Post-New Hampshire.

The Clinton comeback was stunning and reminiscent of George H.W. Bush's win there in 1988. In both cases, everyone "knew" they were dead and buried. In both cases, they weren't. New Hampshire voters apparently don't like gang tackling when combined with late hits.

On the GOP side, I make the case that Gov. Huckabee's campaign was the real beneficiary of the McCain comeback. It will help him in Michigan and it should help him in South Carolina. You can read the column here.

Iowa.

A terrible defeat for Mitt Romney. Iowa was important because the Christian base of the party had a long time to mull over a Mormon candidate, who was well-funded and eager to please. They rejected him. If they rejected him in Iowa, they will reject him in Georgia and Florida and Texas and Ohio and Illinois and Missouri and North Carolina and Washington State.

Trust me on that.

Here's my Romney obit which is posted at Real Clear Politics.

Phil Dusenberry.


The obit is here. During his tenure as executive creative director at BBDO, the initials were said to mean: "Bring it Back and Do it Over." He was the best there ever was at what he did. And a prince among men. He died at the age of 71.

Immigration.

It is clear in Iowa that immigration is the great issue that won't go away. Members of the American elite, including U.S. senators, continue to do damage to the public debate on immigration. They do not view it as a crucial question of America's continuance. They view it as an onerous issue that might upset their personal plans, an issue dominated by pro-immigration groups and power centers on the one hand, and the pesky American people, with their limited and quasi-racist concerns, on the other.

Because politicians see immigration as just another issue in "the game," they feel compelled to speak of it not with honest indifference but with hot words and images. With a lack of sympathy. This is in contrast to normal Americans, who do not use hot words, and just want the problem handled and the rule of law returned to the borders.

Politicians, that is, distort the debate, not because they care so much but because they care so little.

Hillary Clinton is not up at night worrying about the national-security implications of open borders in the age of terror. She's up at night worrying about whether to use Mr. Obama's position on driver's licenses for illegals against him in ads or push polls.

A real and felt concern among the candidates about immigration is a rare thing. And people can tell. They can tell with both parties. This is the real source of bitterness in this debate. It's not regnant racism. It's knowing the political class is incapable of caring, and so repairing.

--Peggy Noonan, WSJ, December 14, 2007

The Future of Warfare

Is genomic. And the first really comprehensive overview of the threat can be read here. It's useful to remember that this is not futuristic stiff. About five years ago, some scientists purchased chromosomes from the back of some science magazines and re-engineered the polio virus, genetically modified it and delivered the results to NIH. You can read about that (and other, similarly terrifying "developments") here.

Political Commentary.

I've long been a fan of Real Clear Politics. Jmac and Tom Bevan have done an amazing job building out the indispensable political website. And they are adding to their empire! Next week, the official launch of Real Clear Markets and Real Clear Sports will occur. Those sites are "live" now, if you want to check out the betas.

Anyway, I'll be filing columns with Real Clear Politics from time to time. And here's the first one, which was posted today.

General Wayne Downing

A great soldier died yesterday at the age of 67. It was no surprise that immediately after the attacks of 9/11, President Bush turned to him for help. He was the guy you called in situations like that.

Merry Christmas.


Ellisblog is on a more or less permanent hiatus, due to other work. But we wish you a Merry Christmas and a happy and healthy New Year.

Columns.

Below is a column I wrote a while back about a private equity group's scheme to acquire The Boston Globe from The New York Times. In the column, I opined that Times Publisher and CEO Arthur Sulzberger "would be a fool" to sell the Globe at this juncture. I no longer believe that. I now think he should sell all of the "New England assets" (The Globe, the Worcester paper, the Red Sox stake and the NESN stake), and gather up $1 billion-plus. This would enable the Times company to enter the next (2009-2010?) recession loaded with cash.

The fact is that the Globe is doomed. Without union concessions, the cost structure doesn't work. And the unions will never concede anything, ever. So the NYT might as well get $600 million for it now, rather than $300 million for it in 2010.

