Online Public Relations Thoughts

The failure yesterday of the bailout bill in the House of Representatives is an historical misreading of the temperament of its members and of the public. It was a shocking rebuke of the President and the Speaker of the House. The vote was flung in the face of both parties as well. No wonder the market collapsed. The financial world has entered new and uncertain territory. It is anyone's guess what will happen today.

From a PR perspective, the question arises of how the President and Speaker could have miscounted so badly. How could they have assumed that the House would go along with a bill that enraged millions of Americans? Perhaps positive support in the Senate blinded them to the reality of ill-feeling. Whatever it was, it is a legislative case study of how not to pass a law.

There is a lesson here for communicators. Know what the public thinks before attempting major moves. The administration tried to move faster than the understanding of citizens. People on the street do not see the emergency because they haven't seen the effects of a frozen credit market. It is unlikely Congress will attempt another vote today, so Americans may watch the markets melt even more. It is a scary time.

This is an example of where transparency fails. In forging agreement among hostile parties, it is best that few witness the event. Although plenty of leaks emanated from the meeting over the weekend, there was no member of the press watching play-by-play. It is a good thing too. Legislators were able to place their fears, anger and resistance on the table with less concern of others learning about it.

Transparency has limits, and those who want totally open government, sometimes fail to appreciate that. Their belief is that the public will understand if it is allowed to see the inner workings of government. What happens though is that the public is confused, enraged and another pressure point that negotiators don't need. It is better that the public see a final result rather than watching how the sausage was made.

The rhetoric and exposure of ill feeling in Congress is extraordinary and an example of where the current administration has lost control of its own party. There isn't much that President Bush can do to round up votes. He is nearly finished with his term, unpopular and considered a wrecker of the Republican Party as it is. His credibility is as low as any modern president. Now, he has to shepherd a huge rescue bill through an angry Congress. It is a case study in reputation -- the lack of it -- and its outcome. Yesterday was supposed to be a triumphant coming together of all sides behind one bill in which the administration had made major concessions. They will try again today. It is interesting and instructive to watch.

From a campaign tactic point of view, Senator McCain's suspension of campaigning to return to Washington DC might be a smart move. His reasoning is that the country is in trouble, and he needs to be working in the Senate rather than on the campaign trail. This may be the way he actually feels. On the other hand, he caught Senator Obama off-guard, and Obama says he still plans to go ahead with a scheduled debate.

McCain has always said he puts country first, and the suspension is at least a symbolic act that underscores his words. He can say to supporters and the undecided that when his country calls, he comes. On the other hand, it is entirely possible he will lose momentum as a result of the suspension. He needs it, if one believes the latest polls that show a swing to Obama.

Still, to live one's words is a powerful statement, that is, if voters are paying attention.

It's hard to believe there is news other than the proposed bailout of Wall Street firms. Headlines are large, the twists and turns of Congress documented breathlessly and actions of individuals like Warren Buffett commented on relentlessly. Reporters don't want to hear about much else.

Yet, media relations continues. The work of a PR practitioner in times like this is harder than ever. We look toward the day when matters return to some semblance of normal. We are also preparing for changes that may shift how we relate to reporters. What will be high on their agenda? CEO compensation, home mortgage help, the cost of the bailout to taxpayers? We will have to navigate these interests to tell our clients' stories.

We live in interesting times.

It's always nice to see our European friends lecturing the US on its failings. It's not that we don't deserve it -- what with two financial bubbles in less than 10 years. On the other hand, it is easier to see the failings of another before accepting one's own. Getting a lecture from the Italians is particularly amusing. The country still hasn't learned how to collect taxes.

What is happening is a natural human tendency and one communicators need to guard against -- telling others what to do. The failings of others seem simple from the outside. Yes, there was greed and stupidity in the US, and yes, anyone with common sense should have seen the two bubbles as they were occurring, but millions didn't here and abroad.

Financial regulators have to deal with the reality of the moment and wait for finger-pointing later. There will be enough of that as the US financial system is re-shaped. Congressional hearings will be hypocrisy in action. Senators will excoriate the same people from whom they took campaign funds and protected against critics only a few months ago. That will be fun to watch, if one likes irony.

Meanwhile Americans can begin toting what it is going to cost them personally to clean up the mess, and those who saved for retirement can watch their investments shrink. As that happens, the US will do a fine job of criticizing itself.

There are two more essays posted on online-pr.com. Here and here. That totals to 84 essays.

The first essay focuses on training young practitioners for agency work. It is speculative because I'm not in the training business, and I no longer teach. The second essay is on collaborative PR. It is a reflection on working in teams to solve client challenges and what it takes to work well. This essay is based on personal experience.

As usual, any comments you may have are welcome.

The markets were cheered momentarily yesterday when the government announced it would be the buyer of last resort for defaulted debt. The cheering stopped a week of hysteria for at least a few hours. We will know more today.

