Feet to the Fire: The New Media and the Elites

0:00Thanks for coming. It's a humbling experience to be here and, more importantly, to be presented with the task of delivering the Hazlitt Memorial Lecture. Hazlitt has been an inspiration for my entire professional career, not just because his appreciation of economics was inspired by his work as a journalist, but also because of the clarity of his writing. Now, it was a different era, of course, back when he was writing for places like the New York Times, Newsweek and The Nation. On one hand, those media enterprises were open-minded enough to actually let an editorial writer write about things in a free-market way that they probably would not today. On the other hand, though, he did this before the intellectual support of organizations like the Mises Institute and the vast array of information and literature that the Institute and folks like you in the audience have created.

0:54That literature makes it a lot easier for journalists writing about policy to do our jobs today. Of course that is if we actually pay attention to critical thinking and research. But let me have the indulgence of a brief digression first. Lew asked me to talk about media elites. He wrote the title for the speech. And at first glance it may seem like I'm an odd person to talk about elitism. I mean, I live in downtown San Francisco, after all, which is probably what most conservatives would call elite in a very anti-Auburn, a very unflattering kind of way. Now, I mean, San Francisco is a city that delights in thumbing its nose at not just federal law, but also state law and everything from gay marriage to banning handguns. My elected representative in Congress is none other than Nancy Pelosi.

1:42My city pioneered the entirely economically sensible idea of handing out monthly cash payments to every homeless person with the entirely predictable result of luring homeless people from all over California and convincing at the margin gainfully employed people to pretend to be homeless and stand in line for an hour a day to collect their checks once a month. San Francisco is where we issue licenses to clubs for private encounters of the sort that cannot be described in family newspapers. It's where the city supports an annual event called the Folsom Street Fair, where the same encounters become much more public. This is Orrin Hatch's worst nightmare of liberal elitism, and I'm coming from it to be here today.

2:34On the other hand, though, it's a beautiful area to live in. The Sierras are just 200 miles away. We have the natural splendor of Big Sur and Monterey Bay to the south. That's where Carmel is. This is a town that elected Clint Eastwood Mayor. Eastwood is, by the way, a self-described libertarian, so there's some hope for our area yet. We have the excellent wines of Sonoma and Napa Valleys across the Golden Gate Bridge to the north. On the political Free-thinking remains alive and well. A town just outside of San Francisco, Fremont, is home to Pete Stark, who you might have heard about this week. He's the only openly atheist member of Congress, according to the American Humanist Association. And, of course, the area is home to the greatest and smartest collection of entrepreneurs the world has seen so far.

3:19We've been home to the National Revolt Against Draconian Federal Drug Laws. Angel Raich, the plaintiff who went up before the Supreme Court, which shamefully said, oh yes, of course, regulating drugs is a reasonable use of the Commerce Clause, lives right across the bay in Oakland. And our handgun ban was struck down by the court, so though unfortunately not on the same Second Amendment grounds that the DC Circuit used, this is California after all. Okay, now let me return to my original topic. Before I moved to When I was in New California a year or so ago, I lived in Washington for over a decade, and I suspect that's why Lew invited me to speak here today, if California is a home of liberal elites, Washington is a home of media elites. One reason why many of us here today care so much about the topic of the media is that we believe that it's hostile to Austrian ideas and to free market views in general.

4:12Well, I haven't come across any research yet that asks and answers precisely that question. But if we rephrase it along more traditional lines, liberal versus conservative, there's a wealth of consistent survey data and other research. The American Society of Newspaper Editors research suggests that journalists are younger, better educated and more liberal than the general public. Its survey of journalists found that at the bigger papers, 61% of newsroom respondents has described themselves as Democrats or leaning towards Democrat and only 10% as Republicans or leaning towards Republican. Another survey found that in 92, 89% of Washington journalists surveyed voted for Bill Clinton and 7% for Bush. This is George Bush, of course.

