The power of the purse.

It was an uncanny coincidence. 

Friday, two Pennsylvania juries came in with guilty verdicts in separate high profile trials involving child sexual abuse.

One was with former Pennsylvania State University football coach, Jerry Sandusky. The other convicted a Catholic clergyman, Msgr. William J. Lynn, of endangering children by assigning a known pedophile to a church community without warning its members.

A state university and a church had broken the ultimate trust. To protect the children they educate and nurture. Sandusky and Lynn are just the faces of these scandals. They are poster boys for our deficit of trust. But university officials as well as the shepherds of the Church are hiding behind the scenes, along with the leaders of countless corporations and our governing bodies.

Our institutions have failed us and the most fundamental levels of our confidence have been shaken.

Think about it. Do you trust the banks? How about your financial advisor and Wall Street?

Many people feel helpless about the state of affairs, both economically and morally. But in these financially fragile times, we actually have more power than ever. The power of the purse.

Consider the nation’s law school applicants who chose not to apply to Penn State this year. Now, applications are down at all U.S. law schools, but they’re down 30% in Happy Valley, far outpacing the national average. The message is, we don’t want to go to a law school where university leadership allegedly broke the law and recklessly endangered children. Every application is worth $60 to the university, and when your talking thousands of them, the registrar’s office notices.

So, if you’re disgusted with banks, move your money to a credit union. Some will handle your business accounts, too. If you think Apple is exploiting its store employees by paying them less than $12.00 per hour, don't buy their stuff. If you feel oil companies are gouging you at the pump, buy the most fuel-efficient car you can afford, car pool and drive 55 mph on the highways. Or take the bus.

Register to vote, cast your ballot at the polls and then vote with you wallet. If there’s one thing business and institutions understand, it’s money. But to be sure they don’t miss the message, send them a letter, place a phone call or show up at your legislators’ office. If you just slide your account from a bank to the local credit union they’ll never miss you. But if you hand the bank manager a letter and explain you’re removing your principal on principle they’ll take notice.

It may be inconvenient, it may cost you a little more in the short run, but voting with you're your wallet will ultimately make the loudest, most powerful statement.

Occupy Wall Street, Oakland, Detroit, and Miami got attention but it didn’t change anything because no money was involved. But during the Civil Rights Movement, the Montgomery, Alabama bus boycott made a difference. It wasn’t violence or noisy protests. It was the fact that people stopped riding the buses and paying fares that ended centuries of discrimination.

If we want to move trust to the front of the bus, we have to be willing to walk the talk and let our money do the talking for us.

No free ride.

If you told most future parents it would cost about $235,000 to raise a kid to age 18, how many would go through with it? And that doesn’t include college.

Adjusted for inflation, the number is a little closer to $295,000 for a kid born in 2011. That’s a sobering thought on this Father’s Day weekend, especially in an economy where good jobs are rare and even professionals struggle to find gainful employment.

The U.S. Department of Agriculture released its kid-cost estimate this week, including this breakdown.

Childcare and education (18%)

Food (16%)

Transportation (14%)

Healthcare (8%)

Miscellaneous expenses (8%)

Clothing (6%)

The line that jumped out at me was transportation; it’s as much as healthcare and duds combined, and just shy of food costs. Based on the cost estimate, 14% equates to over $30,000 before adjusting for inflation.

Why is it so expensive to move kids around until age 18? Does that assume parents buy Suzy and Johnny cars at 16? I doubt it.

My guess: it reflects the future costs of vehicles and energy. This should pressure families to move closer to schools, their houses of worship and other activities.

That should lead to the growth of central cities as families cocoon around convenience and urban communities.

If you think about it, it costs society significant sums to build roads and provide infrastructure for a sprawling suburbia. Taxpayers subsidize real estate developments in remote locations, an hour from our urban centers.

In Michigan, the Oakland County and Macomb County Executives, L. Brooks Patterson and Mark Hackel made an ironic announcement recently.  They want Detroit to reimburse them for police assistance their counties will provide during the city’s annual fireworks display and International Freedom Festival celebration. This was their firm public position, despite the fact that tens of thousands will pour into Detroit from the suburbs to enjoy the show.

