CROWDS OF SPECTATORS JAMMED THE PUBLIC GALLERIES OVERLOOKING the U.S. Senate, eager for the day’s fireworks to begin. Normally the public paid no attention to debates over bills with names as dull as this one, and Vice President Lyndon Johnson would have preferred to slip the Communications Satellite Act of 1962 through Congress quietly. The proposed law restricted ownership of communications satellites to a new company that would be controlled by AT&T and was designed, its supporters said, to ensure that the new technology got off to a fast start. But below the dais where he sat, the vice president could see the group of dissident senators dedicated to making sure that didn’t happen. Senator Ralph Yarborough of Texas, one of the group’s leaders, began to hammer on Lyndon Johnson and the bill’s other supporters, describing what he and his allies saw as a more nefarious motive for the proposed law: eliminating the mortal threat that satellites posed to America’s communications cartels.
“It is rather depressing,” said Senator Yarborough, “that, on the threshold of one of the greatest scientific discoveries in the history of the human race, we have a greedy little band that reaches out to Congress and says: ‘Give it all to us. Let us have it.’”
Before leaving the Senate to become JFK’s vice president, Lyndon Johnson had spent his happiest days as a politician in this room. As the Senate majority leader, he excelled at intimidation, becoming famous for his ability to bend other senators to his will. In his eighteen months as vice president, LBJ often grumbled to friends, his life in politcs had turned into a chore. Today offered a welcome change of pace. The United States Constitution gives a sitting vice president a single way to directly control the levers of power. In the V.P.’s secondary role as the president of the Senate, Johnson had the right to preside over the Senate’s debates and, in the rare event of a tie, to cast a deciding vote. Today, for as long as Johnson sat atop the dais in the well of the Senate, the lawmakers addressed him as “Mr. President.” LBJ, who had challenged JFK for the presidential nomination at the 1960 Democratic convention before agreeing to take the second spot on the ticket, preferred that salutation.
From the floor of the Senate, the drawl of Senator Yarborough continued, as he took his time describing the venality and hypocrisy he saw in the bill’s supporters. Having given up hope of shaming the bill’s supporters into switching sides, he and his allies now hoped to talk the bill to death.
According to century-old tradition, senators only filibustered a bill in exceptional circumstances. In recent years, a group of southern senators who bitterly opposed civil rights laws backed by President Kennedy had been the only ones to use the tactic. Defeating a filibuster was possible, Johnson knew, but it was a parliamentary maneuver so rare that he had never seen it succeed during his dozen years in the Senate.
That was the challenge that Lyndon Johnson had returned to the Senate chamber to take on: squash the filibuster and pass the bill. “Issues affecting the Senate’s procedures and bound up with its hallowed rules always bring tension and high drama to the old chamber in the north wing of the Capitol,” wrote one reporter watching the action. “And nothing so captures Washington’s imagination as a filibuster.”
Senator Yarborough’s speech made it easy to see why. Before finally yielding the floor to a fellow filibusterer, he aimed an unusually pointed barb directly at the vice president (addressing him, according to tradition, in his current role as president of the Senate): “Mr. President, is this the council hall of the States, or has the Senate become the council hall of the corporations?”
SINCE THE DAWN of the satellite age, RCA’s David Sarnoff had been the leading public enthusiast for the technology, often rhapsodizing about a communications industry remade by the new technology. Testifying before Congress, Sarnoff described how satellites could soon relay programs produced by NBC and its fellow networks directly to local TV and radio stations, Sarnoff pointed out, slashing the $50 million they now paid AT&T every year to use its wires for the same purpose. Soon after that, he predicted, satellites would become powerful enough to broadcast a vastly expanded selection of channels directly to people’s homes, skipping the bottleneck now created by the shortage of terrestrial TV channels. He also predicted that satellites would eliminate the need for AT&T’s monopoly on long-distance telephone calls. In the presatellite era, building multiple long-distance phone networks had been too expensive to seriously contemplate. That was no longer true, Sarnoff had testified to Congress in the hearings over this bill: “The satellite system is the most revolutionary communications development in my more than 50 years in the business.”
Naturally, America’s twin communications cartels—AT&T in telephone service, local stations in the TV industry—viewed satellites’ potential very differently. For Bud Rogers and his fellow local station owners, satellites threatened to bypass the distribution bottleneck that was the source of their power and profits. The leaders of the Bell System disliked the idea of losing the $50 million in annual radio and television distribution fees, but what really terrified them was the idea of competitors invading their $3.5 billion-a-year long-distance business by bouncing phone calls off satellites.
