Josh Silver has spent the last decade working as a full-time activist for a cause that every American supports. “What I want is to have a real, working democracy here in the United States,” said the energetic young executive director of Free Press, the organization he cofounded in late 2002 and has quickly turned into the nation’s most prominent media reform group. “We now have a political system run by big money and a media controlled by big corporations that are happy to keep Americans uninformed about the bread-and-butter issues that affect us most. You can’t have democracy without an educated public, and you can’t have an educated public with the media ownership structure we have today.” What compounds the problem, Silver added, “is that there are few major issues where the policy-making process is as decidedly undemocratic as it is for media. And that’s what Free Press set out to change.”
The media was not always Silver’s primary concern. In 1997, when he was approaching thirty and his friends were settling into families and careers, the political junkie let his civic interests take over, packing everything he owned into his car and moving from Washington, D.C., to Arizona to become the campaign manager for the Clean Elections ballot initiative. “We wanted to make the electoral system more open and competitive,” Silver told me. “That meant giving candidates a way to run without relying on special-interest money. Arizona had experienced a bunch of campaign finance scandals, and—after a lot of work—we won the initiative there. I really believed that the clean election movement could catch on in national politics, too. But after we won in Arizona similar efforts in other states got hammered. It was devastating. But the parties who oppposed it spent a ton of money on the media, and they convinced people to support a system that actually shut them out.”
Yet Silver knew that this was not the only lesson to take from his experience with the Clean Elections movement, and he returned to D.C. in search of a deeper explanation for the forces that were driving American politics. “Someone recommended that I read Rich Media, Poor Democracy,” by the prolific communications scholar Robert McChesney. “I was thinking about the book one night before turning on the evening local newscast, and the top story—I kid you not—was the rising cost of lobsters. There it was, lobsters with a big graphic saying TOP STORY stamped on the TV. And I said to myself, ‘Damn, if more than sixty percent of Americans say local TV is their main source of news, and rising costs of lobsters is what they learn about it, no wonder we’re in such bad shape.’ After that I looked up McChesney online and cold-called him. I knew what he had written, but I wanted to know what he was going to do. He asked me some questions, and I told him about my background. Then he said, ‘Josh, I’ve been waiting for you to call for years.’”
Months later, McChesney and his collaborator, John Nichols, a progressive journalist, traveled to D.C. for meetings on media policy. They made time to visit Silver at his home, where they launched Free Press over dinner. By January 2003 they had raised about $100,000. Silver moved to Northampton, Massachussets, because he was convinced that a grassroots organization could get trapped in a Beltway bubble and lose touch with ordinary citizens. He also opened a small Free Press office in Washington—and his timing was perfect. In September 2002 the FCC had initiated the “biennial regulatory review” required by Congress, which also indicated that it would soon schedule a formal vote on new ownership rules. Just a few months later, lobbyists, civic groups, and consumer organizations were stepping up their public campaigns to preserve or roll back existing limits on how many broadcast outlets a company could own, and the House and Senate were holding formal hearings on media regulation in anticipation of the FCC’s upcoming vote. A heated debate about media policy was breaking out in the Capitol, reaching an unprecedented pitch when the FCC announced that its vote would take place on June 2. “The ownership fight launched us,” said Silver, a mischievous smile breaking out across his face. “We had just started, and suddenly we were in the center of the ring.”
CONGRESS AND THE FCC WERE ACCUSTOMED TO MAKING MEDIA POLICY without public scrutiny. In the two years before the Telecommunications Act of 1996, media and telecommunications companies doubled their lobbying investments on Capitol Hill.1 The proposed legislation, which included expanding ownership caps for broadcasting, cable, telecommunications services and giving away digital spectrum, would have far-reaching consequences for both the media industry and citizens, and it attracted considerable attention in the trade publications and the national business press. Yet, as the media policy scholar Patricia Aufderheide wrote in her book about the political process behind the act, despite its “broad social significance,” the issues raised by the proposed legislation “rarely … made the front pages of newspapers … and exceedingly infrequently made TV news … By and large,” she concluded, “the American public perforce ceded the argumentation over terms of the Act to experts.”2
This may be overstating the role of the commission in dictating the terms of the 1996 act, since many of its proposed regulations were supported and in some cases actually written by industry leaders, and political officials from both parties also aggressively advocated for the act. Fresh from their sweeping electoral victories in 1994, Republicans made relaxing ownership caps the key part of their national media policy proposals, drafting a bill in 1995 that allowed newspapers to own and operate television stations, and television stations to own and operate as many radio stations as they liked in the same market. Then president Bill Clinton threatened to veto such sweeping measures but, determined to push through laws that would encourage private-sector interest in developing the “Information Superhighway,” and facing the reality that the 1996 act passed the House by a vote of 414 to 6 and the Senate by 91 to 5, he ultimately supported most of the congressional majority’s deregulatory agenda.