4:59This is actually an increase of liberals and a decrease in conservative affiliation from a similar survey conducted over a decade earlier in the early 1980s. Other researchers found similar patterns with about 61% of journalists calling themselves liberal and about 9% conservative or conservative to moderate. Now occasionally you have journalists who are going to admit this. In 2004, the New York Times public editor wrote a refreshingly frank column saying just this. He was talking about social issues, gay rights, gun control, abortion, environmental regulation. Quote, if you think the Times plays it down the middle on any of them, you've been reading He was talking about hostility to the idea of savings, but it works just as well in referring to hostility towards other free market ideas writ large.

5:47He said, quote, when once people have decided to deride a practice or an institution, any argument against it, no matter how illogical, is considered good enough. Now, my own experience working in D.C. as a political correspondent for over a decade indicates this is consistent with my experience. Correspondent for over a decade indicates this is consistent with that premise. Some of my previous jobs were working as a reporter in the Washington Bureau of Time Inc., which publishes Time Magazine, the Washington Bureau for Wired Ventures, which at the time published Wired Magazine, now it's owned by Condi Nast. I've written a short-lived column for UPI, a slightly longer-lived one for Business 2.0, and an even longer-lived one for George Magazine, the home of the media elite right there. I've accompanied the president on Air and have, when I lived in DC, been a card-carrying member of the National Press Club and during that time, in interactions with hundreds of my colleagues, I found political reporters to be consistently left of center and editors to be consistently, generally, the same way.

6:47The better ones will go out of their way to correct for this bias, but it's like any profession. You have the mediocre people who will not or cannot. And so if we accept that the allegations of bias are true, we have to ask why they're true. To conclude that a mostly liberal media exists almost requires positing something like a news cartel, which in turn requires things like collusion among existing members, limiting competition and punishing defection. Daniel Sutter at the University of Oklahoma explored this topic in a 2001 paper in one paper and tried to answer whether the source of the bias comes from the demand side, that is the reader or consumer of news or the supply side and that is either the owners, editors or journalists. Now he pointed out correctly that bias news runs the risk of alienating customers who have centrist or conservative views. I mean think about it, why would the owners of a biased news organization tolerate that bias if they could maximize

7:46profits by appealing to a larger audience that included underserved conservatives or Libertarians. And we do know that it's possible for new entrants to join the traditional national media marketplace. So Fox News and USA Today are good examples of that, but it's an expensive and risky proposition. USA Today lost $800 million in its first nine years of operation, and Fox News still lags behind CNN in terms of unique viewers even 11 years after its launch. In fact, from August 2005 to 2006, Fox News lost 7% of its total day viewers, while CNN and MSNBC gained 35% and 26% respectively. And so one demand-side explanation of bias is that news media consumers are more liberal than voters, and there in fact is some evidence to back that up.

8:37But the better explanation probably lies on the supply side with journalists themselves. There is a personal and often a professional cost in being an outlier among your colleagues during those water cooler conversations and annual salary reviews. Surveys suggest the top tier journalism programs like Columbia University's Graduate Journalism School graduated very liberal, a crop of students every year, which implies that the most desirable new writers are probably going to be left to center. David Barron, who's a professor of political economy at Stanford University, offered what I think is an intriguing explanation. He said that a profit-maximizing news organization tolerates bias if and only if that bias allows it to hire journalists at a lower wage.

9:24Now think about it. And so let's assume reporters are also qualified to work in public relations, technical writing or ad sales. Mean reporter salaries are just over $40,000, according to the latest information, 2005, from the Bureau of Labor Statistics. But public relations, technical writing and ad sales salaries are an average of nearly $13,000 higher. The mean disparity grows to over $30,000 when you compare editor's salaries, basically editors or managers, with those of public relations and advertising managers, $30,000 a year. Now, there are many reasons why journalists would probably take lower salaries, maybe the potential for travel or the publicity associated with bylines. But for many reporters, at least in my experience, they like the quasi-academic feel of being divorced from a for-profit organization.

