CNN Fake News Scandal is Wiiild, Madison School Attack Updates, Veo 2 vs Sora Drama, & Today’s News
PDS Published 12/17/2024
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CNN just got caught red handed spreading what is quite literally fake news.
Right, this begins with a story you may remember from last week, with CNN reporter Clarissa Ward searching for the missing American journalist Austin Tice in Syria. [B roll, 00:12]
But instead of him, she found a padlocked jail cell in Damascus, with a rebel guard then busting it open. [Same B roll, 00:50]
Revealing a man who identified himself as Adel Ghurbal [Pronounce 04:39], a civilian abducted by the regime from his home. [Lead B roll into clip]
[Clip, 01:39 - 01:41, 01:50 - 01:55, 02:15 - 02:20, 02:32 - 02:37, 02:45 - 02:55]
Thing is, all of that? It’s complete bullshit. [Do record scratch]
Right, it turns out that man is not a civilian, but rather a former Air Force Intelligence officer for Assad’s regime. [Image]
Right, his real name’s Salama Mohammad Salama [Pronounce 02:32]; you can see him wearing military apparel in this photo. [Same image]
With the self-described Syrian fact-checking website Verify-Sy first uncovering the man’s true identity Sunday and calling out CNN. [Headline]
Citing local residents who claimed that Salama managed several security checkpoints and was involved in theft, extortion, and coercing residents into becoming informants. [Quote same link, find “extortion”]
Also, he reportedly participated in military operations in 2014, killed civilians, and was responsible for detaining and torturing numerous young men without cause or on fabricated charges. [Quote same link, find “2014”]
Now it’s not clear exactly why this man was in jail when he was found.
But locals told the website he was there for less than a month because of a dispute over “profit-sharing from extorted funds with a higher-ranking officer.” [Quote same link]
So now CNN has put its tail between its legs and corrected the fuck-up.
Corroborating the main point, though not all of the details, in the Verify Sy report by interviewing local residents.
Though if you read CNN’s update, they make it sound like they simply did their due diligence, pursuing more info about the man after the original report on their own. [Quote, find “to pursue”]
Rather than, you know, posting a sensational story without checking the guy’s background, then getting called out for it.
Links:
https://www.cnn.com/2024/12/16/middleeast/syria-assad-prisoner-homs-intl-latam/index.html
https://verify-sy.com/en/details/10562/Did-CNN-Fabricate-the-Story-of–Freeing-a-Prisoner-from-a-Secret-Jail–
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A teen shooter killed two people at the Pre-K through 12 Abundant Life Christian School in Madison, Wisconsin, yesterday.
Right, reports initially claimed that at around 11:00 am, a second grader at Abundant Life calls 911 to report a shooting and officers are dispatched. []
Though police later clarified today that’s not entirely correct – it was a second grade teacher.
But anyway, within minutes, the first officers roll up and by 11:05, they report that the shooter is down and a gun has been recovered. []
It is worth noting here that it was later reported that evidence suggests the shooter took their own life. []
By 11:30, officers and bomb sniffing dogs had cleared the building and the injured had been taken off to the hospital.
Outside of the shooter, 2 people died - with one being a teacher and the other a student. []
And 6 others were injured - two of which were students that, as of this morning, are in critical condition. []
We still don’t know the identities of the victims while the police inform their families.
But we’ve slowly been getting a clearer picture of what happened thanks to updates from the local police chief Shon Barnes.
Yesterday, we learned that the shooter was a 15-year-old girl and a student at Abundant Life and that the shooting was confined to a study hall with a mix of students from different grades. [] []
The gun used was reportedly a 9 millimeter handgun and the ATF is currently trying to figure out exactly where it came from. []
And the Madison police are investigating the shooter’s parents, who are reportedly cooperating. []
With the police specifically looking at whether the parents owned the gun that was used in the shooting.
Barnes saying,
“We also want to look at if the parents may have been negligent. And that’s a question that we’ll have to answer with our district attorney’s office. But at this time, that does not appear to be the case.” []
As for motive, that’s still unclear - though the shooting was reportedly planned in advance.