In 1962 AT&T had grown into a corporate giant with a financial might unparalleled in history. The phone monopoly owned every last piece of its communications network, from the 64 million phones its customers used every day to the 318 million miles of wire that connected them together. AT&T’s network, which the company’s accountants valued at $24 billion, was the world’s most valuable corporate asset. The phone giant was the world’s largest private employer, with 781,000 workers. (General Motors with 553,000 employees, ranked second. RCA, with 90,000, remained a relative pipsqueak.) The phone company’s business was even recession-proof, having expanded for the previous thirty-nine straight years.
Since World War II, the Bell cartel had drifted away from Theodore Vail’s original philosophy, which tied the right to sizable profits for AT&T’s shareholders to steady improvements in the cost and quality of its phone service for customers. Since the end of the war, the phone monopoly had abandoned the old Vail tradition of cutting the price per call (and making up the difference by carrying more calls) and replaced by a more shortsighted view. Since 1945, the number of a local phone calls was up 150 percent (from 91 million a day to 231 million), while the total tab Americans paid for local service rose over 350 percent (from $1.1 billion to $5.1 billion). That meant the average cost of local phone service jumped from three cents a minute in 1945 to six cents a minute in 1962, despite the enormous cost reductions made possible by microwaves and other technological advances. Inflation accounted for one penny of that increase. The other two pennies went into the pockets of AT&T’s executives, its well-paid workforce, and its legions of shareholders.
AT&T built its network with money tapped from millions of investors large and small. Since World War II, the company had raised $9.2 billion by selling new shares of stock, almost a quarter of all new stock issued in the United States during the period. Shares of AT&T were America’s favorite investment. The company’s two-millionth shareholder, an all-American family from Wichita, Kansas, had recently traveled to New York so AT&T chairman Frederick Kappel could present them with their stock certificates. (The Poulsons had smiled broadly and declared their intent to use the investment to send their two children, Kay and Steve, to college.) AT&T lobbyists rarely failed to mention how many of a congressman’s constituents were also AT&T shareholders.
The satellite brawl in Washington began when the Kennedy administration proposed flexible rules for the new industry, along with explicit provisions designed to prevent AT&T from extending its monopoly into orbit. AT&T and its broadcaster allies responded by backing a competing bill written by Oklahoma senator Robert Kerr, who also professed a desire to make sure the new industry got off to the best possible start.
According to Senator Kerr, President Kennedy’s plan to allow unfettered competition in space posed the real danger to the new industry. If AT&T, RCA, Westinghouse, and other big companies all launched satellites, the senator argued, soon competition would be so fierce that none of them would make money and the industry would wither. To help these corporations avoid investing their money so foolishly, Congress needed to create a single company that would be responsible for running a single satellite communications network, Senator Kerr said. Under his plan, AT&T would be the new corporation’s dominant shareholder, but the FCC would monitor it closely to make sure the phone company lived up to its promise to let competitors use the satellites on a fair and equal basis.
The phone giant’s executives, led by Vice President James Dingman, had been roaming Capitol Hill for months, extolling the virtues of Senator Kerr’s approach. Dingman told every legislator he could that launching satellites would be incredibly expensive, and so there was no need for a bunch of different companies that duplicated one another’s efforts—reprising the original justification for creating AT&T at the turn of the century. Ma Bell was simply interested in helping the promising technology develop to its full potential, Dingman promised. “This position may be construed by some as stemming from the selfish interests of my company, which is the largest of the carriers involved,” he testified. “Let me assure you it is not. Let one thing be crystal clear: AT&T has no desire or intention of seeking to control the communications satellite system to its own competitive advantage.”
At first, the Kennedy administration fought back against Kerr’s bill. Lee Loevinger, who ran the antitrust arm of Robert Kennedy’s Justice Department, scoffed at the problem the bill purported to fix and suggested Ma Bell’s interest in adopting the infant industry was less maternal than filicidal. AT&T’s power came from its land-based network of metal wires, Loevinger told the Senate’s monopoly subcommittee. Putting it in charge of space-based satellites that one day might render the land-based network obsolete, he testified, made as much sense as responding to the invention of the automobile with a decree that all motor transportation must be owned by the railroads.
