crisis management

The defunct $10,000 billThe insurance company American International Group (AIG), which "vowed to temper spending after hosting a conference at a California resort amid a federal bailout," belatedly canceled "a similar event planned for next week at a $400-a-night hotel." The U.S. government loaned AIG $85 billion in September and the Federal Reserve Bank of New York just loaned the company another $37.8 billion, to "replenish liquidity." Members of Congress harshly criticized AIG's earlier luxury conference, which cost $440,000. Before AIG canceled its more recent event, it considered buying ads to explain that such conferences are necessary to "motivate and educate" independent agents selling AIG coverage. But AIG's public relations consultant, George Sard, warned against the move. Sard, who heads the PR firm Sard Verbinnen & Co., emailed that "to spend the taxpayer's money on an expensive ad campaign to apologize for how you used taxpayer money leaves you open to further attacks." However, Sard mistakenly sent his advice to a Bloomberg reporter.

The Burson-Marsteller PR firm did pro bono communications and media relations support for America's Health Care at Risk: Finding a Cure, which is billed as "a bi-partisan conference bringing together major stakeholders in the health care debate for a high-level dialogue aimed at generating real and lasting solutions." While organizers of the conference were thrilled to have the free help, they may have been wise to check on B-M's health credentials. B-M has had a close relationship with cigarette maker Philip Morris and the tobacco industry as a whole over the years, having organized the smokers' rights group the National Smokers Alliance for PM in the early 1990s. In addition, B-M has performed crisis management work for corporate clients on a variety of issues, including Salmonella (Schwan's and Jewel Supermarkets), worldwide product recall and relaunch (Perrier), and Mad cow disease/BSE (McDonald's and the National Cattlemen's Beef Association). B-M is glad for the opportunity to burnish its image. Chris Foster, Chair of Burson-Marsteller's U.S. Health Care Practice said, "We are proud to be part of this bi-partisan effort to develop real solutions for one of the major challenges facing the U.S. today."

While the closing of 600 Starbucks stores is bad news for the 12,000 baristas who will lose their jobs, it's an economic plus for others. The coffee giant is ramping up PR efforts to shape its message about its contraction. Edelman has been the company's firm of record for several years, and their offices in Portland, San Francisco, Los Angeles, Dallas, Austin, Atlanta, New York and Seattle (Starbucks' home town) are all engaged to work with local media for Starbucks. Besides Edelman, "Starbucks is relying on a PR roster that currently includes The Frause Group (Seattle), The Limtiaco Company (Honolulu), Eiseman PR (Chicago) Airfoil PR (Detroit), Cone (Boston), Brotman Winter Fried Communications (Falls Church, Va.), and rbb PR (Coral Gables, Fla.)." Grey Worldwide handles Starbucks' PR in Canada, which is fielding questions about any plans for closing stores there. All in all, it's an intensive PR effort. Bridget Baker, communications program manager at Starbucks said, "We couldn't be doing this without them all by our side."

The cover of the upcoming issue of the New Yorker magazine bears a satirical cartoon that incorporates practically every jab the right wing has taken at Barack Obama and his wife Michelle: the couple is pictured standing in the White House Oval Office dressed in Muslim garb. Barack is wearing a turban, Michelle has an "Angela Davis"-type afro hairdo and is shown toting a machine gun. An American flag burns in the fireplace as the couple engages in a "terrorist fist-bump." A portrait of Osama bin Laden hangs over the fireplace. The cover is titled, "The Politics of Fear." Both presidential campaigns quickly condemned the lampooning cover as "tasteless and offensive." Jeffrey Goldberg, a blogger at the Atlantic.com laments the whole situation as "the death of humor."

Private military corporations such as Kellogg Brown and Root (KBR) have lauched a new public relations and lobbying initiative to counter what David Marin calls "the steady drip of negative front-page media reports about contractors and growing public concerns about the effectiveness of the federal contracting process." Samuel Loewenberg reports that Marin is the industry's "point man charged with heading off criticism." A former Republican staff director of the House Oversight and Government Affairs Committee, he now works for the Podesta Group, a PR and lobby shop. His client is the Professional Services Council, a trade association whose members include KBR, Blackwater USA, Boeing and DynCorp International.

