econscius

Big Bird Doesn’t Need Obama’s Federal Handout

In 2012 Elections, Federal Deficit on October 10, 2012 at 9:22 pm

Big Bird - Library of Congress, Living Legends, Award & Honors, 2000.jpg

Being a 1%er, Big Bird doesn’t need your taxes.  If you have children, surely you’ve spent plenty on Elmo, Big Bird, Muppets and other Sesame Street character royalties.  Perhaps you’re a PBS contributor.  To get our federal deficit under control, we need to cut spending.  President Obama thinks it’s an outrage Mitt Romney suggested easing Sesame Street off its federal subsidy, but the outrage  lies in a President who refuses to cut spending, even in unnecessary areas, though the country’s credit rating was downgraded on his watch.

There are more than 500 cable channels, including channels devoted to History, children’s TV shows, public affairs, documentaries and culture.  Is it unthinkable PBS could survive on its own?  Sesame Workshop President and CEO Gary Knell received $956,513 in compensation in 2008. [1]  “Sesame Street is a lucrative enterprise.” [1] From 2003 to 2006, Sesame Street earned $211 million in toy and consumer product sales. [1]  Its 2009 tax form shows Sesame Workshop took in $140 million in 2008 in 2008, with government grants accounting for just over $14 million of that (roughly 10 percent). [1]   The proportion from government was down to 6% in 2011. [4]

“Sesame Street appears in more than 120 countries,” [2] with licensing revenue achieved from all.  Big Bird has his own spot on Hollywood’s Walk of Fame. 

According to Slate, “The Workshop earned about $45 million in merchandising during 2010, which accounted for one-third of its total revenue. The rest came mainly from distribution fees and royalties, and from an assortment of private donors, corporate sponsors, and government.” [3]  Sesame Street is obviously very profitable because, “The production budget for Sesame Street domestically is about $16 or $17 million per year, which produces about 26 episodes.” [3]

The Wall Street Journal provides data on Sesame Street’s significant assets:

At the end of fiscal 2011, Sesame Workshop and its subsidiaries had total assets of $289 million. About $29 million was held in cash and “cash equivalents,” mainly money-market mutual funds. Another $121 million on the balance sheet was held in “investments.” According to the accompanying notes, these investments included stakes in hedge funds and private-equity funds. [4]

Everyone likes Big Bird.  He is in no danger of extinction if he loses his government handout.  President Obama should be ashamed of his false claims and unauthorized usage of Big Bird in Obama’s campaign ad.  Big Bird should at least receive royalties for the Obama campaign, but the President would prefer to pay with your tax dollars. [5]

 

Sesame Street logo.svg 

[1]  http://www.politifact.com/truth-o-meter/statements/2011/feb/28/jim-demint/sen-jim-demint-takes-aim-muppet-lobby/

[2] http://www.nytimes.com/2005/12/12/business/media/12sesame.html?pagewanted=print&_r=0

A sample international licensing deal with British retailer Marks & Spencer is located at:  http://www.licensing.biz/news/4600/MS-to-debut-Sesame-Street-apparel.

Another example of the licensing value of the iconic Sesame Street characters is seen with Google at http://www.licensing.biz/news/4231/Sesame-Street-celebrates-40th-with-Google.

[3] http://www.slate.com/articles/business/explainer/2012/01/does_sesame_street_lose_money_.html

 

[4] http://online.wsj.com/article/SB10000872396390443982904578046671220961776.html

[5] http://www.cbsnews.com/8301-250_162-57528812/sesame-workshop-to-obama-take-big-bird-ad-down/

For more on the business history of Sesame Street, see http://www.referenceforbusiness.com/businesses/M-Z/Sesame-Workshop.html

Pictures from Wikipedia Commons.

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