With a source telling CNN that the shooter had been struggling - which she expressed in writings that the police are currently reviewing. []
Which was confirmed by Barnes this morning, who said,
“We have been made aware of a manifesto, if you want to call it that, or some type of letter that’s been posted by someone who alleged to be her friend. We haven’t been able to locate that person yet, but that’s something we’re going to work on today.” []
The community has obviously been hit very hard - they’ve planned a candlelight vigil for tonight and a memorial has started to take shape outside the school.
And we saw news outlets interviewing members of the community - with one mother saying,
(“It’s sad, you know? To be home and then somebody call you and say your kids’ school in lockdown and shooting. And you didn’t know where they are. And thank God they were safe but the trauma. It’s a lot. Because I’m sure they lost friends and teacher. Which is not okay. And I don’t think they will be okay for a long time. And I’m not.” 0:40-1:04)
Now, according to CNN, this is at least the 83rd school shooting to happen this year alone and of those, 56 have happened on K through 12 campuses. []
And what’s especially devastating about that number is it marks the most school shootings that have happened up to this point in a year since CNN started counting in 2008.
Surpassing last year’s tally of 82. []
As you can imagine, we’ve seen many politicians pointing to Madison today in their calls for gun control.
Like Wisconsin Representative Mark Pocan (Poh-can) , who said to CNN,
“I’ve sat through so many moments of silence on the floors of Congress that are followed by zero moments of action.” []
Adding that he even had a media appearance get canceled because the number of deaths was corrected and dropped to 2, saying,
“If that is the societal response, we are screwed. We have to do more as a society. We have to be more outraged that you drop your kid off to a school and you’re not sure they’re going to be safe. That’s completely unacceptable. And we all need to speak out much louder.” []
And there has been a lot of conversation surrounding both the media coverage of school shootings and the overall response to them.
CNN, specifically, got some heat for interviewing students who were in the building at the time of the shooting. [B Roll 0:58-1:12]
With people saying things like,
“Just seen an 8-year-old girl getting interviewed about the school shooting in Madison - clearly traumatized after seeing her teacher shot. Why are you shoving a mic and camera into these babies faces?” []
“As a journalist y’all need to draw the line and stop interviewing children. They don’t need to re-live the trauma. L for every journalist involved.” []
And then the likes of Hasan Piker chimed in, reacting to this CNN clip and saying,
CNN: “One week before Christmas, a student….”
Hasan: “Dude this is wild stuff. It’s just so commonplace at this point where like, we have streamlined the coverage. We’ve streamlined the coverage immediately.” 3:21-3:45
Later adding,
“Now we have additional industries tasked with designed with the purpose of extracting some kind of profit out of tragedies like this.” 3:51-4:01
“And yet we seemingly always find a reasonable market solution, and that doesn’t mean that we’re actually eliminating the problem. It’s never about eliminating the problem. It’s about trying to triage and I guess like stop the bleeding by you know, making more money. Yeah. One man’s tragedy is another’s man’s opportunity.” 4:25-4:44
And he’s not alone there - many have taken issue with people trying to profit from even just this shooting specifically.
Just as an example - someone online shared what they said is the Madison shooter’s manifesto with a watermark across each page.
Though it’s important to note here that police have still said they’re not ready to confirm whether this actually is what people are saying it is.
Regardless, that watermark landed the original poster in a world of backlash - with people saying things like,
“An influencer watermarking a school shooter's manifesto with their social media handle feels like an episode the writers of Black Mirror rejected because they thought it was too obvious.” []
With others saying that we’ve gotten to this point thanks to the monetization of posting on X. []
Right, things go from bad to worse when money gets involved.
With that, I will pass the question off to you - what are your thoughts here?
Specifically, in reference to the media coverage.
And our hearts and thoughts go out to those in Madison.
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Google has announced its new AI video generation model Veo 2.
The announcement came just a week after OpenAI’s release of its AI video generation model Sora, as well as in the middle of the company’s “12 Days of Open AI” –
A two-week promotional period during which the company is revealing a new product or feature every weekday.
And with that, you have some people saying the timing of Veo 2’s release is an obvious effort by Google to upstage and maintain dominance over its competitor (1, 2, 3)
And notably, many saying it’s succeeding, and claiming Google’s software absolutely blows Sora out of the water.
