SOUTHWEST AIRLINES: ANOTHER EXAMPLE OF EXTREME CAPITALISM

Southwest Airlines and its debacle of canceled flights around the Christmas holiday is another example of the extreme capitalism that U.S. policies have allowed to flourish. These policies of deregulation, a lack of support for workers and unions, and failure to enforce antitrust laws have allowed profits and returns to shareholders to trump all other goals and responsibilities of businesses.

(Note: If you find my posts too much to read on occasion, please just read the bolded portions. They present the key points I’m making.)

Southwest Airlines canceled over 17,000 flights in the couple of weeks around the Christmas holiday. It canceled far more flights than any other airline; some days it was responsible for 90% of the flights canceled in the U.S. On some days it canceled two-thirds of its flights while other airlines were canceling 2% or fewer of their flights. Although the weather contributed to triggering the cancellations, other airlines coped much, much better with the weather conditions. [1]

The dramatic extent of Southwest’s cancellations was caused, not bad by weather, but by extreme capitalism that has pushed its workforce to the limit and failed to invest in needed infrastructure, while maximizing profits and returns to shareholders. Southwest’s management admitted that the cancellations were primarily due to the failure of internal systems and technology, particularly its personnel scheduling system. Its unions have been highlighting the need for an improved personnel scheduling system for years.

Workers had been complaining about their treatment even before the December meltdown – 16-hour days, mandatory overtime, and a requirement for a doctor’s letter to take a sick day – driven by very thin staffing levels, driven in turn by the push to maximize profits. Things only got worse with December’s problems. Some of Southwest’s unions are talking about going on strike, with much of the focus on working conditions.

Southwest is not a corporation that has been struggling to survive; rather it’s one that’s very profitable. It’s had profits of $5.9 billion and $5.4 billion in 2022 and 2021, respectively, while revenue has grown from $9 billion in 2020 to $15.8 billion in 2021 and $22.7 billion in 2022. It received $7 billion in pandemic relief funds from the federal government, but nonetheless laid off 7,800 workers between March 2020 and July 2021. Its CEO was paid $9 million in 2022 and it spent $2 million on lobbying in 2021 – 2022.

Furthermore, from 2017 through 2019, Southwest spent $5.6 billion of its profits on buying back its own stock and then another $451 million on buybacks in the first quarter of 2020 (as the pandemic was hitting). Using its profits for stock buybacks enriched shareholders and executives, when it could have invested them in workers or needed infrastructure and technology instead. [2] Furthermore, in December 2022, Southwest resumed paying $428 million a year in dividends to shareholders. (Dividends were suspended in the first quarter of 2020 when the pandemic hit). Clearly, Southwest could afford to invest in infrastructure improvements and to treat its employees reasonably.

Despite its horrible performance in December, in January 2023, Southwest announced the promotions of five executives, including the person in charge of network operations. While customers suffered, it seems there’s no accountability for executives. [3]

So far, the federal Department of Transportation has not imposed any penalties for Southwest’s December meltdown. Members of Congress, union representatives, and consumer advocates are all calling for an investigation of what happened, of delayed refunds to customers, and of possible deceptive business practices (such as letting customers book flights when Southwest knew if didn’t have the personnel to operate the flights, which at least three airlines are being investigated for doing).

Better government oversight of the whole airline industry is needed, including stronger rules for consumer protection, as well as better enforcement of existing regulations. Industry-wide problems include slow payments of refunds and compensation to harmed customers. The airlines owe roughly $10 billion in unpaid refunds and other compensation to customers, which have accumulated over the course of the pandemic.

The industry as a whole is so thinly staffed (in pursuit of higher profits) that problems with cancellations and delays are happening fairly regularly when travel peaks around holidays. For example, around July 4, 2022, the problems were bad enough that Attorneys General of 38 states wrote to Congress in August to complain that the federal Department of Transportation (DOT) wasn’t doing enough to respond to customer complaints and problems. Last fall, the DOT imposed fines on airlines (but not Southwest) of $7.25 million in total for delays in providing refunds and compensation to customers. [4]

The airline industry is another example of the poor treatment of workers and customers because U.S. policies allow extreme capitalism and big profits. The big profits are used, of course, to reward shareholders and executives rather than to invest in the business, reward workers, or improve service and prices for customers. I’ve previously written about extreme capitalism in general here and here, as well as about its manifestations specifically in the railroad industry (here and here), in the food industry, and in Medicare privatization.

