The Austin Chronicle

The Hightower Report

By Jim Hightower, June 14, 2002, News


Lily Tomlin said, "I worry that the man who invented Muzak might be thinking of inventing something else."

Unfortunately, that's a worry come true, for instead of the mild annoyance of Muzak in elevators, a company with the somewhat threatening name of Captivate Network Inc. has come up with a way to make your elevator ride much more annoying than a Muzak moment. Thanks to exciting advances in the science of wireless technology, it is now possible for outfits like Captivate to fill your 30-second ride with: advertising videos. Yes, as you glide up to put in another day's work in your cubicle, you can be blessed by a yammering pitch for Right Guard, Starbucks, or Rolaids.

Captivate Inc.'s elevator ads are merely the tip of the commercialization iceberg for a Brave New World of Advertising that calls itself the "outernet industry." It sees all space outside the home as potential places for capturing consumer's ears and eyeballs for advertisers. This merciless industry is targeting doctors' offices, movie lobbies, commuter trains, convenience stores -- even ski lifts!

The Los Angeles Times reports that "The industry operates on a simple principle: Find out where consumers are gathering and put a screen in their faces." The possibilities are boundless -- taxicabs, restrooms, bank drive-throughs, bus stops, golf tees, public parks, and along the boardwalks at the seashore.

The head of one of these outernet firms claims they're doing us a favor: "If you're standing in line waiting for a Big Mac and fries, you've got nothing else to do." Yes we do! We could plot revenge against the crass commercializers of our world.

"Big Gun-- Ebbers Goes Down

The Arizona tombstone of a Wild West gunslinger declares: "I was expecting this, but not so soon."

I thought of this epitaph when I heard that Bernie Ebbers had gone down, offed as CEO of WorldCom Inc. Bernie had been the top money-slinging deal-maker of the wild and wooly, deregulated telecommunications market during the past two decades. He developed a cult following on Wall Street for making WorldCom one of the world's largest long-distance phone networks. However, it turns out he achieved this not through any managerial genius, not by inventing a better product, not with a savvy marketing strategy -- but simply by picking off other phone companies in a rapid-fire acquisitions binge, notching his corporate gun with 75 takeovers in 10 years.

It was only a matter of time before Bernie got his. He was full of arrogance and avarice, and he finally was done in by four fatal flaws. One, he knew nothing about operating the companies he was acquiring -- as a WorldCom director now points out, Ebber's only experience with a telephone company "was he used the phone." Two, in order to amass his empire, he borrowed wildly from investment bankers, saddling the company with unbearable debt. Three, he grossly miscalculated the market, buying up telephone networks while consumers were switching en masse to cell phones and e-mail -- an industry consultant notes that Bernie "never truly understood the business that he was in." Four, he got cute with WorldCom's corporate accounting, so its finances are under federal investigation, including examination of a curious $366 million personal loan the company made to Ebbers.

WorldCom's stock is now in the ditch, so the board has dispatched Ebbers. Meanwhile thousands of fired workers and millions of snookered shareholders are paying the price for his ineptness. He was Wall Street's darling and once hailed as a business genius ... but what would you put on Bernie's tombstone?

Stanley Works the System

Stanley Works is the name of an American toolmaker that has grown to fame and riches, thanks to the hard work and pride of generations of employees at its factory and headquarters in New Britain, Connecticut. Stanley Works was perfectly named, for this company and its sturdy yellow-and-black tools have long been made by and for working class folks, embodying American know-how, teamwork, and community spirit.

But in recent years, the Stanley Works name has come to refer to working the system. Stanley's current honcho, John Trani, is a former Wall Street analyst and GE executive who doesn't give a damn about American know-how, community spirit, New Britain, or America. Trani says, "I'm paid to make money for shareholders." Period.

This "me first" approach to corporate ethics has already led the once-proud, made-in-America company to abandon thousands of workers in New Britain, moving their $10-20 an hour middle-class jobs off to China and other sweatshop countries, where they can pay poverty wages of under a dollar an hour. But now, Trani has a scheme to abandon any sense of corporate responsibility to America itself. Although Stanley makes its wealth here, and although Trani and other execs would remain living in our Golden Land of Opportunity, he intends to re-incorporate Stanley Works as a Bermuda corporation and establish its legal residence in Barbados.

Trani's move is nothing but an un-American corporate shell game deliberately designed so Stanley can dodge its U.S. tax bill. Stanley Works, which would evade paying about $30 million a year in taxes, would continue to enjoy the benefits of everything from U.S. highways to our national security protections -- it just wouldn't help pay for them.

To help stop this raw selfishness, call Sen. Charles Grassley: 202/224-3744.

Jim Hightower is a speaker and author. To subscribe to his monthly newsletter, The Hightower Lowdown, call toll free 866/271-4900. To order his books or schedule him for a speech, visit

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