turned out to demand an end to the NYPD's racist campaign of terror were subjected to unimaginable acts of official violence.

Now, Umansky reports on the Civilian Complaint Review Board's progress in investigating the cops who punched, kicked and trapped demonstrators, a progress report Propublica shamed the CCRB into releasing.

It's been nine months since the uprising, since the whole world saw endless videos of the NYPD's acts of egregious, unprovoked acts of violence. In that time, the CCRB has brought serious disciplinary action against two NYPD officers.


Nine months after the uprising, "60% of the agency’s 297 protest-related cases are still open…75 cases were closed before a full investigation could be completed."

How can this be?

Well, NYPD officers "[wore] protective gear with incorrect shield numbers." They "repeatedly said it had no body-worn camera footage of an incident" ("only to have investigators later discover that there was, in fact, footage").

As for those two officers facing serious discipline, have no fear: "commissioners have often used their discretion to overturn not only the CCRB’s recommendations for punishments but also rulings by NYPD hearing officers and even guilty pleas agreed to by police officers."

Aviation bailout cost $666k/job (permalink)

Since January of 2001 – 20+ years! – I've been digesting all the news I read that seems significant by writing summaries and analysis on a blog, first on Boing Boing and then on, my solo project.

This is an incredibly useful exercise, one that converts the fragmented and chaotic news-cycle into a series of puzzle pieces that slowly click together, building up a coherent picture of what's happened, what's happening, and what might happen.

About a decade in, I started reviewing my older posts every morning, going back one year, five years and ten years. I still do it, only now, it's #1yrago, #5yrsago, #10yrsago, #15yrsago, and #20yrsago. I repost the most significant of these each day in my blog and newsletter.

Today's edition contains a link to this one-year-old post, "American Airlines blew billions, now it wants a bailout ," describing how AA accumulated $30b in debt, mostly through stock-buybacks, and as begging for billions more in public funds.

This was – and is – outrageous. Over the period that AA was liquidating its cash-reserves through financial engineering schemes that made millionaires out of its stock-compensated C-suite, it was turning its service into flying garbage.

Prices went up, seats got smaller, routes got centralized around inconvenient, delay-plagued hubs. They lost bags. A year ago, Tim Wu catalogued these sins and more for the NY Times.

Wu proposed that a bailout for airlines (not just AA, but the whole monopolized sector, which had all committed AA's sins to varying degrees) should come with strings attached – ending surprise fees, minimum seat standards, and an end to common ownership.

Common ownership? Yes. All the airlines' cap tables have high degrees of overlap – that is, they all belong to the same investors. Or rather, investor. Single. Warren Buffett is nipple-deep in each of the American aviation giants.

Maybe you see Buffett as a folksy grampa. He's not. Don't let the old car and modest home fool you. Buffett's a pure Rockefeller sociopath, minus the flash. He only buys into monopolies, then squeezes customers and suppliers, destroying their lives.

The airlines were no paragons before Buffett bought giant slices of all the major aviation companies in the US, but afterwards, they got much worse. They withdrew from routes they competed on, leaving one supplier for each, who could raise prices without fearing competition.

They merged with one another. They squeezed their pilots, flight attendants, mechanics and baggage handlers. They introduced absurd fees, charging you for the privilege of selecting your seat in advance so you could be sure you got to sit with your small children.

The seats themselves shrank. So did the meals – which now cost a pretty penny. Canceling or changing a ticket became a luxury that cost more than the ticket itself. But the airlines could cancel or reroute you, or strand you on a runway.

If you didn't like it, they'd bring in uniformed thugs to literally beat you bloody and drag you out of your seat.

Even if you thought that the US government should take measures to ensure that there were still airlines plying the American skies after the crisis ended, only Warren Buffett and other major airline shareholders wanted this system to continue.

Well, it's been a year to the day since Wu's op-ed, and the NYT's Andrew Ross Sorkin is back in the paper, assessing the bailout that Big Plane got and what the public got in return.

All told, the airlines got $50B in public funds and saved 75,000 jobs. That's $666k per job. Now, obviously, the airlines didn't spend three quarters of a million dollars per employee over the past year – that money has gone to their shareholders, not their employees.

The shareholders are happy about this. Shares in United have tripled during the crisis. For United execs – paid in stock – that's a massive payday. For Warren Buffett, who owns far more stock that United's C-suite, it's a vast, permanent fortune.

The past year has seen the transfer of most of $50b from the federal government to the wealthiest execs and investors in America. The airlines weren't punished for squandering their pre-pandemic warchests on buy-backs. They were rewarded for it.

The right likes to wring its hands about "moral hazard":

"If we ensure people who lose their jobs don't starve or end up homeless, why would they show up for work?"

This is just cruelty dressed up as rationality.

But moral hazard IS real, and applies exclusively to remorseless plutes. With the aviation bailout, the US government has signaled to airline execs and investors that if you spend the company dry while enriching yourself, Uncle Sucker will bail you out, no strings attached.

Other travel-related sectors – hotels, rental cars, restaurants, travel agencies – didn't get bailed out. The airlines, meanwhile, got so much money they literally can't figure out how to spend it all.

How else to account for United blowing $20m on a daffy electric helicopter startup that went public through a scammy SPAC (the reigning speculative garbage fire – until NFTs arrived on the scene).

The airline bailout did come with strings, but they were illusory. Capping exec pay is meaningless when bailout money can be used to inflate share prices and make overnight millionaires out of top management. The warrants given to the Treasury are infinitesimally cosmetic.

The airlines aren't too big to fail. No company is. The lesson here is that if Congress offers a blank check to a monopolist to save jobs, the monopolist will charge the federal government $666,666.66 per job, and pocket 90%+ of that.

This day in history (permalink)

#15yrsago Marvel Comics: stealing our language

#15yrsago MPAA/RIAA/BSA: No breaking DRM, even if it’s killing you (literally!)

#10yrsago Up Against It: smart, whiz-bang space opera pits astro-bureaucrats against rogue AIs

#10yrsago Tim Wu in the Guardian

#10yrsago Anti-labor ads celebrate workers taking paycuts and CEOs getting millions

#5yrsago FBI issues car-hacking warning, tells drivers to keep their cars’ patch-levels current

#5yrsago BART’s twitter manager drops truth-bombs, world cheers

#5yrsago Medusa’s Web: Tim Powers is the Philip K Dick of our age

#5yrsago Apple engineers quietly discuss refusing to create the FBI’s backdoor

#5yrsago Chelsea Manning gets the US Army to cough up its “insider threat” training docs

#1yrago 3D printed ventilator hero got a patent threat

#1yrago How to split a single ventilator for four patients

#1yrago John Green's mutual aid manifesto

#1yrago American Airlines blew billions, now it wants a bailout

#1yrago Charter orders all workers to keep showing up

Colophon (permalink)

Today's top sources: Naked Capitalism (, Eric Umansky (

Currently writing:

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