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CNN IN THE MONEY
A Preview Of Summer Movie Season; Many Mothers Want More Time With Family
Aired May 8, 2005 - 15:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
ANNOUNCER: From New York City, America's financial capital, this is IN THE MONEY.
JACK CAFFERTY, HOST: Welcome to the program. I'm Jack Cafferty. Coming up on today's edition of IN THE MONEY:
Fuel for the fight: a new bill would give the Pentagon billions as Iraq's insurgency turns white hot yet again. We'll look at whether the extra cash can help to cool things down.
Plus, the chairwomen of the bored, as in uninterested: a lot of women are finding executive work so dull they'd rather stay home with the kids. See why the best Mother's Day gift might be a pink slip.
And a few good reasons to sit in a cold, dark room this summer: We'll look at the reasons -- some big movies -- and check out their box office prospects as the summer movie season gets underway.
Joining me today, a couple of IN THE MONEY veterans, CNN Correspondent Susan Lisovicz and "Fortune" magazine Editor-at-Large Andy Serwer.
I saw a terrific interview on "Lou Dobbs" program here on CNN. And I give Lou credit because, one, he hired me to work here at CNN.
ANDY SERWER, "FORTUNE": I know that guy.
CAFFERTY: And two -- two he's got a terrific show. But he had Warren Buffett on live, for a couple of seconds last week, and it was just fascinating because Mr. Buffett is very compelling when he talks about almost anything.
One of the things he talked about was the president of the United States spending two months on the road trying to sell this Social Security reform plan by convincing people that we've got a serious problem on our hands. And we may have one. But he suggested -- Mr. Buffett did -- that the president is talking about a projected $100 billion deficit when Social Security goes broke, down the road 30, 40, 50 years. And he said, you know, we got a $400 billion budget deficit this year and a $600 billion trade deficit this year. And the president spends two months trying to convince people we got a real crisis in 40 years with a $100 billion deficit. We got a $1 trillion deficit situation going on right now.
SERWER: Well, first of all, I could listen to Warren Buffett read an instruction manual. I mean, he's really great to listen to and a smart guy. It's interesting, and I think he raised an incredibly salient point, which is: Why did the president choose to take this on and ignore that? And I think it has to do with the fact that these deficits that he's running now are things that he sees that he has to do so he doesn't want to attend to them. In other words he needs to borrow money to get to the war and those sorts of things.
The trade deficit is troubling and I know that Buffett is actually more concerned about that, that we're becoming a debtor nation. And it's a big problem.
SUSAN LISOVICZ, CNN CORRESPONDENT: Right, there's no question that he certainly talks a lot about that. But, at the end of the day he's optimistic about the United States -- and that's reassuring for Warren Buffett -- saying never, never go short on America and saying something that's been the subject of debate, I know, in my family, a lot of friends, that our children and our children's children will live better than we do. And I think that there's been a big question mark as to whether that would happen. So, he's optimistic and that's encouraging to hear.
CAFFERTY: All right. Warren Buffett on "Lou Dobbs" program. And thanks Lou, I think. More to come.
The House, this week, gave the OK to an $82 billion spending package including $76 billion for the wars in Iraq and Afghanistan. The Senate's expected to pass the bill next week. If it goes through, and it will, the new measure will bring the total cost of the fighting so far to $300 billion. And it comes as insurgency violence in Iraq is on the rise yet again.
For a look at that and whether more money can help to calm things down over there, we're joined by Fawaz Gerges who is a Middle East analyst and a professor Sarah Lawrence College.
Professor Gerges, nice to have you back with us.
PROF. FAWAZ GERGES, SARAH LAWRENCE COLLEGE: Thank you.
CAFFERTY: Last time you were here in April you suggested that we might have been seeing the end of the insurgency. Where are we, vis- a-vis that, and if we're not, what's changed?
GERGES: Jack, we had hoped that the new government, the government, Ibrahim al-Jaafari that was sworn in last week, would reconcile all Iraqis and bring in Sunni Arabs. In fact, I ended my segment, as you said in April, by saying by bringing Sunni Arabs who represent about 22 percent of the population in, you could really hammer a deadly nail in the coffin of the insurgency. Unfortunately Jack, the new government, which is led by Shiite religious parties, in fact, have done the opposite. They have poured gasoline on a already raging fire. First of all, the new government rejected almost every single name given to al-Jaafari by Sunni Arabs and Sunni Arabs believe their arms were twisted. And secondly, I think, the new government which is led, as I said, by Shiite religious parties, has made it very clear it would purge ministries of former Ba'athists of the Saddam Hussein regime, in particular low-level bureaucrats and this should present a major reversal of the policy of the former government, the government of Iyad Allawi
LISOVICZ: Professor, you raised one obstacle, but there are many others and one of them is the increasing violence now. We had Tom Friedman on the program just recently and he said that the last five yards are often the bloodiest, the most violent. But he was encouraging at the end of the day. How do you see this, this increase in violence in Iraq?