10:14But nevertheless, just about all of them know that they could make more money elsewhere if they wanted to switch jobs, sometimes even doubling their salaries in large metro areas. And by the way, for anyone on the business faculty of a college or university right in between those numbers, the average salary is $67,500. So the model I suggested so far is one of an industry with cartel-like aspects that has historically been marked by relatively high barriers to entry, at least on a national scale. On the supply side, reporters tend to be liberal and owners may tolerate this bias in exchange for paying lower salaries. But this model that has been in existence for decades now starts to crumble when barriers to entry are low, which brings us to the Internet.

11:02We've already seen some instances of blogs raising topics that the mainstream media has been unwilling to touch. By unearthing information, publicizing it aggressively, they've practically forced mainstream journalists to pay attention on occasion. Now one of those happened in President Bush's re-election campaign in 2004 when CBS News ran a story raising the question of favoritism during his time in the Texas Army National Guard. You don't have to see the details, but basically this is one of the documents that CBS News' 60 Minutes claimed were authentic. Dan Rather claimed that they came from the late Colonel Killian's personal files and they had been authenticated by outside independent experts. Now the segment aired two months before the November election and this and other documents indicated that Bush disobeyed a direct order to appear for his physical.

11:55Documents alleged that the Bush family friends intervened on his behalf. Hours after the story aired on 60 Minutes, conservative bloggers started assailing the documents and the credibility of the reporters. The discussion seems to have started on sites like Free Republic and Powerline and quickly spread outwards. Some bloggers questioned the fonts used, saying that it looked like the alleged original documents had been created by a modern version of Microsoft Word rather than something typed in 1972. CBS and Dan Rather initially stood by the document's authenticity, but after about two weeks they vowed to criticism from bloggers and other competitors that were essentially forced by bloggers to pick up the story, USA Today among them, and acknowledged that the documents could not be authenticated and no originals were actually available.

12:51CBS News President Andrew Hayward would eventually say, based on what we know now, CBS News cannot prove that the documents are authentic, which is the only acceptable journalistic standard to justify using them in this report. We should not have used them. That was a mistake, which we deeply regret. Now, what made this incident even more embarrassing for CBS News is that the producer put her source of the documents in contact with John Kerry's presidential campaign, something that's not a neutral or even professional thing to do. What's worth noting is that political bloggers tend to be overtly biased instead of covertly biased, and even proud of these biases, whether it's liberal, conservative, libertarian, or other. I mean, certainly all of the most popular online writers and bloggers fall into this category.

13:37And my hunch is that it's a market response to the lack of media organizations, at least mainstream national ones that are openly partisan, Partisan, even ones that are, in fact, biased, of course, claim not to be. It's also a throwback to the earlier days of journalism. To pick up a book, it's called Debating the Issues in Colonial Newspapers, and it's a compilation of original sources, hundreds of pages of newspapers that describe the partisan political debates that took place at that time in those pages. The Federalists had their network of weekly newspapers, primarily in New England, but with a strong presence in Pennsylvania. Here's an image from one of them. It's a pro-Federalist poster circa 1800 with Washington urging support for pillars of Federalism, Republican and Democracy.

14:26At Alexander Hamilton's urging and with some of Hamilton's money, Noah Webster founded New York's first daily newspaper with an unabashedly Federalist slant. Both allies and enemies attributed Thomas Jefferson's eventual presidential victory in 1800 to Newspapermen with Anti-Federalist Biases, and even so, the Jeffersonians were outnumbered with some estimates showing that Federalists were losing ground but still had a 2-1 numeric advantage in terms of newspapers controlled by the turn of the century. In other words, some corners of new media are just reverting back to that time-honored tradition of partisan reporting. If you wanted to have a balanced view of the news back then, you just read both the Federalist in the Anti-Federalist Papers, and you didn't expect neutrality from one single source.