David Sarnoff, who also testified before Senator Kefauver’s subcommittee, pointed out that government policy had done a fine job of introducing competition into the business of moving telegrams and other digital messages—most everything except phone calls, which remained the exclusive province of the phone company. The General argued that if Congress were to establish a regulated satellite monopoly, it had to make sure that the company brought competition to the movement of all kinds of information—including phone calls.
Such concerns hadn’t seemed to matter. Once again, the Washington machinery that had proven so effective at crushing new communications technologies revved up. As the competing bills made their way through the legislative process, AT&T’s lobbying power slowly pushed aside congressional worries about its intentions. Eventually, President Kennedy agreed to support the bill that the senators were now debating.
As Johnson listened impassively, many of the filibustering lawmakers used their time to accuse Kennedy of having caved to the phone company’s pressure without even having the decency to admit that he had abandoned the fight. Louisiana senator Russell Long hit this point with his usual dry wit: “There were two bills introduced to Congress, the Kennedy Bill and the Kerr Bill, both authored by distinguished friends of mine,” Long drawled. “And I must say, as I look at the progeny, it looks a little more like my friend Senator Kerr than it does look like President Kennedy.”
As for his colleagues’ assurances that the Federal Communications Commission would oversee AT&T’s new satellite monopoly to make sure it didn’t abuse its power, Long quipped: “If the FCC cannot control AT&T on land, how in the world can it do it in outer space?”
To Lyndon Johnson, the objections of the filibustering senators sounded both sanctimonious and naive. To his way of thinking, turning the public airwaves into private wealth offered an excellent way for clever politicians to get rich. During his twenty years in Washington, Lyndon Johnson had settled on a single rule: be discreet about the graft.
IN 1942, A few years after arriving in Washington as a freshman congressman, Johnson learned his first lesson in how not to run the airwave con from a Georgia congressman named Eugene “Goober” Cox. Immediately after lobbying the FCC to grant an AM radio license to Albany Herald Broadcasting, Congressman Cox had cashed a $2,500 check from the broadcaster in payment for unspecified “legal services.” The same company then sold Representative Cox $2,500 in stock at prices that seemed suspiciously low. When FCC staffers discovered the transactions, FCC Chairman Lawrence Fly made the obvious—and in retrospect terribly naïve—decision to forward the evidence to House Speaker Sam Rayburn for a possible investigation into influence peddling.
Eager to squash the scandal, Rayburn called in the Georgia congressman and offered to sweep the accusations under the rug. That wasn’t good enough for Goober Cox. His honor had been insulted, and he demanded the insolent regulators be made to pay. The FCC was “the nastiest nest of rats in the country,” he fumed, and had “established terroristic control of all media of communications.” Capitalizing on a widespread sense in Congress that the eight-year-old agency was a failed experiment, Cox requested a congressional investigation into the commission, and soon after the House of Representatives voted to appropriate $60,000 to create a special subcommittee to do just that, installing none other than Goober Cox to lead the investigation.
Chairman Cox dispatched private investigators to dig up dirt on members of the FCC, especially it’s chairman, Lawrence Fly, who had a reputation as a playboy that dated back to his days running the Tennessee Valley Authority. After one of the investigators turned up evidence of an extramarital affair from Fly’s TVA days, Representative Cox used it to pressure the FCC Chairman into backing off his original charges against the congressman.
The story might have ended there, if not for the bit part that Lyndon Johnson played in the scandal. Clifford Durr, one of Chairman Fly’s allies on the FCC, happened to be a neighbor of Johnson’s. Then-congressman Johnson suggested Durr leak the story to the Washington Post. A few days later, the paper ran a front-page story laying out the details of Congressman Cox’s behavior (minus his investigation of Chairman Fly’s affair). The Post also ran a front-page editorial that excoriated Cox’s investigation of the FCC as “a mockery of justice [that] gives narrow personal prejudices and interests precedence over the public welfare.”
