Guilt by Association
By Doug Pinkham
Public Affairs Council President
May 8, 2012
For voters, the 2012 elections are supposed to be about the economy. In a recent Gallup poll, more than 90 percent of Americans said candidates’ positions on the economy will be “very” or “extremely” important when they cast their ballots.
For businesspeople, 2012 is supposed to be about economic recovery. An annual CEO survey from PwC said most senior executives plan to concentrate this year on developing talent, meeting with customers and improving efficiency.
Nevertheless, it seems like Americans spend a lot of time arguing over social, not economic, issues — and companies are increasingly getting dragged into the discussion.
Recently, the American Legislative Exchange Council (ALEC), a champion of free markets and limited government, found itself in a political maelstrom for backing gun rights and tougher voter ID rules. ALEC’s practice of drafting business-friendly legislation for state legislators has upset critics on the left for years, but it didn’t enrage the general public. It took the shooting of Trayvon Martin and the debate over the Stand Your Ground law to place ALEC and its corporate members at the center of controversy.
As ALEC’s role came to light, groups such as the Center for Media and Democracy and Color of Change organized protests against ALEC funders. Commentators like The New York Times’ Paul Krugman suggested it’s time for corporations that fund ALEC to be “publicly associated with the hard-right agenda.” Coca-Cola, McDonald’s, Kraft Foods, Johnson & Johnson and other companies with popular brands faced organized protests calling for them to drop their membership. Some have already done so.
Responding to pressure, ALEC announced in April it was eliminating its Public Safety and Elections task force, the committee that addressed gun rights and voter ID laws. It vowed to concentrate “on initiatives that spur competitiveness and innovation and put more Americans back to work.”
Even in a down economy, it has become common for social issues to attract headlines and cause anti-corporate protests. What’s going on here?
For starters, social issues are personal; they are about rights and liberties. Reasonable people can have conversations about trade policy or banking regulations, but when an issue is about personal rights, the nation’s collective blood pressure rises. It doesn’t take long before the shouting begins.
Second, most civically active people organize around social issues. They care about the economy, but their passion and commitment go to groups representing their religious beliefs (Family Research Council), their concern for the environment (Sierra Club), their sense of identity (Human Rights Campaign), their dislike of government (Tea Party Patriots) or some other personal cause. Aside from business and trade associations, we don’t hear much about advocacy groups focusing on economic growth.
Like it or not, companies are being defined by their memberships and indirect ties to controversial causes and politicians. It’s a case of “guilt by association.”
To make matters worse, when companies are connected to social issues, one protest or boycott sometimes leads to another, Bradley A. Smith of the Center for Competitive Politics writes in The Wall Street Journal. He notes, for example, that many ALEC donors also support the Congressional Black Caucus, which is opposed to voter ID laws. “If secondary boycotts become the norm, supporters of voter ID — who, if we are to believe the polls, vastly outnumber critics — could decide to boycott those companies.”
That happened back in 2005, when the American Family Association (AFA), a conservative Christian organization, demanded that Ford Motor Co. stop supporting gay-oriented publications, groups and events. When Ford agreed to pare back its ads to certain publications, leaders of 17 gay rights groups organized a protest. In an attempt to assuage these activists, Ford announced a compromise that reinstated some of the advertising. This, of course, caused the AFA to resume its boycott.
Why are companies increasingly getting caught in the middle?
- Many corporations have made commitments to sustainability, human rights and other principles, which place them under scrutiny if their actions don’t seem to match their words.
- In recent years, social conservatives have become more influential in the Republican Party, which has increased the likelihood of pro-business conservative groups putting social issues out front. The ALEC episode is likely to be one of many.
- Thanks to the power of the Internet and social media, activists have better tools to attack corporate brands.
So what’s a company to do? When corporate funders of groups facing controversy try to explain that they don’t care about an organization’s position on social issues, or when they are dismissive of criticisms, they sound defensive.
The ideal approach is to understand and accept a group’s entire mission before agreeing to fund it. But this isn’t going to happen all the time. Donors should still be clear about what activities and issues they will and won’t support. Many nonprofits expect this and create segregated funds for new initiatives.
If the group is so large that a donor can’t possibly agree with all of its priorities, a company needs to consider its reputational risk and decide if the tradeoffs are worth it. Analyzing risk will also prepare a firm for future controversy — whether the controversy is real or manufactured by political opponents.
That’s what many companies did when they continued to support the U.S. Chamber of Commerce in 2009 after activists attempted a boycott to protest the Chamber’s views on climate change. While several firms did drop their memberships, there was no mass exodus. I suspect the Chamber’s success was partly a result of its size and scope of services and partly because, in the middle of an economic downturn, activists had a hard time framing the climate change issue as a threat to individual liberties.
