October 2008

The financial bailout bill signed into law last Friday included several tax credits for movies and TV, but Wall Street did not show its appreciation where prices for media stocks were concerned. The Dow Jones Industrial Index and Nasdaq stock market each ended this past Friday down 1.5 percent, and The Hollywood Reporter Showbiz 50 did worse, falling 2 percent. The Showbiz 50 has lost 13 percent in the past week, while the S&P 500 lost 9 percent. Media stocks are doing poorly, experts said, because with the economy hurting, businesses will rein in advertising spending. With digital video recorders and so much new media vying for attention, some worry that businesses that cut back on TV and radio ads might make their decisions permanent. The bailout bill is expected to save the film and television industries $487 million over 10 years.

[Commentary] When Michael R. Bloomberg, the mayor of New York, stepped to the microphone last Thursday at City Hall to announce that he would probably run for a third term even though he was limited by law to two terms (a limit approved by voters twice), he said did not take the people's verdict lightly. "But as newspaper editorialists and others have pointed out," he said, "the current law denies voters the right to choose who to vote for — at a time when our economy is in turmoil and the Council is a democratically elected representative body." It is no coincidence that Mayor Bloomberg cited voices from the city's opinion leaders. With a fiscal crisis at hand, the business leaders of New York has already held a private referendum and decided who the next mayor should be. So in spite of his rather breathtaking grab for another term, there will be no opprobrium forthcoming from the editorial pages of the city's newspapers.

Amid a presidential race that may decide its future direction, the Supreme Court begins a new term on Monday with cases about tobacco company lawsuits, protecting whales from Navy sonar and a government crackdown on dirty words on television. This term's docket includes Federal Communications Commission v. Fox Television Stations, a challenge by broadcasters to the FCC's policy on "fleeting expletives." The commission, in a sharp reversal, started imposing large fines for television programming with brief profanities — like a Golden Globe awards show in which the singer Bono uttered a single offending word. A federal appeals court rightly struck down the policy, which seriously infringes on free speech. The New York Times hopes the court sides with the broadcasters

The House of Representatives has voted to extend a research and development tax credit to US businesses as part of its approval of a giant bailout of the US mortgage industry. The bill included a two-year extension of a research and development tax credit for U.S. businesses that expired at the end of 2007. Several tech companies, including Microsoft and Texas Instruments, had called on Congress to extend the tax credit, saying it helps U.S. businesses invest in R&D and keeps R&D workers in the country. The R&D Tax Coalition, representing the tech, manufacturing, chemical, pharmaceutical, and other industries, praised Congress for extending the tax credit. Lawmakers have resisted making the tax break permanent largely because of its price tag of about $7 billion a year. Some critics have called the tax credit a government subsidy for large businesses.