The news that Oprah Winfrey pulled the plug on the dying Rosie Show on OWN Network comes as no big surprise. As expected, O’Donnell was unable to hold the half million train wreck enthusiasts who tuned in at the beginning. The numbers quickly fell to around 135,000 viewers. OWN partner, Discovery Communications, reportedly lost $300 million due to overall low ratings for the network.
After five months of hope and change, Oprah was forced to turn both thumbs down on Rosie. The following day, the axe fell for thirty more OWN employees, another decision made by Winfrey.
At first blush there is nothing newsworthy about thirty-one more jobs lost in the midst of the turbid Obama economy. At second blush the real story emerges.
Oprah Winfrey, one of the biggest backers of Barack Obama, threw the President, and by extension his policies, under the bus. When push came to shove, the multi millionaire talk show queen, business woman and TV network executive made a crucial business decision. Rosie O’Donnell had to go.
In evaluating this decision we have to be clear. Oprah had options. She could have chosen a bail out for Rosie and the staff, as President Obama did with General Motors. OWN could have invested more money into the O’Donnell show to save jobs. More writers, set designers and make up artists could have been hired. Ms Winfrey could have cut her own salary back to save her good friend Rosie O from unemployment. She could have but she did not.
Instead, Ms Winfrey applied common sense business thinking to a failed venture. With her own money on the line, Oprah instinctively recognized the futility of sinking more money into something the public was not buying.
With the parallel established between Oprah Winfrey protecting her company and President Obama’s responsibility to protect the American economy, we can examine what should and would have happened had there been no car company bailouts.
Since both GM & Chrysler filed for bankruptcy anyway, the Obama administration’s needless manipulation of bankruptcy laws only muddied the natural process, adding at least $20 billion (and likely more) onto the backs of taxpayers.
Had both companies closed their doors, the remaining assets (buildings, parts and equipment) would have been purchased by a group of entrepreneurs; the experienced, laid off auto workers would have eventually returned to work and stronger, more competitive, determined companies would have risen from the ashes shackle free.
That is the very definition of the term entrepreneurial spirit; risk taking private investors creating successful businesses, jobs and profit. All government intervention does is reward failure with tax dollars removing any sense of responsibility from those who engineered the failure. The incentive to succeed disappears when bailouts exist as safety nets.
The bottom line is neither company needed government aid to resolve its fiscal crises. Restructuring could have occurred under existing bankruptcy guidelines. The unintended consequences of a bailout means companies that are able to convince the government of their political importance, will bring pressure to bear for more bailouts. The economy simply cannot absorb this bending of the rules to give control of private enterprise to those who can’t even deliver a budget.
No one with business acumen wants the government to become the lender of choice. That’s just not its role.
Getting back to OWN Network, it is clearly not being run according to the Barack Obama business manual. We’ve just witnessed it. OWN refuses to be that reckless.
A tip of the hat to Oprah for knowing when to drop the hammer and how to cover her assets.