A report by the Institute for Policy Studies that 25 corporate CEOs earned more than their companies paid in taxes attracted a surprising amount of press coverage today. And blogger outrage.
The Washington Post has an article by Peter Whoriskey, Politico has a dispatch by Mackenzie Weinger, the New York Times has a story by David Kocieniewski, Bloomberg has an article by Andrew Zajac, and we aired the story on the Marketplace Morning Report.
That's an impressive list of placements that any PR rep would kill for. How did the IPS manage to place its report so successfully? A couple of reasons, I'd say. First, it chose the inflammatory issue of CEO pay outstripping corporate taxes, bound to get attention from the media "in these tough economic times." People are all about rage right now, and they'll direct it anywhere the media tells them, whether it be banks, the President, the FOMC or Bill O'Reilly.
Second the IPS released the story to the media yesterday and embargoed it. This seemed like a risky strategy to me: media outlets of all stripes are notorious for breaking embargoes when it suits them, and there didn't seem any reason not to in this case. But IPS got lucky. The fact that the story held gave everyone lots of time to work up a version, complete with reactions from companies and the public, to give it even more punch.
Third, the IPS released the story in the middle of the silly season. This summer hasn't been as dumb as some, but the market volatility notwithstanding, it hasn't been a bumper period for business stories. So their timing was impeccable.
Finally, they picked a subject that was inevitably going to go viral. The "liberal" media picked it up because of its appeal to the "class warrior in all of us." Then members of the financial services community jumped in to discuss the story online, irritated by the juxtaposition of what they saw as two completely different metrics. And then there were the right wing bloggers and pundits (they get up a bit later, I guess) who pounced on it and batted it back and forth around the web like a bunch of angry cats worrying a mouse. Except in this case the mouse was laughing away the entire time, having been given more column space than it could possibly have dreamed of.
Thankfully, Felix Salmon dug into the report and found that there was less to it than met the eye.
25 CEOs make more than their companies pay in taxes? Wow! Except, it turns out that only five of those 25 companies are paying any taxes at all, by IPS methodology. The lowest-paid janitor, at those 25 companies, makes more than the company pays in taxes.
Felix notes that whether IPS meant it, it was the embargo that created and stoked this little web tornado.
... the world of embargoed reports is clever that way. If you're a think tank, you send them out to lots of journalists. Some will look at them and see little news there; they will ignore the report. Others will buy it, and write the report up. So the only stories you see about the report are from journalists who buy into its thesis. That's a bias right there.