Clinton’s closest Democratic colleagues were more enthusiastic than he about the virtues of loosening the federal government’s reins on Big Media companies. Vice President Al Gore called passage of the act “a historic event that will change forever the way every American lives, works, learns and communicates.” Reed Hundt, who went to high school with Gore and studied law with Clinton before the administration picked him to chair the FCC (“I owe this job to lots of hard work and to fortunate seat assignments,” he once said), pledged that “this bill creates the promise of good, high-paying jobs for millions of Americans and the promise of competition and its benefits of lower prices, higher quality and better service to us all.” Upon signing the Telecommunications Act of 1996 into law, Clinton declared: “My administration has promoted the enactment of a telecommunications reform bill to stimulate investment, promote competition, provide open access for all citizens to the Information Superhighway, strengthen and improve universal service and provide families with technologies to help them control what kind of programs come into their homes over television. As a result of this [act], consumers will receive the benefits of lower prices, better quality and greater choice in their television and cable services, and they will continue to benefit from a diversity of voices and viewpoints in radio, television and the print media … Today with the stroke of a pen, our laws will catch up with the future.”3
That future began immediately, ushering in a golden age for Big Media, if not for consumers. Just one year after its implementation, the industry had been dramatically consolidated through an unprecedented series of mergers, acquisitions, and new partnerships. Relaxed ownership caps in radio and television resulted in a feeding frenzy, with giant companies like Clear Channel, Viacom, and Disney gobbling up small broadcasters and minority-owned stations while showing little interest in local content, whether it be news reporting or music programming. Cable television rates soared. Not only did Internet service go up in price; it also went down in speed and service quality compared with what was available in other nations. Local phone service remained uncompetitive. And broadcast companies acquired $70 billion worth of digital spectrum—with which they planned to expand the number of radio and television stations that they operated—for free. The FCC neither provided a compelling rationale for the giveaway nor specified any meaningful public-service obligations that it would impose on the corporate beneficiaries, so it’s no surprise that citizens were the biggest losers in the deal. According to a report published in 2005 by the nonpartisan citizens advocacy group Common Cause, “Over ten years, the legislation was supposed to save consumers $550 billion … Industries supporting the new legislation predicted it would add 1.5 million jobs and boost the economy by $2 trillion. By 2003, however, telecommunications companies’ market value had fallen by about $2 trillion, and they had shed half a million jobs.”4
FALLOUT FROM THE 1996 TELECOM ACT WAS NOT THE ONLY REASON THAT the FCC was in the spotlight. In previous years the commission had been directed by men of scant renown, such as Alfred Sikes (1989-93), Reed Hundt (1993-97), and William Kennard (1997-2001), none of whom attracted much interest outside of the media industry. But President George W. Bush selected an unusually prominent chairman: Michael Powell, a military veteran and then thirty-seven-year-old son of Secretary of State Colin Powell, was given a mandate to clear away the so-called regulatory underbrush that impeded market activity, and to do so with what industry analysts considered “unprecedented authority” from the White House. Powell, who first came to the FCC as a commissioner in 1997 after serving in the U.S. Department of Justice Antitrust Division, had already established his reputation as a free-market fundamentalist who, as even the venerable libertarian William Safire put it, “never met a merger he didn’t like.”5 “Monopoly is not illegal by itself in the United States,” Powell told Wired magazine. “People tend to forget this. There is something healthy about letting innovators try to capture markets.” On January 23, 2001, the day after Powell’s official nomination, USA Today announced that Powell would take a “hands-off approach to communications regulation,” with Priscilla Hill-Ardoin, senior vice president of the telecommunications giant SBC, calling the new chairman “a consistent voice advocating market competition over regulation.”6
Powell bears a strong physical resemblance to his father, but his Utopian faith in a better world shaped by new communications technology and open markets places him ideologically closer to President Bush, for whom he quickly set to work. On March 29, 2001, the new chairman told the House Subcommittee on Telecommunications and the Internet that “suddenly, the Commission finds itself blown into a position in which its decisions have far-reaching impact, not only on the industry, but increasingly on the whole of the American national economy and that of the world.” Powell explained that he was “humbled and privileged, and some days daunted” to have responsibility for such an important set of policy issues, and he assured the House subcommittee that he looked forward to working with them in a democratic manner.