Lyndon Johnson had his own reasons for wanting to help defend the FCC from the Cox investigation. While Cox and Fly were busy squabbling in Washington, Johnson was looking into buying a Texas radio station, focusing his attention on a struggling one in Austin, KTBC. The AM radio industry of the early 1940s was very profitable as a whole, generating pretax profits of $45 million on $190 million in revenue, but a few radio stations continued to lose money year after year. KTBC was one of them. The cause of the station’s financial woes was obvious. The FCC had sandwiched the small station between two higher-power San Antonio stations near the top of the AM dial. Even worse, the commission only allowed KTBC to broadcast during daylight hours. At night, KTBC had to cede the frequency to a radio station run by Texas A&M University.
In the lingo of the industry, KTBC was a “sundowner,” and experienced broadcasters dreaded owning a sundowner. Being confined to daytime-only hours amounted to a virtual death sentence. The most popular radio programs were broadcast at night. AM radio waves didn’t travel as far during the day, when sunshine limits the waves’ ability to bounce off the ionosphere. To top it off, sundowners rarely managed to land affiliations with CBS, NBC, and ABC, which preferred to sign up twenty-four-hour stations.
KTBC’s financial records testified to its troubles. In 1942, when LBJ began eyeing the station, it was on track to lose $6,000, bringing its accumulated debt to nearly $25,000. The increasingly desperate owners had been begging the FCC to save the station by moving it to the uncrowded end of the radio dial and letting it broadcast at night. Despite the owners’ extensive engineering reports on the wisdom of the idea—and the obvious benefits to the Austin-area listening public in having an additional nighttime radio station on their dials—the FCC repeatedly refused.
That changed as soon as Lyndon Johnson showed up. Using $25,000 of his wife’s money, which she had recently inherited, Johnson negotiated a deal for her to buy KTBC. The price was a key part of the plan. Paying $25,000 for a money-losing sundowner was certainly fair, perhaps even generous. What’s more, the purchase also appeared to be a real risk for the Johnsons, who sank nearly a third of their wealth into a money-losing business. Lady Bird Johnson filed an application with the FCC to purchase KTBC on January 23, 1943—four days after Congressman Cox announced that the House of Representatives would be investigating the FCC. The commission approved the transfer request to the wife of their secret Congressional ally in less than three weeks.
Four months after that, as Chairman Fly fought to defend the FCC from Goober Cox’s investigation, Johnson began the next phase of his plan. Lady Bird petitioned the FCC to let her station move to the less-crowded end of the dial. She also asked for the license to be modified to turn the “sundowner” into a full-time station. After years of saying no to identical pleas from the previous owners, the agency took less than a month to reverse its stance on both counts. Overnight, the Austin-station broadcasts could be heard in at least thirty-eight counties in the heart of Texas. When Johnson bought the station it had been selling $2,600 in ads a month. By the end of 1943, as a full-time station, that number jumped to $5,645.
To Johnson, this was not nearly enough. The lanky congressman started taking trips to New York to see Bill Paley and Frank Stanton, the men who ran CBS. Often he simply showed up in their offices unannounced. The congressman told the CBS brass that he badly wanted to affiliate with CBS’s top-rated network. (The CBS affiliation, he wrote in a private letter, “is life and death to us.”) Normally, such a request would have been reviewed by CBS’s affiliate relations department and summarily denied. The network already had an affiliate in San Antonio whose programs played in Austin. After LBJ dropped by Bill Paley’s office at CBS, however, CBS decided the conflict with its existing affiliate wasn’t a problem, after all.
His CBS deal in hand, Johnson headed to the office of ABC’s chief executive, Leonard Goldenson. Ostensibly, Johnson’s visit was intended to get Goldenson to look over KTBC’s programming and offer any suggestions on how to improve it. No fool, Goldenson took the opportunity to offer Johnson a favor, calling up J. Walter Thompson and a few other major New York ad agencies to suggest they buy ads on the young congressman’s radio station. By 1944, ad sales at KTBC had more than doubled again, to $13,500 a month.
Johnson was similarly shameless in persuading Texas businesses to become advertisers. The list included grocery stores and other local companies, which had a legitimate interest in reaching his listeners, as well as many companies whose main business was selling to the U.S. government, not the citizens of Austin, Texas. To anyone familiar with this side of LBJ’s business dealings, most of which remained private, the implication was obvious. Lyndon Johnson wasn’t really selling ads. He was selling influence.
