JimmyCsays: At the juncture of journalism and daily life in KC

While waiting for Congress to raise the debt ceiling, Rupert Murdoch to open a Sunday edition of the Sun (replacing his folded News of the World), and Greece to drag the Euro into the abyss…

A few tidbits:

Speaking of Greece, in this week’s edition of The New Yorker, financial writer James Surowiecki lays out one of the major reasons that the country is waiting on a handout from the other countries in the Euro zone.

Surowiecki

“According to a remarkable presentation that a member of Greece’s central bank gave last fall,” Surowiecki said, “the gap between what Greek taxpayers owed last year and what they paid was about a third of total tax revenue, roughly the size of the country’s budget deficit.”

The reason? “A culture of tax evasion” afflicts Greece.

“Greece, it seems, has struggled with the first rule of a healthy tax system: enforce the law. People are more likely to be honest if they feel there’s a reasonable chance that dishonesty will be detected and punished. But Greek tax officials were notoriously easy to bribe with a fakelaki (small envelope) of cash. There was little political pressure for tougher enforcement. On the contrary: a recent study showed that enforcement of the tax laws loosened in the months leading up to elections, because incumbents didn’t want to annoy voters and contributors. Even when the system did track down evaders, it was next to impossible to get them to pay up, because the tax courts typically took seven to ten years to resolve a case. As of last February, they had a backlog of three hundred thousand cases.”

Three hundred thousand…

Surowiecki went on to say that the new Greek government is trying hard to change things, but it’s going to be a tough slog. A successful transformation, he said, would require not only a policy shift but a cultural shift.

“Pulling that off would be quite a feat,” he concluded. “But the future of the European Union may depend on it.”

After reading that, I say thank God for the IRS and the willingness of a majority of Americans to pay their fair share of taxes. 

***

Speaking of The News of the World closing (Sunday was its last edition), Alan D. Mutter, a newspaper industry guru in San Francisco, had an interesting blog on July 5 titled “Why newspapers can’t stop the presses.”

“Fifteen years after the commercial debut of the Internet,” Mutter wrote, “publishers on average still depend on print advertising and circulation for 90 percent of their revenues. Stop the presses and newspaper companies are out of business. It’s just that simple.”

Noting that the Gannett newspaper chain laid off 700 employees last month, Mutter said the move was an indication not that the company was preparing to phase out any of its newspapers but that Gannett is “aimed at staying healthy long enough to build truly robust and sustainable digital publishing businesses.”

To succeed in the digital world, Mutter said, “publishers know they have to find bold, new ways to leverage the power of their brands, content-creation capabilities and large local sales teams…

“”Until those new initiatives achieve critical mass, however, print will continue to be the lifeblood of the newspaper business.”

Thin as the weekday paper is, I hope The Star keeps publishing every day for a long time.

***

Continuing with The News of the World saga, I’m sure you’ve read about the outrage over News of the World reporters and private investigators hired by the paper “hacking” into the cellphone voice mailboxes of relatives of terrorist-attack victims, a murdered 13-year-old girl (before her body was found) and others.

You may have wondered, like I did…Just how is that done?

On Thursday, The New York Times had a “sidebar” story explaining the techniques.

Hackers, wrote reporter Ravi Somaiya, “took advantage of default codes — like 1111 or 4444 — that cellphone providers in Britain gave users to retrieve their voice mail. Many customers did not change this standard number to a more secure code, allowing hackers to use it in one of two ways.”

In one method, a reporter would call the intended victim’s phone, engaging the line. Then, a second reporter, or person, would call simultaneously and would be directed to the voice mail system, where he would enter the default code, allowing access to the messages.

In the case of the missing girl, Milly Dowler, reporters or others went so far as to delete some messages when her cellphone mailbox was full to allow more messages, giving the reporters fodder for more stories and, more important, giving her relatives false hope that she was still alive.

Somaiya said that if any of the intended victims had changed their codes,” the hackers would resort to what they called ‘blagging’ — calling cellphone companies, pretending to be authorized users or company insiders, and requesting that the access code be reset to the default.”

Brooks and Murdoch

(As an aside, Rebekah Brooks, a former editor of News of the World, says she knew nothing about the hacking. Uh-huh. Despite a chorus of calls for her ouster, she has managed, through her good offices with Murdoch, to hang on as chief executive of News International, Murdoch’s British subsidiary.)

On the positive side, Somaiya said that Britain’s major cellphone companies have tightened their  voice mail access procedures since the early 2000s, “the heyday for phone hacking.”

This is a huge black eye for journalism worldwide; it gives the “dead-tree-journalism” cynics lots of fresh ammo.