It is interesting to see the dependency that "so-called" free markets have on government presence. They are like adolescents who don't want their parents around, except when they do. It is useful for PR practitioners to remember that. Raw capitalism isn't pretty and doesn't work well. There is need for a referee to keep players in line. Where government fails, we have such things as bad lending practices and tainted milk (in China).

On the other hand, government never seems to know when enough is enough. The fear that businesspeople have is that government will go too far in making rules so the game becomes unplayable. There is a tension that will never go away. PR practitioners should call for responsible government, government where needed, but not government that inhibits the competitiveness of business.

Should the government have let more firms fail this week? Yes and no. When a rock-solid firm like Goldman Sachs comes under pressure from rumors and short sellers, government should intervene. When a weak firm like Lehman teetered, a hands-off policy was proper. The government appreciates market risk and doesn't want poor players to gain advantages they shouldn't have. But, it is a balance that a group of men (They are all men.) are making by the hour. It won't be perfect, and they can make serious mistakes. We won't know until later.

What the financial markets fear after this is over is the government regulation that will come as a result of what happened. They would prefer to promise they will never do it again and to go on as before. That won't happen -- nor should it.

We are in an historic period of global hysteria in the financial services business. One would have to look far back to find another time in which bank runs were as common as they are now. The trading herd is running wild and nothing central banks might do to stop it will help. The fear goes beyond the ability of investment banks to jawbone their way out of plummeting share prices.

It's amazing to watch. The entire financial services system is teetering because of a lack of credibility. I would not be surprised if these last few weeks become a case study in business schools. PR practitioners should certainly study what is happening. It validates every principle of reputation management.

In the early days of the motorcar, auto racing was seen as a way to test components that would eventually find their way into sedans sold from showrooms. Over the years, that lessened as racing machines became ever more sophisticated. It looks now like we are going back to the future with race cars like the following . European companies are testing diesel race engines and now hybrids on the track with an eye to moving these technologies into street cars. It's good PR because even if these machines just complete a race without winning, they show the durability of the technology. (Diesels, however, already have a winning record.) It's interesting that the more things change, the more they stay the same. Should Peugeot score a victory with a hybrid, can you imagine what it will do for the company's image as a hybrid manufacturer? Regrettably, there doesn't seem to be a similar effort by American manufacturers to compete in the development of new engines.

This incident of photographic sabotage has received attention in the news, but it contains an important lesson for PR practitioners. Always know what a photographer is doing with a subject. In this case, the photographer deliberately "horror lighted" candidate John McCain because she is an avowed Democrat. The editors of Atlantic Magazine who hired her had failed to check on her affiliations, so she got away with her trick.

The magazine has publicly apologized for one photograph and called the photographer irresponsible, but the damage was done. This is not the first time that a photographer has used lighting to make a point. It's just the latest example. The humbling part of the experience is that McCain's handlers were standing right there and didn't see it happen. It pays to be paranoid some times.

The stories from Galveston, TX of people who tried to ride out the hurricane are a tale of hubris. They didn't respect the power of wind and water and the order to evacuate ahead of the storm. It seems that in every hurricane, there are those who think they can "ride out" nature and be OK in the end. In fact, a few were OK, but many others called for help during and after the time that Hurricane Ike passed through. The authorities expressed "frustration" that they had to rescue people who should have left anyway.

This is a lesson for communicators. No matter how one sends a message and no matter the weight of the message itself, there will always be those who ignore it and "know better." These are the "10 percent" who just don't get it.

Fortunately it appears there were few lives lost when the hurricane blew ashore but rescuers lost valuable time doing what they should not have done. The "10 percent" drive up cost and risk for society overall, but they feel justified in ignoring authority -- that is, until they get into trouble.

Here is a case where communications are beyond difficult. The CEO of Lehman Brothers Holdings Inc. is trying to sell the firm before it collapses. The company's stock price has plunged. The death watch for the firm is weeks old. Each day the news gets worse. A colleague of mine asked yesterday, "Who would want it?" Good question. But, if there is a way of communicating the residual value of the business to potential acquirers, Lehman needs to do it now. There isn't much time left.

Imagine what the corporate communications department is doing at Lehman. It is preparing death notices before the doors have closed. That is not a job anyone wants. The word on the Street is that Lehman's CEO moved too slowly to shore up the capital of the firm as its financial situation deteriorated. Whether true or not, imagine having to defend him while he is working furiously to peddle the firm. Of course, if the firm is sold, it is likely the corporate communications department will be let go. If the firm is liquidated, they will surely find themselves out of work. PR in a dying company is a dirty business.

What does one say to resolve this culture clash? There are times when two sides are so far apart that any hope of reconciliation is nil and compelling compliance is the only option. This appears to be one such instance. The farmers in turn can stop raising livestock for sale.

It would be interesting, however, to develop a communications plan with the objective of getting the farmers to understand why RFID tagging is a protection for them and the public. There wouldn't be much hope of success, but it would be a good study in bridging deep differences.

