Home State Blues
Senator John Edwards (D-NC) would lose his home state to President George W. Bush by 56%-40%, according to a new poll. Worse, a plurality of North Carolinians don't want him to seek the 2004 Democratic presidential nomination.
This is the kind of news that gives fund-raising types the heebie-jeebies.
Saluting Sgt. Hall
A small armada left San Diego yesterday, en route to the Persian Gulf. The New York Times has a great story on the emotional farewell. "It used to be that people at home worried about you coming home," US Marine Sgt. Scott Hall told the Times, "but nowadays you worry about what's going on at home. Tell New York they're in my mind."
Sexual Politics
Tom Edsall has a smart piece about attitudes towards sex and voting behavior. He says that in the absence of war, these attitudes favor the Democrats.
Thanks to reader A.M. for the heads up.
Richard Parsons today assumed the additional role of chairman of the board of AOL Time Warner. I wrote about this for yesterday's Wall Street Journal and for those of you who are not subscribers to the wsj.com site, this is what I said:
Case Closed
By John Ellis
Shortly after AOL's acquisition of Time Warner was announced in January 2000, Time Warner CEO Gerald Levin explained that he had decided to sell because he couldn't figure out how to harness the power of the Internet. He reasoned that by harnessing Time Warner to AOL, a new/old media juggernaut would be born. Shortly after that, Mr. Levin was named chief executive officer of AOL Time Warner. The inherent contradiction of having someone flummoxed by the Internet run a supposedly Internet-driven enterprise struck many observers as emblematic of what ensued.
Immediately after Steve Case announced that he was stepping down as chairman of AOL Time Warner, the company put out a statement saying that Mr. Case would remain on the board of directors and would continue to serve as co-chairman of the company's strategy committee. That contradiction -- he has to go but he can stay as the company's chief strategist -- will hopefully not be emblematic of what comes next.
Mr. Case's demise marks the end of AOL's influence within the larger enterprise. The Time Warner team now assumes complete control. It seems likely that by the end of this year, they will drop AOL from the company's name and sell or spin off the AOL business. If they could, they'd probably do it today.
But then what? Right now, AOL Time Warner is $25 billion in debt. It has lost $200 billion in market capitalization in two years. It will soon write off another $15 billion for the 4th quarter of last year. It is under investigation for "accounting irregularities" and the possibility of criminal prosecution looms. And its various business units, with a couple of notable exceptions, continue to underperform. The notion that the company can now coalesce around a common purpose is laughable. Time Warner has always been about egomaniacs running fiefdoms and raiding each other's turf. Division heads collaborate only to kill off rivals. They collaborated to kill off former COO Robert Pittman and Chairman Case. Now they'll start on each other.
The notion that the company even has a common purpose is dubious, at best. The ceaseless hyping of Time Warner entertainment in the pages of Time Inc. magazines diminishes their editorial integrity. High-speed Internet access through Time Warner cable systems diminishes the value of Warner Brothers music (since customers can download music for free at blazing speed). Time Warner cable systems enhances the value of HBO, which diminishes the value of Warner Brothers TV. And on and on it goes.
The only way synergy can be realized is if all the companies within the enterprise agree to share data and to invest in the information technology that makes data-sharing an operational fact. Management consultants call this "information technology interoperability." IT interoperability means that when a Time Warner cable system subscriber watches an HBO special presentation, every other business unit is made aware of that preference and is invited to approach that subscriber with relevant material. A Sopranos fan might be asked to buy an album of Sopranos music or a Sopranos cookbook or Sopranos DVDs. A Tiger Woods fan might be offered both a subscription to Golf magazine and Sports Illustrated, as well as a Warner Books guide to the best 100 golf courses. You get the idea.
Let's just say that "interoperability" isn't a keyword with Time Warner types. They're more interested in tangible things like corporate jets and idling Town Cars waiting to whisk them off to the Four Seasons for lunch. Spending time and money with techies is your typical Time Warner chieftain's idea of corporate hell.
Synergy is for suckers, and they know that. The only viable strategy that AOL Time Warner CEO Richard Parsons can follow is divestiture and the recombination of various parts. Selling off AOL will help pay down some of Time Warner's debt. Selling off all or part of CNN will help pare it down some more. Selling the music and book business will cut costs and raise extra cash. He will then be left with three basic businesses; magazine publishing, entertainment media and cable TV. All are strong and -- in an improved advertising market -- prosperous. Sell one and the other two are stronger still. Finding the right combination of companies to keep together will be the key to unlocking shareholder value and the creativity that exists at the edge of the individual business enterprises.
The truth about AOL Time Warner is that the parts are worth more than the whole. This truth is not lost on Mr. Parsons. What Messrs. Levin and Case brought together, he must now tear asunder and reconfigure.
Mr. Ellis writes the "Strategy" column for Fast Company magazine and is a partner at Ellis Kreamer Partners.
Walter Mead
Sometimes quality shines through. Following is a press release from the Council on Foreign Relations:
Walter Russell Mead has won the Lionel Gelber Prize for outstanding writing on international affairs for his book "Special Providence: American Foreign Policy and How It Changed the World" (Knopf, 2001). The book examines American foreign policy over the past two centuries.
The winner was announced today by Patricia S. Rubin, Chair of the Lionel Gelber Prize Board, in partnership with Janice Gross Stein, Director of the Munk Centre for International Studies, University of Toronto, and Moisés Naím, Editor of Foreign Policy magazine in Washington. The Economist has called the Lionel Gelber Prize, which has a cash value of $30,000 Canadian, "the world's most important award for non-fiction."
It really is a great book.
Synergy is for Suckers
The Wall Street Journal today has a piece about the most recent developments at AOL Time Warner and what they imply. Since I wrote it, I urge you to read it.