That includes the likes of Marques Brownlee, for example, who we’ve seen sharing some Veo 2-generated clips and saying:
“...if these hand-picked examples are real, they look better than anything I've gotten out of SORA…” []
And as far as why?
Well, one of the biggest criticisms against Sora so far, something MKBDH highlighted in his review, is that the AI video generator can't capture movement in a way that looks truly natural to the eye (BROLL).
Google, however, is claiming that Veo 2 does it better.
With a press release, for example, saying:
“[Veo 2] brings an improved understanding of real-world physics and the nuances of human movement and expression, which helps improve its detail and realism overall.”
And adding: “While video models often ‘hallucinate’ unwanted details — extra fingers or unexpected objects, for example — Veo 2 produces these less frequently, making outputs more realistic.”
And with that, for example, you have people taking the type of video that’s often difficult for AI to replicate, like this Veo 2 clip of someone shuffling cards (BROLL)
With one commenter saying:
“The AI tells are getting harder to spot, but they're still there” []
And another adding:
“That is actually pretty impressive. It didn't lose consistency or anything. Looked like a real person shuffling cards."[]
But then, besides all that, there’s some other potential advantages to Veo 2.
One, it’s supposedly supposed to have a better understanding of “cinematic language.”
So for instance, you can reference a specific genre of film, cinematic effect or lens when prompting the model.[]
One person demonstrating this sharing the prompt they used to generate this clip of a car drifting through city streets (BROLL) []
And finally, in theory, Veo 2 can produce clips longer than two minutes, with resolutions reaching up to 4K.
That's four times the resolution and over six times the duration of Sora.[]
But also, in reality, right now, Veo 2 is currently exclusive to Google's experimental video tool VideoFX, where videos are limited to 720p and eight seconds long.
So, really, Sora sort of has the upper hand with 20-second videos at 1080p.[]
And then, besides that, you have people pointing out that Sora has been out for a week, but right now we’re still mostly seeing Google’s best examples .
Though, you have some of the people still noting:
“...today's Veo is more impressive than the past "perfect" examples from Sora.” []
But really, at the end of the day, whether it’s Google or OpenAI, one thing we knew this technology was only going to get better.
And whoever’s behind it, the concerning parts, the scary parts of this? They’re all still the same.
Right, whose content is being used to train these models, who are these models replacing, and what nefarious, fucked up shit might they end up being used for?
But with that, I’ll pass the question off to you.
What are your thoughts on the whole OpenAI vs. Google, Sora vs. Veo thing? And then, what do you think about AI-generated video in general?
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Let’s talk about TikTok, because we have almost exactly one month until it could be banned.
And yesterday, the company asked the Supreme Court to stop this.
Right, at the center of this is the Protecting Americans From Foreign Adversary-Controlled Applications Act, which would ban the platform unless it is sold to an American company.
It was passed by Congress and signed by Biden, and is slated to go into effect on January 19, which is the day before Trump moves back into the White House.
TikTok has thrown a ton of different challenges at the wall, and yesterday it barked up SCOTUS’s tree, with a filing saying:[]
“The Act will shutter one of America’s most popular speech platforms the day before a presidential inauguration. This, in turn, will silence the speech of Applicants and the many Americans who use the platform to communicate about politics, commerce, arts, and other matters of public concern.”
With it further claiming that small businesses and other people who make a living on the app will suffer monetary harms.
And so it is asking the court to block the law by January 6.
Further arguing that Trump and his incoming administration have expressed some support for the app.[]
And on that note, Trump did previously say he would save the app, he also met with the CEO of TikTok yesterday at Mar-a-lago.
And while speaking to reporters yesterday, he said that he partially credits TikTok for his victory in November:
“We’ll take a look at TikTok. You know, I have a warm spot in my heart for TikTok.” (1:04-1:08)
“TikTok had an impact, and so we’re taking a look at it.” (1:37-1:40)
Though, he declined to further say what he was looking at or planning to do on that front.
But all this comes as creators and users of the app are kind of hitting an “oh shit” realization that a ban might actually come to fruition in just a few weeks.
Because while the ban would not remove the app for those who have already downloaded it, it would force companies to take it off app stores and prevent it from being updated. []
And without updates, it would eventually become too buggy to work.
