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Hey, Hypocrite! Yes, I Mean You
Big corporations should walk the talk of their patriotic ad campaigns.

By Jason Tanz

Monday, December 10, 2001

In the days since Sept. 11, politicians from George W. Bush to Bill Clinton have asked the American consumer to assume a heavy responsibility: keeping the country afloat. Madison Avenue has also unfurled patriotic appeals to "keep America rolling" (General Motors) or "show your support" (Council of Fashion Designers of America) or "demonstrate our resolve and help keep America's economy strong" (National Restaurant Association).

That message has sunk in. According to a survey by Deloitte Consulting, 74% of Americans view shopping as their "patriotic duty." Indeed, retail sales rose more than 7% in October. Many businesses, however, have been making decisions that--by their own definition--are unpatriotic in the extreme.

Look no further than ground zero. Big corporations have relocated 4.4 million square feet of downtown office space and more than 17,000 jobs outside of Manhattan since the attacks, says M. Myers Mermel, CEO of TenantWise, an online commercial real estate firm. Merrill Lynch and American Express--whose offices were damaged but not destroyed--have signed medium-term leases for office space and moved some employees outside the city. (The companies assert that the relocations were necessary, and that they are committed to returning to New York.) Meanwhile, the area's residential real estate market remains healthy, if cheaper, according to Pam Liebman, CEO of New York real estate firm the Corcoran Group.

New York City companies are certainly not the only ones to blame. In September, Mayor Rudy Giuliani said, "If you want to help, come to New York and spend money." And while hotel occupancy rates are still down about 15% since before the attacks, says John Fox, vice president of hotel advisory firm PKF, it is business travelers, not tourists, who are staying home. No data are available, but Fox, who provides information to the New York Convention & Visitors Bureau, thinks that most of the drop "has been a cutback in business travel." There may actually be more vacationers in New York now than there were before the attacks, thanks to a surge in what he calls "patriotic tourism."

Studies of the airline industry since Sept. 11 back up Fox's thoughts. While leisure air travel has faltered during the past couple of months, business travel has almost collapsed. In September, the latest month for which data are available, the number of domestic miles flown by business travelers fell a whopping 44% over last year, according to the Air Transport Association; leisure travel fell 30%. A survey conducted by the National Business Travel Association suggests that safety fears motivated most of those business cancellations--46% of companies said that increased security would be the deciding factor in getting them to return to the skies; only 30% said that the financial health of their business would be.

There's nothing wrong with businesses cutting spending or reducing staff during a downturn; that's to be expected. Still, it is galling for companies to announce near-record layoffs--as they did in October--while calling on consumers to raid their savings for the good of the country. The airlines, for instance, don't win sympathy when they accept a $15 billion bailout package while signing over 100,000 pink slips. If corporations are going to equate the national interest with their bottom lines, then they should start thinking more patriotically--and we're not talking about flag-waving ad campaigns. And if corporate America isn't going to pull its own weight, it should stop asking consumers to do all the heavy lifting. 

ęCopyright 2001 Time Inc. All rights reserved

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