AI and Political Ads

 The new political ad machine: Policy frameworks for political ads in an age of AI Center on Technology Policy at the University of North Carolina at Chapel Hill

While there is limited empirical research on GAI in political ads, our reading of the literature considering online misinformation, political ads, and bias in AI models offers five important insights into the potential harm of GAI in political ads: 

• First, research suggests that the persuasive power of both political ads and online misinformation is often overstated. Political ads likely have more of an effect on behavior – such as voter turnout and fundraising –  than on persuasion. 
• Second, political ads likely have the greatest impact in smaller, down-ballot races where there is less advertising, oversight, or familiarity with candidates. 
• Third, GAI content has the potential to replicate bias, including racial, gender, and national biases.
•  Fourth, research on political disclaimers suggests that watermarks and disclaimers are unlikely to  significantly curb risks. 
• Fifth, significant holes in the research remain.

 These insights from the literature help to formulate recommendations for policymakers that can mitigate the potential harm of GAI without unduly constraining its potential benefits. Research suggests that policy should focus more on preventing abuse in smaller, down-ballot races and in mitigating bias than on banning deceptive GAI content or requiring disclaimers or watermarks. Although the research points in this direction, holes in the literature remain. The result is that we should approach its insights from a position of curiosity, rather than certainty, and conduct additional research into the impact of GAI on the electoral process. Building on our assessment of the academic literature, we offer ten recommendations for policymakers seeking to limit the potential risks of GAI in political ads. These recommendations fall into two categories: First, public policy should target electoral harms rather than technologies. Second, public policy should promote learning about GAI so that we can govern it more effectively over time.

Ad Spending and the Decline of Print

 Many posts have discussed the decline of print newspapers.  Underlying that trend is the decline of print advertising.  (The old saying is that the business of for-profit media is selling eyeballs to advertisers.)  In an Axios profile of outgoing Meta president Sheryl Sandberg, Sara Fischer offers a telling graph:

From Pew:

The total combined print and digital circulation for locally focused U.S. daily newspapers in 2020 was 8.3 million for weekday (Monday-Friday) and 15.4 million for Sunday. Each of these numbers is roughly on par with the previous year, but they are still among the lowest reported: Total weekday circulation is down 40% since 2015, the first year available for this analysis. Similarly, total Sunday circulation has fallen 45% since 2015.

"Free and Fair Markets" Astroturf

James V. Grimaldi at WSJ:

About 18 months ago a new nonprofit group called Free and Fair Markets Initiative launched a national campaign criticizing the business practices of one powerful company: Amazon.com Inc.

Free and Fair Markets accused Amazon of stifling competition and innovation, inhibiting consumer choice, gorging on government subsidies, endangering its warehouse workers and exposing consumer data to privacy breaches. It claimed to have grass-roots support from average citizens across the U.S, citing a labor union, a Boston management professor and a California businessman.

What the group did not say is that it received backing from some of Amazon’s chief corporate rivals. They include shopping mall owner Simon Property Group Inc., retailer Walmart Inc. and software giant Oracle Corp. , according to people involved with and briefed on the project. Simon Property is fighting to keep shoppers who now prefer to buy what they need on Amazon; Walmart is competing with Amazon over retail sales; and Oracle is battling Amazon over a $10 billion Pentagon cloud-computing contract.

The grass-roots support cited by the group was also not what it appeared to be. The labor union says it was listed as a member of the group without permission and says a document purporting to show that it gave permission has a forged signature. The Boston professor says the group, with his permission, ghost-wrote an op-ed for him about Amazon but that he didn’t know he would be named as a member. The California businessman was dead for months before his name was removed from the group’s website this year.

News Does Not Benefit Much from the Digital Ad Bonanza

The shift of advertising from print to digital is hurting newspapers.  But it is not helping online news as much as one might think.

Michael Barthel at Pew:

Total digital advertising revenue has jumped 25% in 2017 across all types of digital outlets, not just news, according to eMarketer. This has been especially true of mobile advertising revenue, which totaled $61 billion in 2017, roughly equal to the totalamount of digital advertising revenue just two years prior, in 2015 ($60 billion) – and which goes hand in hand with Americans’ increased use of mobile for news. However, news organizations seem to share little in this bonanza – 52% of all digital display advertising revenue goes to just two companies: Facebook and Google.

The MLK Ad

During the Super Bowl, Dodge hawked pickup trucks by using the voice of Martin Luther King.

As Phil Klinkner points out, King actually used the speech to denounce advertising, specifically auto advertising. "The Drum Major Instinct," February 4, 1968:

Now the presence of this instinct explains why we are so often taken by advertisers. You know, those gentlemen of massive verbal persuasion. And they have a way of saying things to you that kind of gets you into buying. In order to be a man of distinction, you must drink this whiskey. In order to make your neighbors envious, you must drive this type of car. (Make it plain) In order to be lovely to love you must wear this kind of lipstick or this kind of perfume. And you know, before you know it, you're just buying that stuff. (Yes) That's the way the advertisers do it.

I got a letter the other day, and it was a new magazine coming out. And it opened up, "Dear Dr. King: As you know, you are on many mailing lists. And you are categorized as highly intelligent, progressive, a lover of the arts and the sciences, and I know you will want to read what I have to say." Of course I did. After you said all of that and explained me so exactly, of course I wanted to read it. [laughter]

But very seriously, it goes through life; the drum major instinct is real. (Yes) And you know what else it causes to happen? It often causes us to live above our means. (Make it plain) It's nothing but the drum major instinct. Do you ever see people buy cars that they can't even begin to buy in terms of their income? (Amen) [laughter] You've seen people riding around in Cadillacs and Chryslers who don't earn enough to have a good T-Model Ford. (Make it plain) But it feeds a repressed ego.