And while the looming threat of a TikTok ban has existed on and off for a few years, users are really starting to take it seriously.
So now, if you scroll on the app, you’ll see tons of people commenting on their favorite creators’ videos wondering how they can still find them if it gets banned in January.[][][]
With tons of creators trying to get people to find them on YouTube and Instagram, trying to sort of preemptively move their followings over.
But others fearing it just won’t be the same, that without the TikTok algorithm, everything they have built could be turned to dust.[]
And as for where any potential battles stand, well, a US court of appeals already rejected one of TikTok’s challenges. []
But you had the New York Times saying there is a chance SCOTUS will see it differently though we just don’t know for sure, explaining:
“The court has shown keen interest in recent terms in the application of free speech principles to giant technology platforms, though it has stopped short of issuing definitive rulings.”
So for now, the next month will likely see creators scrambling as the app hangs in limbo, and with that I’d love to ask you some questions.
Right, if TikTok is banned, will you be following people elsewhere? Are you just going to move the party over to say YouTube or Reels?
Or are you just kind of gonna shrug it off and decide that part of your social media habits is over, right, you’ll scroll as usual on other apps, but without TikTok recommending things to you, you’re not going to bend over backwards to find this stuff.
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When you get arrested by a cop, you can expect a few things.
Getting handcuffed, taken to the station and booked, for example.
But having your asshole visually inspected is not, or rather should not be, one of them.
Yet apparently if you head just north of New York City to the suburbs of Mount Vernon, that was guaranteed for years.
Right, because the Department of Justice wrapped up its investigation into the Mount Vernon Police and just released its findings.
And the top line is that the department performed strip searches and/or cavity searches on every single person it arrested until at least October 2022. [Quote, find “October” and Image]
A practice the DoJ called a “gross violation of the Fourth Amendment on an enormous scale.” [Same quote]
With officers also strip-searching people they did not arrest. [Quote, find “not arrest”]
Even when they had no reason to believe the person had drugs or other contraband. [Quote, find “no reason”]
In fact, several people said officers had searched them repeatedly even when they had been in custody and under police observation “at all times” between the searches. [Same quote]
With the report detailing one case it said was emblematic of the department’s shortcomings.
You had two women, ages 65 and 75, arrested during a traffic stop on suspicion of buying drugs. [Quote, find “75”]
But when the cops searched the car, they found nothing, so they took the women to the station for a fully nude strip search. [Quote same link, find “fully nude”]
Where, according to the report, the pair were told to “bend over and cough.” [Same quote]
But once again, no drugs were found, and a later internal probe found that the cops had lied about the women buying drugs. [Quote same link, find “had lied”]
And their punishment? A few less vacation days. [Same quote]
So shit like that reportedly kept happening until at least 2023. [Quote, find “least 2023”]
And although the department curtailed the practice while the DoJ investigated, the investigators still conclude: [Same quote]
“we are not confident that these practices have ended.” [Same quote]
But that’s just the strip-searching; there are also more garden variety civil rights violations.
Things like arresting people without probable cause, unnecessarily escalating minor encounters, overusing tasers and closed-fist strikes. [Quote, find “fist”]
With that last one happening to people who had already been taken to the ground, were controlled by many officers, or were already restrained. [Same quote]
And then of course, cops were significantly more likely to arrest someone in predominantly Black neighborhoods than in whiter areas for the same types of complaints and traffic stops. [Quote, find “whiter”]
Now in response to this, the city so far seems relatively receptive to working with the DoJ on reforms.
With Mount Vernon’s mayor saying in a statement:
“We have never run from this issue. We wholeheartedly support our good officers and at the same time will not tolerate and will punish unconstitutional policing.” [Quote]
And to their credit, the police have taken some steps since the probe first opened.
For example, working to equip all officers with body cameras and less-lethal weapons. [Quote, find “cameras”]
As well as revising their policy on strip searches and offering training on the practice. [Same quote]
But some say it’s also doubtful whether a few immediate policy changes can fix the deeper rot at the department.
