Imagine that you belong to a very close group of friends. You talk with each other every day and spend hours of time together each week. When you aren't in each other's physical presence you share emails and texts and have your own inside jokes and special language. Because you are so close with these friends you have, more or less, the same values and beliefs and generally see the world through the same lens. In short, you are each other's people.
What would you do if you discovered that these very special friends who are so dear to you actually thought that you were stupid, a fool, and generally had great contempt for you? In private, they make fun of you and are using you for money and to get attention. Would you stay? Would you confront them? Would you just deny reality? Or would you attack the person who told you the truth about these "good friends?"
This is the situation that Fox "News" has with its viewers, what they call the "Fox and Friends family."
As is now widely known, the Dominion defamation lawsuit has revealed that in private emails, texts, other communications the network's hosts and personalities knowingly lied to the audience about "voter fraud" and the 2020 Election. In those same communications, Fox hosts and management said disparaging and insulting things about the viewers, describing them basically as being stupid and crazy. They also shared their disdain and disgust for Donald Trump, with Tucker Carlson describing him as "a demonic force."
On Tuesday, Fox "News" settled with Dominion for $787.5 million as a way of avoiding what would have been a lengthy trial where even more (and potentially even worse) damaging information could have been revealed to the public.
"The settlement has set in motion a new wave of problems for the network that could prove devastating."
Has this information about how Fox "News" really feels about its audience had any substantive impact on their relationship? Public opinion polls and other evidence suggest that the answer, at least to this point, is no. Moreover, viewership has been steady or actually increased during the last few months since the "revelations" were revealed by the Dominion lawsuit.
Those who hoped, very naively, that the Dominion lawsuit would weaken or perhaps even break Fox's power and influence over its right-wing universe did not account for the sophistication of its propaganda model.
Fox "News" is a type of "political technology" that uses what is known as "the firehose of falsehood" propaganda tactic of disinformation and misinformation where the very idea of objective truth and reality are disrupted and overturned by malign actors in the mass media and across the public sphere. The Big Lie about the 2020 Election and Fox "News" role in amplifying and circulating that narrative is a textbook example of political technology and psychological warfare applied here in the United States. A 2016 report by the Rand Corporation explains the firehose of falsehood model as follows:
We characterize the contemporary Russian model for propaganda as "the firehose of falsehood" because of two of its distinctive features: high numbers of channels and messages and a shameless willingness to disseminate partial truths or outright fictions. In the words of one observer, "[N]ew Russian propaganda entertains, confuses and overwhelms the audience."
Contemporary Russian propaganda has at least two other distinctive features. It is also rapid, continuous, and repetitive, and it lacks commitment to consistency…..
Why might this disinformation be effective? First, people are often cognitively lazy. Due to information overload (especially on the Internet), they use a number of different heuristics and shortcuts to determine whether new information is trustworthy.20 Second, people are often poor at discriminating true information from false information—or remembering that they have done so previously. ..
Familiar themes or messages can be appealing even if these themes and messages are false. Information that connects with group identities or familiar narratives—or that arouses emotion—can be particularly persuasive….
False statements are more likely to be accepted if backed by evidence, even if that evidence is false…
Finally, source credibility is often assessed based on "peripheral cues," which may or may not conform to the reality of the situation.24 A broadcast that looks like a news broadcast, even if it is actually a propaganda broadcast, may be accorded the same degree of credibility as an actual news broadcast.
The Rand Corporation report could have (assuming it was not) been entered into evidence by Dominion against Fox.
In keeping with the firehose of falsehood model, Fox "News" and the larger right-wing echo chamber tell its people who to love, hate, and fear and how to make sense of their lives. In total, the right-wing echo chamber episteme is a type of neofascist lifeworld that is ruled by an Orwellian paradox: Truth and reality do not matter, but simultaneously the only truth and reality that matters and exists are provided by Fox "News" and the other parts of the right-wing experience machine.
"The settlement comes at the worst possible time for Fox, which hopes to juice its profits this year as it renegotiates contracts with several major cable carriers."
Fox's statement about the Dominion lawsuit settlement even channels the logic of an abuser who has been confronted, refuses to apologize properly, and actually believes that somehow both parties are equally wrong and to blame. It reads: "We are pleased to have reached a settlement of our dispute with Dominion Voting Systems. We acknowledge the court's rulings finding certain claims about Dominion to be false. This settlement reflects Fox's continued commitment to the highest journalistic standards. We are hopeful that our decision to resolve this dispute with Dominion amicably, instead of the acrimony of a divisive trial, allows the country to move forward from these issues."