Maybe Wayne County should return the favor every time residents of Oakland and Macomb come to use our airport. Perhaps out-of-county travelers should pay an extra surcharge since their cops don’t police the facility. Same thing at Comerica Park, Joe Louis Arena, Ford Field, etc. Detroit cops secure every one of those events, and manage traffic before and after the games.

The era of the free lunch is over and costs deserve to be shared. What’s good for the goose is good for the gander, and whatever other cliché you’d like to insert. The lack of shared responsibility and public goods has financial consequences. Cities have been shouldering the burden for the suburbs for too long. 

If communities want to encourage families with children to move in, they should provide sidewalks, bike trails and convenient mass transit. In the metro Detroit area, cities like Dearborn, Dearborn Heights, Grosse Pointe and Harper Woods offer all those benefits close enough to the Motor City’s central business district, cultural center and our international airport.

I grew up on the West side of Detroit, where my mom still lives.  My family didn’t have a car until I was ten years old. Mom and Dad were immigrants and they put Catholic school tuition for four kids ahead of an automobile or other conveniences like dining out. They made the tough sacrifices that included schlepping home groceries in a cart from shops on the main street in our neighborhood. And we kids did our part. We walked to school, church and all our athletic and extra curricular activities. And yes, it was miles in the snow, round trip!

Of the items listed by the Department of Agriculture, transportation seems the easiest cost to control. The message for parents is, driving kids to soccer, dance and every other event in their lives not only teaches dependency and a sense of entitlement, it’s expensive.

In a nation that’s battling childhood obesity sounds like a little more walking is just what the doctor and your accountant ordered.

Beware of Job

In George Orwell’s novel, “Nineteen Eighty-Four,” he crafted a diabolical character that oppressed free thinkers. Big Brother was a deified party leader of a dictatorship  that used ceaseless surveillance and mind control to manage society.

Ironically, in 2012, it’s not government that’s invading privacy to manage people, it’s free enterprise.

There’s commotion in Congress and protests on Main Street in opposition to employers who demand that job applicants release their credit reports and Facebook passwords. You can imagine, if you’ve been unemployed for a while, your credit report might look less than stellar. Complete Facebook access might reveal your love life, wacky pictures from your class reunion, your political affiliations and your religious beliefs and disabilities.

A lot of these topics are off limits to employers in job interviews. Here’s a sample of questions that are illegal for companies to ask applicants:

1. What is your maiden name?
2. Do you have or plan to have children?
3. What religion do you practice?
4. Do you belong to a social organization or club?
5. Do you have a disease?
6. Have you ever been arrested?

You get the idea. Employers aren’t allowed to discriminate on the basis of marital status, religious beliefs, social or political affiliation, disabilities and even crime. If an employer has a specific concern about fraud or theft, he or she must ask about those crimes only. An arrest doesn't make you a criminal. You've heard of innocent until proven guilty, right?

Among the rights we consider inalienable is the right to privacy. Seems our freedom of speech is getting some folks in trouble, and their freewheeling approach to social media is inadvertently lifting the veil on their private lives.  

What you post on Facebook can be used against you if you grant access to an employer. This year, a Congressional amendment designed to restrict prospective employers from asking for Facebook passwords failed in the House of Representatives. A coalition of 25 civil rights and labor groups are petitioning America’s largest credit reporting firms to stop selling employers access to financial records of job applicants. Some experts argue and have testified to state legislatures that there is no real world evidence to prove a correlation between credit reports and job performance or any employee crime such as stealing or embezzling.

And in a bad economy, like this one, even the most frugal can run into financial trouble. Yet surveys show 60 percent of employers use credit reports in at least some hiring decisions, and some companies won’t even consider unemployed people.

Now here’s a twist. It’s not uncommon for credit reports to be erroneous, and it can take months for you to get one corrected. Meanwhile, you may be rejected from a series of jobs without even knowing it’s your bogus credit history that’s the problem.

According to critics, Facebook is lax about complying with the Child Online Privacy Protection Act. Some reports estimate 5.6 million Facebook subscribers are under 13 years old. What a sophomoric kid posts as a teenager or college student could affect his future employment status. And unpaid credit card accounts could lead to similar repercussions.

