Presswatch / Imam We Trust
Ledeen, Michael
"Presswatch / Imam We Trust" This month's award for runaway prose goes to the world press in general for its coverage of AmericanIranian affairs during the first half of March. That, you'll recall, is...
...One's first temptation is to say that the press was fooled by President Carter, who had good reasons for wishing the public to believe that a breakthrough had been achieved...
...Quite a bit, as it turns ont...
...You may think the Post should have been more careful with its headline (and I agree), but consider the performance of the pride of French political culture, Le Monde, on Saturday, March 8. By t h a t time, the editors had decided that the transfer of the American prisoners from "student" control to that of the Revolutionary Council was a certainty, and so it was proper to speak of it in the past tense, In an unsigned comment on the front page, the editors analyzed the significance of the event (which had not, and still has not, occurred): The decision of the "Islamic students" to return their hostages to the Revolutionary Council constitutes a new and important victory of M. Bani-Sadr over the "parallel powers" that have so singularly limited his authority ever since his election in January . . . . The attitude of the Imam Khomeini was decisive . . . . Pressured by the "students" who called upon him to condemn "every effort at compromise," he took a clear position in favor of the new President of the Republic...
...J a c k Anderson Department: Last month we found our hero attacking the Pentagon for throwing away money on gadgets and generally spending too much...
...That, you'll recall, is when the Carter folks put out the idea that the hostage "situation" had finally come to an end...
...On the one hand, he has some of the best information in the country...
...You may think this is small potatoes, but in reality it reflects a smallmindedness and lack of professionalism on the part of the Times that ill-befits the "newspaper of record...
...Moreover, Capucci's main claim to fame is that he was convicted of terrorism in Israel, where he ran weapons for the PLO from Lebanon to Jerusalem...
...If utilities were permitted to base their profits on their payrolls, their ads would show plants swarming with smiling workers...
...As many careful readers deduced, the Times had been given an advance copy of the Washington Quarterly, which was the starting point for the Times article...
...Moreover, what Messrs...
...I suppose the conclusion is, read Jack Anderson for the d a t a - - v e r y high quality ore--but swallow slowly the packaged product...
...bases around the world have dwindled from more than 100 to less than 30 and as the Russians have assembled the world's largest Navy...
...Villalon is part of the menagerie of lawyers who acted as secret intermediaries between the United States and Iran...
...Thus, readers of the Sunday, April 20 Times saw a front-page story dealing with the mission of General Robert Huyser to Iran in the final days of the Shah's rule...
...received yet another lesson from his Imam about political cunning...
...employees aren't...
...What's going on ? First of all, there is the usual cultural distortion: If a group of American "students" issued a statement, and a French p a r l i a m e n t a r y body confirmed it, it would be safe to announce an "event" in the press...
...The "supposedly" is necessary because utilities have not been allowed returns that look attractive at recent interest rates nor do they always earn even as much as they are allowed, which is why some utility stocks are selling below book value...
...A typical advertisement for nuclear power shows a single engineer in a bright yellow hard hat gazing out over acres of shiny plumbing, or a white-coated technician facing a bank of computers...
...Something like $250,000 must be invested for every job created...
...If you do, you may reflect that the anti-nuclear people aren't all crazies...
...This was sent to the editors in New York, who re-worked the article, producing the final product...
...In it, readers heard that the American government was contemplating a military coup d'&at in Iran in late January and early February, 1979...
...Thus, Henry Villalon should not be called-as he was by Jonathan C. Randal in the Washington Post on 16 April--"a b y Michael Ledeen political exile of sorts in Paris as a supporter of Argentina's late president Juan Per6n...
...The French also find him the most a t t r a c t i v e figure because he speaks their language perfectly and looks like P e t e r Sellers playing a bumbling French detective...
...The real politician--for the Post and Le Monde--was, of course, the man who won the "elections," BaniSadr...
...Among these bad habits is that of acting as if any story printed in the Times is its own...
...caused by regulations until they are given a name, because they are as common as toads...
...What is so strange about that...
