The Good, the Bad & the Ugly
CNBC Host to Obama Adviser: Ask Yourself – 'What Would Milton Do?'; ABC Grills Exxon CEO over ‘Obscene’ Profits; Green Is Not the Color of NBC’s Beijing Olympic Broadcast

August 20, 2008

The Good
     Too often the liberal perspective on taxation and redistribution of wealth goes unchallenged by the media. That was not the case on CNBC August 14.

     "Squawk Box" fill-in co-host Michelle Caruso-Cabrera wasn't afraid to buck the trend and challenge Democratic presidential nominee Sen. Barack Obama's senior economic adviser Austan Goolsbee.

     Goolsbee appeared on the August 14 "Squawk Box" to defend an op-ed he wrote for the August 14 Wall Street Journal outlining Obama's tax plan. Caruso-Cabrera invoked the name of Milton Friedman, an economist who was a primary proponent of free markets throughout the 20th century. Ironically, Friedman taught at the University of Chicago, where Goolsbee is a faculty member.

     "WWMD, Austan - what would Milton do? Remember that," Caruso-Cabrera said. "Remember your roots - what got you to where you are."

     Goolsbee, in other media appearances, has also consistently defended the Obama plan by claiming the overall rate would be lower than it was under former President Ronald Reagan.

     "He's outlined a program that's paid for and keeps the overall tax rate in the economy the same as what it was under Ronald Reagan," Goolsbee said.

     Goolsbee was referring to the tax rates as a percentage of gross domestic product compared to Reagan – as Caruso-Cabrera pointed out on CNBC's August 14 "Power Lunch." But "Power Lunch" co-host Sue Herera warned with the current economic conditions, it would be no time to raise taxes on anyone (Obama wants to raise taxes on “the rich”).

     "[W]e're at a very fragile state in this economy," "Power Lunch" co-host Sue Herera added. "If indeed - as [CNBC contributor] Dennis [Kneale] suggests, we're at an inflection point at either the economy or the stock market, this is the worst time to raise taxes. You want to improve the economy? Cut spending, don't raise taxes."

     Caruso-Cabrera wasn't playing favorites with political parties. She also had strong criticisms for the Republican Party on CNBC's August 14 "Power Lunch."

     "[T]he Republicans have not had truth in advertising," Caruso-Cabrera said. "They were supposed to be the party of smaller government. They were supposed to stay out of your pocket and out of your bedroom and they didn't do either of those things. They did just the opposite."

The Bad
     Maybe it was a stab by Charles Gibson to provide a national group therapy session for his 8 million viewers, but the ABC "World News" anchor aggressively questioned ExxonMobil CEO Rex Tillerson on the August 14 broadcast for "obscene" profits and asked him to "justify" the company's success.

     "As we said earlier, Rex Tillerson - who is the board chair and CEO of ExxonMobil, doesn't talk often to the press," Gibson said. "His company has reported remarkable profits in the first half of this year. The high price of gas brought ExxonMobil close to $22 billion in profit - in profit - for the first half of this year. I asked him how he justifies that amount, that some see as obscene."

     But Tillerson explained to Gibson it was the nature of a large business that performs an incredible amount of transactions.

     "Everything we do, the numbers are very large," Tillerson replied. "I saw someone characterize our profits the other day, in terms of $1,400 in profit per second. Well, they also need to understand we paid $4,000 a second in taxes. And we spent $15,000 a second in costs. We spend $1 billion a day just running our business. So, this is a business where large numbers are just characteristic of it."

     As a report posted on American Petroleum Institute's Web site on July 25 explained, Exxon (NYSE:XOM) and other oil companies' profits reflect the size of the companies and the industry and aren't necessarily a good reflection of financial performance in terms of what they are charging at the pump. In other words, the profits are high because of volume, not profit margins.

     Gibson also questioned Tillerson about the public's attitude toward Exxon and others. He asked the CEO if he could empathize with consumers – as if he had any ability to alter market forces which have drove the price of oil to record highs, but have since receded.

     "Do you understand and can you appreciate from your position, with the escalation of the price of a gallon of gas, why people are fed up, angry, indeed disgusted, with the oil companies?" Gibson asked.

     Tillerson wouldn't comment specifically on the public "anger." "Well, I can understand why people are very upset and why they're very worried and concerned about their ability to deal with these high prices," Tillerson said. "In terms of where they should direct their anger, I don't think it's useful for me to comment on that. Although, it does bother that much of that is directed at us."

The Ugly
     Do as we say, not as we do must be the new theme for NBC. Despite pushing green living in news reports, NBC wasn’t exactly going green at the 2008 Summer Olympics.

     WTHR, the NBC affiliate for Indianapolis, reported from Beijing and described the set used for the network's two highest-rated news broadcasts, "Nightly News" and "Today," as air conditioned. But those sets were outdoors!

     "The set is outside, but air conditioning vents make the weather bearable," Anne Marie Tiernon wrote for WTHR Eyewitness News on August 14.

     NBC "Today" co-host Matt Lauer also remarked about the air conditioning, but complained the weather was still uncomfortable even with the luxury.

     "The first couple of nights even with the air conditioning it was steamy in here, but we've been lucky ever since," Lauer said to WTHR. "It's been overcast some days, takes the temperature down. We call it fog smog."

     Last fall, the network performed a publicity stunt on the November 4 broadcast of its highly-rated Sunday Night NFL show, "Football Night in America." The broadcast used limited lighting for the broadcast and even went completely dark for the final moments of the program.

     That effort was to raise awareness and set an example for the rest of the country. But it seems the network wasn’t setting an example for China, the world's biggest polluter, while covering the Beijing games.

The Good, the Bad & the Ugly tracks the best and worst media coverage of business and economics. Readers are invited to submit suggestions or news tips to Staff Writer Jeff Poor at jpoor@mediaresearch.org.