It's a Gamble

What with Donald Trump suddenly so very visible in the Media, Brigitte got to wondering just where gambling is classified in the U.S. economy and, furthermore, just how big it actually is. An earlier post here, measuring the advertising industry as percentage of Gross Domestic Product was in the background of this question. How does the gaming “industry” compare to advertising? No doubt, to be sure, matters of chance were on her mind too—in view of the rather awkward fact that she managed to break an arm when, accidentally, slipping as she got out of the shower…

Well, gambling is part of Amusement, Gambling, and Recreation Industries (NAICS 713), specifically NAICS 7132, Gambling Industries. As best as I can determine, the industry’s revenues in 2013 were a shade over $33 billion, amounting to 0.2 percent of GDP in that year. Advertising, by contrast, was around 1.03 percent. Advertising is barely visible—and gambling is too small to see.

But if you go to Atlantic City and stand before the Trump Taj Mahal, especially when it’s lit up for the night, you get an altogether wrong impression of gambling’s importance—or Donald Trump’s as a presidential candidate. To be sure, if Trump triumphs, in both of his ventures—to get nominated or to rescue the Taj Mahal from bankruptcy— it will at least prove that our times are reaching the highest improbabilities even for a truly crazy state of the world. As for Brigitte, she’s got a few more  days before the present (sea-foam-green?) cast gives way to the (oyster-beige?) last one and the process of relearning to write with her right hand can be taken up in earnest…

Where Search and Social Draw their Funds

The Business Pages these days tend to focus on Mergers & Acquisition, Finance, Mobile Devices, and that sector of Internet business represented by big search engines and the social Media.

It is the last category that interests me. There is a great deal of hoopla about Internet companies, but those that provide a free service all draw their income from the Advertising expenditures by the rest of the economy.

So the question arises, how big is that “funding sector.” Is it as large as the media’s interest in Internet startups and IPOs? The surprising answer is that Total Advertising Expenditure in 2014 was $161 billion; that comes to less than 1 percent (0.92%) of the Total Economy measured by GDP, or $17.4 trillion. My number for Advertising comes from Group M, a global media company. Some put the 2014 number at $180.12 billion (1.03% of GDP). In 2008, advertising was $141.7 billion, 0.99 percent of an economy of $14.3 trillion. The Total Advertising Expenditure category has actually shrunk as a percent of GDP.

A great deal of media hoopla, but in reality a tiny and shrinking slice of the economy.

Echoes of the Prayer Wheel

A post on LaMarotte (where I was venting about automated calls), got me wondering how the future would see our absolute faith in the power of advertising to move the secular version of Heaven. The Romans, of course, at the appropriate stage in their development, had the same sort of idea: Vox populi, vox dei. They were, however, technologically backward. And that, in turn, made me wonder if there are other relevant examples from the even deeper past. The image of a prayer wheel then presented itself to me.

These wheels are at home in India and in Tibet. I am showing a hand-held Tibetan version. It has a little counter-weight which causes it to whirl with but a little bit of human effort. They are functionally equivalent to calls delivered by a living human being. Prayer wheels, usually inscribed with the mantra Om Mani Padme Hum, also come in more automated versions. They may be driven by wind, water, or the heat of burning butter. They are, of course, equivalent to automated calls. In any case they illustrate a human belief: If it is worth doing, its worth doing without any effort. The device actually used, of course, may cost a bit of money, and the more elaborate and expensive, the more powerful, to be sure. Behind these wheels is the belief that the turning wheel works just as well as saying a prayer mentally or out loud.

Now, of course, the folks who start to smile awkwardly (and the more multicultural, the more awkward the smile) when they behold the prayer wheel will, nonetheless, expend huge sums of money on automated calls intending to persuade me to vote for X.

Oh, by the way. If you wish to try a prayer wheel—who knows, it might work!—the one I am showing is available from World Bazaar Imports for $22.49 (link).

A Modern Description of Magic

A news story on today’s New York Times business page—in which transactions in the billions were mentioned—sent me to discover how Yahoo might describe itself in the framework set down by the U.S. Securities and Exchange Commission. In other words, I looked up their 10K.