If a company decides it wants to engage directly in a social issue — whether it’s gay rights, environmentalism or fair trade — it needs to know the expectations of employees, customers and investors ahead of time. And it also should make sure its affiliations with outside groups look and feel consistent with its stated commitments.
As the economy improves, we’ll see more cases in which activists try to influence the behavior of an organization by exerting pressure on customers or donors. Social issues, not economic ones, will be the fuel for these campaigns.
Comments? Email me.
Are We Getting the News We Need?
By Doug Pinkham
Public Affairs Council President
March 29, 2012
Personalized news delivery is The Next Big Thing in the media business. Tired of foreign wars or coverage of politicians you don’t support? No worries. Readers of The Washington Post can now create their own “Personal Post.” The artificial intelligence-driven service analyzes your browsing patterns, screens out the bad stuff and produces a stream of customized news.
Similar services exist at The New York Times, The Wall Street Journal, the Financial Times and other outlets. But many fret that personalized news — along with social networking sites — encourage people to wall themselves off from opposing views. Eli Pariser, author of The Filter Bubble, is concerned that media and social networking companies are trying too hard to give us what we want to see, not “what we need to see.”
When it comes to politics, personalized news delivery may be the journalistic equivalent of ordering two desserts and skipping the fresh vegetables. Critics believe that what you don’t consume — or don’t know — will hurt you. And personalized news makes it easy to choose your preferred diet.
I felt the same way until I read two recent studies — one from academia and one from the Pew Research Center’s Internet & American Life Project.
In the first study, Neil Thurman and Steve Schifferes at the City University London tracked the personalization of national news sites in the UK and the U.S. to determine how news organizations predict readers’ preferences and what those preferences mean for society.
Thurman and Schifferes found that only a small number of readers are willing to spend the time it takes to personalize their news content. As a result, media companies have shifted toward a passive form of personalization that relies on software algorithms to figure out what we want to read based on our past behavior. (It’s kind of like the way your TiVo recorder decides you like Tom Cruise movies after you’ve watched Mission: Impossible II.) These algorithms have become increasingly sophisticated.
The authors also record significant growth in “social collaborative filtering,” in which a social network (usually Facebook’s Activity Feed plugin) shows media articles that a user’s friends have read or recommended. The obvious problem with this approach is it relies heavily on the assumption that one person’s specific interests are shared with hundreds of others. Plus, relatively few articles are posted through the Activity Feed. This means we are not likely to get all our personalized news via Facebook anytime soon.
So what about the impact on society? The authors note that news providers (especially newspapers) are still responsible for most original reporting and that aggressive deployment of personalized news delivery seems to help media sites charge subscription fees. “If personalization helps build audiences and shift revenues from search providers, content aggregators and other intermediaries to the ‘content creators,’” they argue, “deliberative democracy may actually be better sustained.” What’s more, automated links to related articles may be increasing the diversity of sources connected to mainstream news sites.
In the second study, a new poll from Pew shows that “birds of a feather don’t always flock together on social networking sites when it comes to politics.” It turns out that “friends” do in fact disagree with “friends” on social networking sites such as Facebook — and most of the time, nobody cares.
Of the users whose friends post political content, only 25 percent mostly or always agree with these postings and the rest only sometimes agree or never agree. Most important, when there is disagreement, 66 percent of such users ignore the posts and 28 percent respond with comments or posts of their own. “Interestingly enough,” says Pew, “there were no differences in these responses among party partisans or different ideological groups.” Kind of sounds like a well-functioning democracy, doesn’t it?
Eighteen percent of social media users have grown tired of at least one friend’s political rants, however, and have blocked, unfriended or hidden that person from view. Usually this results from somebody posting too frequently about politics or being offensive or argumentative.
For critics concerned that personalized news and social media sites reduce exposure to new ways of thinking, here’s a surprising statistic: 38 percent of social network users have discovered through friends’ postings that their political beliefs were not what they expected.
As Pew observes, social network users “are like other Americans in that many are not particularly passionate about politics.” (Note to Washington insiders: The report says “many friendships are not centered on political discussion.”)
Social networking sites do provide tools to weigh in on public policy issues despite the fact that most users are not choosing friends based on political affiliation. For example, nearly half of users have hit the “like” button in response to political comments or material, 38 percent have posted positive comments in response to a political post or status update, and 16 percent have friended or followed someone because of shared political views.
These numbers represent opportunities for advocates to educate and influence, but the survey’s overall results are a reminder that Facebook and related sites are not political networks. They are social networks, which means politicos need to tread lightly.