15:13So liberal bloggers have also had chances to take potshots at politicians. When Senator Trent Lott spoke at Strom Thurman's 100th birthday party, he said, when Strom Thurman ran for president, we voted for him, we're proud of it, and if the rest of the country had followed our lead, we wouldn't have had all those problems over the years either. Now, Lott clearly was supporting the ideas that Thurman ran on as a Dixie crowd in 1948, but it's less clear what ideas he meant. Was Lott making a Federalist point about states' rights that many of us here would agree is perfectly reasonable, or was it a thinly veiled racist remark? Well, liberal bloggers said it was the second, and they kept the story alive. Eventually, the mainstream media returned to it. They just treated it as a gossip item initially, and after losing the support of some of his fellow Republicans and the White House, Lot resigned as Senate Majority Leader two weeks later.

16:03Now, it's not just bloggers doing end runs around print media, of course. I mean, recently, fast Internet connections and cheaper digital and video cameras have let sites like YouTube and Flickr become household words. When John Kerry showed up at a campaign stop for California gubernatorial candidate Phil Angelidis last October, Kerry said, if you make the most of education, you study hard, If you do your homework and you make an effort to be smart, you can do well. If you don't, you get stuck in a rack. And that video quickly appeared on YouTube and you all remember the rest. And then there's Representative John Sweeney who found out that the perils of having embarrassing moments like this one endlessly replayed online. And for him it wasn't something that he said, it was something that he did.

16:48He showed up intoxicated at the Alpha Delta Phi fraternity at Upstate New York's Union College. One of the students had a camera phone, you can see a second one, aiming a phone right there in the bottom right. The incriminating photographs hit the net, and Sweeney lost his re-election bid. Correlation or causation? I don't know, but it certainly didn't help. There's Senator Ted Stevens, a Republican, had much the same treatment, but with a twist. Let's see if we can actually hear this. Anyone remember the Tubes video? Maybe it's not playing. Stevens at the time was chairman of the Senate Commerce Committee, which is charged with a hopeless task of writing laws to regulate the Internet. We may not agree with that, but we could probably agree that Internet legislators should at least have a modicum of understanding of the medium they're trying to regulate.

17:40Unfortunately, Stevens did not. He said the Internet is not a dump truck, which probably is reasonable, but his metaphor didn't really take him much further beyond that. This was quickly picked up on YouTube on Comedy Central's The Daily Show and on a techno remix that I tried to play but failed to do. Once your comments make it into a techno remix, you know that there's not much further down you can go. And then there's Senator George Allen's and his macaque racial slur, which also is probably not going to cooperate. This was caught on YouTube. He made an ethnic slur at a campaign rally. It was caught on video camera. He was talking about representatives of the opposing campaign that were there, and he lost re-election.

18:27Now what's interesting is this sort of YouTube and blogging and Wikipedia, MySpace, etc. revolution is an emergence of free market websites that can propel us beyond this traditional left-right axis. I'm thinking of sources of commentary, news information, amises.org, rationalreview.com, downsizeddc.com, antiwar.com and probably dozens or hundreds of others that I don't even know about, but certainly could not have existed without the internet. These sites also represent our best chance of challenging the pro-power bias in the mainstream media. I'm not aware of any research that's quantified this and I'm probably not even expressing it very eloquently. My impression is that both liberal and conservative journalists tend to be pro-government power and therefore pro-government expansion for entirely predictable reasons.

19:20Let's think of them. Quoting government statistics is easier than having to do the research yourself. They're also free. Private organizations may charge for them. Government officials are always ready to assist in news coverage that's expected to be favorable, sometimes much more so than private organizations, If you're in Washington, you're a political reporter who lives in Washington. Your friends and the parents of your children's friends, your social network, in other words, is made up of government officials, party hacks and like-minded folks. Covering power can be lucrative. If you're a reporter in a state house, you're covering an obscure politician, and that politician ends up on the presidential campaign trail, If you're covering an obscure politician, that politician ends up on the presidential campaign trail and you get a six-figure advance.