Right, because the report notes that it suffers from financial mismanagement, which makes all the other issues worse. [Quote, find “financial”]
So for example, if you can’t pay good salaries, you can’t attract and retain quality officers. [Same quote]
And it’s much harder to train staff and pay bills. [Same quote]
But this is just one of about a dozen investigations into police agencies across the country; we covered the Memphis one a couple weeks ago.
So we can expect to see more of the same for others in the coming months, unless the Trump administration pulls the plug on those probes, of course.
Links:
https://www.cnn.com/2024/12/15/us/mount-vernon-new-york-strip-search-civil-rights/index.html
https://www.nytimes.com/2024/12/12/nyregion/mount-vernon-police-strip-searches.html#site-content
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Trump wants to privatize the US Postal Service — and the impacts could be catastrophic.
Right, since Trump won the election, there has been speculation swirling about whether he might try to take the USPS private.
And yesterday, he publicly confirmed that this is on the table:
“Well, there is talk about the Postal Service being taken private, you do know that. Not the worst idea I’ve ever heard. Really isn’t. You know, it’s a lot different today with — between Amazon and UPS and FedEx and all the things that you didn’t have. But there is talk about that, it’s an idea that a lot of people have liked for a long time. We’re looking at it.” 00:01 - 00:23
Now, notably here, this isn’t really surprising at all — Trump's disdain for the USPS is no secret.
He has repeatedly slammed the agency, calling it “a joke” that “loses massive amounts of money.”
He has previously tried to get the mail carrier to hand over key functions to the Treasury, threatened to withhold COVID aid —[]
And installed a controversial Postmaster general who made massive cuts criticized by both Republicans and Democrats for hurting service.[]
Then, of course, there was the whole mail-in ballot Big Lie debacle of 2020.
Hell, this wouldn’t even be the first time he’s tried to take it private — the White House proposed a plan to do just that back in 2018.
Now, as far as any specifics for how Trump would overhaul the USPS this time around, that remains unclear.
But sources did tell The Washington Post that Trump said the government shouldn’t subsidize the agency anymore.
With that in reference to the fact that the service lost $9.5 billion in the last fiscal year.
But ending subsidization of the USPS isn’t the same thing as privatizing the carrier outright.
Right, while the service does receive federal dollars, it is mostly self-funded, relying primarily on its own commercial activities like selling postage, products, or services.
Which also helps explain why it lost so much money last year — that’s a massive operation to sustain.
But gutting the more limited federal money it does receive would just further undermine the agency’s ability to do its job.
And experts say that privatizing the agency wouldn’t fill those gaps, and instead create a whole host of other problems.
And that’s because, unlike private competitors such as Amazon or FedEx, the overarching goal of the USPS isn’t profit — it’s access.
Right, the agency is governed first and foremost under what’s known as the “universal service obligation.”
Which requires to provide equal service everywhere in the country, regardless of how remote the location may be or concerns about profitability.
But experts say that privatizing the Postal Service would inevitably put an emphasis on profit that could result in cutting access to rural areas that aren’t as profitable.
And that’s just one downfall — they also say taking the USPS private could result in longer delivery times, fewer days of delivery, and increased prices for consumers.
And that wouldn’t just be for people who use USPS.
Right, here’s a really interesting fact: the Postal Services’ single-biggest customer is actually Amazon, which uses the carrier for “last-mile” deliveries made between Amazon fulfillment centers and consumers’ homes or businesses.
So it's not like everyone who lives in a rural area could just switch to Amazon or FedEx if USPS goes private and is forced to prioritize profit over access.
Those companies ALREADY don’t serve a ton of public areas because — say it with me — it’s not profitable, and profit is king.
Right, so making the USPS private would totally upend the trillion-dollar e-commerce industry, disproportionately impacting small businesses and rural consumers who rely on the service.
And, in addition to totally fucking up consumer shipping and business supply chains across the country, experts also say that that privatizing the nation’s mail carrier would cost hundreds of thousands of federal jobs.
But all those reasons are also why any effort on this front could be doomed to fail.
Right, any attempt to privatize the USPS or even just ending its universal service obligation would likely require an act of Congress.
But such a move would likely cause backlash for Republicans who represent rural districts that the agency largely serves, so it’s unclear if Trump could get enough support to actually do this.