Though Lawrence Fly’s chairmanship was set to run through 1949, after his battle with Chairman Cox he decided to retire almost five years early. That proved no problem for Lyndon Johnson, who quickly struck up a friendship with Fly’s replacement, former CBS lawyer Paul Porter. In 1945, Lady Bird Johnson asked the FCC for permission to quintuple the power of KTBC’s broadcast signal, expanding the station’s reach to another twenty-five counties. Porter’s commission quickly agreed that such a move would be in the public interest. By 1946, KTBC’s ad sales had nearly doubled yet again, to $22,000 a month.
Through it all, Lyndon Johnson stuck to a simple story: he had no involvement with the station, which was owned by his wife. He credited the station’s success to Lady Bird’s hard work and business acumen. He also made a particular point of noting that by law, her assets from her inheritance remained solely her property, not his: “I don’t have any interest in government-regulated industries of any kind and I never have. All of that is owned by Mrs. Johnson.”
While this was technically true, all the profits that flowed out of the station landed in the Johnsons’ joint bank account. By the 1950s, that flow had become a flood. Lady Bird drew a $21,500 annual salary, more than her husband’s congressional paycheck. Far more importantly, she could siphon cash from the station’s rapidly growing bank account whenever she felt like it, or whenever her husband asked.
Over the years, as Congressman Johnson became Senator Johnson and his net worth swelled, he watched new generations of lawmakers forget the lesson of Goober Cox, failing to take the same precautions as Johnson had to disguise their graft. In 1958, a law professor named Bernard Schwartz exposed Representative Oren Harris’s sweetheart deal to buy 25 percent of an Arkansas VHF station for just $5,000. An artless con man, Harris had been far too blatant in his version of the scam. The station already had $100,000 in hard assets, so even ignoring the value of the FCC license, which was worth many times that amount, paying $5,000 for a 25 percent stake was the height of grabby incompetence. His business partner’s paper-thin cover story—I sold it to the congressman cheap because we were childhood pals—sealed Harris’s fate. While the congressman escaped any formal punishment, the publicity forced him to abandon his investment. A few years later, the remaining owners of the station flipped it for $1.1 million, of which Harris got nothing. Had he been smart enough to put up a reasonable amount of cash to purchase his stake, he would have walked away a rich man.
Other lawmakers had done a better job of running the scam. No one made a fuss over the holdings of lawmakers like Senator Clinton Anderson, a Democrat from New Mexico, who had acquired, under somewhat mysterious circumstances, a 5.5 percent stake in his hometown TV station worth roughly $152,000, the equivalent of six years of senatorial paychecks. While no one kept a definitive list of how many lawmakers had gotten in on the game, when Johnson was majority leader that group included both himself and the Republican minority leader, William Knowland, co-owner of an Oakland radio station. In both the House and Senate, the committee charged with overseeing the FCC was run by a member of the station-owning clique—or had been until the bumbling Representative Harris had been forced to sell. In the Senate, the job of running the Commerce Committee remained in the hands of Warren Magnuson, part owner of Seattle radio station KIRO.
When the FCC ended its four-year study of how to promote competition in television in 1952, the opportunities for lawmakers to get rich off the airwaves instantly multiplied. While the FCC focused its public efforts on licensing a huge number of UHF stations that almost no one would ever watch, it also decided to squeeze in a few more VHF stations in a handful of cities. Several lawmakers tried to profit from that opportunity in the established way, quietly arranging for small ownership stakes in exchange for their influence with the FCC.
When the FCC found room to squeeze in a single additional VHF station in Seattle—by that point a guaranteed ticket to tens of millions in profit—it happened to go to the radio station partially owned by Senator Magnuson. When his opponent in the next Senate race cried foul, accusing him of a conflict of interest—chairing the committee that oversaw the FCC while simultaneously profiting from the agency’s gift of a VHF television license—Magnuson declared it wholly unfair to accuse him of a crime without concrete proof. “The wickedest nonsense would be his assertion that the Eisenhower-appointed FCC is subject to influence,” said Magnuson’s indignant campaign spokesman. The issue never captured voters’ interest and the senator cruised to reelection, demonstrating once again the advantages of using an invisible resource that voters couldn’t see and didn’t understand as a currency for a political payoff.
Despite his many imitators, no lawmaker had ever come close to matching the scale of Lyndon Johnson’s broadcasting ambitions. Austin was an obvious candidate for a new VHF station in 1952, since its residents had waited out the FCC’s four-year license freeze without any local stations at all. Everywhere else in the country, competition for any of the handful of new VHF licenses was fierce. Well-financed applicants hired consultants, lobbyists, engineers to put together elaborate applications in anticipation of having to duke it out with other applicants in front of the FCC. In Austin, however, after Lady Bird Johnson applied, no one else bothered. Why enter a fight that everyone knew LBJ was going to win?