I urge you to contact President Biden and your U.S. Representative and Senators to ask them to support stronger regulation of businesses, better protection for consumers, more enforcement of antitrust laws, and enhanced support for workers and their unions. We need to temper the extreme capitalism in the U.S. because it’s hurting workers and consumers, as well as leading to high and growing levels of economic insecurity and inequality. You can email President Biden at http://www.whitehouse.gov/contact/submit-questions-and-comments or you can call the White House comment line at 202-456-1111 or the switchboard at 202-456-1414. You can find contact information for your US Representative at http://www.house.gov/representatives/find/ and for your US Senators at http://www.senate.gov/general/contact_information/senators_cfm.cfm.

[1] Stancil, K., 12/28/22, “Southwest under fire for mass flight cancellations, ‘despicable’ treatment of workers,” Common Dreams (https://www.commondreams.org/news/southwest-airlines-corporate-greed)

[2] Johnson, J., 1/8/23, “Southwest Airlines spent $5.6 billion on shareholder gifts in years ahead of mass cancellation crisis,” Common Dreams (https://www.commondreams.org/news/southwest-airlines-shareholder-gifts)

[3] Johnson, J., 1/12/23, “‘They are just mocking Pete Buttigieg’: Southwest promotes executives after historic meltdown,” Common Dreams (https://www.commondreams.org/news/southwest-promotes-executives)

[4] Johnson, J., 1/8/23, “Sanders calls on Buttigieg to hold Southwest CEO accountable for ‘greed and incompetence’,” Common Dreams (https://www.commondreams.org/news/sanders-southwest-greed)

STORIES CENSORED BY CORPORATE MEDIA Part 3

A central purpose of my blog posts is to share information that is under-reported by the mainstream, corporate media. This post and the previous two (here and here) share highlights of the top ten under-reported stories of 2022 from the annual State of the Free Press report from Project Censored. The media – print, TV, on-line, and social media – have undergone a dramatic corporate consolidation over the last 40 years. They are now a handful of huge, for-profit corporations, often owned and run by billionaire oligarchs. Through bias and self-censorship, this has restricted the content and quality of the information reported, skewing the terms and content of public debate and decision making. Project Censored works to hold the corporate news media and their owners accountable. (See this previous post for more detail.)

(Note: If you find my posts too much to read on occasion, please just read the bolded portions. They present the key points I’m making.)

The under-reported stories highlighted by Project Censored’s report mean that the media are failing to provide citizens and voters important information, which threatens our democracy. This also undermines progress toward of a just, fair, and inclusive society. My previous post summarized numbers five through seven of its top ten stories for the year. Here are summaries of the last three. [1]

UNDER-REPORTED STORY #8: CIA’s plans under Pompeo and Trump to kidnap or kill Wikileaks founder, Julian Assange. Such plans were seriously considered in late 2017 according to September 2021 investigative reporting by Yahoo News based on interviews with over 30 former government officials. Pompeo and others wanted vengeance against Assange for Wikileaks online publishing of documents from the CIA’s top secret hacking division. Apparently, resistance from England (where Assange was in refuge in an embassy), from the U.S. National Security Council, and from the U.S. Department of Justice kept these plans from being undertaken. Despite some coverage in non-mainstream media of the Yahoo News reporting, very little, if any, coverage occurred in the mainstream, corporate media.

UNDER-REPORTED STORY #9: Efforts to prevent disclosure of election campaign donors. In the wake of the Supreme Court’s 2010 Citizens United decision (and others) that have reduced regulation of and limits on campaign spending, the role of money whose true donor is unknown (so-called “dark money”) in our elections has exploded. Republican legislators at the national and state levels are promoting legislation that would make it illegal to require non-profit organizations engaged in political spending to disclose their donors.