20:08It can pay off in other ways. Journalists landing civil service jobs for life, becoming lobbyists for trade groups. At the most basic level, if your job is to cover the federal government and the federal government begins to shrink, you just may not have a job anymore. So these are just a few of the temptations that the mainstream media has, that the YouTube blogging revolutionaries do not.

20:42And so let's hope that as the Internet grows, as technology advances, as more people find it easier to do things online, Let the internet give birth to many more Henry Hazlitts. Thank you very much.

21:04We'll have any questions now. The whole issue of why the media is so left-wing, the two economists named Michael Jensen and Bill Meckling wrote about this about 20 years ago. They were from the University of Rochester, and one part of their theory was that if you're a journalist, most of the news you cover is government information, comes from the government that you just sort of thought about, so that if you don't treat government in a positive way, you risk being cut off from that information flow, and your career is ruined. And so that was, I think that was their main theme of why the media is so biased, that the information flow from government, maybe it wasn't like that 50 or 75 years ago or 100 years ago, but a friend of mine who just moved from Canada told me that one of the big differences she noticed is that almost all the national news in America is always politics, whereas in Canada at least a lot of it was about life, it wasn't about politics. So you would watch the evening news, it was nothing but politics.

22:07So the question is to repeat it for the online audience. There's evidence that two researchers at the University of Rochester who said that journalists are essentially pro-large government because so much news comes from the government and if you write things that are too critical you cut off your sources and that's of course entirely true. The better news organizations will have a good cop and a bad cop. There will be a good cop reporter who shows up at the press conferences at the Department of Commerce or or the Department of State or whatnot, it writes the nice flattering article and then you'll have the bad cop reporter who does the digging, writes the investigative pieces that make the government look like idiots and because PR people and government tend not to be that aware, they may still keep talking to the good cop reporter and generally do, thinking that it's more of a personal thing rather than an organizational or institutional thing. But you're right. If you piss off your sources, you tend to lose information in the future.

23:07exclusive access or the interview of a senior official that could advance your career.

24:37The question was, or two parts, first was, there's the book, I have a copy of it by the Emory Fellow saying that there's no gun culture. It was given to me by the head of a Washington, B.C. liberal advocacy group who said, read this and learn something. And the other point is an excellent one, which was journalists are biased because they tend to be intellectuals. They see people who are high school dropouts making much more money as entrepreneurs. And I think that's right. It's even worse in business and politics to some extent, because business reporters are covering people who are making insanely more than the reporters.

25:24The reporters get jealous. There's politics, it's probably just as much. You see these not-so-smart, lying, conniving politicians who then turn around and become lobbyists at mid-six-figure salaries, and you, well, anyway. There's, okay, any other questions? In the far back, yes, you. Do you think old media can survive in the credit world? The question is, can old media survive in today's world? Yes and no. I'm going to hedge the question a little. This is a huge topic of conversation in journalism circles. Sites like Pointer.org, P-O-Y-N-T-E-R. Endless discussions about our newspapers.

26:09Certainly circulation hasn't been doing very well. At the same time, there's more advertising going online. My employer, CNET Networks in San Francisco, is benefiting from that. And so you have circulation dropping, advertising moving online. This is not a great position to be in if you're in the newspaper biz. Most of the people I know who work at newspapers are thinking of exit strategies or at least contemplating them in the back of their mind. And so I'm not sure if newspapers are going to be around as we know them today in 20 years, but is the mainstream media going to be around? Probably. I mean, even after you have these millions and millions of blogs being created, you still don't have a substantial number of people who use them as a daily news source. Under less than 10%, according to, I think it was Pew Research stats.

26:56And so if you don't have the many people who are using them as info sources, then I think the mainstream media is going to exist for a while. I've been involved in a patient last year who wanted to get into reducing cost cases and I will say that Now you can subscribe to broadcast television that is produced by someone with much lower budget but looks just as good or almost as good as the nightly newscast or maybe with a less free market antagonism bias. Another question in the back. Yes. I've been involved in a patient's last year who wanted to be under the influence due to a cost case, and I will say that we bloggers have tended on the news media to sort of get some information out there.