Especially because his previous attempt in 2018 broadly failed to gain traction.
Now, that said, there are still other ways he could gut the agency without taking it private or needing the consent of Congress.
He could cut off the agency’s access to loans from the Treasury Department — which is something his administration attempted during first term.
Beyond that, people who will work on the “Department of Government Efficiency” panel led by Elon Musk and Vivek Ramaswamy have also reportedly been having conversations about “major changes to the Postal Service.”
With Musk also voicing support for privatization on X.
But, again, any proposed cuts the DOGE commission recommends will likely have to be approved by Congress.
So for now, we’ll just have to wait and see.
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In international news, the name of the game right now is political chaos.
Right, just this month, if we haven’t been talking about war, we’ve been talking about marital law in South Korea, mass protests in Georgia, and the collapse of the French government.
And today, we’re turning our attention to crises of confidence in Canada and Germany – two countries that have previously been seen as sort of pillars of stability in the West.
So let’s start with Canada.
Right, there, the government of Prime Minster Justin Trudeau is on the brink.
And notably, US president-elect Donald Trump is partly to blame.
And this all has to do with the abrupt resignation of finance minister Chrystia Freeland.
Right, she has long been one of Trudeau's closest allies.
In fact, she’s the person many expected would succeed him as leader of the Liberal Party.
But now, hours before being scheduled to deliver a fiscal and economic update to Parliament, she stepped down with a public resignation letter blasting Trudeau’s approach to handling another Trump presidency.
In the letter, saying her decision came after Trudeau said he no longer wanted her to serve as finance minister and offered her another position in his cabinet.
And with that, saying the two of them found themselves “at odds about the best path forward for Canada”
And specifically citing disagreement about how to respond to economic threats from Trump, writing:
“Our Country faces a grave challenge. The incoming administration of the United States is pursuing a policy of aggressive economic nationalism, including a threat of 25 percent tariffs. We need to take that threat extremely seriously.”
And notably, there, Trump himself responded to Freeland’s resignation, writing on social media:
“Her behavior was totally toxic, and not at all conducive to making deals which are good for the very unhappy citizens of Canada. She will not be missed!!!” []
With Trump also insulting Trudeau as “governor” – a quip he also made last week when joking about Canada being the 51st state.
And with that, the hits have just kept coming for Trudeau.
Right, today, just a day after Freeland’s resignation, his party lost a special election in the western province of British Columbia.
Notably, it was a seat they had won with 39 percent of the vote in 2021.[]
With the party now only getting 16 percent compared to the Conservative Party’s 66 percent. []
And with all that, the pressure for Trudeau to resign is now at an all-time high.
Right, he’s been in power for nine years, and his approval rating has plummeted from 63% when he was first elected to 28% in June of this year. []
Not to mention at least seven members of his own party have publicly called on him to step down, with more reportedly having done so in private []
But resign or not, his days may be numbered.
Right, Canada’s next federal election must legally be held by next October.
It could happen earlier if Trudeau calls it, or if lawmakers trigger a no-confidence vote. []
And whenever it happens, it’s believed by many that it won’t have been enough time for Trudeau to recover.
But with that, it’s time to talk about Germany.
Right, because there, Trudeau may be getting something like a sneak peak of his own future.
With Chancellor Olaf Scholz losing a vote of confidence in Parliament that means Germany will hold new federal elections in early 2025, likely in late February.
Which is about seven months earlier than originally planned.[]
And with that, a key thing, Scholz called the vote himself.
Right, that’s because his governing coalition collapsed last month when the Free Democrats party withdrew, leaving Scholz’s Social Democratic Party in a minority government with the Green Party.
And since then, the political pressure on him to call the vote became overwhelming.
Right, if he had waited longer, his party would probably be expecting to do even worse in the upcoming election.[]
But in the meantime, while there’s obviously concern in Germany about the instability and uncertainty, the impact of this is much bigger.
Especially because it’s happening just weeks after the French government fell apart.
With a new prime minister being named only days ago and the situation still fragile.
Right, Germany and France are the most influential countries in the EU, and these domestic political crises are just exacerbating a crisis of leadership at the European level – at a bad time to say the least.
I mean, one, there’s all sorts of economic challenges the continent is facing.