Like personalized news delivery services, Facebook probably won’t deprive us of the chance to hear important information and contrary opinions. This is good news in a complex and increasingly partisan world.
Of course, we still have the right to ignore information and opinions — or perhaps unfriend the person who is broadcasting his political views. Active listening, unfortunately, can’t be enforced.
Comments? Email me.
Dangerous Metaphors
By Doug Pinkham
Public Affairs Council President
March 6, 2012
“Abuse of words has been the great instrument
of sophistry and chicanery, of party, faction,
and division of society.”
— John Adams
John Adams knew what he was talking about. The election of 1800 between Adams and Thomas Jefferson was one of the nastiest on record. Jefferson supporters called Adams a vain monarchist who was “quite mad,” writes historian David McCullough. Jefferson, meanwhile, was portrayed by Adams loyalists as an atheistic, “shameless Southern libertine.”
Modern campaigning has gone beyond name-calling and falsehoods (though they are still handy weapons). Now, political strategists use polling and focus groups to write language that defines policy debates and opponents. By choosing the right words, they believe they can elicit certain responses from voters.
We’ve talked before about Frank Luntz, whose deft use of words has successfully framed major issues. Thanks to Luntz, “estate taxes” were renamed “death taxes,” and “eavesdropping” became “electronic intercepts.” As Luntz said in his book, Words That Work, “It’s not what you say, it’s what people hear” that has an impact.
Last year, two scholars at Stanford University took this concept one step further. If choosing the right words is so important in driving public opinion, they asked, could choosing the right metaphor be even more persuasive? “Metaphors aren’t just used for flowery speech,” said Lera Boroditsky, an assistant professor of psychology at Stanford. “They shape the conversation for things we’re trying to explain and figure out. And they have consequences for determining what we decide is the right approach to solving problems.”
Boroditsky and doctoral candidate Paul Thibodeau asked a large group of students to read short paragraphs about rising crime rates in the fictional city of Addison. In one version of the story, crime was described as “a beast ravaging the city of Addison.” In the second version, the researchers depicted crime as “a virus ravaging the city of Addison.”
When asked to recommend strategies for dealing with the problem, the test subjects’ answers differed greatly depending on which metaphor was used. Seventy-one percent of those who were presented with the beast metaphor called for more enforcement, while only 54 percent of participants who read the virus metaphor thought enforcement was the answer. The “virus” group was much more likely to suggest social reforms such as improving the economy or providing better education.
When the researchers asked test subjects to reveal their party affiliation, it turned out that Republican participants were about 10 percent more likely than Democrats to support stronger law enforcement. Yet the participants who had read the beast metaphor were about 20 percent more likely to support a get-tough-on-crime policy than those who read that crime was a virus, no matter their political persuasion.
In other words, using the right metaphor — particularly a violent one — can galvanize opinions and sometimes change minds.
This leads me to consider how many other violent metaphors dominate our political speech. It also makes me question the motives of those who use them.
Think how often we’ve heard the word “war” used to frame public policy. First there was the “war on poverty” in the 1960s and then the “war on drugs” in the 1970s. As catchphrases, they got the public’s attention and helped to rally Americans around big national problems. They had limitations, however, since anti-poverty programs were not military operations and enforcing the laws was only one component of the government’s anti-drug effort.
When President George W. Bush declared a “war on terror” to symbolize the fight against militant Islamists and al-Qaeda, he too was trying to rally the country — and his approach worked well. But over time, his phrase came to symbolize American militarism and anti-Islamic attitudes. That’s why, within weeks of taking office, President Barack Obama started referring to the “war on terror” as the “enduring struggle against terrorism and extremism.”
While imperfect, these war metaphors served a national purpose and were outwardly focused. That’s not the case with recent examples, which are showing up everywhere. Our latest symbolic wars relate to internal, partisan conflicts.
If you’re keeping score, at various times over the past three years Obama has been accused of waging wars on America, jobs, the economy, small business, big business, gun owners, energy, religion and even Christmas trees. Differences in social policy are called “culture wars,” and differences in economic policy amount to “class warfare.” This trend is not a coincidence; it is a conscious framing of the debate by opponents.
Meanwhile, we’ve heard lately about the Republican Party’s “war on science” and, because of recent controversies over abortion and contraception laws, its “war on women.” Democrats don’t play the war card as often as Republicans do, but they still play it.
Why? Matthew Nisbet, an associate professor of communication at American University, says when this framing device is used to point to an external or real threat, the metaphor transcends ideological divisions. But when the perceived threat comes from a group within American society, “the metaphor polarizes views, communicates the differences between ‘us’ and ‘them,’ and rallies a particular social movement or ideological base.”
