Dobbs on ABC: With Bid for Anheuser-Busch, 'America for Sale'

Amy Menefee

June 12, 2008 - 4:53pm

A foreign bid for the beloved Bud had “Good Morning America” fearmongering about international trade June 12.

For analysis of what an Anheuser-Busch buyout could mean, the ABC crew didn’t turn to a businessman or even to a government regulator. They invited CNN’s Lou Dobbs, who regularly rails against trade and foreigners in general.

“[It] raises the question – is America for sale?” asked ABC’s Chris Cuomo, who called the brewer “iconic” and worried that “some of the nation’s most beloved brews would move out of American hands.”

But Anheuser-Busch’s business isn’t confined to the United States now. According to its Web site, “Anheuser-Busch also owns a 50 percent share in Grupo Modelo, Mexico’s leading brewer, and a 27 percent share in China brewer Tsingtao, whose namesake beer brand is the country’s best-selling premium beer.” The LA Times reported Anheuser-Busch’s biggest markets are the United States and China.

Belgian-based InBev, which has a presence in Europe and Latin America, made an unsolicited offer for the company, which must be considered by its board of directors.

For ABC, this offer symbolized an America being sold off to other countries.

“That’s exactly what thousands of angry Anheuser-Busch employees believe is happening. They’re expressing their views all over the internet,” said reporter Bianna Golodryga.

What Golodryga didn’t tell viewers is Anheuser-Busch includes members of the Teamsters union [1], and unionized workers have caused upheaval such as strikes [2] in the past.

“Resistance to a buyout is likely to be fierce among the union workforce,” said the June 12 LA Times article.

Golodryga dramatically announced that “The King of Beers might have to retire his throne.” But he’s already started that process.

According to the LA Times, Anheuser-Busch controls 49 percent of the U.S. beer market and 11.5 percent of the world market. Its dominance has been shrinking.

“Although profitable, Anheuser-Busch has been troubled in recent years by changing consumer tastes and stagnant sales of its flagship Budweiser and Bud Light brands,” wrote Jerry Hirsch and Andrea Chang.

The writers said “no matter who is in control, Anheuser-Busch faces a difficult task finding a way to sell more to the legions of beer drinkers in the United States.”

InBev, which has major brands Beck’s and Stella Artois, offered an 11-percent premium over Anheuser-Busch’s stock price June 11, the LA Times said.

The Los Angeles Times pointed out many drinkers just don’t like Bud, and “young adults have gravitated to wine and spirits, as well as craft beers.”

Golodryga left out all that information about the beer company’s troubles and made a passing mention of the “business” aspect of the offer.

“Putting all emotions aside, from a pure business point of view, it’s hard to argue against globalization and its effects like this,” Golodryga said.

But she didn’t have anyone on to argue for globalization or to explain business. Instead, ABC turned the report in a sinister direction.

“The obvious question – what does this mean for the future of the country?” said host Chris Cuomo.

Dobbs proceeded to rant about the “slippery slope” the United States has been on for some time, according to him: “thanks to a weak dollar and a lagging economy, foreign investors are eyeing everything from American brands to American buildings,” he said.

“This is not only America for sale; it’s for sale at fire sale prices.” In this case, InBev has offered $46 billion for the “fire sale.”

The host of CNN’s “Lou Dobbs Tonight,” who has proclaimed you won’t find “objective journalism” on his program, complained about a “federal government that’s basically dysfunctional” and blurred the line between U.S. businesses like Anheuser-Busch and critical infrastructure.

Though he began by saying there was a difference where security was concerned, he continued warning about letting foreign investors buy interests in railroads while “This Bud’s for Sale?” remained on the screen.

Cuomo asked Dobbs whether he saw “all these foreign investors as the same,” and Dobbs replied, “I think you have to maintain absolutely a national ownership of strategic assets. … It doesn’t matter to me whether it is a Middle Eastern, Asian or European company.”

ABC failed to give the perspective of free trade, something BMI has documented [3] Dobbs attacking regularly on his program. Cuomo also allowed Dobbs to rant about the U.S. trade deficit and declare that “the reality is that these trade policies and business practices are in effect bankrupting the country.”

As BMI adviser and George Mason University economics chair Don Boudreaux has explained, there is nothing unnatural or dangerous about a trade “deficit” with another country.

“Neither economic theory nor common sense suggests that country A will or should sell to country B the same amount of goods and services that it buys from country B,” Boudreaux wrote for BMI. “To see why, consider that each month you buy more from your local supermarket than your supermarket buys from you. Month after month and year after year, your trade with your supermarket is ‘unbalanced’; you run a trade deficit with it.

“Of course, the U.S. runs not only a trade deficit with China; it runs a trade deficit with the whole world. But this fact isn’t worrisome.

“Ask: why do foreigners willingly ship more goods and services to the United States than they demand in return? The answer is that foreigners find America to be an astonishingly attractive place to invest,” Boudreaux concluded.

Stay tuned to the Business & Media Institute for an upcoming video blog [4] about Lou Dobbs. Sign up for our free weekly newsletter [5], The Balance Sheet, to make sure you don’t miss it!

BMI Special Report: Trade Secrets: ‘Lou Dobbs Tonight’ Hides Good News Behind Negative View of Free Market [3]