27:41Now, what happened was the mainstream media all decided to get into these guys' guilty, and it's really been interesting because I started writing on it, and I started hearing here, like, you know, I've got a mole with the New York Times telling me about, oh yeah, this reporter really screwed up on this story, so we had to finally take him off it and put somebody else on there. and so it was interesting to see what happened in that the blogs actually have had an effect upon the mainstream coverage. I tell people that, you know, last day there were, you know, really you had, there's about four of us writing on the case and it was up against the New York Times and all the other mainstream media and the, as well as the judicial system of the state of North Carolina

29:32In short, I agree with you. There is a market. It's hard to know exactly how it's going to go. One thing is that we are no longer going to have to depend on getting a piece of paper to tell us what happened the day before, because we already know what happened. Thanks to the internet or whatever, the form will be different. The team speaks of these organizations that make people actually get in place, and there's something to map them.

30:24by journalists and editors, you're not going to have bloggers packing up and moving to Afghanistan or Iraq to cover what happens there. They're not going to be able to take off two months of their life and cover a high-profile trial. Yeah, they might be able to drop in on a lark, but some events do not lend themselves to blogging. But, you know, court documents, original things, especially anything you can find on the Internet lends itself to readily available blogging. It requires some digging, requires lots of telephone calls, lots of in-person visits. Yeah, that's not going to happen for a while until we get some very good micropayment system set up. Click here, spend 20 cents to read an article, and then the journalist can get presumably paid that way. It hasn't happened yet. Maybe it never will. I've been predicting it for a while and I've been wrong every time.

31:09Yes, sir? Well, we're all, for the past time, I think, pretty well aware about the concept of market failure by mainstream economics. And the idea is that if the price cycle can turn out something, can be quantitized, then the government should step in. And like we don't have enough left-wing propaganda, and you painted a quite oblique picture of that, we have an NPR and PBS turning the same kind of thing on our behalf, using government taxes. So we think that the subsidy, that's practically a subsidy of left-wing views, affects the whole market. I haven't thought about it phrased in those ways. The question is, does the existence of NPR and PBS move the entire market to the left?

32:14I suspect you're right. NPR and PBS are large operations. They've got studios all over the place. These are multi-billion dollar operations. And so if you wanted to compete with them and have free market or even remotely libertarian conservative talk radio, you're going to have a very difficult time doing that. And also because NPR breeds a lot of journalists and PBS breeds a lot of journalists then you tend to have that supply that you mentioned and it probably does move things to the left but I haven't actually thought about it before now. Yes, we're in the front. So the question is, are journalists really liberal when they've gone along with the Bush administration and have been insufficiently aggressive in covering it?

33:19Well, I mean, some of us have been aggressive in covering the Bush administration. I have been since 2001, but the question is, has everyone else? I mean, maybe this goes to the last thing I mentioned, which is reporters have this love for power, and to get close to power, and power in Washington is measured by your proximity to the presidency, and anything you can do to move that along is going to help your status in many ways. That's probably the best answer I can offer. It's not like reporters are now 90% Democrat registered and voting, 90% Republican registered and voting. It could be overcompensation. Liberals don't want to be viewed as soft on terror, much like the Democrats also lost their spine for many, many years.

34:09It's probably some combination of sucking up to power versus not looking, versus the terror thing. I don't have a great answer for you. Yes, in this order. Just a comment on that. I would say that the Bush administration is big government socialist team A, and then you have big government socialist team B, which might be the Democrats in Kerry. And as long as you have journalists covering this team A, team B thing, My question is, do you think that the powers that be, the elite that you're talking about here, will restrict the Internet, that they will restrict the freedom of this, and are they truly threatened by it because Americans are naturally anti-establishment and an essential people?