Here is a wonderful way to illustrate a complex story at a low cost. For the cost of painting the side of a container, BBC has the chance of reporting a major story about how the world is connected through trade. It is one of those ideas that has one asking, "Why didn't I think of that?" Great ideas do not need to be expensive. Addition of a GPS transmitter was brilliant. Readers can watch the container move on a web map throughout the year.

PR practitioners are guilty of performing thousands of junk surveys in efforts to get publicity. Their surveys are garbage because the data that went into them was bad from the beginning. This essay discusses why surveying is harder than ever to do and why for most communications programs, it is a bad idea. As we know from political polling, it is difficult to get a random sample of a targeted population. People have been over-surveyed, and they resent being asked questions.

It is past time to give surveying a rest as a technique, or if one feels the need to do one, spend the time and money to survey correctly. Surveying is an area in which experts earn their pay. Dropping a few questions on a web site in an automated form is not a statistically accurate representation of anything. Practitioners should know that, but alas, they continue to do it anyway.

This essay is the 84th posted to online-pr.com.

PR techniques can be used for good or ill. Here is a fellow who used them well to cheat others. Note that he is an individual with empathy who makes up stories to gain approval then progressively manipulates other persons. PR practitioners who believe in "spin" rather than facts are not much different. This is why unethical practitioners are dangerous. Without a moral core, they can and do mislead people to gain their ends. Unfortunately, there are too many practitioners in the business for whom winning is everything. How one plays the game counts in terms of personal credibility. Clients may not care but you should.

This is a major come-down for the two mortgage giants. Only a short time ago, they were untouchable. The two companies had cultivated close ties with members of Congress and could deflect criticism. They still have supporters on the Hill. However, with the Treasury having placed both institutions into conservatorship, there isn't much that Congressmen can do.

This is a lesson that good PR only goes so far. Performance counts. Neither company performed. They took on too much risk and made the same erroneus assumptions that most of the rest of the financial world made. Namely, housing prices will always go up and homeowners would fight to keep their dwellings. Neither assumption proved true in the housing bubble. In a sense, their close relations with Congress also proved their undoing. The companies could not have pulled back from guaranteeing mortgages even if they wanted to do so. They would have been summoned by irate Congressmen demanding to know why they were not helping American citizens buy homes.

Still, they could have done more to protect themselves. They didn't. We've entered a new era, and it is not clear where we go from here.

Sticking to a course only goes so far when one is in the wrong. That is what the Mayor of Detroit has learned. He tried to continue in a "business-as-usual" mode with scandal swirling around him. It worked for a few months, but the storm claimed him yesterday. The plea deal he took was onerous, which indicates that prosecutors were not giving him much slack. That might have been in response to his effort to brazen his way through the charges against him. In this case, perception was not reality. Reality caught up.

The better part of PR for the mayor would have been to step down when the city council asked him to -- or before. He would have been embarrassed but the long-running horror show he precipitated would have ended sooner. One wonders why he decided to push through a scandal he could not contain. Was it stubbornness or arrogance -- or both?

There is one time a PR practitioner gets to be rude, demanding and outrageous with clients -- role playing in media training. That is what I was doing yesterday. I was posing as an investigative reporter asking questions that a client could not answer easily and cutting the client off in mid-answer to see how he would react under pressure and blinding light. Fortunately, the client is affable and none of this shook a confident demeanor. Others will freeze, and answers will become disconnected or off point.

The important part of such practice is to familiarize clients with playing on an unequal field in a televised interview. Most clients never face such demanding interviews, but this one may, so there was good reason to engage in bad behavior. Still, it is an odd feeling to be insulting and to hope that no harm was done.

The lack of posting this morning was due to a quick overnight road trip to Chicago and back. It was a spur-of-the-moment client decision, so, of course, one goes. The day was productive, but I wasn't sure what town I was in, since the entire morning was spent in a windowless conference room.

That didn't take long. McCain announces his pick for VP last Friday and by Monday, there are rumors about her floating through the blog world. The campaign did the right thing by announcing the truth. Palin's teenage daughter is pregnant. That is embarrassing to a parent but understandable. Fortunately, Obama backed away from the topic immediately. That was good public relations on his part, and he doesn't need to make an issue of it anyway. Others will. Meanwhile, bloggers are proving that they can sling dirt right along with the tabloids.

No one can blame city, state and Federal officials for their concern over the fate of New Orleans with a hurricane aimed at the city. One can, however, ponder the over-reaction that occurs time and again after a major event, especially this time with the memory of Hurricane Katrina still fresh. Everyone is mobilized. Citizens of New Orleans have left. The Republican Party has cut back its convention in distant St. Paul, MN.

If Nature holds true to course, winds will howl and rain will fall, but there will be no major damage to the city. Then, of course, citizens will grouse that they were inconvenienced for no reason. Government will defend itself for telling citizens to evacuate.

Unfortunately, there is no balanced communication in a situation like this. It's binary. Evacuate or not. A communication with exceptions for those living on high ground wouldn't work because citizens would not understand it. Some would stay who ought to leave and others would leave who didn't have to. So, officials used a no-exceptions message. They will deal with fall-out later, and that is the way it should be.