GERGES: Susan, one point must be made very clear and we have been barking about this particular point. There's no military solution. There's a political solution. And the political solution is the following: You must integrate Sunni Arabs who represent 6.6 million people out of the population of 23 million people. I mean, the Sunni community, basically is leading the insurgency and the fact is that the new government has not even tried to reconcile Sunni Arabs and bring them in, into the system, tells me this is why, I think, we are seeing an increase in violence.
It seems, Susan, more and more dissatisfied Sunni Arabs are joining the insurgency are leading the insurgency in addition, of course, to foreign fighters and terrorists who basically number about 1,000 fighters and terrorists. But the big issue (ph), the critical point is the following: As long as Sunni Arabs, basically, feel excluded, feel marginalized, I fear that the insurgency will continue. It's an essentially political problem. There is a low-intensity civil war taking place between the Sunni Arab community and the nascent emerging order in Iraq.
SERWER: All right, Fawaz, let me jump in for a second here and ask you -- I'm not sure if this is your area of expertise, but one thing that always amazes me about what's going on in Iraq, day after day after day, the number of bombings, three, four, everyday -- where do the bombs come from? Where is all of this explosive material and isn't this an indication of just how lawless the nation is that there is so much -- so many bombs all over the country that our military and the police can't seem to find? I mean, it's incredible. I can't think of another country where that would take place like this.
GERGES: And is not -- should not be should not be surprising, Andy. I mean, American commanders made it very clear that thousands of tons of weapons existed in Iraq before the American invasion and after the American invasion and occupation of Iraq and one of the major, as you know, Andy, on of the major blunders made by the coalition forces, by American forces, were basically the country was looted. Most of the weapons were looted out of the Saddam Hussein's bases.
And so in this particular sense, you have tons and tons of armaments left in Iraq after the American invasion and occupation of Iraq. And here you have, Andy, you had a 400,000 strong army, basically, discharged by Mr. Paul Bremer, so in this particular sense, not only you have thousands of tons of weapons, but also you have an army, an army that is angry, alienated, and in this particular sense -- and Andy, you're raising a critical point here, we are witnessing not only an increase in suicide car bombings and a new developments now is what they call the suicide belts. We're seeing more and more suicide bombings using belts, suicide belts. But, in fact, the sophistication -- the sophistication of the attacks tell me that thousands of former officers of the Iraqi Army are being involved in the insurgency.
CAFFERTY: Let me ask you this -- we got 30 seconds so you got to answer it as short as you can. But, what is it about the mindset of the new political leadership in that country that will not engage the Sunnis? The results of not engaging them are all over the TV screens every day. This thing is going nowhere except toward civil war unless they do something different. What's the problem?
GERGES: Absolutely, Jack. In fact, to its credit, the Bush administration has made it very clear that it would like to bring in the Sunnis. It would like to stop the policy of purging of former Ba'athists, in particular, I mean, lower-level bureaucrats. And it's mind-boggling why a government like Ibrahim al-Jaafari would come on the platform to exact revenge instead of building a government based on national unity and reconciliation. To its credit, the Bush administration recognizes the problem, unfortunately it can't do much about it.
CAFFERTY: There was a certain chorus of voices a couple years ago that said this was exactly where this things was headed, too. Fawaz Gerges, professor at Sarah Lawrence College, Middle East analyst. Always a pleasure, sir. Thank you.
GERGES: Thank you Jack.
CAFFERTY: When we come back on IN THE MONEY:
Bored out of their jobs: a lot of women are walking away from top corporate gigs because the work's too dull to take. Hey, they ought to try this. We'll see if there's a way besides quitting.
Plus, may the greenbacks with you: the new "Star Wars" movie is just one of the big-budget films coming out this summer. See if they look set to pay off big time at the box office.
And also ahead, on message, off the radar: there are plenty of ways to sell a TV network. We'll tell you which one a certain broadcaster says it isn't using. Stay with us.
CAFFERTY: Women are getting masters degrees in record numbers, but you still don't see a lot of them sitting in the corner office as CEO of America's big corporations. In fact, an alarming trend shows qualified women choosing to leave the executive-level positions. Is it the old glass ceiling that's driving them away or is it something else? Are professional women just bored and frustrated?
To tell us more about what women really are looking for from careers and whether business is beginning to hear what their needs are and respond, we're joined by Mary Quigley, who's a journalism professor at NYU and the author of "Going Back to Work: A Survival Guide for Moms."