Herewith the first paragraph describing Yahoo’s business:

Yahoo! Inc., together with its consolidated subsidiaries (“Yahoo!,” the “Company,” “we,” or “us”), is a premier digital media company that delivers personalized digital content and experiences, across devices and around the globe, to vast audiences. We provide engaging and innovative canvases for advertisers to connect with their target audiences using our unique blend of Science + Art + Scale. Through our proprietary technology and insights, we deliver unique content and experiences for our audience and create powerful opportunities for our advertisers to connect with their target audiences, in context and at scale. To users, we provide online properties and services (“Yahoo! Properties”). To advertisers, we provide a range of marketing services designed to reach and connect with users of our Yahoo! Properties, as well as with Internet users beyond Yahoo! Properties, through a distribution network of third-party entities (our “Affiliates”) that have integrated our advertising offerings into their Websites or other offerings (those Websites and other offerings, “Affiliate sites”). We believe that our marketing services enable advertisers to deliver highly relevant marketing messages to their target audiences.

I find it amazing to what an extent our materialistic age has, in a manner of speaking, become etherealized. Yahoo describes its product as “content and experiences,” not once but twice. These, of course, reach audiences digitally, thus as electronic pulses, and appear on screens of various sizes. There is a kind of magic, I think, implied in an ability to “blend” science, art, and scale (no less). The “properties” delivered, when you boil them down, are actually disc space. Another deliverable, this time to advertisers, are “canvases” but these not made of any kind of natural or synthetic fiber, and “target audiences.”

Yahoo’s revenues in 2010 were $6.3 billion on which the company realized net income of $1.2 billion—not bad for a company persistently labeled as struggling. That’s 19 percent—in a bigger world where 5 percent is deemed pretty decent. Of that revenue stream advertising accounted for 84.1 percent, “other” for 15.9, the other described as a combination of interest earnings and gains on sales of securities or properties. My unruly imagination produces the image of what appears to be a Gigantic Monster with an insatiable hunger to Persuade People To Buy! It can’t find enough food to satiate it. And Yahoo then turns out to be but a small eatery where this Monster stops, along the way to others, trying to satisfy Its Elemental Need.

Still Wearing the Commercial Burqa

When the Age of Oil finally ends, commercialism will most certainly die with it. I’m fairly sure of this because commercialism absolutely depends on mass wealth, and mass wealth is due to “energy slaves.” Ponder for a moment world-wide energy consumption today (2005). It amounts to energy equivalent to 1.8 tons of oil per person per year; to be sure, not all of that comes from oil. The U.S. consumption is 8.7 tons per capita, dwarfed by the consumption in Qatar, the world’s highest, at 21.5 tons of oil-equivalent. By way of contrast there is Bangladesh, the world’s lowest with 0.2 tons or 377 pounds. Bangladesh comes closest to what the world was like before the Age of Oil.

My topic today, however, isn’t oil. It’s the obscenity of obscenities—commercialism’s most visible symbol, advertising on television. That too will disappear but will soon be forgotten. These forms of assault on human dignity will vanish because the arts needed to display them will decay along with the high technology necessary to make them visible when energy-wealth will be no more. Advertising, to be sure, is not on the same level of evil as the gladiatorial games, human sacrifice, the immolation of Hindu widows, foot-binding, and other actual physical assaults (usually on women). But it does resemble an obscenity still very much alive and well in parts of the Muslim world—the burqa.

Print advertising doesn’t cover things up. And bits and pieces of that kind of advertising produced today will still be in archives in the year 4000. That sort of stuff is relatively innocuous because it’s easy to ignore. But the Commercial Burqa? That we must endure—and these days even on Public TV. It covers up the programming so that it can’t be seen—not even through little holes in its fabric. We can mute it, to be sure, but the muting is itself a kind of burqa. And, to be sure, ads are bad. But silence? Lordy! Silence is really unendurable for us, creatures of our own time that we are.