In fairness and in the spirit of full disclosure, perhaps the Feds should require the following warnings be acknowledged before these transactions:

CAUTION: the contents of your Facebook page may be viewed by your future employer and may cost you a job.

WARNING: failure to pay credit card and other bills in a timely fashion could prevent you from getting a job.

CAUTION TO JOB APPLICANTS: during your job interview, the employer may ask you questions that are illegal. Should you work for this employer, you could be sexually harassed, illegally terminated, racially profiled, or discriminated against on the basis of age, sex, religion or political affiliation. This employer may subsequently file bankruptcy and fail to meet obligations to you such as salary, wages, benefits and pension. Federal law affords you the full right to take legal action against this employer in the event of illegalities or any breach of contract.

If nothing’s private then everything should be public, and clearly posted. Let all buyers beware.

Can we get there from here?

What do you write when you have too many unanswered questions going through your mind? I call it blog soup. Hopefully, you’ll find these pithy chunks appetizing and easy to digest.

Our younger son is headed out of town to work a great job for a Chicago law firm for the summer. We thought a train might offer the most affordable way to get there with a lot of luggage. You can fly for $28.00 but the baggage fees will kill you. Now, you can ride Amtrak from Detroit, Dearborn, Ann Arbor, Birmingham or Royal Oak for about $52 one way. But you can only bring two carry on bags, because there is no checked baggage service. However, drive one hour to Toledo, Ohio and you can check three bags to Chitown, up to 50 pounds each at no extra charge, plus two carry on pieces. If you’d like, you can check up to six bags, and pay only $10 each after the first three. What a deal!

My question: why do I have to drive an hour to Toledo? Detroit isn’t a big enough hub to have checked baggage service? During these times of high gas prices and tight budgets, affordable transit is a must.

“Taken for a Ride” was the 1996 PBS documentary that chronicled the demise of urban mass transit under pressure from the American car industry. According to the producers, GM put the squeeze on big city governments in the 1930’s to swap streetcars for yellow buses the car company manufactured. Who’s preventing us from getting checked baggage service at the Amtrak train station in Detroit? Is it the airlines lobby? Will the high-speed rail from Detroit to Chicago offer full baggage service?

On Mother’s Day weekend, we were tied up celebrating with our older son and his lovely new fiancé. So I ran out of time to blog. My topic would have been “Look, Mom … No Job!” Economic signals remain crossed four years into this recession. Why can’t we gain employment momentum, while car companies report record sales and consumer confidence was up in April’s University of Michigan Survey of the U.S.? One reason is companies are exploiting the job shortage to maximize productivity at no cost.  More and more grads and even those with advanced and professional degrees are forced to take internships at no pay.  Plus, in the advertising and marketing business, there’s a whole class of young professionals who are paid low wages and subsidized with vendor perks like free dinners, complimentary cocktails at swank clubs and tickets to must-see events. Unfortunately, they can’t pay their bills with those gratis gifts and swag. That’s what a college education buys you today.

More than 30 years ago, I did two back-to-back internships with ABC-TV, but there were rules. I was getting college credit, a grade and my professor required a supervisor’s evaluation. I had to submit a journal of my experience and meet with my professor twice during the term. In fact, I had to beg my prof for permission to do a second internship, because the TV station was predicting they’d have a job for me if I could hang on for another few months. I did and they made me an offer two days before graduation. What’s happening today with college grads is a lot like what happens to illegal aliens desperate for work. They’ll take anything, even toil for free, rather than atrophy on the unemployment line.

There’s another key point in this story; when I did my internships, my four-year scholarship at Wayne State University was valued at $4,800.00. At the time, my brand new 1977 Chevy Monte Carlo set me back $5,700 cash. Try going to college today for the price of a midsize car.  Despite all these inequities, we’re soon going to hear cries for a tax amnesty program so big American businesses can bring their enormous offshore profits home without paying the piper. If they don’t get the tax break, will corporations continue to hold jobs hostage?