Welcome to the program. What is it about corporate America that makes them deaf to the needs of the women who have so much potential in their work force who are simply walking out the exit door because they're bored and they want to go find something else to do?
MARY QUIGLEY, AUTHOR: I think one of the problems is that corporations tend to think of women as men and they are not, I mean, women are not men with just better hairdos. Women have needs that are not similar to men's and that a lot of women -- and the women who you're talking about who leave -- are leaving because they're not getting emotional satisfaction from their job as well as the kind of flexibility that he need to balance a family and career.
LISOVICZ: Well, but Mary, I mean, there's one thing that men and women are very similar on and that is their need for a fair and equitable paycheck. And women still earn 80 cents on the dollar. I'm sorry, and Jack is playing the violin right to my right. Andy's rolling his eyes.
SERWER: I'm not.
LISOVICZ: But that is the fact.
SERWER: I want money, too.
LISOVICZ: That is a fact. Can you please address that? Why, in the 21st century, there is still such a discrepancy?
QUIGLEY: Well, actually for younger women, women, professional women, lawyers, MBA's, they're -- they come a lot closer than 80 cents. What happens, though, as women leave the work place and then when they try to go back in, that's when the discrepancy arises. And some would say women are their own worst enemies in that case, but younger women are almost matching men dollar for dollar. It's when they reach that, sort of, breaking point, the road they're going to take. Am I going to stay on this career track or am I going to go somewhere else, that's where the discrepancy comes in.
SERWER: I mean, are we talking here about, really, sort of an upper-middle-class situation, though Mary, because, I mean, a lot of people, well, I don't feel fulfilled -- hand me a paycheck.
QUIGLEY: Well, yes. OK, and that's a lot of studies and articles you've seen address women who do have a choice. Granted there are a whole segment of women in the economy who don't have a choice, they have to pay the rent or the mortgage. But, what gets a lot of media attention are women who are, again, on that professional track who do have a choice who can stay home, maybe they're not going to move to a bigger house or take a fancy vacation, but they can live on one paycheck and those are what's interesting because they are some of the women who would go break through the glass ceiling and that is why they get such attention, is why are those women who could get to the tops of corporations, why are they leaving? And that's what the issue is.
CAFFERTY: Are the corporations starting to hear any of this or starting to get it at all? I mean, as far as I'm concerned, women ought to run the country and run all the corporations. I have four daughters a couple wives...
SERWER: They do at your house.
CAFFERTY: And they're smarter than 99 percent of the men and we ought to just turn it all over to them and let them run it. We ain't doing such a great job.
LISOVICZ: Right on, Jack.
QUIGLEY: I agree. I agree 100 percent, yes.
CAFFERTY: I mean, are the corporations hearing any of what's going on out there? I mean it's in the interest of their stockholders to pay attention.
QUIGLEY: Well, it's not only in the interest of stockholders, we're facing a brain drain. I mean, the baby boomers are sooner or later going start to retire and the coming -- the younger people replacing them are not replacing them at the same rate. So, it's in corporation's interest to keep women. And they are. There's an interesting term called "boomerang employee" and a number of the corporations that are more progressive thinking are doing things like when women leave, looking for ways to get them to come back because there's many women who leave for five or six years, but they all -- almost 97 percent, according to one of the statistics, want to come back to work.
LISOVICZ: And, you know Professor, a lot of my friends who have had children when they come back to work they say this is like a vacation, so they really have their act together in terms of time efficiency and things like that. Can you give us hard examples of big companies that actively reach out for these types of workers?
QUIGLEY: Yeah, there's a fair number of companies. Johnson and Johnson, Pfizer, Ernst and Young, Deloitte and Touche...
LISOVICZ: Well, what are they doing exactly?
QUIGLEY: OK, they have several things. Number one, they have something called an alumni network, in a lot of cases, where when you leave a company, there's various ways that you can keep it touch. Some of them may be as simple as an Internet site where you go and you can keep up your skills. A little bit of the next step up would be to work part-time on a contract basis or as a as needed. Another way would be to job share with someone. Another way would be to telecommute. Another way is a four-day workweek, another day (SIC) is flexibility, oh, another way is flexibility as you need it. All these things that interested women do, men don't do. It's verboten for men to do, it's just not socially acceptable. Women are, in larger numbers, doing this and companies are finding that's a way to keep a woman that's been working for say 10 or 12 years that's left. You put a lot of money into her training, her getting to know your client bases, you want her to come back. And you'll -- a lot of companies are showing a willingness to do that.
SERWER: I don't know if I endorse the Quigley-Cafferty plan, first of all. Let's be clear on that. Aren't really men and women in the work place, isn't it really all about the same thing? You know, you talk about how everyone's different. I mean, don't you have to be driven, smart, creative to get ahead?
