Different leads all around. The Washington Post leads with a scoop: The European Union will nix the Sprint-WorldCom merger, the biggest ever blocked by regulators. The EU's decision effectively kills the merger, even before the U.S. had reached its own decision. The New York Times leads with the Senate's 57-42 passage of a "hate crimes" bill. The measure, which expands federal jurisdiction for crimes motivated by racism, xenophobia, religious bigotry, sexism, and homophobia, will likely never pass the full Congress. (The Wall Street Journal puts this story atop its front-page "World-Wide" news box, but the Post and Los Angeles Times run this story inside, and USA Today does not run it.) The LAT leads with a second-day followup to the Vivendi-Seagram merger--a story that the paper ran on Page C18 yesterday. Investors, who doubt that synergies exist, punished both companies' stock price. (The NYT and Post both run similarly skeptical stories inside.) USAT leads with more shenanigans in the Los Alamos nuclear-secrets scandal. Lie-detector tests indicate that the data may have been missing for six months instead of just one, as employees had maintained. (The Post, LAT, and WSJ run this story inside; the NYT does not run it.)
Europe's antitrust authorities note that if the Sprint-WorldCom merger had gone through, the two companies would have delivered 45 percent of the world's Internet traffic. The companies had proposed selling off Sprint's Internet division as a compromise, but the EU objected because Sprint would still share fiber-optic wires with the spun-off company and thus retain de-facto control. (EU regulators say this is exactly what happened when they ordered MCI to sell its Internet division before its 1998 merger with WorldCom.) Both the Post and the WSJ--in its story on the Justice Department's continuing review of the merger--note that the United States probably would have blocked the deal too, because Sprint and WorldCom are the third- and second-largest long-distance providers in the U.S., respectively. The Post writes that the DOJ and EU had been in constant communication during the review.
The NYT, LAT, and Post front Judge Thomas Penfield Jackson's unexpected stay of the restrictions against Microsoft's business practices, at least until a higher court affirms them. (The WSJ puts this story atop its front-page "Business and Finance" news box, and USAT gives it a prominent above-the-fold reefer.) The Post's headline gets the story backward, putting the expected news--"MICROSOFT CASE SENT TO SUPREME COURT"--in the head, and the unexpected news--"Judge Puts Curbs Against Firm on Hold"--in the subhead.
USAT reefers, with an above-the-fold picture, Indiana Gov. Frank O'Bannon's two-month suspension of the state's sales tax on gas. The suspension comes amid an investigation by the Federal Trade Commission into price-gouging by oil companies in the Midwest, where prices are more than $2 a gallon. (The national average is $1.68.) O'Bannon said he would reinstate the tax if prices come down. (If the governor had consulted an economist, he would have discovered that his strategy is sure to backfire: It will raise gas prices, while transferring tax money to the price-gougers. To understand why, click here.) In a related story, the NYT reefers OPEC's decision to raise output a token amount, a move sure to keep prices high throughout the summer.
On the NYT opinion page, Jack Valenti, chairman of the Motion Picture Association, warns that when computers get broadband capability, movies may get stolen via the Internet as frequently as music now does. Valenti argues that if the government lets technology undermine film copyright, the nation will lose not just great films (because nobody will invest in movies without an expectation of return) but its economic health (because Hollywood is one of our greatest moneymakers). He concludes:
Suppose some genius invented a magic key that could open the front door of every home in America and wanted to make the keys available to everyone under a canopy sign that read, "It's a new world--take what you want." Wouldn't it be the responsibility of our society to try to control the use of that key?