At the state-level, legislators are using model legislation developed by the American Legislative Exchange Council (ALEC) to ban such disclosure and have passed such laws in nine states. ALEC brings together corporate lobbyists and corporate-friendly legislators to draft and promote legislation favorable to corporations and right-wing interests. ALEC is part of the sprawling political influence network funded by right-wing billionaires, such as the Kochs and Bradleys, both of whom use dark money non-profits to conceal their political spending.

At the federal level, the 2022 fiscal year budget bill included a rider exempting politically-active non-profit organizations that self-identify as promoting the social welfare from having to report their donors. Another rider prevents the Securities and Exchange Commission (SEC) from requiring corporations to disclose political and lobbying spending.

There has been very little coverage in the corporate, mainstream media of these efforts to protect and expand dark money in election campaigns, let alone the role of ALEC and its collaborators in such efforts at the state level.

UNDER-REPORTED STORY #10: Lobbying against online privacy protections is, in part, funded by the mainstream media. “Surveillance advertising,” which collects a user’s data from online activities to tailor advertising to that individual, generally without the user’s knowledge, is ubiquitous and essential to profiting from online advertising. It is extremely profitable for social media apps and platforms, including Facebook, YouTube, Instagram, TikTok, etc. The mainstream media also depend on online advertising revenue, including the New York Times, CNN, MSNBC, Time, the Washington Post, Fox TV, and many others.

The Federal Trade Commission (FTC) is working on regulations for the collection and use of data on online users. However, the Interactive Advertising Bureau (IAB) and its lobbyists are opposing such regulation. The IAB is funded by and represents the interests of online media outlets (including the mainstream media) and data brokers. The personal user information collected online (including from minors) is not only used to target advertising by the app or platform being used, it is typically sold to data brokers. These data brokers create predictive models of users’ online behavior and then sell them to advertisers. These predictive models also allow manipulation of the public’s perceptions of political issues. This occurred during the 2016 presidential campaign: the British firm, Cambridge Analytica, used the personal date of Facebook users, without consent or permission, to craft and target political ads and propaganda.

The importance of revenue from online advertising is huge; it has grown from $32 billion in 2011 to $152 billion in 2020 (almost five times the previous amount). Meanwhile, hardcopy advertising revenue has declined roughly one-quarter from $125 billion in 2011 to $90 billion in 2020. The mainstream corporate media increasingly rely on extensive privacy violations to generate badly needed revenue from online advertising, while the public relies on them to report on this – obviously a huge conflict of interest. While there’s been some reporting of the FTC’s efforts to protect users’ privacy, the corporate media have been largely silent on the push by the FTC and in Congress to ban or severely regulate surveillance advertising. And they have been totally silent on the fact that the industry organization they fund, the IAB, is lobbying against privacy protections for online users as well as against limitations on surveillance advertising.

CONCLUSION: The overarching theme of these under-reported stories is the failure of the mainstream corporate media to educate the American public about the power and influence of wealthy corporations and individuals. The success of these wealthy special interests in influencing government policy and the enforcement of laws is something every voter needs to be well aware of in order to make informed decisions.

This blog can only scratch the surface of the issue of stories under-reported by the mainstream corporate media. For reporting on such stories (and many others), please see the free, reader-supported media that I recommended in this previous post.

[1] Rosenberg, P., 1/3/23, “Project Censored, Part 2: Billionaire press domination,” The American Prospect, (https://prospect.org/power/project-censored-part-2-billionaire-press-domination/)

STORIES CENSORED BY CORPORATE MEDIA Part 2

A central purpose of my blog posts is to share information that is under-reported by the mainstream, corporate media. This post and the previous one share highlights of the top ten under-reported stories of 2022 identified by the annual State of the Free Press report from Project Censored. The media – print, TV, on-line, and social media – have undergone a dramatic corporate consolidation over the last 40 years so they are now a handful of huge, for-profit corporations, often owned and run by billionaire oligarchs. Through bias and self-censorship, this has restricted the content and quality of the information reported and, therefore, skewed the terms and content of public debate and decision making. Project Censored works to hold the corporate news media and their owners accountable. (See my previous post for more detail.)