QUIGLEY: You do. But, you know, once -- something happens to women when they have children, other than losing their minds sometimes with the kids, but I think when a lot of women stay home, they see the future and they see that they change their what -- they change their goals, incredibly, again, and this is borne out by survey after survey, up to 60 to 70 percent of women do not want to go back to the same job. They want to go back to something that either is more socially responsible other than marketing ping-pong balls or whatever they were doing before. They want to work for their community, they want to go into teaching and health professions, so they do change and I think somebody in one -- in our surveys that we wrote in our book, summed it up. She said if I'm going to put my family through hell to go back to work, the job better be emotionally satisfying. And I think that's the difference. You don't find too many men saying, oh, I'm looking to be emotionally satisfied by my job.
LISOVICZ: Looking for meaning in life. Mary Quigley is the professor, is a professor at New York University and the author of "Going Back to Work: A Survival Guide for Moms." Happy Mother's Day to you.
QUIGLEY: Thank you.
And to all of the mothers, including my own, watching today. Thank you.
Coming up after the break:
It's today's paper, but it is so last century: A new study finds young adults are putting down the newspapers in droves. We'll check shares in the Tribune Company.
Plus, the older you are the tougher it gets: Find out why getting laid off at 50 can translate into early retirement whether you want it or not.
And straight from the hard and straight to the gut: See some greeting cards that don't play by the rules on our "Fun Site of the Week."
LISOVICZ: Now, let's take a look at the week's top stories in our "Money Minute." Alan Greenspan and the fed raised short-term interest rates for the eighth straight time. The latest hike was another quarter point increase to an even 3 percent. The fed says it expects to continue raising rates at -- in its words -- a measured pace, to keep fighting inflation.
Billionaire Kirk Kerkorian wants to buy another 5 percent of General Motors. Kerkorian's investment firm is offering $31 a share for GM stock, 13 percent more than the company shares were trading for before the offer. Kerkorian already owns about 4 percent of GM stock, and some auto industry experts believe he's trying to shake up the troubled company.
And does outsourcing hurt corporate profits? Deloitte Consulting has completed a new survey of 25 large U.S. companies. The firm found that 70 percent have had significant negative experiences with outsourcing projects. And another figure, 25 percent of all the companies surveyed have brought many functions back in-house due to lower costs, overall.
SERWER: A study out this week from the Carnegie Corporation found that 18 to 34-year-olds are ditching traditional media, like newspapers. Instead, they're going digital for their news and getting it from sources like websites and blogs. Newspaper circulation numbers have been in decline for about 20 years, but recently, the rate of decline has increased and that's ringing a few alarm bells at some of the nation's biggest media companies. One of those giants is the Tribune Company, owner of the "Chicago Tribune," the "L.A. Times," "Newsday" and even the Chicago Cubbies. But, you can't blame sagging profits and falling share prices on Steve Bartman. Tribune is -- that was the guy who caught that flyball for -- in the -- yeah, the Cubs. Never mind.
LISOVICZ: I forgot all about that.
SERWER: Tribune is our "Stock of the Week." It's not the fault of the Cubs. Although the Cubs are actually not helping the Tribune Company, we'll get to that in a second. There's another problem in the newspaper business. And that is some of the companies, including the Tribune Company, there have been allegations they have been inflating circulation numbers, making their numbers look better at the newspapers than they have been. And basically the industry is all in a disarray because of that.
LISOVICZ: Well, it's making a bad situation worse. It also -- the same sort of problem existed at "Newsday" out here in the New York area. And those kind of things comes back to bite you, but the fact is while circulation, or I should say, ad rates are declining for newspapers, traditional sources of news, they're booming for the Internet, so there's a real problem there, with trying to get this lifeblood of the newspaper.
CAFFERTY: Well, in the Tribune Company, in fairness, is probably not the best example of declining newspaper circulation problems simply because they're invested in so many other things. They own WGN, which is a Superstation in Chicago. They own WPIX Television, here in New York. They own cable systems, they are diversified, as they say. But a lot of people would tell you that we've been on a slow deathwatch for the daily newspapers for, as you mentioned, 20, 25 year and that, you know, the day probably isn't too far away when there'll be only a few major papers in the big city the "Times," the "Wall Street Journal," the "Chicago Tribune," "L.A. Times," but a lot of smaller papers are going to simply disappear because they can't compete.