Every decision the FCC made regarding the Johnsons’ new TV station seemed to break in the senator’s favor, just as it had for him in the radio business. In smaller Texas cities like Corpus Christi (with 75 percent of Austin’s population) and Amarillo (with 60 percent), the FCC found room for three TV stations. After granting Johnson Austin’s first TV station, however, the commission had decided that city didn’t need any more. As a result, Johnson managed to do his Austin radio station one better, using his monopoly to win affiliations with all three networks, allowing him to broadcast whichever network’s show would attract the highest ratings.
Johnson even found a way to make money from UHF television, which, by the late 1950s, had been exposed as the disaster Edwin Armstrong and others had warned the FCC it would be. Acting through his wife, Johnson worked out a deal to buy a UHF TV station in Waco, Texas, for $25,000 in cash plus another $109,000 in assumed debt. The sale price, far from looking like a sweetheart deal, actually appeared a bit generous. The station was on channel 34, a UHF station at a time when less than 10 percent of the sets had dials that allowed them to tune in UHF stations. Adding to its problems, channel 34 was an affiliate of the still-struggling ABC network, while a competing VHF station in Waco was set to become an affiliate of the top-rated network, CBS. (NBC already had an affiliate in nearby Temple, Texas, and planned to honor that deal.) After Johnson’s purchase, however, CBS abandoned its affiliation plans with the Waco VHF station, KWTX, and instead signed Johnson’s UHF station. All of a sudden the city’s clearly inferior TV channel was its sole CBS affiliate.
It was the closest that Lyndon Johnson ever got to overreaching. The owners of KWTX, apoplectic at getting spurned by the networks, filed a fifty-page brief with the FCC accusing Johnson’s company, ABC, and CBS of a conspiracy that violated every major antitrust law on the books. CBS’s decision could not have been “motivated by ordinary business judgment,” the filing pointed out. And the result—a two-station town in which only one station could air network programming—represented an obvious conflict with the FCC’s stated desire to give viewers “the widest choice” in TV programs.
Adding to the anger of KWTX’s owners, the FCC had chosen that very moment to allow Johnson’s Austin TV station to crank up its transmitter’s power, just as they had done so often with his AM radio station in the past. Waco sits one hundred miles north of Austin and with the new power, KTBC’s programs could reach a large section of the southern Waco TV market.
Johnson moved quickly to protect his growing media empire and quash the feud. Eighteen days after the outraged KWTX station owners filed their challenge with the FCC, they withdrew it. Shortly thereafter, the two sides revealed the terms of their truce. In exchange for 29.05 percent of Waco’s VHF station, Johnson agreed to transfer the affiliations of his UHF station, which he would then close down. Both Johnson and the station’s original owners did well in the deal: the original owners kept 71 percent of a VHF station that suddenly had the Waco market all to itself, plus the benefit of Johnson’s sway over the FCC the next time a regulatory decision threatened their profits. Waco’s television viewers and advertisers were the obvious losers, a fact that the FCC was content to ignore.
Within two years the FCC granted LBJ’s Austin TV station another major power increase, again increasing its viewership and value. The senator also negotiated the purchase of a third TV station, in Weslaco, Texas. Soon after, the commission agreed to let that station raise its transmitting power as well. In Bryan, Texas, after the Johnsons bought an educational TV station, the FCC did the senator and his wife an even more unusual favor, deciding that the public interest would best be served by allowing the Johnsons to convert it to a commercial station.
AS LYNDON JOHNSON listened to yet another filibustering senator mock the satellite bill, he tried to keep his focus on his goal. After all his efforts, he had no intention of allowing satellites to start poaching the viewers that he had worked so hard to have all to himself.
In his days as majority leader, Johnson had taken pride in entering the well of the Senate knowing just what was going to happen next. “You’ve got to work things out in the cloakroom, and when you’ve got them worked out, you can debate a little before you vote,” he liked to say.