And two, the war in Ukraine has really reached a pivotal moment, especially with Trump set to take office in the United States.
And now Germany, which is Europe’s largest economy, will be in the hands of a caretaker government that can’t really make major policy decisions.[]
And so we’ll have to wait and see what this means over the next couple months, and then beyond that, what the long-term consequences might be.
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Some of America’s top schools ran an illegal monopoly that cost 200,000 students over $685 million extra to get their education.[]
At least that’s what lawyers claimed yesterday as part of an ongoing case that stretches back to 2022.
At the center of the suit are accusations that schools like Georgetown, Notre Dame, University of Pennsylvania, MIT, and others “price fixed” admission costs by placing too much emphasis on a student’s ability to pay, leading to artificially higher prices for those more reliant on financial aid.
What’s really crazy is that some of this price-fixing is at least superficially legal.
The schools had formed a group called the 568 Presidents Group, named after a 1994 exemption to antitrust laws that let schools collaborate on financial aid as long as they used “need-blind” admissions.[][]
That’s just an awkward way to say that schools were required to consider applicants regardless of their income or financial status.
But the schools apparently did the opposite in many cases and sometimes gave preferential treatment to those from rich families.
For example, the suit alleges that Georgetown University’s then-president would allegedly make a list of about 80 applicants with the words “PLEASE ADMIT” written at the top every year.[]
This list had information about their parent’s income and past donations.
However, it would often lack their transcript or anything else you’d normally associate with applying to a college.
Similar things also reportedly happened at MIT, and Notre Dame… pointing to a pattern of considering income when admitting students in direct violation of the law.[]
The fact that the schools considered income is a major deal for this lawsuit because IF they did then they automatically don’t qualify for the antitrust exemption on financial aid pricing and would be super screwed.
So, again, the ability to pay more for school upfront was a major factor in who was admitted to a school, raised the prices, and caused those on financial aid to pay more out of pocket themselves.[]
In the end, this made the schools cost that $685 million extra for low- and middle-income students who claim they should have been given more aid.
And it’s not shocking that a big motivation for considering how much a student’s family had was the hope that would lead to more endowments.[]
This case seems to have some legs too as the plaintiffs have had some success so far with this suit.
Initially 16 schools were part of the lawsuit before a 17th was added.
But ten of the schools have since settled to the tune of $284 million so far. (although the schools use the standard settlement language of admitting to no wrong doing).
That money will be added to a pool that will eventually be paid out to the 200,000 students affected across every school… not just those from the ten that have settled.
Cornell, Caltech, Georgetown, John Hopkins, MIT, Notre Dame, and Penn are still fighting the suit.
And that could be really risky, since this is an antitrust case and thus any damages are tripled, putting the possible judgement at over $2 billion.[]
(after attorney’s fees, etc. that would probably come out to one-thousand-something per person affected).
For their part the schools still deny they did anything wrong during that time period.
They claim that they largely had generous financial aid policies that have only expanded over the years.
And in some cases, those aid packages can be substantial, such as Caltech which covers tuition, fees, housing, and food for students from families that make less than $100,000 and tuition for families with less than $200,000.[]
But there’s even push back to this.
Yes, these schools do often have amazing financial aid packages… NOW.
But during this time period the lawsuit covers that wasn’t the case and often they could have offered 10 to 20% more but didn’t with a co-lead attorney saying yesterday:
“Our motion today spells out very substantial evidence supporting our claim that the Defendants colluded with each other for twenty years on financial aid, and the illegal collusion resulted in the Defendants providing far less aid to students than would have been provided in a free market.”
And to be clear, not every Ivy League school was okay with this scheme, as officials at schools like Harvard claimed it didn’t join the consortium over fears the school would be pressured to cut aid.
But either way, this practice is largely dead… kinda.
The 568 Presidents Group was disbanded in 2022 after the antitrust exemptions expired.
Instead, there’s ANOTHER lawsuit that deals with a similar-ish situation from October of this year.
That one has the College Board allegedly trying to pressure schools to also illegally price fix based on financial aid.
But that’s an entirely different can of worms and the net result is still the same:
American schools continue to be super expensive and there’s no end in sight.