The Pentagon is attempting to influence filmmakers and future movies depicting the U.S. conflict in Iraq. Vietnam-era war movies like "Apocalypse Now" and "Born on the Fourth of July" helped stereotype Vietnam veterans as crazy or psychologically damaged. To prevent this from happening again, the U.S. Army has assigned a lieutenant colonel to an office in Los Angeles, given him the job of reviewing movie scripts about the Iraq conflict and deciding which ones will get military assistance in their making. If the Army approves a script, it means the filmmaker can gain valuable access to bases, ships, planes, tanks and Humvees, and receive advice from the military in making the movie. In exchange for advice and access to these props, though, the filmmaker must agree to address any "problems" the Pentagon finds with their script. If the filmmaker refuses, the Pentagon can pull its offer. Some filmmakers view the Pentagon's script advice as a subtle form of censorship or an attempt to spin the war. Filmmaker Paul Haggis, who wrote and directed the Iraq war movie "In the Valley of Elah," said he believes the Army is not interested in telling honest stories about soldiers or the war. "They are trying to put the best spin on what they are doing," he said. "Of course they want to publicize what is good. But that doesn't mean that it is true."

A recent investigation by BBC Television showed British American Tobacco (BAT) violating its own voluntary marketing and advertising codes in Malawi, Mauritius and Nigeria. Contrary to BAT's public pronouncements that it doesn't want children to smoke, the company was caught using marketing tactics in these countries that are known to appeal to young people, like advertising and selling single cigarettes, and sponsoring non-age-restricted, product branded musical entertainment.

As trading has become more global and corporations have become more multinational, countries started discovering that they have little recourse to rein in the harmful behavior of corporations. As public clamor to regulate multinationals has grown, companies have increasingly responded by adopting "voluntary codes of conduct." But what are the real purposes for these codes? Are they just window dressing, or worse?

Jeff Gannon"If you ever wondered what happened to Jeff Gannon, the former conservative reporter whose questionable White House credentialing and ties to several sex Web sites forced him out of a job," he's an active member of the National Press Club. Gannon -- whose real name is James Guckert -- initially drew attention after repeatedly asking softball questions during tense moments of White House press briefings. It was later revealed that Gannon had little journalism experience but regularly received day passes to White House briefings. "Press Club rules require that a new member be sponsored by at least two current members," explains Joe Strupp. One of Gannon's sponsors was Rick Dunham, now of the Houston Chronicle. Dunham said he supported Gannon because "my goal was to expand our membership into blogging and multimedia." The other sponsor isn't known. Gannon is on the Press Club's New Media and Newsmakers committees. The chair of the Newsmaker Committee, which "decides which 'newsmakers' to invite to some Press Club events," said of Gannon, "We need everyone we can get."

Dick CheneyThe Bush administration has long held that overly-aggressive interrogation methods used on detainees in Abu Ghraib and Guantanamo Bay were the work of a few "bad apples." Now, an investigation being conducted by the Senate Armed Services Committee has revealed that William Haynes II, General Counsel for the U.S. Department of Defense, sought the advice of military psychologists within a Pentagon agency to design the interrogation techniques. The Committee's findings add to mounting evidence that the detainees' torture resulted from decisions made at the highest levels of government, particularly within the office of U.S. Vice President Dick Cheney.

Listen to this week's edition of the "Weekly Radio Spin," the Center for Media and Democracy's audio report on the stories behind the news. This week, we look at what grades med schools get for cozying up to pharma, the continuing controversy over menthol cigarettes, and an extra ingredient in your chicken dinner. In "Six Degrees of Spin and Fakin'," we look at poor, pitiful Chevron. The Weekly Radio Spin is freely available for personal and broadcast use. Podcasters can subscribe to the XML feed on www.prwatch.org/audio or via iTunes. If you air the Weekly Radio Spin on your radio station, please email us at editor@prwatch.org to let us know. Thanks!