As in the Stanford experiment, when we hear news of an aggressor threatening our way of life, our primal instincts kick in. We draw sharp battle lines and support tough actions to win the fight.
Before politicians can find bipartisan solutions to national problems, they need to stop dividing people into allies and enemies. They use the war metaphor because — so far — it works to energize their reelection campaigns. But it certainly doesn’t work for the country.
It’s time for rhetorical disarmament. No more metaphoric wars, battles, fights or clashes. We can still have lively debates, heated discussions and arguments, but let’s stop demonizing one another. When it comes to language, this country needs an anti-war movement — and I already have a bumper sticker in mind, courtesy of John Lennon:
“All we are saying is give peace a chance.”
Comments? Email me.
Do Elections Drive Markets?
By Doug Pinkham
Public Affairs Council President
February 8, 2012
It’s often said that Washington is a town that defies logic. And the most common logical fallacy is that “correlation” means the same thing as “causation.” In other words, say many D.C. insiders, when two events occur at the same time, one must be the cause of the other.
That’s why we hear politicians proclaim that rising public cynicism has reduced voter turnout or that negative campaigning has increased partisanship. Each of these variables represents a real trend, but neither assertion is true.
Mixing correlation with causation becomes even more ridiculous when pundits start tying presidential politics to the financial markets. Investor’s Business Daily recently reported that when the stock market increases by 6 percent or more in January of an election year, the challenger beats the incumbent president. Apparently this pattern has held true since 1936. “Indeed, the stock market typically looks ahead and reacts before headlines become reality,” says IBD’s Paul Whitfield, creator of the IBD January Incumbent Barometer. “So there may be more at work than an uncanny streak.”
Tell that to Joe Weisenthal and Jon Terbush of Business Insider, who have traced the rise in the president’s popularity to gains in the S&P 500. Responding to a post in Talking Points Memo that tried to link President Obama’s higher approval rating to specific policy decisions, they suggest the real cause is the improving stock market. And they have visual evidence to back up their claim:
They’re both wrong, says Barry Ritholtz in The Washington Post, who argues that an incumbent’s poll numbers have very little to do with stocks. “Instead of assuming that one is causing the other, we need to look for broader forces that are driving both elements,” he writes.
When the economy is doing better and earnings, hiring and spending are up, voters feel more secure, which helps a sitting president. The opposite is also true: Markets go down not because a challenger is polling well but because economic conditions are weak.
The correlation/causation fallacy is rampant during elections, he notes:
These simple facts never seem to get in the way of the op-ed writers at various journals who seem to favor arguments along these lines: “Worries about possible policy changes are weighing on markets ahead of the year’s presidential elections. Candidate X’s rise in the polls is a risk that is giving the stock market jitters. Stock prices are wobbling, all leading to uncertainty. (And the markets hate uncertainty.)”
Here are some other logic-free observations Ritholtz says we’ll hear regarding politics and markets this year.
Misplaced credit and blame: Presidents get more credit than they deserve for strong economies and good markets, and more blame than they deserve when times are bad. “This is true regardless of which party wins the White House or where the economy is in its cycle.”
The Obama bull market: People who think the markets will respond positively to a pro-business president should ask themselves why stocks didn’t soar throughout George W. Bush’s entire term. (The S&P declined about 37 percent while he was president.) On the other hand, the markets have gained substantially since Obama was sworn in.
Anthropomorphizing markets: Markets don’t prefer one candidate over another, and poll numbers don’t spur short-term rallies. “It is a trick used to frame issues, and it is disingenuous at best,” writes Ritholtz. “Indeed, with these silly claims, pundits manage to combine all of the analytical errors discussed above.”
So why are people sucked in by irrational reasoning? Jonah Lehrer, author of How We Decide, argues that causal explanations are useful because they help us understand the world at a glance. This approach has worked reasonably well for centuries, but in both the natural and social sciences, “the reliance on correlations has entered an age of diminishing returns,” he writes in a recent article in Wired magazine.
First, all of the easy cause-and-effect relationships have been discovered, which means science “is getting harder.” Second, looking for correlations “is a terrible way of dealing with the primary subject of much modern research: those complex networks at the center of life.” There are simply too many variables, and they can’t be isolated.
And yet — in Washington and elsewhere — we continue to see two unrelated trends and conclude that one is causing the other. Perhaps, as the world’s problems have become more complicated, we keep hoping for easy answers. It’s clear the public has an appetite for this sort of thing. That’s why Investor’s Business Daily computes its IBD January Incumbent Barometer and why we see sports bloggers claiming that a president’s reelection chances are related to which team wins the Super Bowl.