Meanwhile, the presidential election is coming. What should we believe about the race? I’m going to make a prediction. Regardless of what actually happens, we will continue to hear that the polls are tight. It’s in the best interest the TV and radio networks. There are billions of dollars in ad revenues at stake. Both political parties have huge war chests, and with the U.S. Supreme Court designating corporations as citizens with full freedom of speech, this election will be the most expensive in American history. The tighter the race the more money the media will make.

On Friday, Bloomberg TV interviewed Matthew Dowd, the former campaign strategist for President George W. Bush. His analysis was that in election years, voters actually make up their minds in May, June and July and spend the rest of the time rationalizing their vote for president. So, the money that pours into advertising is designed to prevent you from changing your vote. News organizations face a significant conflict of interest. Report the facts, or muckrake for billions.

Here’s a question for the Supreme Court: if a corporation owns a TV or radio network and it runs a free ad in favor of a candidate, under the equal time clause, is it required to do the same for the other candidate? Just asking.

Gas prices are falling as the summer vacation season heats up. Despite sanctions on Iran to help diffuse their nuclear aspirations, the supply of petroleum is rising with a surprise source filling the gap. Iraq is back and pumping millions of barrels a day and their capabilities are growing. Without the Iraq war, would the U.S. have seen $4 per gallon prices in recent years?

The good news is America has diversified its energy resources and continues to pursue greener options like incredibly abundant natural gas. Even utility companies in coal country are converting their power plants to burn natural gas instead of coal. What special interest is stepping up and attempting to derail our new found trend toward energy independence?

There are answers to all these questions. Do we have enough real journalists with the courage to ask them? I’m still waiting to find out.

Sunday Night Live

In our dizzying world of text messages and virtually constant electronic connections, people still crave live human contact. Perhaps now more than ever. And that’s an important lesson for marketers.

My wife, Ellen, and I spent the afternoon in Ann Arbor, Michigan enjoying a paddleboat ride on the Huron River and working up an appetite. So, we headed to South Main Street for a meal at a sidewalk café. Afterward we strolled over to Kilwin’s so Ellen could grab an ice cream. I would only taste it, of course. And to our surprise, there was a show in the window. One young woman crafting waffle cones and the other making caramel and peanut butter fudge on a chilly slab of white marble. It was quite entertaining to watch scrumptious delights handmade the old fashioned way. And people stopped on the sidewalk to enjoy the artisans at work.

We went off looking for a cup of coffee and stumbled across two street entertainers near the corner of South Main and East Liberty. On the east side of Main, a mime performed, a delightfully cute woman in a white bobbed wig and white face mesmerized pedestrians. People stared and then dropped a buck or two in her beaded basket.

But across the street in front of the now shuttered Parthenon Restaurant was the main attraction. Twenty or thirty people formed a semicircle around a willowy character, a tall, dark Ichabod Crane of magic man. His name is Alexander the Magician and he says he’s performed his street show around the world, from France and Italy to Tunisia in the Arab Spring and New Orleans, Louisiana.

Alexander captivated families, young couples, toddlers and seniors with his slight of hand. His close-up magic was flawless and he involved a number of volunteers including kids. At the end of his 45-minute act he passed a hat.

“How much money do you typically get?” I asked.

“Enough,” Alexander replied. Enough for him to work about two days a week and make a living. He’s been plying his craft as a street performer for 10 years. After attending Central Michigan University and the University of Michigan, Alexander earned degrees in Philosophy and Drama. And he’s proud to work for himself.

“So, you’re an entrepreneur,” I declared.

“I’m a free man,” he replied.

Besides his magic, which is genuinely impressive, Alexander’s ability to grab audience attention and hold it in the midst of a bustling urban community speaks volumes. No microphone, no lighting, no set or staging other than a few props like coins, handkerchiefs, playing cards and dollar bills. He had people smiling, laughing, gawking, clapping and cheering for 45 minutes. The audience was eating out of his hand. And then they dug into their pockets and paid him for a show they never planned to see. One guy came by five minutes after the act ended to drop a couple bucks in the hat because he had stepped away to take a phone call.  

