Obama cabinet official Peter Orszag took a spin through the revolving door and ended up in a million-dollar sinecure at Citigroup, which is still part owned by the government.
James Fallows has the best take on that, calling it “damaging and shocking”:
Shocking, in the structural rather than personal corruption that it illustrates. I believe Orszag (whom I do not know at all) to be a faultlessly honest man, by the letter of the law. I am sorry for his judgment in taking this job,* but I am implying nothing whatsoever “unethical” in a technical sense. But in the grander scheme, his move illustrates something that is just wrong. The idea that someone would help plan, advocate, and carry out an economic policy that played such a crucial role in the survival of a financial institution — and then, less than two years after his Administration took office, would take a job that (a) exemplifies the growing disparities the Administration says it’s trying to correct and (b) unavoidably will call on knowledge and contacts Orszag developed while in recent public service — this says something bad about what is taken for granted in American public life.
When we notice similar patterns in other countries — for instance, how many offspring and in-laws of senior Chinese Communist officials have become very, very rich — we are quick to draw conclusions about structural injustices. Americans may not “notice” Orszag-like migrations, in the sense of devoting big news coverage to them. But these stories pile up in the background to create a broad American sense that politics is rigged, and opportunity too. Why do we wince a little bit when we now hear “Change you can believe in?” This is an illustration.
I’d love to see the full-blown Fallows treatment on this theme in an upcoming issue of The Atlantic. Sort of a companion piece to Simon Johnson’s fantastic “The Quiet Coup.”
— Speaking of The Atlantic, The New York Times reports that the longtime money loser is now in the black. How did that happen in the worst recession in eighty years?
The Times credits the mag’s focus on the Web, but that’s only part of the story.
Since 2005, revenue at The Atlantic has almost doubled, reaching $32.2 million this year, according to figures provided by the company. About half of that is advertising revenue. But digital advertising — projected to finish the year at $6.1 million — represents almost 40 percent of the company’s overall advertising take. In the magazine business, which has resisted betting its future on digital revenue, that is a rate virtually unheard of.
This is good news, but I wish the Times had broken out the magazine’s revenue better. Doubling the magazine’s revenue in five years is fantastic, but the Web doesn’t account for most of that gain. We should have been told what online revenue, which is now at about $6 million a year, grew from. And while getting more money from the Web has helped push the magazine into profitability, it’s still less than 20 percent of The Atlantic’s revenue.
— I pointed to a Journal story on Monday looking at how Google is using its dominant market position to benefit its own products.
So it’s worth noting that the Washington Post had a nice story the same day. Its angle is sharp:
Google this year has been gobbling up Web companies that look nothing like Google, from a social gaming start-up to a firm that powers most online sales for the airline industry.
As the tech giant spreads its reach, it is making new enemies who fear that once Google steps onto their turf it will use its almighty search engine to quash them. Now, these critics are pushing antitrust officials to block some of Google’s mergers or build a blockbuster case against the search behemoth, reminiscent of the government’s battle with Microsoft.
And this is interesting:
At a conference this month organized by Consumer Watchdog, an FTC lawyer laid out potential arguments to prove that Google is illegally abusing its market power.
On The Atlantic, the NYT story gives it much less play but does note at the bottom that the company's branded conferences "now make up more than 14 percent of its total revenue." That's about $4.5 million, which isn't all that far from the $6.1 million in digital ad revenue.
That's not surprising -- the reorientation around the Web and aggressive efforts to franchise the brand name are the two defining features of The Atlantic over the last few years, so it makes sense that that's where revenue growth is coming from. It's also not surprising that the Times emphasized the Web angle, which a) slots easily into the running debate over whether news orgs can make money online, and b) is probably more flattering to journalists' egos.
(Of course, those conferences cost something to put on too, but the Times article doesn't list those costs so we don't know how much the events contributed to overall profits.)
#1 Posted by Greg Marx, CJR on Thu 16 Dec 2010 at 01:38 PM
As a moderate liberal Democrat I take Atlantic so I can go into the archives when so desired. Also, though they claim conservative Republican, they have also put Pres. Bush in his place regarding Guantanamo in particular and other items are not necessarily "conservative" but mostly common sense actions needed by both sides. They are also more stable with money sent for subscriptions even if "lost" for a period of time. With a few liberal magazines, I have more difficulty having them record my check and then "find" that which gets lost. We also have to remember that many liberal magazines,i.e. Harpers and The Nation are not for profit. I don't know which Lapham's Quarterly is.
But that's why I refuse to subscribe and/or renew online. It's too easy to get lost and I end up paying twice. I spend over $1000 annually for magazines and newspapers so I don't have money to replace lost payments.
The Atlantic still has items I like being there but others I don't. As the Spanish say "Asi es la vida!" If the Atlantic is true to its word, it will put out where its profits came from even though The Times didn't.
#2 Posted by Patricia Wilson, CJR on Thu 16 Dec 2010 at 03:39 PM