35:02You made two points. The first was a better response than I gave, which was that Bush's big government anyway, no child left behind, is hardly a very Federalist type of thing to do. And the second is, will the government restrict the Internet? I've been writing with that topic since 1996, actually even earlier. Early on, the danger was greater because not as many people knew about the internet. There weren't as many alternative news sources on the internet. There have been a bunch of censorship laws. The Communications Decency Act, which punished four-letter word usage online, was one of them. The Child Online Protection Act of 1990 was one of them. I was one of the plaintiffs in the lawsuit against the Communications Decency Act. We sued Janet Reno in 1-9-0 before the Supreme Court, which is always kind of fun. Early on, the danger was greater because not as many people knew about the internet. There weren't as many alternative news sources on the internet.

35:58in 1998 followed that. It's still in litigation. It went up to the Supreme Court. It went back down. We're now awaiting a decision from a district court judge in Philadelphia. That's on the free speech front. On the privacy front, there have been a bunch of, I mean, this is the liberal view of privacy, which is data collection and retention regulations aimed at for-profit businesses. And those have been enacted, but not as broad as it could be. Regulations, not as broad as it could be. The best example is the Federal Election Commission attempt to regulate bloggers, and that came down about a year or two ago. I interviewed Brad Smith, who was at that time a Libertarian leading FEC commissioner, and he essentially blew the whistle through my article on what the FEC was going to do in terms of regulating and Registring Bloggers.

36:50After that happened, the FEC backed down. They said, oh no, of course we don't want to do this even though it was a deadlock three-to-three Republican versus Democrat. The Republicans needed a majority to appeal their lost sum in court, saying that the regs were unconstitutional. The bottom line is that the Democrats backed down really quickly because they didn't want to alienate their blogger base, and that got shot down about 90 percent of the teeth in Regulation fell out. That's the best example, but it's probably going to happen again. This is government and this is what regulators do.

37:47The question is, is the fairness doctrine going to rear its ugly head again? I don't write about broadcast stuff, and so I don't actually follow this. There has been some talk among Democrats at reviving it, in terms of, this is more heated conversations and serious policy proposals, but that has been talked about, it has not been talked about in the context of the internet as far as I know, and that would be a pretty big step for them to try to make. Yes, sir? YouTube is currently facing different lawsuits for a number of major broadcast companies in terms of news services, and so I was wondering if you see intellectual property copyrighted in any way for the mainstream media to reserve a monopoly over the capital?

38:45Is that a way for the old media to restrain the new? I mean, copyright and intellectual property in these circles is sort of divisive, and I have mixed views myself. My reading is that it's clearly unlawful for people, individuals on YouTube, to post content outside of the scope of what fair use permits. The question is, can there be contributory or vicarious liability attaching to YouTube for this? The Supreme Court said in the Grokster case that Grokster could be held liable for what its users do, but Grokster, this is a peer-to-peer sharing or file sharing case, Grokster's executives were really sort of egging it on, and YouTube's been much more, well, of course we don't want any of that infringing content to appear on YouTube.

39:38So I think it's going to be a much harder case for Viacom to win. Overall, probably, but at the same, this would be a way, but on the flip side, these large media conglomerates, including CBS, have started licensing stuff to YouTube, and so I think in the end it's just a business dispute that's playing out in the courts, and if Viacom and YouTube reach the magic number, that loss is going away tomorrow. Other questions? Yes. Do you have any thoughts on Roger Ailes and Murdoch's efforts to start a new business channel? I was particularly thinking about Murdoch's comment that the existing financial news channel was anti-business.

40:38It is odd that a lot of what we call financial journalism nowadays is not very pro-market. Even Journalists for the Wall Street Journal, not the editorial page, but for the front page, are somewhat hostile to free market ideas, which when I was a young and somewhat naive reporter in DC, surprised me immensely when I ran into them at a party one evening. How could you write for the Wall Street Journal? How would you? Anyway. And so I think that such a thing could probably survive, it could be the Forbes versus the fortune of the broadcast media sector, but I haven't followed it more closely than that. Other questions? I think we're finished folks, thank you very much.