SERWER: That's true. You know, this is sort of widely known, though. And I'll tell you something, the stock, surprisingly, Tribune Company stock has outperformed in the market over the past five years. You know, this is not a big secret, and some of these companies are going to do better than people had anticipated. And as you said, Jack, they do own other properties. In fact, it's interesting, we'll get back to the Cubbies -- the president of the Tribune Company recently saying that he's not going to sell the Cubs, they do OK. Though, he did say, if they win a few games, they'd be even better. They had a problem with Sammy Sosa's contract. It cost them a $15 million hit to earnings in the first quarter because he went to the Orioles and the Cubs had to pick that up, you may remember. But, you know, these guys are going to be around forever. And to say they're going to go completely away, that's one of those situations where -- it's probably overblown.
LISOVICZ: Right, and if you're saying over the past five year its outperformed in the market this might be the time, if somebody was interested, because it's close to its 52-week low, right now.
CAFFERTY: Oh, OK.
SERWER: Interesting stuff. All right, let's leave it at that. Coming up on IN THE MONEY:
Overqualified and underemployed: "Fortune" magazine, you know that publication, has tips on how to spot the signs of a troubling new trend.
Plus, hot days and hot tickets: We're going to scope out the upcoming crop of summer movies. Find out which ones look set to deliver on the screen and at the box office.
And mixed messages: We'll tell you about the blogosphere ad campaign a certain media company says it isn't running.
LISOVICZ: Put in 30 years of service and some companies will reward you with a cake or, if you're lucky, maybe you'll get an entire lunch. Others may give you something else around the 30-year mark, something a little harder to swallow, like a pink slip. According to the new issue of "Fortune" magazine, more and more executives in their 50s are being displaced by younger, cheaper workers. Senior Writer John Helyar penned the cover story "Fired at 50," and he joins us now with a look at this depressing trend.
JOHN HELYAR, SENIOR WRITER, FORTUNE MAGAZINE: Thank you very much for having me.
LISOVICZ: Well, you know, it's kind of ironic, right, because we're living longer, we're living healthier, we're not saving enough, Social Security is in trouble. We really need these jobs, not only in our 50s, in our 60s, possibly in our 70s. You know, you have Kirk Kerkorian, who's in his 80s. You have Warren Buffett in his 70s. These are people who are active and bright, and we have all sorts of examples of this. But yet we're still being booted at 50. Why is that?
HELYAR: Well, partly it's -- you could call it age discrimination or ageism. I think there's become a presumption that younger is better, not just in terms of being cheaper, but that older executives, older managers have not kept up technologically, they're not able to go 24/7 around the clock for the company anymore, and so they're the most vulnerable at a time in which layoffs in management have become epidemic and in a way are age neutral.
In the last several years, you've seen the stripping out of whole layers of management in a lot of companies. They're outsourcing jobs, they're contracting out for things they used to do in-house. They are doing a lot of things differently to lower their costs, and it just happens that a lot of these middle-aged middle managers are in the way of this particular trend, which is probably a very permanent thing and not just tied to an economic cycle.
SERWER: John, as a colleague of yours, I think it's important to point out to our viewers that you're going to turn 39 this year...
SERWER: ... so that you're in no risk and neither am I, I hope, with this. But I want to ask you: Aren't there laws on the books to prevent employers from terminating older employees, and can't you file an age discrimination lawsuit?
HELYAR: You definitely can fight it legally. Since 1967, it's been illegal to discriminate for employers against anyone over age 40. But just try and win one of those cases. The EEOC, the Equal Employment Opportunity Commission, got 17,000 complaints of this last year, and they litigate less than 1 percent of them, and only about maybe 15 percent or so of the people that complain to the EEOC will actually get any kind of financial settlement out of court of any kind.
The thing is it's a very -- it's a harder thing to prove than for other forms of discrimination and a fairly high hurdle for a plaintiff to make the case. A recent Supreme Court decision has made it somewhat easier because it can -- it's allowed the plaintiffs to show that even if there is a punitively neutral policy by an employer that, in fact, discriminates against people over 40, that they -- if a business -- if a company can show a business necessity for what they've done, then they're still pretty much free and clear to do what they want.
CAFFERTY: Let's talk about, for a minute, what people can do to perhaps insulate themselves or perhaps deal with the reality because the reality is, according to the statistics I read, the times have changed, and they're probably not going to change back.
Productivity continues to rise in this country. We're working more efficiently, making more money with fewer people working less hours that at any time in our history. That doesn't bode well for the old status quo where companies kept people on the payroll until they retired at 65 and are given a gold watch.
So, if you're 45 and feel the hot breath of this kind of thing on the back of your neck, what, if anything, can you do about it?
HELYAR: One thing is get very worried if you see the black balloons being brought to your desk.
CAFFERTY: That's a clue, right?
HELYAR: Never a good sign.
HELYAR: But of the people that I talked to in outplacement services and other areas, they really recommend people being proactive, don't wait for the axe to fall because people that lose their jobs in this situation or think that they're about to, aren't condemned to disappear into a black hole.
