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Porn: Too Big Too Fail?

“Too big too fail.” It’s one of the most overworked phrases in this bailout bonanza. But I’ve always thought that it sounded more like the title of a porn movie. (“See Dirk Rambo in To Big To Fail,” an advertisement might read.)

Speaking of bailouts and porn, I’m afraid I’m going to have to disagree with Campbell Brown on this one.


Just a minute, now. By no means am I a big fan of guys like Larry Flyntt and Joe Francis. But they do have a point — and there is a point to be made — about them getting a little bailout action. Let’s put this in to perspective.

Here’s a graphic of about how much we’ve spent on bailing out the financial sector. Yeah, it looks kinda like a ruler, but never mind its shape, etc. And, yes, that’s the actual size. I left it full sized so you could take it all in.[Via Mother Jones.]

Go all the way down to the base, and get a load of the number there: $3.43 trillion and counting.

Now look at who’s been getting all the action. There was the injection into the whole banking system in August of ’07. In fact, there were three injections in just one month. Then it was hot bailout injections all around. Bear Stearns got a $29 billion piece. The FHA got a $200 billion injection. AIG got in for $70 billion, got back in line for another $37 billion, and then another $27.5 billion.

And while the fed was taking all comers, it was also still giving it away to the whole of Wall Street.

The porn industry has come late to the party and, by comparison, what they’re asking for is basically sloppy seconds. Or thirds. Fourths. May even fifths. Sixths or sevenths, anyone?

Bottom line: they’re not asking for much.

Two porn moguls including Hustler magazine founder Larry Flynt are seeking a five-billion-dollar bailout from Washington, arguing that the limp US economy has thrown cold water on the adult entertainment industry.

Flynt and “Girls Gone Wild” video series creator Joe Francis asked the newly convened 111th Congress “to rejuvenate the sexual appetite of America” in a bailout move similar to the one set aside for US auto manufacturers.

“Congress seems willing to help shore up our nation’s most important businesses, (and) we feel we deserve the same consideration,” Francis said in a statement.

“In difficult economic times, Americans turn to entertainment for relief. More and more, the kind of entertainment they turn to is adult entertainment.”

The pair were quick to admit that “the 13-billion-dollar industry is in no fear of collapse, but why take chances?”

Francis, recently imprisoned for nearly a year on a prostitution-related charge after pleading no contest in a plea bargain, cited industry figures that show adult DVD sales and rentals decreasing 22 percent in 2008, as people turn to the Internet for adult entertainment.

“With all this economic misery and people losing all that money, sex is the farthest thing from their mind,” Flynt said.

Actually, the opposite of what Flynt says is true. One of the consequences of the economic downturn is that more people are staying at home. And they’re not staying home alone either. According to one blogger, a recent Cosmo polled showed that 80% of readers worried about the economy and 40% admitted that sex takes their minds off of it.

Now, that doesn’t always have to mean they’re having sex with someone. But it’s a safe bet, since more people are staying together because of the economy.

With nearly one in six homes worth less than the mortgage owed on it, according to Moody’s Economy.com, divorce lawyers and financial advisors throughout the country say the logistics of divorce have been turned around.

“We used to fight about who gets to keep the house,” said Gary Nickelson, president of the American Academy of Matrimonial Lawyers. “Now we fight about who gets stuck with the dead cow.”

As a result, divorce has become more complicated and often more expensive, with lower prospects for money on the other side. Some divorce lawyers say that business has slowed down, or that clients are deciding to stay together because there are no assets left to help them start over.

“There’s an old joke,” said Randall Kessler, Ms. Needle’s lawyer: “Why is a divorce so expensive? Because it’s worth it. Now it better really be worth it.”

They may not be having sex with the spouse they can’t get shed of because of the house they can’t sell, but they’re having it with someone, because condom sales are up.

Condom kings Durex reported 19 million dollars in US sales for November, up on 18 million dollars last year, a performance that must make other retailers, many of them deeply in the red, sick with envy.

The economic logic behind this bedroom boom is simple.

“At a time of a recession people tend to stay in. They do date-night in. Maybe they don’t go out to dinner so much. And when you’re at home, around the home fire, one thing leads to the other,” Jennifer Grizzle, a spokeswoman for Durex, said.

“The condom business is recession proof: you can’t stop mother nature.”

But there is another, more romantic cause for recession sex.

“It’s a scary time,” Babeland’s Cavanah said. “People want to connect.”

That may also be because they want to make whoopie — not babies — right now.

It’s an angst-filled debate raging in bedrooms around the country and on Internet sites such as Twitter Moms. Can couples afford to start a family or have another child when layoffs are running rampant, employers are cutting benefits and the cost of raising and educating children has never been higher? Or, as some proclaim, is it a decision that shouldn’t be tied to finances or economic cycles?

With the advent of birth control, many U.S. families have been better able to time when they start having children or have more. And the evidence shows that fertility rates fall during times of economic hardship, demographers say.

..There’s good reason to be cautious.

For families with household incomes of about $80,000, a child will add about $10,000 a year in additional expenses in the form of part-time child care, extra groceries and diapers, and a minimal college savings plan, according to estimates by Chicago financial planner Chris Long of Long & Associates.

That number can reach almost $30,000 for a family earning $150,000 if they choose to move to a bigger house and employ full-time day care. And it can soar to almost $80,000 per year for households with $300,000 in household income, depending on choices parents make such as private versus public school.

That may also be because they’re spending more time with their kids, keeping them at home instead of sending them to daycare.

A growing number of child care providers are reporting a drop in enrollment as parents lose jobs or try to cut back expenses, according to an organization that helps connect families with quality day care.

“We’re talking to centers and for the first time we’re finding vacancies,” said Becky Hancock, program coordinator of Child Care Resource and Referral. “Normally, especially for infants, we’ll have to call five, six or seven centers or home-care providers for the little guys. Now we’re calling and being able to place them immediately. Even for large families, centers are having openings.”

So, why would this industry need a bailout like Wall Street needed a bailout?

Well, there’s no comparison really. On the one hand we’re talking about a sector that doesn’t seem to produce much except paper of questionable value and that seem to cause more trouble that it may or may not be worth.

Seriously, did even one dollar of the multi-trillion dollar Wall Street bailout make you feel good? I mean really, really, really good? Good enough to wake the neighbors?

On the other hand, we’re talking about an industry that actually makes something that people can really use, and use more now than ever.

Because even if they’re having more sex, they can’t have it all the time. But they’re still at home, and they’ve got to entertain themselves somehow.

Look at video games, for example. Game sales have soared in Britain, where more people are finding themselves staying home. And early returns from retailers showed strong sales for game consoles, despite the recession.On the whole, the industry is expected to whether the recession quite well.

Do I need to draw you a picture? The porn industry is in pretty much the same make-or-break position, with some advantages and some disadvantages. Technical know-how, beyond the ability to point and shoot, isn’t much of a requirement. But demand is likely to be much higher. Not everyone plays video games or likes them. But almost everyone enjoys sex.

And that’s where the need for a bailout comes in. We want to make sure that an industry that makes a product people want and use can keep up with a likely increase in demand. And given that its a $13 billion industry right now, we can make it bigger — huge, even — for a fraction of what we’ve paid to bailout Wall Street.

Yes. We get more bang for our bailout buck.

This is also about job creation. The sex industry is actually the one sector of the economy that could experience real growth. And with college students entering an already tight and steadily-shrinking job market that’s only expected to get worse, Girls Gone Wild or Guys Gone Wild may be halfway-decent entry-level employment.

Given all the above, can we afford to do the porn industry the way we did, say, Detroit?

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