Funny Joke.
A guy sees a sign in front of a house:
"TALKING DOG - FREE TO GOOD HOME"
The guy stops at the house to inquire about the dog and the owner tells him "The dog is in the backyard."
The guy goes around to the back yard and sees a mutt sitting there. "You talk?" he asks the dog.
"Yep" the mutt replies.
"So, what's your story?"
The mutt looks up and says "Well, I discovered this 'gift' while I was pretty young and I decided I wanted to help the government, so I told the CIA about my gift, and in no time they had me jetting from country to country, sitting in rooms with spies and world leaders, because no one figured a dog would be eavesdropping. I was one of their most valuable spies eight years running. But the jetting around really tired me out, and I knew I wasn't getting any younger and I wanted to settle down. So I signed up for a job at the airport to do some undercover security work, mostly wandering near suspicious characters and listening in. I uncovered some incredible dealings there and was awarded a batch of medals. And in time I found a bitch, mated, had a mess of puppies, and now I'm just retired."
The guy is floored ... and says to the owner, "This dog is amazing, ...just Incredible! Why on earth are you giving him away?
The owner just shakes his head and replies "Well, for starters, he's a fucking liar."
Die Another Day
Kim Jong-il, North Korea's maximum leader, is a big movie buff. He has a huge collection at his residence and has been known to stay up half the night watching Hollywood classics like Scarface and The Godfather. My half-baked theory regarding North Korea's ridiculous behavior of late is that Kim saw "Die Another Day," the new James Bond movie, and decided that he had somehow been slandered. I think he thinks that we think he killed his father. And that the Bush Administration had this slander inserted into the movie's plot line.
MI5
Stuart Taylor has a good column on reconfiguring US counter-terrorism efforts. You can read it by clicking here.
A Better Job
Walter Isaacson is leaving CNN to become the head of the Aspen Institute. His letter to colleagues at CNN explains why. Isaacson's departure is a huge loss for AOL Time Warner.
That Kennedy Quote
A number of readers have written to say that they thought I took Charles Pearce's quote about Senator Edward Kennedy out of context. Since I included a link to Mr. Pearce's Sunday Globe magazine piece with the quote, I felt that that was all the context one could possibly need. But assuming that some people read the quote, but not the piece, what follows is a letter from a colleague of Mr. Pearce's:
Mr. Ellis:
I write in defense of my good friend and colleague Charlie Pierce, who wrote the cover story on Ted Kennedy from which you lifted the quote about Mary Jo Kopechne. As soon as I saw the byline on the article, I knew Charlie couldn't have said that with a straight face, and a quick reading of the article shows I was right. Here's the context... Charlie is riffing on a line used against Teddy Kennedy in his first campaign, that if his name was Edward Moore, his candidacy would have been a joke:
"And what of the dead woman? On July 18, 1969, on the weekend that man first walked on the moon, a 28-year-old named Mary Jo Kopechne drowned in his automobile. Plutocrats' justice and an implausible (but effective) coverup ensued. And, ever since, she's always been there: during Watergate, when Barry Goldwater told Kennedy that even Richard Nixon didn't need lectures from him; in 1980, when his presidential campaign was shot down virtually at its launch; during the hearings into the confirmation of Clarence Thomas, when Kennedy's transgressions gagged him and made him the butt of all the jokes.
"She's always there. Even if she doesn't fit in the narrative line, she is so much of the dark energy behind it. She denies to him forever the moral credibility that lay behind not merely all those rhetorical thunderclaps that came so easily in the New Frontier but also Robert Kennedy's anguished appeals to the country's better angels. He was forced from the rhetoric of moral outrage and into the incremental nitty-gritty of social justice. He learned to plod, because soaring made him look ridiculous. "It's really 3 yards and a cloud of dust with him," says his son Patrick. And if his name were Edward Moore, he would have done time.
-snip-
And that's the key. That's how you survive what he's survived. That's how you move forward, one step after another, even though your name is Edward Moore Kennedy. You work, always, as though your name were Edward Moore. If she had lived, Mary Jo Kopechne would be 62 years old. Through his tireless work as a legislator, Edward Kennedy would have brought comfort to her in her old age."
It's part of the thesis of his article, that Kennedy has tried to bury his many disgraces through substantive, if small, achievements. That's arguable, but it's far more serious than your selective quoting suggests.
Best,
Peter
J. Lo!
One of the weird things about living in New York is the city's obsession with Jennifer Lopez. There's a funny piece about this in The New York Observer, which is worth a look.
31 Under Par
Without Tiger on the scene, Ernie Els would be Tiger; the dominant player in the game. He laid down a marker at the Mercedes Championship this weekend. It's too bad we can't fast-forward the tape to Augusta right now.
Out
Steve Case is out as chairman of AOL. Supposedly, this means that AOL itself will be sold or spun off and that the ABC-CNN merger will now move to the front-burner. The former is probably true. The latter remains problematic, to say the least.
Edsall on Democratic Money Woes
How is it that Tom Edsall owns the ongoing story of the Democratic Party's fund-raising woes? Is no one else interested? Does no one else understand the implications? Edsall has another solid report today.
Baker on North Korea
Former Secretary of State James Baker has a smart piece in today's Los Angeles Times on what the US must do to face down North Korean blackmail. I found the piece at what has become the best political "infomediary" on the web, Real Clear Politics.
Ernie Els
After three rounds, the smooth-swinging South African is 25-under par at the Mercedes Championships. Astonishing as that it surely is, more astonishing is that he may not win the golf tournament. K.J. Choi shot 62 yesterday (11-under par) and is only two shots of the pace.
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