(Note: If you find my posts too much to read on occasion, please just read the bolded portions. They present the key points I’m making.)

By failing to provide citizens and voters important information, the under-reporting highlighted by Project Censored’s report undermines democracy, the public interest, and the promotion of a just, fair, and inclusive society. My previous post summarized the first four of its top ten issues for the year. Here are summaries of the next three. [1]

UNDER-REPORTED STORY #5: A network of right-wing “dark money” organizations is undermining democracy in multiple ways. Dark money organizations are politically active groups organized as non-profits so they don’t have to report their donors. A network of them, including the Judicial Crisis Network, The 85 Fund, and the Donors Trust, has been funding election deniers, the January 6 insurrectionists, and campaigns for and against Supreme Court nominees. They have funded support for President Trump’s Supreme Court nominees and opposition to President Biden’s nominee. The billionaire Koch brothers (although one of them has passed away) have their own network of groups that funnel money to political causes, including through the Donors Trust. These dark money groups are also closely link to the Federalist Society of right-wing lawyers and judges and its co-chair Leonard Leo.

This network of dark money groups has been set up to obscure the sources of funding for right-wing political activities. In 2020, these dark money groups provided the Federalist Society and related groups over $52 million, primarily to promote the confirmation of Supreme Court Justice Barrett. In 2020, they provided over $37 million to entities that played a role in the January 6 insurrection. They previously had spent tens of millions of dollars promoting the confirmations of Trump-nominated Justices Gorsuch and Kavanaugh. They gave tens of millions to groups promoting lies about the 2020 election. Members of the Federalist Society played key roles in the various schemes to overturn the results of the 2020 election and to prevent the confirmation of Biden as President. For example, 14 of the 18 Attorneys General who filed suit to throw out election results in key states are Federalist Society members.

Despite the size and scope of this dark money network supporting right-wing political, anti-democracy activities, the corporate media have left the story of the connections and coordination of these funders almost totally unreported. Although the media have covered specific right-wing activities, they have not provided the context of the network of funders of these activities. Therefore, the impact and threat of these dark money funders and the need to address the overarching issue of dark money remain unknown to most of the public and most voters. If nothing else, this minimizes public understanding of the level of the threat to our democracy, to our elections, and to trust in our governments. This undermines democracy by failing to educate voters about the extent of the network of funders and the coordination among the right-wing extremists’ organizations.

UNDER-REPORTED STORY #6: Corporate consolidations and the marketplace power that this creates are key drivers of “inflation.” The mainstream, corporate media have reported extensively on the current surge of inflation. However, they rarely report on the price gouging by huge, monopolistic corporations that has been a key cause of inflationary price increases. When they do report on it, it’s usually to dismiss it as a cause of inflation. Corporate consolidation leading to the marketplace power to engage in price gouging has occurred in many industries in the U.S. and globally, from railroads to pharmaceuticals to ocean shipping. The food industry, which has engaged in price gouging causing high inflation in grocery prices, is a great example. Three corporations own 93% of the carbonated soft drinks sold, three other corporations own 73% of cereals, and four or fewer firms control at least 50% of the market for 79% of groceries. The four big meat suppliers have paid over $225 million to settle suits related to price fixing and other market manipulation.

Because of price increases across the whole economy, U.S. corporations’ profits are at the highest levels in 70 years. Fifty to 60 percent of “inflation” is going to increased profits, which are being used to pay big dividends to investors and to buyback over $20 billion of corporations’ own stocks in 2021 alone. (See previous posts here, here, and he re for more information on corporate consolidation and price gouging that causes “inflation.”)