...The Avercb-Jobnson effect, A-J for short, refers to a tendency in a regulated industry to over-invest in whatever factor of production determines its rate base.* It's about as startling an observation as Engel's law: that poor people spend proportionately more of their money on food than do rich people...
...by F r e d D. Baldwin A large power plant, whether coal-fired or nuclear, is one of the most capital-intensive forms of investment in our economy...
...And what grounds were there for the banner headlines, for the total gullibility of normally skeptical newspapers like the Post...
...Economists seek a duller immortality by lending names to things that are under our noses, for example, that there is a trade-off between employment and inflation (Phillip's curve...
...You will have an incentive to reduce labor and other operating costs, which is a good thing for your customers, but you will have little incentive to reduce capital investments, which may or may not be a good thing for them...
...The second character who is invariably mis-labelled is Hilarion Capucci, who often passes as the "Greek Archbishop of Jerusalem," as if he were a Greek Orthodox prelate...
...Yet the need for sea power has increased dramatically, as U.S...
...Bani-Sadr has no comparable power...
...They also heard that H u y s e r ' s mission had followed a recommendation from National Security Advisor Zbigniew Brzezinski that James Schlesinger be sent to Teheran to encourage the Shah to defend himself...
...The final story made it appear that virtually all the information had been dug out by the Times...
...Why were there not strong words reminding the public that the Iranians had been lying for months and that there was no reason to believe them now...
...Second, and more important, was the "who's winning...
...It's hard to know what to make of Jack Anderson...
...A final Iran note: It would be nice if the newspapers would identify accurately the major participants...
...The newspapers decided that "our guy" had beaten the "other guy" (or the "other guys' ' - - t h e students), but they forgot that in a theocracy the top priest always wins against'the top lay spokesman...
...The newspapers forgot who they were dealing with...
...In reality, Capucci is an archbishop of the Greek Catholic Church, which is tied to the Vatican, and not Orthodox at all...
...You can be sure that if the Navy had opted for more THE AMERICAN SPECTATOR JUNE 1980 23 sea lift and fewer fighting ships Anderson would have announced the discovery of a secret memorandum showing that the Pentagon was neglecting fighting ships...
...So the press has been rooting for Bani-Sadr against Khomeini...
...their business, as will be discussed later...
...s The News T h a t ' s Fit To Print" Department: The New York Times has some bad habits it would do well to scrap...
...For those who read the whole story, it emerged around paragraph nine (on the inside of the paper) that there was also an article on the same subject in the spring issue of the Washington Quarterly, written by me and Professor William Lewis of George Washington University...
...Utility executives would make speeches about the importance to the economy of direct job creation, and suggest that electricity, like homemade ice cream, would be better if cranked out by hand...
...Furthermore, the germs that were implanted in the body press in early March are still with us, as will be seen...
...Is it all sloppiness, or is there an unwillingness at the Times to give proper credit to an institution'it may not admire ? [] AN IMMINENT ELECTRIC ORGY N a t u r a l i s t s bestow their names on out-of-the-way flora and fauna, giving us Fowler's toad and Nuttall's cockle...
...This is easy to understand, but it hopelessly distorts the Iranian realities, since Khomeini is the only man in the country who can fill the s t r e e t s simply by making a speech on television (or by ordering the mullahs to give a certain speech in the mosques...
...But Villalon is under indictment in Argentina, which makes him something other than "a political exile of sorts...
...Averch and Johnson stated, and what others have attempted to document, is that you will almost certainly go further in this direction than if you were forced to optimize your investments based on market competition...
...Johnson, authors of "Behavior of the Firm Under Regulatory R e s t r a i n t , " American Economtc Review, December, 1962...
...More precisely, you will have a strong incentive to make the ratio of capital to operating costs as high as possible in favor of capital...
...With the Navy on the way toward 300 ships, one has to conserve at least some hard core of firepower and hope that existing sea-lift capacity will get us by...
...Although the rationale for regulation is that electric utilities are monopolies, this may arise from a misdefinition of "The A-J effect takes its name from two e c o n o m i s t s , Harvey Averch and L.L...