A Priceless “Free Speech” Moment

One way to sum it up is to say that today money may speak, but a hundred years ago bulls were well advised to wear pants. Puzzled? Read on.

It’s 1907 and the leading tobacco company in the United States, American Tobacco, signs a contract with a stage-coach line. We’re talking about the horse-drawn variety. The company wants to use the sides of the stage-coach to advertise one of its most popular brands, “Bull” Durham. The ads are made and affixed, the first stage-coach heads out. A huge public outcry follows. Why? Well, the bull’s testicles are so prominently featured in the ad that people daren’t even look!! The City of New York, always a guardian of public morality, arrests the stage coach driver. The coach is rapidly shunted out of sight. Then as now (some things never change), the affair bursts into litigation, and that, in turn, eventually reaches the Supreme Court no less. It is now 1911. And the Supremes uphold the city’s action, approve of the ban. What!? you cry. Hadn’t those benighted judges heard of free speech yet? No doubt they had. It’s just that they clean forgot it—staring at those humongous testicles.

I Can't ...

One of my now-and-then reveries is attending a year 4010 seminar in the far-far-future. A learned professor is lecturing with exhibits on what he calls “probably the most strange of all mass delusions of the Age of Oil.” He continues speaking: “In looking for other parallels in ancient history, we have serious difficulties finding any that measure up—unless it is the equally strange custom of the prehistoric Incas who sacrificed humans on top of admirably constructed (for their time) pyramids. In their case, however, and in other instances of human sacrifice, we at least detect a plausibly rational explanation, thus possibly overpopulation. But the amazingly vast expenditures in the Age of Oil on a practice they called Advertising, which was the continuous and most artfully executed display of objects and concepts of all kinds—for no detectable reason—given that these times, due to oil wealth, were already overwhelmed by both, objects and concepts—presents an almost impenetrable mystery to our modern minds.”

The image is courtesy of Macy’s 2010 advertising campaign here.

Ancient, Ambiguous, Odorous Words

“simplicity IS THE ULTIMATE SOPHISTICATION.” - L. DA VINCI

The above is from a Hyatt Hotels advertisement of their Visa card in today’s New York Times. I love the abbreviation L. for Leonardo. So sophisticated. Here is one of those wondrous ancient words; it has undergone so many cycles of use over time that quite contradictory meanings attach to it. The root is sophia, the Greek for wisdom—and I should really render it Sophia in honor of the Goddess of Wisdom. We find this root in philosophy, the love of wisdom; there its ancient meaning is preserved unsullied if also, perhaps, mostly unnoticed.

Precisely at the time when Greece emerged from its own religious (call it medieval) period—thus around the time of Socrates in the fifth century BC—the high arts began a descent into the world of commerce. Socrates was condemned to death by the state of Athens for supposedly corrupting the minds of the young—but the Oracle of Delphi considered him the wisest of men. In Socrates’ time emerged a profession of “teachers of wisdom,” the Sophists, who taught for a fee. Money and wisdom rarely mix well. Some of the sophists were, of course, genuine and serious teachers of philosophy; and far be it for me to deny the honest teacher his income. But many others—and they came, in the long run, to set the tone—“diversified” their product and began to teach cleverness in argument.

Here I’d note a more modern instance of ambiguous labeling. In the seventeenth century the Jesuits were accused of similar “sophistication,” so that the word jesuitical has a bad smell for those who know about such things. But the Jesuits are an upstanding and respected order, and I count myself lucky in having had them as my teachers.

In Greece we had an early split between philosophy and sophism—and lucky for philosophers that the language managed to produce a word that has retained its purity. The word itself, philosophy, was apparently introduced by Pythagoras, another fifth century figure. Rhetoric, the very serious science of oratory and of communications generally, suffered from an ambiguous reputation throughout its long, long history—having only been freed of this taint in modern times when, finally, we have differentiated advertising and public relations as the honestly dishonest forms of paid public discourse.

Isn’t it delightful, therefore, to see an ad in the New York Times lauding sophistication—the child honoring its parent?