Alexander’s act occurs spontaneously when he finds an open corner where merchants and proprietors will allow him to perform in front of their establishments. He calls out to people as they pass and the show begins. Soon the crowd gathers.

For a few minutes, the pressures of the world melt away. No signs of a bad economy. Just priceless moments with awestruck little kids and parents laughing out loud. Not via text, but real belly laughs.

You can find this talented guy at alexanderthemagician.com and you might stumble across a video of him on YouTube. But it’s nothing like the real thing. He’s available for hire.

Ironically, amidst the explosion of Web advertising, marketers have discovered that the best way to really reach people is through experiences. And experiential and guerilla marketing are gaining importance. Market research demonstrates that people will spend 15 to 30 minutes engaged in a brand when their invited to participate in an experience. It’s the value of a test drive, a taste test or an open house or plant tour.

So, if you’re looking for a little magic in your marketing, get up close and personal with your audience and put on a show. They just might fill your hat with dough.

Face it

What made Facebook a crazy success was that college kids had a place to hang out virtually, free of adult supervision. It played right into endless connectivity, a trend that began with Gen Y using e-mail, instant messaging and Napster. Shared experiences, 24/7. Eventually, their parents, little brothers and sisters and even grandma and grandpa joined the party.

Now, Mark Zuckerberg has gone and spoiled all the fun by taking his billion-member social network public on the NASDAQ stock exchange. The reportedly greedy guru may have cashed out, because now he’s taken his cool idea corporate.

Ironically, when Zuckerberg and his partners first launched Facebook, while at Harvard University, he adamantly opposed the idea of selling advertising to monetize the burgeoning social media experiment. He didn’t want to prostitute the “coolness” of the concept until it became more viable. It was an online global village that belonged exclusively to college students.

But as the number of Facebook members grew to astronomical proportions, comparable to half the population of China, the urge to cannibalize it became too great. Now, you get to see ads next to photos of your friends and what they’re eating for lunch. Zuckerberg had built a village square for people and groups to gather for free. Now he sells electronic billboards around the perimeter and fills the air above with blimps and skywriters.

General Motors announced this week that it’s dropping Facebook ads, because the carmaker believes they’re ineffective. This went down as Facebook launched its IPO and later kicked off trading. But GM still says brands can build relationships through social media. It’s just that the ads don’t measure up. They’ve tasted the milk for free and don’t think it’s worth paying for.

I wonder if Zuckerberg’s future plans for generating profits will include a premium paid model. We’ll call it Facebook 3D. It could offer special features like chat rooms with celebrities and virtual backstage passes to concerts or events. Don’t laugh. LinkedIn and IMDb both have professional grade versions that you can access only if you buy a monthly subscription.

My sense is, people desire a commercial-free environment for the social lives. We always tolerated ads with free TV and radio. It was a small price to pay for all that programming. But the more we pay for cable and Internet access, the less it seems we should have to endure an endless stream of marketing.

Don’t get me wrong. Ads are very appropriate on the Web. For example, Google provides an amazing service free of charge. Type in a word or phrase and miraculously you receive hundreds and even thousands of related links, articles, images, videos and news stories. You name it. Anyone who is old enough to have done library research the old fashioned way and cranked through miles of microfilm should shed a tear every time Google spits out a list of links in seconds. The ads are a small price to pay for all that free knowledge. In fact, the ads are often exactly what we want to discover.

But there’s something particularly eerie about targeted ads showing up next to a photo of your little nephew’s birthday party. Or a snapshot at your brother’s wedding. We’ve reached the point where reality TV has become viewers broadcasting themselves and corporations selling that content without sharing the profits with the creators. Sounds kind of like what pimps do, doesn’t it?

Enter Dish Network and The Hopper. The satellite TV provider now offers a digital video recorder (DVR) that will automatically zap the commercials so you don't have to watch them during playback. Only seems appropriate since we all pony up so much for cable and satellite and still have to buy Web access. The networks are screaming about the editing technology.

Zuckerberg and his team will be under intense pressure to show a profit right away, since he’s got lots of investors now. Facebook may be tempted to snoop your posts and pics and offer ads that connect to your life. You post a photo of your new Chevy Camaro and Facebook ads for State Farm and Shell gasoline pop up. Maybe even a promo for a local detail shop and Auto Zone. How’s that sound?