But the best illustration of the correlation/causation fallacy came in a recent edition of Bloomberg Businessweek, in which Vali Chandrasekaran paired a series of trends with similar trajectories. Among the many “conclusions” he reached was one tying the number of active Facebook users to the yield on 10-year Greek government bonds:
“Correlation may not imply causation,” he writes, “but it sure can help us insinuate it.”
Comments? Email me.
Public Affairs Goes Mainstream
By Doug Pinkham
Public Affairs Council President
January 13, 2012
Corporate lobbyists know intuitively that they add value to a company. Now they have proof. According to a recent study by four financial scholars, companies that lobby significantly outperform those that don’t. In fact, say the authors, “lobbying is an important channel through which the firm can strengthen operational results and competitiveness.”
But lobbying is only part of a company’s overall public affairs strategy. Because public affairs seeks to manage all aspects of a firm’s business environment, companies are learning to integrate their government relations, communications and corporate citizenship activities in ways that add even more value.
In a new survey from the Foundation for Public Affairs, 79 percent of business executives say public affairs already plays an increasingly important or very important strategic role in their firms. An additional 14 percent say it is becoming more important. (The Foundation is the research affiliate of the Public Affairs Council.)
Given these data — and the political and economic uncertainty facing the world — it’s no surprise that corporations are increasing the resources devoted to public affairs.
Corporate public affairs departments survived the budget cutbacks of the 2008-2011 timeframe better than did many corporate functions. Forty-four percent of respondents to the Foundation for Public Affairs survey say their budgets have increased over the past three years, while 36 percent say their budgets have remained the same.
Staffing levels also have been remarkably resilient during this time of corporate retrenching. The median number of professional staff in the survey sample is seven (though the headcounts ranged from one to 350 people). Nearly one-half (46 percent) report increases in professional staffing, while 35 percent say the professional staff headcount remained the same. Meanwhile, the administrative staff headcount increased in 23 percent of companies, with 64 percent reporting no change.
In order to be effective, public affairs executives need access to the top levels of the company — and most have it. In the Foundation for Public Affairs survey, nearly one-half say they report directly to the CEO, chairman or president, and another 30 percent report to the company’s general counsel. The rest report to an officer or a business unit head.
Because of this access, public affairs executives have been able to persuade CEOs to become increasingly involved in corporate public affairs activities, from communicating with Congress to endorsing corporate political programs. While CEOs had decreased their involvement in direct federal lobbying in 2008 (when this survey was last conducted), nearly three in four have recently engaged in federal lobbying. Roughly the same number made contributions to the company’s PAC.
What CEOs aren’t doing is spending as much time at trade association meetings. Direct involvement in associations has been on the decline since 2005, when 89 percent of companies said their CEO was active in associations. This year, only 68 percent report their CEO is active.
But this doesn’t mean firms are abandoning trade groups. To the contrary, 38 percent have relied more on trade associations over the past three years, and only 14 percent have relied less on associations. Back in 2008, we noted that companies had greatly reduced their reliance on business associations (such as the U.S. Chamber or the Business Roundtable) for lobbying and issue advocacy. Since that time, the percentage of firms using business groups for these functions has risen — particularly for issue advocacy.
In addition, more than half of respondents say they have increased their use of coalitions over the past year; only 4 percent report a decrease.
Running a public affairs department is not without significant problems, however. When asked to name their greatest challenges, a growing number of executives (63 percent) list the difficult political environment, and 57 percent list insufficient staff resources. The third highest vote-getter (40 percent) is the difficult economic environment — a reason not even mentioned when the survey was conducted in 2008.
Given the amount of publicity generated by changes to the lobbying/ethics laws in recent years, it’s worth noting that only 9 percent consider the complexity of these rules to be a challenge. When asked to comment on emerging issues, only 21 percent point to possible changes to these laws as a major worry.
Despite the assumption (propagated by the media and reform groups) that companies spend a lot of time trying to work around gift bans and registration rules, their focus is on larger issues. Like most Americans, public affairs executives are frustrated with partisan politics, nervous about the economy and wish they had more resources to do their best.
If you’re looking for convincing evidence that public affairs has become a mainstream corporate function, you just found it.
Comments? Email me.
Copies of the 2011-2012 State of Corporate Public Affairs report are available free of charge to survey participants. Additional copies are available for $100 each. Non-participants may also purchase the report for the same price. For a list of participating companies, click here. For questions about publications, contact Mary Beaver at mbeaver@pac.org or 202.787.5982.