Squeeze Play

By JOHN ELLIS
October 31, 2006; Page A18

Last week in Boston, a group of local businessmen led by Jack Welch let it be known that they were interested in acquiring the Boston Globe from the New York Times Company for $500-$600 million. The offer served to put the Globe "in play" (as the talking heads say) and to galvanize Class B (non-family) shareholders of Times stock, already up in arms about mismanagement and financial performance.

The public side of this saga began on Oct. 19, when Times Chairman and CEO Arthur Sulzberger received a letter from Sen. Edward Kennedy and a motley crew of local pols and labor skates demanding that the Times stop "disinvesting" in the Globe and sign a pending labor agreement with Globe employees. Picking a fight with the Times has long been the express lane to oblivion in Democratic Party politics. The fact that a gaggle of Democratic pols was picking a fight with it over one of its owned properties meant that private equity could not be far behind. And indeed it was. Whenever a company is "in play," the prospect of auction looms. Buyers hate auctions. They serve only to drive up price. Private-equity firms spend countless hours scheming to derail auctions, often enlisting competing private-equity firms into their consortium to short-circuit the process. Sellers, of course, love auctions and generally insist that they occur to "maximize shareholder value."

What made the Team Welch bid remarkable was its keen understanding of the auction process and its skillful leveraging of local assets toward shutting down any possibility of same by the Times. The Kennedy letter wasn't meant for Mr. Sulzberger; it was a message to other private equity firms: We have the local pols and labor leaders on our side. The presence of Jack Connors, Boston's leading ad-man, as a partner in the deal was another message to private-equity firms: We have the best-connected guy in the city and he employs a lot of people who decide where to place advertising in local media. The inclusion of Joe O'Donnell, concessionaire and one of Boston's favorite sons, sent another message: We have friends on both sides of the aisle. And, oh, by the way, "Jimmy" Lee of J.P. Morgan Chase is crunching the numbers and will provide Team Welch with all the financing it could ever need. Usually, the more public the process is, the more likely an auction results. But by tilting the mirrors of perception in public, Mr. Welch left other private-equity players with the following choice: Sign on with Team Welch or risk a nasty, local bidding war that will doom the upside in the deal for everyone.

Now comes the tricky part. Mr. Welch and Mr. Lee must get shareholders of Times B-shares to clamor for the sale of the Globe. Morgan Stanley has been vocal about its disappointment with Times senior management and must decide whether it should push for a sale. Ordinarily, they would push for an auction to maximize return. But with Welch and Co. having effectively shut that door, they may find themselves endorsing the deal (demanding a higher price) and calling it a day. If enough Class B's join with Morgan Stanley clamoring for a sale, pressure on Mr. Sulzberger would be ferocious.

Mr. Sulzberger would be a fool, of course, to sell the Globe to anyone at this juncture. The transition from newsprint to pixels has been a painful one for newspaper companies everywhere. Print advertising revenues have hemorrhaged. But Web 2.0 is just around the corner and social networks have emerged as the engine of growth on the Internet. Combine shared interests (social networks) with publishers (content aimed at those interests) with targeted advertising (specific to those interests) and you have the makings of a money machine. On any given day in the summer, more people read the Globe's Red Sox blog than buy the physical newspaper. The blog is a social network. The content that is published there doesn't cost much to produce. Red Sox stuff sells like hotcakes all across America. Everyone shares in the revenue.

The Times has said it has no interest in selling. Jack Welch and Co., having capped the price by taking auction out of play, must now move decisively to force a sale. It's a long shot -- but the skill with which Team Welch has played its hand so far suggests that the future ownership of the Boston Globe is still an open question.

Viacom

Here's the column I wrote for the Wall Street Journal's op-ed page about the shake-up at Viacom. Jim Cramer has an excellent column on the same subject in last week's issue of New York magazine. And last Friday's "Heard on the Street" provides a good insider-y account of how Viacom's stock rebounded last week.