Hook, Line and Sinker
Rusty Guinn
October 1, 2020·9 comments·Money
A choice has been reframed as an inevitability. When airlines announced massive layoffs during the pandemic, executives pointed to Congress. Media outlets across the political spectrum echoed the framing. But the actual decision about how to structure support, preserve jobs, and protect capital was never Congress's alone to make.
- The narrative spread with remarkable speed. News reports from CNN to Breitbart to local CBS affiliates all centered the same premise: Congress was responsible for worker furloughs. The talking point achieved what most corporate messaging cannot: unified coverage across the entire political spectrum in a single direction.
- The framing depends on a hidden equation. What executives presented as synonymous (that financial support for airlines equals support for current shareholders, executive compensation, and stock prices) are actually separate things. The public interest in keeping airlines operational doesn't require protecting any particular ownership structure.
- Media didn't investigate the premise. Business journalists saw the narrative and reported it as fact rather than as a claim worth examining. The speed and uniformity suggest the story was pre-positioned and simply accepted when offered.
- This succeeds because audiences carry one idea at a time. The public can recognize that airlines are critical infrastructure and that workers deserve protection. What becomes difficult is holding both that recognition and a separate skepticism about how support should be structured.
- What's at stake is how future corporate crises get narrated. If executives can successfully redirect accountability to government while framing their own decisions as inevitable, the template is established for every industry that claims strategic importance. The question is whether media will recognize the pattern or continue swallowing each new narrative whole.
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Comments
As I’ve said on my Twitter header forever - “Humans do 2 things well: Tell stories & work in teams.” The antidote to a well-told story is a better-told story.
True in almost every circumstance! Although I would also accept as an acceptable antidote fewer storytellers among those (e.g. financial media) who purport to be truth-tellers.
When you get CNN and the Washington Examiner to both bite on the same narrative that’s genuinely impressive. They captured pretty much the full spectrum of right to left with one message, which was basically “why aren’t you in favor of these workers keeping their jobs? What do you have against them?” Just brilliant.
Bread and Circus. I would be completely in favor of bringing back the Lions and setting them loose on the political class. Would make the battle of the septuagenarians significantly more interesting.
Why can’t I shake this feeling of Ponzi? If rates move off of 0%, it all comes down. If we don’t allocate more to risk, it all comes down. If the Fed doesn’t supply more liquidity, it all comes down. If the government doesn’t bail something out, it all comes down.
Tulip, South Sea, Mississippi … What should we call this one?
All true. Two related notes. (1) MSM gullibility worsened as politicians (both parties) have hammered point that taxpayer aid was for “workers” while it was actually a ploy to give airline stock prices a quick boost (2) One of the less noticed impacts of extreme industry consolidation is that it eliminates all critical thinking in the trade press, since any outlet that doesn’t slavishly endorse the narrative can be cut off. As have been writing since April, its not just that ample public evidence contradicts the airline narrative, but after six months, absolutely no one within the industry dares challenge the narrative. See https://www.nakedcapitalism.com/2020/08/hubert-horan-the-airline-industry-collapse-part-3-recovery-expectations-were-always-dreadfully-wrong.html
It is hard to say, because the US Dollar permits us (for now, anyway) to act like there are no consequences for far longer than any of us would ever expect. The Long Now can be exceedingly long.
But if I was picking, I’d go with “Boomer.”
I have been fuming for months over the ridiculous airline bailouts.
A neighbor of mine is a United Pilot. He hasn’t flown since March but is on full pay and just bought a 37 foot power boat so he has something to do. Meanwhile, I’m effectively paying his $200,000 salary through my taxes.
If we did not have the bailouts, the planes would still be there, the airports would still be there, the pilots would still know how to fly. The shareholders and bondholders might get wiped out, and the pilots might make $125,000 in the future, but who cares?
Bank smoothed treasury oil
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