The $787.5 million that Fox will pay to Dominion is objectively a huge sum of money – but much less than the $1.7 billion that owner Rupert Murdoch reportedly paid to divorce his second wife in 1999. That almost 800-million-dollar settlement will, in reality, cause little to no real pain to Fox "News" and its owner. Those monies will be massaged by creative accounting practices (all of which are "legal") and declared a business expense or some type of tax write-off, as the Lever reports:
Thanks to an arcane line in the tax code, Fox can deduct that settlement payment from its income taxes, according to a company spokesperson and tax experts consulted by The Lever. That's because federal law allows taxpayers to write off many legal costs, providing that they are "ordinary and necessary" business expenses. The IRS has repeatedly affirmed that for major corporations, paying out settlements is just part of the cost of doing business.
However in the case of settlements between private entities, the entity making the payment can deduct the cost entirely — while the recipient pays corporate income taxes on it.
Fox Corporation reported $1.2 billion in net income in 2022, so the $787 million Dominion settlement is equivalent to about two-thirds of the company's profits last year.
However, Fox could save hundreds of millions of dollars in taxes on the settlement payment. The firm reported paying an effective income tax rate of 27 percent in 2022 — a combination of federal and New York corporate taxes. If Fox can write off the full settlement payment to Dominion, it could amount to an estimated $213 million in tax savings for the company.
If any of Fox's settlement payment is covered by insurance, Fox could not write off that portion of the payment. However, the company would then be able to deduct any subsequent higher premiums triggered by an insurance payout.
The settlement will also likely be more than recouped by the mandatory fees that cable customers pay on every bill for the "privilege" of watching Fox "News" and other networks that are included in their service and which they cannot opt out of.
At Politico, Jack Shafer explains how ultimately, the Dominion defamation settlement is just another cost of doing business for Fox "News" and Murdoch:
If it seems fairly daft to congratulate Rupert Murdoch on settling the Dominion Voting Systems defamation case at a cost of $787.5 million, you probably need to be brought up to speed on how the tycoon excises malignancies when they threaten his core businesses.
Murdoch's company paid $100 million to celebrities and crime victims in his tabloid phone-hacking scandal in Britain, according to the Washington Post. Another $50 million went one year to women at Fox News who alleged sexual harassment at the conservative network. In another case, $15 million went to a former host who complained about wage discrimination. A "seven-figure payment" went to the parents of Seth Rich, who sued Fox for trafficking a false conspiracy theory about his death.
And in 2010, Fox dropped a mammoth $500 million to settle a supermarket-coupon trade secret lawsuit.
In 2011, Murdoch completely shuttered his News of the World tabloid to limit exposure in the phone-hacking scandal. A hundred million here, a hundred million there, might crimp your finances. But in the Murdoch universe, paying such settlements is just the cost of doing business Murdoch-style. …
Via email, I asked Media Matters senior fellow Matt Gertz for his thoughts and predictions about Fox "News" and how it (re)orients itself after the Dominion lawsuit and settlement. He explains:
The Dominion filings show that Fox prioritizes serving up red meat to its loyal viewers to keep them from straying over telling them the truth, and in the short term, its stars may feel emboldened to give the audience what it wants by becoming even more unhinged and destructive. But the settlement has set in motion a new wave of problems for the network that could prove devastating, from additional defamation suits to shareholder lawsuits to potential problems securing defamation insurance. And it comes at the worst possible time for Fox, which hopes to juice its profits this year as it renegotiates contracts with several major cable carriers. Those all present additional opportunities to hold Fox accountable for its lies.
As the 2024 election gets closer, Fox "News" will increase its lies, disinformation, and support of Trump, neofascism, white supremacy, misogyny, violence, conspiracy theories, and anti-LGBTQ hatred and other bigotry. This is exactly the opposite of what "small d" democrats and other defenders of normal politics and civil society had convinced themselves would happen after the Dominion lawsuit.
With that settlement and the lessons learned from Dominion's lawsuit, Fox "News" now has a blueprint for exactly how far to push the boundaries of its anti-democracy alternate reality propaganda machine and the literal cost-benefit analysis such malign acts require.
In the end, Fox "News" and its public will be more tightly bonded together where, like in many abusive relationships, it will be them against the world. Will the collective weight of reality and additional outside pressure finally break the "Fox and Friends family" coupling apart? For the sake of American democracy and society, we can only hope that it does.
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