An awful lot of people are becoming self-employed, starting their own businesses, whether it's consulting or other things. I had a good subject in my story who was a former chief information officer who is now running a pet crematorium and doing quite well, thank you.
LISOVICZ: Who knew?
HELYAR: But there are other things. People buy franchises, and a lot of these people just say be proactive and don't count on either your current employer or any future corporate employer to take care of you. You've got to networking, as they say, and there are these whole huge networking organizations in different professions that have sprung up just as kind of self-help-type tools so that people can be looking for and connecting with people for those opportunities.
LISOVICZ: John, you didn't mention coloring your hair. I think that would be important, but -- for some of us women, in any case. What about just staying current with technology? Is that anywhere on your radar here?
HELYAR: No, I -- that's absolutely vital, and one of the things that older people have going against them is sometimes companies cut them out of their training programs for new technology and other things, and so, therefore, kind of condemn them and marginalize them, and that's one thing people have to do, if they see themselves in jeopardy of being squeezed out by their employer, is make sure they are getting those in-house opportunities to stay current, up to date on technology and other matters. But sometimes they really have to really stand up and force their boss to let them do that.
LISOVICZ: Meanwhile, look into pet crematoriums.
John Helyar, senior writer, "Fortune" magazine.
A lot of information in your article, and some of it is depressing. Thanks for joining us.
HELYAR: Thank you.
LISOVICZ: There's a lot more to come here on "IN THE MONEY."
Up next, a crusade for cash. Find out about "Kingdom of Heaven" and the other movies Hollywood is hoping will get you to the megaplex this summer.
And go on. Tell them what you really think. See some greeting cards that go easy on the saccharin on our "Fun Site of the Week."
SERWER: No, you're not cracking up. Well, speak for yourself. Those summer movie previews should seem a little familiar. A rash of remakes is coming to a theater near you, including "War of the Worlds," "Charlie and the Chocolate Factory" and "Herbie." Is that the love bug? Will these hits score again at the box office? Let's find out from Gitesh Pandya, editor of boxofficeguru.com.
Gitesh, welcome to the program.
GITESH PANDYA, BOXOFFICEGURU.COM: Thanks. Good to be here.
SERWER: This seems to be a common, common theme in Hollywood. Every summer, it's just more and more and more of the same stuff. Is that what's really going on here?
PANDYA: Well, Hollywood just loves to recycle. That's the way they make money. So, normally, we see a lot of sequels. In fact, in 2003, we had 13 sequels.
PANDYA: This year, only four sequels. Why? Because Hollywood is now moving over to remakes. Anything they can get their hands on, they are remaking into a new Hollywood film with younger stars.
SERWER: And, Gitesh, it's Susan. Good to see you.
"War of the Worlds," obviously, is one of them. That's kind of a no-brainer, that that will do well, I would imagine.
PANDYA: Absolutely. "War of the Worlds" is going to be one of the biggest blockbusters of the season. They have Tom Cruise reuniting with Steven Spielberg, opening on Fourth of July weekend, so that is just a combination for huge fireworks at the box office, probably one of the top three grossing films of this coming summer. CAFFERTY: Are we the victims of our own -- I don't know, as consumers -- I mean, what do they get for a movie? It's like nine bucks, Andy, in New York now or something?
SERWER: Yes, $10. Yes.
CAFFERTY: You get a box of popcorn and a coke and park your car in a garage. It costs you a $50 bill to go see a movie here. And yet we paid all this money and kind of settle for remakes, sequels, part four, part eight. Is the consumer to blame in all of this a little bit?
PANDYA: Well, I think Hollywood is to blame for a lot of it because they try to play it safe, they try to minimize risk, and that's why they make sequels and remakes and things like that, because they're trying to go for films with a built-in audience. It's a lot riskier to do something new.
Now, if you look at "Madagascar," like you mentioned before, before the break, here's a film which is a brand-new story, and it's about, you know, the animals in the zoo breaking out and going to Africa and so on. It takes a harder sell to push that to the American public. However, when those movies work, like "The Incredibles" and "Finding Nemo" these brand-new stories, they make a killing at the box office, and "Madagascar" will be one of the few nonremakes nonsequels that will be a big hit.
SERWER: Gitesh, I was surprised to see that Jeffrey Katzenberg provided us with a little bit of trailer footage there.
I'm being sarcastic.
I'm interested -- you know, what's really going on here with this whole nostalgia stuff, that everything we thought was really stupid in the 1960s, we think is really cool now. Like are they going to remake "My Mother, The Car" and "F Troop"? I mean, those are terrible.
SERWER: And I bet you those are under development right now as full-length features.
