Tag Archive: 30 Rock

“On the Merge of Greatness”

Jack Donaghy (Alec Baldwin) goes to Washington in Let’s Stay Together, the 30 Rock episode that aired on Thursday October 7 at 8:30/7:30c. The proposed deal between Cable Town and NBC has raised some political eyebrows, and Jack must represent the company at the Congressional hearings on the subject. Jack explains to Liz (Tina Fey) that he must appear before the fictional House Subcommittee on Baseball, Quiz Shows, Terrorism, and Media” to discuss the concept of vertical integration. 

At the hearing, Jack anticipates that the Subcommittee members will condemn vertical integration on the grounds it is “bad for America, kills innovation, and drives up prices.” Before they have a chance to voice a single concern, however, Jack pipes up with a tribute the the American farmer that seems to convince the Subcommittee members that vertical integration actually drives down prices by streamlining distribution. Jack may have convinced the Subcommittee, but does he have a legal leg to stand on or is his routine all smoke and mirrors?

The episode synopsis reveals that the deal between Cable Town ad NBC is a proposed merger between the two companies. When two businesses intend to consolidate to form a single entity, the planned merger must be submitted to the Antitrust Division of the Department of Justice for prior review. The purpose of the DOJ review is to investigate whether the plan is likely to have anticompetitive effects on the market, which would occur if the two companies, once merged, achieve sufficient market power to restrict product output and drive up consumer prices. Companies with market power are able to maintain a price below competitive levels long enough to put their competitors out of business. These entities are then positioned to exert exclusive control over the market by limiting product availability to drive up consumer demand and raising prices to maximize profits. See here.

The merger between NBC and Cable Town would be classified as a vertical integration because it would result in the “organization of successive production processeswithin a single firm, a firm being an entity that produces goods and services.” NBC, a television network, produces the product that is then distributed downstream to the consumer by Cable Town, a retailer of video programming. This type of consolidation is associated with increased efficiency and decreasedtransaction costs because different steps of the production chain are brought under common ownership and control, eliminating the need for costly contracts with independent suppliers and distributors. Because the DOJ recognizes these advantages, it does not subject vertical mergers to strict scrutinyeven though these types of deals can also have anticompetitive effects. Instead, the DOJ engages in a balancing test analysis to determine whether the efficiency gains achieved by the proposed merger would outweigh the anticompetitive impact. See here.

Jack’s rousing speech in front of the House subcommittee characterizes the American farmer as the perfect example of the efficiency benefits of vertical integration because the farmer owns his farm land, the equipment he uses to cultivate his crops, and the truck he drives to transport his goods to the farmers’ markets where he sells directly to the consumer. This argument won the favor of the Subcommittee members, and is supported by the economic theory underlying DOJ vertical merger enforcement policy. The NBC/Cable Town merger would likely result in cost savings for the two companies, which would ideally be passed on to the consumer. In addition, the consolidation would be unlikely  to create the kind of market power that would raise antitrust concerns because the television production and distribution industries both enjoy an environment of healthy competition among several market participants.  So, Jack probably would have persuaded the Committee members even if he hadn’t accused them of putting a bullet in the brain of the American farmer if they opposed vertical integration!

Thursday’s 30 Rock episode “When it Rains, it Pours” opens with Liz [Tina Fey] on the receiving end of a construction worker’s cat-call.  Initially, Liz believes the comments are directed at her best friend Jenna [Jane Krakowski].  However, the construction worker quickly corrects this misunderstanding and informs Liz the comments were for her.  After openly speculating on the current medical condition of the construction worker’s genitalia, Liz tells Jenna she has never experienced that kind of attention before.  Jenna responds that Liz has been happy and more confident now that she is with someone and guys can sense it.  Liz and Jenna may have shrugged the encounter off, but for many women such an experience is not received as well.

In the workplace setting Congress has provided a statutory remedy, Title VII of the 1964 Civil Rights Act, to alleviate the hostile and intimidating environment sexual harassment creates.  According to the U.S. Equal Employment Opportunity Commission over the past decade sexual harassment grievance filings have gradually decreased.  Whether this is largely a result of Congress’ intervention or more in response to other factors, such as the changing demographics in the workplace, is a topic for another day.  However, since the encounter did not occur in her workplace Liz’s experience raises the interesting question of what legal remedies to women have for such harassment while in public?

Many States such as New York have passed laws that criminalize certain forms of harassment.  For example, under N.Y. PEN. LAW § 240.26:

A person is guilty of harassment in the second degree when, with intent to harass, annoy or alarm another person:

1. He or she strikes, shoves, kicks or otherwise subjects such other person to physical contact, or attempts or threatens to do the same; or

2. He or she follows a person in or about a public place or places; or

3. He or she engages in a course of conduct or repeatedly commits acts which alarm or seriously annoy such other person and which serve no legitimate purpose.

Subdivisions two and three of this section shall not apply to activities regulated by the national labor relations act, as amended, the railway labor act, as amended, or the federal employment labor management act, as amended.

Harassment in the second degree is a violation.

However, the closest the New York law comes to addressing construction worker cat-calls is through subsection 3.  It would be extremely difficult for the New York Legislature to protect women from this type of harassment through a statute directly addressing the issue.  If harassment through speech was specifically addressed instead of using the broad terms of “conduct” and “acts” in the statute, the New York statute might be deemed unconstitutional.

For example in R.A.V. v. City of St. Paul, the United States Supreme struck down a Minnesota statute that read:

Whoever places on public or private property, a symbol, object, appellation, characterization or graffiti, including, but not limited to, a burning cross or Nazi swastika, which one knows or has reasonable grounds to know arouses anger, alarm or resentment in others on the basis of race, color, creed, religion or gender commits disorderly conduct and shall be guilty of a misdemeanor.

While the Court declared “burning a cross in someone’s front yard is reprehensible,” it nonetheless found it violated the right of freedom of speech under the First Amendment.  Certain categories of speech can be regulated because their content is not protected by the First Amendment, such as obscenity, fighting words, and child pornography.  However, the R.A.V. Court held that while the government may regulate generally the unprotected categories of speech the categories are not “invisible to the Constitution.”  The Court cautioned legislators the unprotected categories may not be made “vehicles for content discrimination unrelated to their distinctively proscribable content.”  Thus, even though the Minnesota Supreme Court limited the construction of the statute to reach signs and displays that amount to Fighting Words the statute was still unconstitutional.  The R.A.V. Court reasoned the statute only applied to fighting words pertaining to “race, color, creed, religion or gender” so fighting words pertaining to homosexuality were permissible.  Since the statute only prohibited speakers from expressing their views on certain disfavored subjects, it violated the First Amendment.

Therefore no matter how lewd and lascivious or reprehensible the construction worker’s comments may be, any legislation that specifically addressed it would have to walk a very fine line.  One misstep and the Legislators could find themselves treading on the First Amendment.  In the absence of specific legislative remedies to rely on some women look to alternative means for relief.  The real question to me seems to be, “would you want someone to treat your sister, wife, or mother this way?”

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