The quickest way for Zuckergberg to raise profits is to sell a portion of his mammoth membership a subscription to Facebook on steroids. Let’s say, only 10% of current members buy in at 50 cents a month or five dollars a year for premium access. That would be 500 million bucks without selling a single ad. Ten bucks a year or about three cents a day is a billion dollars, and so on.

And the paid, premium version of Facebook could offer an ad-free environment, just like when the social network started.

Then Zuckerberg could charge corporations like GM big bucks to join as members and post their status. That’s what Facebook should sell, not your private life.

Anchors away.

This week, the New York Times reported that CNN US is a brand in trouble. All but one of its news shows, “Anderson Cooper 360” are experiencing double-digit ratings losses.  Cooper’s losses are single digit. Although, worldwide, CNN will generate a record $600 million in operating profits this year, for it’s parent Time Warner.

But declining audiences directly impact future earnings. So, why is CNN in decline? FOX News and MSNBC audiences have also dropped, during the current lull in the presidential campaign, as candidates like Rick Santorum and Newt Gingrich bowed out. But those networks should recover as the political machine gains steam during convention season.

On the other hand, CNN viewers tune in for breaking news. That’s the backbone and lifeblood of the news brand that captures 57 cents per cable viewer. When there are oil gushers in the Gulf of Mexico, war stories, twisters in tornado alley or plane crashes and railroad disasters, people instinctively tune in to CNN. Once a crisis or big story dies down, they’re free to channel surf, and that leaves CNN struggling to recoup ratings.

FOX and MSNBC offer political red meat for conservatives and liberals, respectively. Since, CNN is somewhere between those two on the political spectrum, they’re viewers are neither as passionate nor as loyal. That’s why interviewers like Larry King were anchors of the network. King was key to filling the gaps between news spikes. Once he retired, CNN went adrift.

Anderson Cooper is an intriguing fellow. A little like a hairless cat, he’s worth a look or two, but has no real gravitas based on essential experience toiling in the field. That’s not due to a lack of travel. I’d love to have his frequent flyer miles he’s piled up, jetting from story to story. But being somewhere to witness a happening, doesn’t mean you’re in the trenches, day in and day out. The late Peter Jennings lived in Beirut and London for years earning his stripes by really covering watershed events like the 1972 Munich Olympics massacre of Israeli athletes. Cooper leapfrogged to the anchor desk on his mother’s family name. That’s fashion icon Gloria Vanderbilt, as in the Vanderbilts. It’s not uncommon to see Cooper reporting on silly topics looking for laughs at the end of his broadcasts.

Soledad O’Brien, Erin Burnett and Piers Morgan are CNN’s latest efforts to boost their prime time viewership when there’s no news to break. As for O’Brien and Burnett, they’re competent, but too young and inexperienced to command authority. Morgan was a judge on “Britain’s Got Talent”, the UK version of “American Idol”. He also had a career with Rupert Murdoch’s British media machine. Not exactly a Walter Cronkite or David Brinkley.

CNN is continuing to grow its network of international bureaus, which builds on their core newsgathering strength, and should make them even tougher to beat to breaking news.

These days, there are few real network news anchors who can draw an audience on their own merit. Maybe Brian Williams at NBC. Maybe.

CBS tried to make Katie Couric a newswoman. She sank like an anchor, but the similarity ended there. An anchorwoman or anchorman’s credibility doesn’t come from a furrowed brow or even grey hair. A 35-year-old can be a legitimate news source if he or she works hard enough while climbing the ladder.

My advice to CNN is to mine their team of correspondents and develop primetime programming around them. Give Piers Morgan an extended vacation and try some real news people in the anchor chair. Rotate reporters in and out according to the topic or the specialty. Middle East reporters interviewing terrorism experts. Financial gurus covering economic analysts. And Anderson Cooper probing fashion, Hollywood and high society. He’s comfortable in that arena and could probably break an actual story or two.

Anchors aren’t made; they’re tempered by the heat of life in the trenches. And they’re only as heavy as the news they cover, day after day after day.