UNDER-REPORTED STORY #7: Gates Foundation gifts of well over $319 million to the media and related entities. The identified gifts (the true total is undoubtedly far higher) go directly to the media, to the coverage of specific topics, and to journalism training programs and associations. These gifts raise serious questions about journalistic independence and conflicts of interest. U.S. recipients include CNN, NBC, NPR, PBS, and The Atlantic. International recipients include the BBC, Al-Jazeera, The Guardian, The Financial Times, Le Monde, and Der Spiegel. An example of funding for coverage of a specific topic is the Gates Foundation’s $2.3 million grant to the Texas Tribune to increase public awareness and engagement in education reform. Given Gates’ longstanding advocacy for charter schools, which many educators and political leaders see as an effort to privatize public education and undermine teachers’ unions, this grant could be viewed as an effort to generate pro-charter school stories that appear to be objective news reporting.

The Gates Foundation, a tax-exempt charity that frequently trumpets the importance of transparency, is often very secretive about its finances and gifts. Not included in the $319 million figure are gifts to academic journals and research targeted at producing journal articles that often end up getting reported in the mainstream media. For example, at least $13.6 million has been spent on creating content for the prestigious medical journal, The Lancet.

Major corporate media have not covered this story, despite a 2011 Seattle Times article noting that the Gates Foundation’s gifts to media organizations were blurring the line between journalism and advocacy.

My next post will summarize the last three stories that Project Censored had in its top ten list of those censored by the corporate media in 2022.

[1] Rosenberg, P., 1/3/23, “Project Censored, Part 2: Billionaire press domination,” The American Prospect, (https://prospect.org/power/project-censored-part-2-billionaire-press-domination/)

STORIES CENSORED BY CORPORATE MEDIA Part 1

A central purpose of my blog posts is to share information that is under-reported by the mainstream, corporate media. This post and the next one will share highlights from the State of the Free Press report from Project Censored, which annually identifies its list of the most important issues that were under-reported by the corporate media. The corporate consolidation of the media – print, TV, on-line, and social media – into a handful of huge, for-profit corporations, often owned and run by billionaire oligarchs, has restricted the content and quality of the information reported and, therefore, skewed the terms and content of public debate and decision making. Project Censored works to hold the corporate news media accountable.

(Note: If you find my posts too much to read on occasion, please just read the bolded portions. They present the key points I’m making.)

Over the years, Project Censored’s State of the Free Press report has identified under-reported issues involving climate change, corporate corruption, campaign financing, poverty, racism, and war. In addition, the report’s diverse contributors advocate for press freedom and media literacy as necessary to hold powerful interests accountable and to promote a just, inclusive, and democratic society. The authors note that, “History shows that consolidated media, controlled by a handful of elite owners, seldom serves the public interest.”

The corporate media’s owners filter the news they report through a class-driven frame, which they may be oblivious to. They overlook or ignore conflicts of interest between their ownership, their investors’ and their advertisers’ interests and the interests of the public that they are supposedly serving with objective news coverage. The concentration of corporate wealth and power skews or distorts what they report and, therefore, what the public learns or doesn’t learn about our society, our economy, and our policy making.

The corporate media’s self-censorship of certain stories and topics does not occur through explicit, blanket bans on reporting them, but through omission or under-reporting due to bias based on the personal perspectives of owners, some editors, and some reporters who tend to be white, male, and economically well-off. Although specific incidents of, for example, corporate corruption may be reported, the overall underlying pattern, scope, and scale of stories are often not presented. This reporting is what is referred to as “episodic,” i.e., about a specific episode or example. It lacks the context that would allow the public to truly understand the scope and scale of the issue or topic. The lack of what’s referred to as “thematic” reporting means the consumer of information is not given a complete picture or understanding of what’s happening in society, and what can and perhaps should be done to address problems, such as corporate corruption.

As a result, citizens and voters in our democratic society are under-informed, in particular about the role of government policies in shaping our economy and society. Therefore, they are ill-equipped to be knowledgeable citizens and voters in a democracy and “government based on the consent of the governed is but an illusory dream.” [1]

An overarching element of many of the under-reported stories is corporate power and sometimes outright corporate corruption. A secondary theme is the exercise of corporate power in influencing government policy making and functioning.