...That utility executives instead make speeches on the virtues of nuclear power does not mean they are wrong, of course...
...The message is subliminal A-J: Pipes and tubes and wires are in the rate base...
...What has the A-J effect to do with nuclear power...
...And, as the Wall Street Journal (followed a bit later by the New York Times) discovered in early April, the President is now fudging the figures on the defense budget: cutting this year's in order to make next year's little budget look like a 3 percent increase...
...It is, however, important to keep their economic 24 THE AMERICAN SPECTATOR dUNE 1980...
...But then, in one of those illogical jumps that characterize his writing, Anderson says: "Ironically, the Navy has tried to o b s t r u c t the sea lift build-up, preferring to spend every available tax dollar for fighting ships...
...I am given to understand that the original version properly credited the Quarterly with the original breakthrough and also indicated those areas in which Burt and Taubman had done their own work...
...On one occasion, the Times quoted an entire paragraph from the Quarterly without attribution, and on another it failed to mention that the conference at which Henry Kissinger delivered his famous speech on the strategic balance was organized by the Center for Strategic and International Studies...
...One rarely sees this in print...
...Why did virtually every newspaper in the West assume that the hostage transfer was a sure thing...
...The electric power industry is a regulated industry, treated as if it were a monopoly, and its investors are supposedly permitted to earn a return on their capital investment, up to some designated percentage, which varies from state to state...
...To do the economists justice, however, we often overlook the economic distortions Fred D. Baldwin is a consultant on pub/ic program management living in Carlisle, Pennsylvania...
...It is sometimes called the A-J-W effect because of a subsequent article by S.H Wellisz...
...Starting from our analysis of Carter administration policy during the Iranian crisis, Richard Burt and Phil Taubman (who himself had been working on the story for months, but with the understanding that he would publish nothing until the hostage crisis had been resolved) gathered additional information and developed their own story...
...The reserve fleet is down from 2,277 ships to 317, many of them fit only for the scrap pile...
...For on several other occasions in the past, the Times has refused to give the Quarterly (and t h e C e n t e r for Strategic and International Studies that publishes it) proper credit...
...On the other, he rarely spends the time necessary to digest and analyze it thoroughly...
...But papers like Le Monde don't place great faith in Carter's words...
...IMAM WE TRUST T h i s month's award for runaway prose goes to the world press in general for its coverage of AmericanIranian affairs during the first half of March...
...As Parisians read these words on the weekend, it was becoming clear that there had been no breakthrough of any sort and that Bani-Sadr had Michael Ledeen is Executive Editor of the Washington Quarterly...
...part of the story...
...This month, in the April 10 Washington Post, he bemoans (and rightly so) the sorry state of the Navy: The Pentagon's plight can be summed up in these stark statistics: During the past two decades, the Navy has shrunk from 900 ships to fewer than 500...
...For a while I had reserved the award for the Washington Post for its six-column (that is to say, full page) headline on March 7, MILITANTS TO YIELD HOSTAGES TO COUNCIL, along with its tantalizing single-column subhead, "Ghotbzadeh: Their Return Not Imminent," but after looking at the rest of the newpapers I concluded that the honor should be spread around...
...The remarks here refer most obviously to investor-owned utilities, which account for about 80 percent of the nation's electric generating capacity, but they apply in some cases to publicly-owned utilities as well...
...From the very beginning of the Iranian drama (not just from the time the hostages were taken), the press has dealt with Khomeini as something other than a clerical fascist, even though his every action confirms that evaluation...
...Now if you are allowed to earn, say, 8 percent profit on whatever is in your rate base and, at best, will only be allowed to recapture costs outside of your rate base, you will try to shove as much into your rate base as possible...
...By and large he gets described as a deeply religious man with some strong feelings about things but no particular political acumen...
...We may be grateful for the latter, of course...
...This spring, while strolling past toads and cockles, and while listening for Swainton's thrush, pause to consider the AverchJohnson effect...
...The point, of course, is that the Navy is being cruelly and dangerously reduced...
Vol. 13 • June 1980 • No. 6