You know, economists tell us that your automobile should not cost more than half of your annual income. So if you make an income of five thousand dollars, your car shouldn't cost more than about twenty-five hundred. That's just good economics. And if it's a family of two, and both members of the family make ten thousand dollars, they would have to make out with one car. That would be good economics, although it's often inconvenient. But so often, haven't you seen people making five thousand dollars a year and driving a car that costs six thousand? And they wonder why their ends never meet. [laughter] That's a fact.

Lobbying 2017

Politico Playbook reports:

FIRST IN PLAYBOOK -- MORNING JOE, O’REILLY FACTOR RAISE AD RATES -- MSNBC and Fox News are capitalizing on Donald Trump’s TV watching habits. The cable networks have dramatically increased prices on issue advocacy rates in recent weeks as companies and outside groups try to influence Trump and his top lieutenants. “Morning Joe’s” rates have more than doubled post-election, according to one veteran media buyer. “The O’Reilly Factor” and other prime time programs on Fox News have boosted their rates about 50 percent. “The president’s media habits are so predictable, advertisers migrate to those areas,” said one media buyer.
ONE D.C. CONSULTANT told us some of his clients, including a big bank and major pharmaceutical company, were negotiating this week to buy ads on “O’Reilly” and “Morning Joe” because they knew they had a good chance of reaching the president. “Instead of lobbying through the usual channels, it’s like speaking directly into the president’s ear,” he said. The consultant also said some companies are proactively placing ads in order to avoid a Trump tweet, or in at least one instance trying to prompt Trump to tweet against their competitors. One source at MSNBC acknowledged that rates would likely go up. She said that “with strategically placed ad buys in New York and DC it’s likely the rates would increase ... [and] we would capitalize on increased interest.” Fox News declined to comment.

Open Secrets reports:

Lobbyists aren’t sure exactly how Trump’s new ethics plan will impact their industry, as it is filled with both new restrictions and more leniency compared to Obama’s plan. Trump allows former lobbyists to work in his administration, though they can’t work on issues they lobbied on in the last two years. (Obama blocked all lobbyists registered the previous year from working in the administration.) His five year lobbying ban only applies to lobbying the agency where they previously worked. Employees, except Cabinet appointees, can’t contact former colleagues for one year, instead of Obama’s two. Trump has also banned officials from lobbying on behalf of foreign governments.

It does seem clear, however, that Trump will make the industry even more opaque: The Washington Post found Trump took out language requiring annual reports outlining ethics compliance, and any ethics waivers do not need to be disclosed.

“At least Obama made his waivers public and now there is no way that we can find out,” Miller said. “You can’t FOIA the White House so they may never let you know,” he added, referring to the Freedom of Information Act.

On the other hand, Trump’s order applies to “lobbying activities” — including prep and strategy for making new contacts — rather than just lobbying per se.

Miller sees some irony in the order. “I can respect people for wanting strict policies on ethics, but when you put very, very strict regulations on lobbying conflicts of interest but you as an administration won’t take these same steps for your own personal and familial dealings, it doesn’t send the right message,” he said.

The Economic Devastation of Newspapers

At Brookings, Robert Kaiser reviews the impact of the Internet on newspapers:

Overall the economic devastation would be difficult to exaggerate. One statistic conveys its dimensions: the advertising revenue of all America's newspapers fell from $63.5 billion in 2000 to about $23 billion in 2013, and is still falling. Traditional news organizations' financial well-being depended on the willingness of advertisers to pay to reach the mass audiences they attracted. Advertisers were happy to pay because no other advertising medium was as effective. But in the digital era, which has made it relatively simple to target advertising in very specific ways, a big metropolitan or national newspaper has much less appeal. Internet companies like Google and Facebook are able to sort audiences by the most specific criteria, and thus to offer advertisers the possibility of spending their money only on ads they know will reach only people interested in what they are selling. So Google, the master of targeted advertising, can provide a retailer selling sheets and towels an audience existing exclusively of people who have gone online in the last month to shop for sheets and towels. This explains why even as newspaper revenues have plummeted, the ad revenue of Google has leapt upward year after year—from $70 million in 2001 to an astonishing $50.6 billion in 2013. That is more than two times the combined advertising revenue of every newspaper in America last year.

...
The other online innovation that has devastated newspapers is Craigslist, the free provider of what the newspapers call “classified advertising,” the small items in small print used by individuals and businesses for generations to buy and sell real estate and merchandise, and to hire workers. Twenty years ago classifieds provided more than a third of the revenue of The Washington Post. Craigslist has destroyed that business for the Post and every major paper in the country.

Newspaper Ad Revenue

Many posts have discussed the economics of the mass media.  At AEI, Mark J. Perry has a graph that sums up a major problem:

Native Advertising

At The Washington Post, Erik Wemple writes:

One of the hottest issues in journalism today is “native” advertising, the tricks that publishers deploy to elide the domains of journalism and advertising. BuzzFeed has sustained gray-bearded criticism for its boundary-defying listicles. The Atlantic earlier this year ran a native ad from the Church of Scientology that inflamed its audience and prompted an apology and a review of Atlantic procedures for approving ads. Forbes, The Washington Post and the Huffington Post are also experimenting with this approach to funding journalism.