PANDYA: Yes. I'm hoping for "T.J. Hooker," the movie.
SERWER: Yeah! Now you're talking.
PANDYA: But, you know, that's what Hollywood studios are looking for. You know, a couple of years ago, there was a sequel backlash. "Charlie's Angels," "Tomb Raider," all these things were not working, and people were saying we can't have these sequels with the number two and three in the titles. Let's do something else which has a built-in audience, and they're remaking films from different countries and they're remaking TV shows from the past or old movies, "Herbie," "Dukes of Hazzard." "Pink Panther" is going to be out there. LISOVICZ: Well -- and, you know, they're making these movies that -- well, that some of us won't see, some of us, and ticket sales for the year are down, and there's fewer movies. Is that correct? There's fewer movies being released this summer?
LISOVICZ: So, in a way, they're stacking the deck so that a large percentage of the audience has to see them? Is that the scenario here?
PANDYA: Well, you know, what we've seen so far this year is that we have a significantly less number of films opening up at the box office. The studios are cutting back a little bit. They're saying, you know, we don't need 14 films in a year, we can do 12, and give more attention to each of those films.
So, as of a couple weeks ago, we were down 28 percent as far as the number of new films opening in wide release. Now, with less films out there and with no "Passion of the Christ" like we had last spring, the box office right now is down about 4 percent or 5 percent versus a year ago, and that really puts the pressure on the summer films to really bring it back up.
So, by the end of the summer, we'll be even or maybe ahead of last year's pace because, with those box-office sales, especially at the beginning of summer, you get bodies into the theaters, they see posters, they see trailers, that gets even more bodies into the theaters in June and July. So the Hollywood studios really critically need a big, big boost at the box office right now in early May.
CAFFERTY: You mentioned "The Passion of the Christ." I mean, if ever there was a film that represented risk-taking on a grand scale, that was it.
CAFFERTY: I read where Clint Eastwood couldn't get anybody to do "Million Dollar Baby," that he walked all over Hollywood where he owns Oscars for best director for "The Unforgiven," his acting career speaks for itself, probably made more money at the box office with "Dirty Harry" movies than anybody in the history of movies during that same period of time, and yet he couldn't get anybody to do "Million Dollar Baby."
Maybe they deserve not 4 percent or 5 percent less at the box office, maybe 15 percent or 20 percent less at the box office or 30 percent or 40 percent. I mean, what kind of a culture turns Clint Eastwood away with a script like "Million Dollar Baby"? What are they smoking? Well, maybe that's part of the problem.
SERWER: It is Hollywood.
PANDYA: Well, you know, that's a Warner Brothers' film, and they were the studio...
PANDYA: ... stepped up to the plate and said, you know, we'll release the film, and, you know, "Ray" was another movie like that, the Ray Charles film. Nobody wanted to touch that. Universal came in and said, you know, maybe we can do something with it. Good marketing, good push and a great performance by Jamie Foxx -- that movie made $70 million, $80 million at the box office. "Million Dollar Baby" did $100 million.
So, you know, sometimes when you do take a risk, there are a lot of rewards, especially with movies like "Passion" and "Ray" and "Million Dollar Baby" that don't cost $100 million.
SERWER: But is anyone writing original screenplays? I mean, even those -- only one of them is an original screenplay really. I mean, "Ray" is a story based on a biography.
SERWER: You know what I'm saying?
PANDYA: Yes, yes. There's a lot of films out there like that as well where they try to take certain kind of source material that people are familiar with, maybe a character, real life, or maybe a comic book character like Batman and make a film out of it because they hope that there is an audience out there, and so it's different than the random movies that come out of nowhere.
LISOVICZ: Gitesh, yes or no. Does the summer movie season begin this weekend because I heard one reviewer actually say that.
PANDYA: Well, you know, in the industry, we were looking at last weekend as the start of the summer box-office season. However, because it didn't do so well, we're now looking at this weekend as the real start of the big summer season.
CAFFERTY: That's a yes. That's a yes.
LISOVICZ: OK. "Kingdom of Heaven," I think, is one of the movies for this weekend.
CAFFERTY: Let him warm a little bit up. Wait until the saga of the Serwer comes out in the fall. Man, that's...
SERWER: That has yet to be written, thank you.
LISOVICZ: Must see. Must see. Gitesh Pandya, editor of boxofficeguru.com. Thank you.
Up next, the positive power of negative buzz. See why some comments showing up in the blogosphere might be closer to home for us here than you think.