UNDER-REPORTED STORY #1: Public subsidy of the fossil fuel industry is over $5 trillion per year worldwide. The subsidy is largely indirect and reflects externalized costs, i.e., costs of using fossil fuels that the industry doesn’t pay. These costs include the health costs of deadly air pollution (42% of the total), damages from extreme, climate-change-driven weather events (29%), and costs of traffic accidents and congestion (15%). Two-thirds of the subsidy occurs in just five countries: the United States, Russia, India, China, and Japan. No national government sets fossil fuels prices at a level that would cover the external costs of fossil fuel use. These were key findings of an International Monetary Fund study of 191 countries published in September 2021 that was ignored by the mainstream, corporate media.

UNDER-REPORTED STORY #2: U.S. employer wage theft from workers is billions of dollars annually and goes largely unpunished. In 2017, the Economic Policy Institute released a study of one form of wage theft: minimum wage violations. It estimated that workers lose $15 billion each year to this type of wage theft, which is rarely reported by the corporate media. For the sake of comparison, street crime is heavily reported by the media, even though its financial impact is less – an estimated $14 billion in 2017 according to the FBI.

Nonetheless, employers are seldom punished for minimum wage violations that steal workers’ pay. A Center for Public Integrity report in 2021 found that over 15 years only one in four employers who were repeat offenders were fined and only 14% of those were required to pay a penalty to the aggrieved worker beyond paying the back wages they owed.

Employer wage theft also includes not paying overtime, requiring workers to work hours “off-the-clock” that they’re not paid for, and withholding tips. Most wage theft is from low-come workers, including, disproportionately, workers of color as well as immigrant and guest workers.

Another form of wage theft is misclassifying workers as independent contractors instead of employees. This has occurred with port-based truck drivers for years and has become an epidemic with the growth of gig workers in recent years. A 2014 study by the National Employment Law Center estimated that California port truckers have $800 million to $1 billion in wages stolen annually through misclassification.

Both federal and state enforcement of wage and labor laws are weak and underfunded. The Wage Theft Prevention and Wage Recovery Act of 2022 is designed to address enforcement issues but is unlikely to pass in Congress.

Given its scale, wage theft is dramatically under-reported by the corporate media. When it is covered, the reporting is episodic, focusing on a specific employer and specific employees. Thematic reporting that includes the scope of the problem, the weak enforcement, and the light punishment of offenders is very rare indeed.

UNDER-REPORTED STORY #3: EPA failed to make reports on dangerous chemicals public. In January 2019, the Environmental Protection Agency (EPA) stopped publicly releasing legally required reports about chemicals presenting a substantial risk of harm to health or the environment. By November of 2021, the EPA had received at least 1,240 reports of substantial risk of harm, but only one was publicly available.

In January 2022, Public Employees for Environmental Responsibility filed a lawsuit to force the EPA to make the reports publicly available. Within a few weeks, the EPA announced it would resume the public release of the reports. There was essentially no reporting of any of this in the corporate media.

UNDER-REPORTED STORY #4: At least 128 Members of Congress have investments in the fossil fuel industry. At least 100 U.S. Representatives and 28 U.S. Senators have investments in the fossil fuel industry. Despite detailed reporting of this in non-corporate media in late 2021, this story has been virtually ignored by the mainstream corporate media. The Senators’ investments add up to roughly $12.5 million with Senator Manchin (D-WV) topping the list with up to $5.5 million in industry investments. (Most reporting is in ranges not specific dollar amounts.) In the House, Representative Taylor (R-TX) topped the list with investments of up to $12.4 million.

Notably, many of the Members of Congress with fossil fuel investments sit on committees that have jurisdiction over energy-related policies. Therefore, they have substantial conflicts of interest as elected legislators supposedly acting in the public’s interest. By the way, the fossil fuel industry spent at least $40 million on congressional campaigns in the 2020 election cycle and spent almost $120 million on lobbying in 2020.

My next post will summarize the six other stories or topics censored by the corporate media that Project Censored had in its top ten list for the year.

[1] Rosenberg, P., 1/2/23, “Project Censored, Part 1: Billionaire press domination,” The American Prospect, p. 1, (https://prospect.org/power/project-censored-part-1-billionaire-press-domination/)