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August 22, 2019 | Hollywood 
Good morning. 💸 The federal budget deficit is on track to hit $1 trillion next year, per the Congressional Budget Office.
• It appears increasingly likely that we're nearing a recession, but the White House doesn't want to talk about it.
Chesnot/Getty What CEOs really want
Moving the Market: The Business Roundtable's new pledge to abandon its singular focus on shareholder value and work for the benefit of all stakeholders (customers, employees, suppliers, communities) is wrongly being portrayed as a sea-change moment in American capitalism. It isn't.
• "Move Over, Shareholders," a Wall Street Journal headline declared. "Top CEOs Say Companies Have Obligations to Society."
• David Ignatius, the veteran Washington Post columnist, wrote that it "could be a turning point" for corporations.
• Michael Hiltzik, the L.A. Times columnist, called it a "shocking reversal," and said "the shareholder value myth" had been put "in the grave."
The big picture: It isn't a sea-change moment, or a turning point, or a reversal, and no, "the shareholder value myth" hasn't been put in the grave. As I wrote earlier this week on Twitter, the pledge is really about prioritizing the very thing it's claiming to de-prioritize: shareholder value.
• This isn't arbitrary good will. It's a defensive measure for corporations in uncertain times. The wealth gap is growing, the middle class is shrinking and the public is growing more antagonistic toward large corporations.
• As NYT's Farhad Manjoo writes today, many CEOs are "worried that when the next recession breaks, revolution might, too." It might "finally prompt the masses to sharpen their pitchforks and demand a reckoning."
• Negative public sentiment thus poses a very direct threat to shareholder value. So the savviest thing business leaders can do is address the antagonism head-on by telegraphing their commitment to the greater good.
• To be sure, some of the 181 CEOs who signed the pledge may genuinely believe in the greater good. But this isn't a come-to-Jesus moment. It's a strategic effort to protect the corporations and, thus, it's shareholders.
None of this would matter. If business leaders are working toward the greater good, who cares what their motivations are? The problem is that the pledge doesn't put any measures or oversight in place to actually guarantee that business leaders will follow through.
• As Manjoo writes, the pledge also "lacks any call for greater structural changes in the American economy — changes to how companies are taxed or regulated, or how executives are paid, or how they should be judged."
What's next: Some business leaders may think more intentionally about benefitting all stakeholders. Some surely won't. But at the end of the day, the primary measure of success for the vast majority of them is going to be what it has always been: shareholder value.
Bloomberg/Getty Why Trump loves Tim Cook
Big in the Bay, big in the Beltway: President Donald Trump has told reporters that he likes Tim Cook because the Apple chief calls him 'whenever there is a problem."
• Tim Cook is "a great executive" because "he calls me and others don’t," the president said yesterday, per CNBC. “Others go out and hire very expensive consultants... Tim Cook calls Donald Trump directly.”
The big picture: As Politico's Steven Overly wrote last year, "Cook is among the few tech industry leaders willing to engage with the president directly and publicly."
🇺🇸 Talk of the Trail 🇺🇸
A return to normalcy, maybe: ABC News has announced that the next round of Democratic debates may actually consist of just one debate on Sept. 12, given that only 10 candidates have qualified.
• Then again, the network says it will add a second night on Sept. 13 if more candidates qualify.
Bloomberg/Getty Sanders 2020 goes Trump
Tired tactics dept.: Bernie Sanders’ campaign manager Faiz Shakir says the political press has a "personal bias" against the senator and that its members find his supporters "annoying," The Daily Beast's Max Tani and Gideon Resnick report.
• "For whatever reason, he gets under their skin," Shakir says.
The big picture: This is "the latest volley from the Democratic-Socialist’s campaign directed at the fourth estate. ... Among the Democrats running for the White House, Sanders stands alone in his sense of aggrievement."
• "Shakir’s remarks don’t appear derived from any direct conversations," Tani and Resnick write, "merely a hunch about the ideological leanings of the political press corps."
But, hell, it worked for Trump.
Drew Angerer/Getty Would Bob Iger buy Sony?
Big in Burbank: NYT's Ed Lee ponders one potential outcome of Sony's war with Disney over Spider-Man, which Sony has the film rights to even though Disney controls the Marvel Universe (of which the superhero is a part).
• "You have to wonder if @RobertIger is wondering... hmmm, maybe we should just by @SonyPictures Entertainment."
Totally possible, if not probable.
Rich Fury/Getty Ted Sarandos vs. the theaters
Talk of Tinseltown: Netflix's Ted Sarandos and Scott Stuber have been locked in months-long negotiations with theater chains over the release of "The Irishman," Martin Scorcese's highly anticipated, $159-million mob epic, NYT's Nicole Sperling reports.
• The sticking point: The chains insist "that the films they book must play in their theaters for close to three months while not being made available for streaming at the same time, which does not sit well with Netflix."
• "Because of the impasse over the three-month theatrical window, Netflix has yet to give any of its films the kind of blockbuster theatrical releases that [chains] like AMC can provide."
• "The streaming giant’s reluctance to concern itself with weekend box-office numbers reflects its laser focus on its main mission: delivering streaming video on demand to its 151 million subscribers worldwide."
The big picture: The negotiations are just the latest chapter in the conflict between the film industry’s old guard and the tech-driven upstarts," which don't want to be "distracted by the demands of the old-style movie business."
• What Marty wants: "A robust national theatrical release."
🎞️ What's next: "Bombshell." Lionsgate has dropped the first teaser for its star-studded film about Gretchen Carlson (Nicole Kidman), Megyn Kelly (Charlize Theron) and the women who took on Roger Ailes (John Lithgow).
• For those wondering, Kayla Pospisil (Margot Robbie) is a fictitious, composite character.
See you tomorrow.
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