Now maybe one day, we'll have an IN THE MONEY blog, and you'll be able to leave smart-alecky comments of your own. Up until then, send us an e-mail. The address is InTheMoney@CNN.com. (COMMERCIAL BREAK)
CAFFERTY: Media companies will do almost anything to get America's attention. But is our own company resorting to trashing itself in public just to turn some heads? Web master Allen Wastler takes a look at that, and he also has a Mother's Day-oriented "Fun Site of the Week."
What's up with the old home office, bro?
ALLEN WASTLER, MANAGER EDITOR, CNN MONEY: Well, this is something Wired -- you have to give credit where it's due -- Wired sort of pointed it out, but there was some buzz going on in the blogs of some sort of anti-CNN messages coming in, OK, and these are things, little posts coming into show.
You know, I'm commenting on various shows. I'll use IN THE MONEY as an example. Say, oh, "In the Money," what a terrible program on CNN, 1:00 on Saturday, 3:00 on Sunday, with such obscure personalities -- Jack Cafferty -- you'll remember him from the New York news scene -- and they have such trashy talk, such scintillating sexually-driven lascivious stuff. I would never watch such a thing. Well, of course, if you read all that...
LISOVICZ: One o'clock and three o'clock.
WASTLER: Yes, I've got to go check it out at 1:00 and 3:00. So it got some people buzzing, thinking, wait a minute, maybe CNN is sort of planting these little anti-CNN things as a backhanded way of generating buzz about the shows.
CAFFERTY: Hey, there ain't nobody around here that bright.
WASTLER: And, you see, you're repeating everything. I polled around all the executives and everything. What we were saying was we were so smart.
LISOVICZ: What a great idea.
CAFFERTY: Yes. It's a great idea.
WASTLER: And CNN, of course, you know, denied the whole thing, but it's sort of brings up -- if you look at the whole blog phenomenon, it started out as this great democracy in action, the citizens can talk. But the marketers have started encroaching in on it.
LISOVICZ: The corporations are...
WASTLER: You know, remember gorilla marketing happened when they found out people were getting paid to go into bars and talk up certain products. I think we're beginning to see the same sort of possibility...
CAFFERTY: That would be a good job, by the way. WASTLER: ... arise out of that. So, if you sort of turn it inside out, what was a big, you know, pro-democracy, pro-citizens' voice thing is now turning into just another marketing game.
CAFFERTY: All right. "Fun Site of the Week" and just in time for Mother's Day.
WASTLER: Ah, cards that you may have wished you had sent, OK? Let's look at a few of them here. "I always wanted to have someone to hold, someone to love." Turn inside, "After meeting you, I changed my mind."
CAFFERTY: Oh, that's terrible.
LISOVICZ: That's not for Mom.
CAFFERTY: I was going to say.
WASTLER: "Congratulations to you on your promotion. Before you go, will you take the knife from my back? You'll probably need it again." That's the Time Warner credo, isn't it?
LISOVICZ: That's good.
WASTLER: And finally, "We've been friends for a very long time. What do you say we stop?"
CAFFERTY: There you go.
WASTLER: So you can get these and a lot of others on our "Fun Site of the Week."
LISOVICZ: Very sentimental.
CAFFERTY: All right. Yes. Thanks, Allen.
Coming up next on "IN THE MONEY," when we continue, it's time to hear from you, as we read some of your e-mails from the past week, and you can send us an e-mail right now if you like. We're at InTheMoney@CNN.com. Back after this.
CAFFERTY: Time now to read your answers to our e-mail question of the week about whether the rising prison population means it's time to legalize some drug offenses.
Todd wrote, "We're spending billions dollars on the war on drugs. We haven't reduced the drugs at all. Addicts are not criminals. They don't belong in prison, and it's high time we started realizing this."
Mike wrote this, "I've been in law enforcement for 30 years, and I've seen how drug use is directly responsible for the erosion of the family unit, enhancement of crime and the general confusion about right and wrong. Legalizing drugs would be a huge mistake." And Charles wrote this, "How do the rising prison population and drug legalization even remotely correlate? If you want to cut down on the population, first try executing the thousands of death-row inmates who are costing us time and money with their endless appeals."
Warm-hearted guy, old Charles.
CAFFERTY: Time now for next week's e-mail question of the week: Do you have a contingency plan if you get laid off in the coming year? Send your answers to InTheMoney@CNN.com. You can also visit our show page at Money.com/InTheMoney, which is where you'll find the address of our "Fun Site of the Week."
On that note, thank you for joining us for this edition of the program.
My thanks to CNN Correspondent Susan Lisovicz, Fortune" magazine editor-at-large Andy Serwer and Money.com Managing Editor Allen Wastler. A fine group they are.
Join us next week, Saturday at 1:00, Sunday at 3:00. Or you can catch Andy and me all week long on "AMERICAN MORNING" which begins at 7:00 Eastern time. Enjoy the rest of your weekend.
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