Today the vice president knew he had no chance of rounding up the sixty-seven votes that constituted two thirds of the hundred-member chamber, but he didn’t intend to let that stop him. Johnson was most interested in the senators he couldn’t see—they were central to his plan. Arkansas senator J. William Fulbright was nowhere to be found, he noted. Nor were four other southern senators who had refused to vote to break the filibuster—not because they opposed handing control of the satellite industry to AT&T but because they feared their votes would be used against them the next time they tried to filibuster civil rights legislation. According to Senate rules, ending a filibuster didn’t take two thirds of the entire Senate, just two thirds of the senators available to vote. Along with a handful of other senators who were away for legitimate reasons, Johnson calculated that the absence of the southern five dropped the necessary number of “ayes” from sixty-seven to sixty-three.
As Johnson began to move for a vote to end debate, other veteran legislators caught on to his game—but there was nothing they could do. Senator Everett Dirksen was droll in defeat: “A lot of things can happen to a Senator on the way to the Senate. Someone might stop a Senator and try to sell him a horse. You can lose a lot of money in a horse trade.”
Almost before the filibustering senators knew what had happened, Johnson had assembled what the the New York Times described as “an unusual assortment of Republicans, Democratic moderates and Southern Democrats” to vote to end debate. Johnson’s cloture motion squeaked through, sixty-three in favor, twenty-seven opposed. After that, the dissident senators had no choice but to give up the fight.
TWO MONTHS after Congress passed the legislation to outlaw competition in the satellite industry, a Delta-B rocket took off from Cape Canaveral, Florida. A few minutes later, it dropped the RCA-built Relay-1 satellite into orbit. As an experimental satellite owned by NASA and not designed to carry commercial traffic, the satellite didn’t violate the new AT&T-backed satellite monopoly. Still, the successful launch was a bittersweet moment at RCA, since the power of satellite technology would soon fall under the control of its bitter rival.
Scheduled to carry a televised message from President Kennedy to the people of Japan, the first television images to ever leap the Pacific Ocean, Relay-1 instead was pressed into service transmitting news coverage of President Kennedy’s assassination, as well as footage of America’s new president, Lyndon Baines Johnson.
As the new leader of a grieving nation, Johnson largely escaped scrutiny over his collection of broadcast properties. Eventually, the press did dig up pieces of the story. A Life magazine investigation in 1964 put the size of the Johnsons’ broadcasting holdings at $8.4 million, up over three-hundred-fold from the $25,000 they had invested twenty-one years earlier. (And that didn’t include the money they had taken out along the way.) As for LBJ’s staunch denials of active management of LBJ Company, the Life magazine report and a similar investigation by the Wall Street Journal found plenty of business associates willing to describe, in vivid detail, just how deep the new president’s involvement had been in every corner of his broadcasting business. “There is little doubt in Austin that Lyndon is deeply interested and involved in his business enterprises thereabouts,” Life noted, “Or that he is touchy as a new sunburn about mention of the fact.”
Unfazed, the broadcaster-turned-president continued to manage his broadcasting empire from the White House. Leonard Goldenson, the head of ABC who had received Johnson’s impromptu visits and fielded his brazen requests for favors for the last twenty years, was shocked at how blatant the new president could be. On one visit to the Oval Office, President Johnson complained to Goldenson about the way the press had questioned his control over Lady Bird’s media holdings, despite the fact that the TV and radio stations had been put in a “blind trust” meant to avoid any conflicts of interest that might arise from a sitting president conducting private business affairs on the side. A few months later, Goldenson got a call from the president, pressuring him to move ABC’s popular college football games onto his stations. “I thought about reminding him how critical he’d been of the way the Kennedys ran their blind trust,” recalled Goldenson in his autobiography. “Here he was, involving himself in the day-to-day management of a station that was supposedly in his own blind trust.
“But I didn’t.”
A few days later, Clark Clifford, the president’s close adviser, came to New York to hammer out the details of the agreement with ABC’s affiliate relations department.
FOR THREE DECADES, America’s communications cartels had been protected by their friends in the FCC and Congress, crippling technologies including superpower AM radio stations, FM radio stations of all sorts, television, microwave relays, and, most recently, satellites. Now, with one of their own in the White House, the local station owners had become even more powerful.
And yet, far from feeling despondent, by the time Lyndon Johnson entered the White House the ever-optimistic David Sarnoff had already shifted his attention to yet another futuristic technology, one final opportunity to ignite a rebellion that would finally bring his enemies’ empires crashing down.