Yet the agenda he would go on to outline was comprehensive and radical, particularly with respect to changing ownership limits. According to Powell, under his control the commission would end its longstanding practice of forcing the industry to prove that regulations were harmful to consumers or unnecessary to promote the public interest. Instead, the FCC would bear the responsibility of justifying any ownership rules that it wished to continue imposing. “Deregulation,” he declared in his opening remarks, means “validate the purpose of a rule in the modern context, or eliminate it. As simple as that. Resist intervention, regulatory intervention, absent the evidence of persistent trends that can be understood, or evidence of clear abuse.”
“That, my friends, is not the law,” said veteran Democratic senator Fritz Hollings, who called a hearing on media consolidation for July 2001 in response to Powell’s pledge. Even the former FCC chairman Reed Hundt, whose support for the 1996 Telecom Act helped initiate an unprecedented wave of broadcast media mergers, condemned Powell’s actions. “No one self-polices antitrust,” he explained. “What Powell is doing is abdicating the responsibility Congress has given him. It’s extraordinarily lawless, and it disserves the country’s interests. He proposes to allow the creation of the greatest, most prodigiously sized media conglomerates that have ever bestrode the planet. And he seems massively indifferent to whether markets are competitive.”7
The chairman didn’t flinch, turning his “validate or eliminate” credo into policy, and immediately putting it to use. On July 25, just days after the Senate hearing on consolidation, Powell cast a decisive vote in the FCC’s three-to-two decision to grant a waiver to Rupert Murdoch’s News Corporation, allowing the major Bush backer’s media company to acquire ten television stations from Chris-Craft Industries, a move that put it in conflict with national ownership limits, the cross-ownership ban, and the duopoly restriction—all of which the FCC is supposed to enforce. “This decision … shows the lengths the Commission will go to avoid standing in the way of media mergers,” wrote Gloria Tristani, one of the dissenting commissioners. “The transfer of these television station licenses violates the Communications Act and raises serious concerns regarding the ongoing concentration in the ownership of television stations and other media.” Moreover, she argued, “today’s decision effectively eliminates the requirement that merger applicants demonstrate to the FCC that their license transfer would serve the public interest. The majority fails to identify a single public interest benefit resulting from this merger.”8
Powell, however, had long before registered his conviction that the commission could not effectively protect the public interest—mostly, he had infamously said, because he did not know what the phrase meant. “When I first became aware that I might be nominated to a seat on the Federal Communications Commission,” Powell told an audience in Las Vegas in 1998, “I was thrilled that I might be one of those charged with protecting and promoting the public interest. I had long known that the public interest was a pivotal part of communications regulation, but realized I was unsure what it really meant … Having read the scriptures of [former Harvard Law School dean James] Landis and [U.S. Supreme Court justice Felix] Frankfurter suggesting that I would just know the right thing to do, I expected some sort of revelation, for I did not feel particularly enlightened after being confirmed by the United States Senate. The night after I was sworn in, I waited for a visit from the angel of the public interest. I waited all night, but she did not come. And, in fact, five months into this job, I still have had no divine awakening and no one has issued me my public interest crystal ball. But I am here, an enlightened wiseman without a clue.”9
WHEN POWELL BECAME CHAIRMAN, CIVIC ORGANIZATIONS AND CONsumer groups reached out to the commission with offers to help it develop a more robust concept of public interest. Others mocked Powell in protest, dressing up as angels of public interest and requesting a visit with him. Powell forged ahead without engaging any of them, intent on replacing fuzzy notions of the public interest with what he considered “hard science,” mostly in the form of technical papers developed by FCC staff economists or outsiders commissioned for the job. “Powell started with a real and arrogant belief in the so-called economic science,” the attorney Harold Feld told me. (Feld is senior vice president for the Media Access Project, a nonpartisan telecommunications law firm in Washington, D.C., that is actively involved in national media policy.) “But he and Ken Ferree [chief of the FCC Media Bureau, which manages policy for broadcast, electronic media, and cable television] had a clear idea of what theories they believed, and they expected the evidence to show that deregulation works.”
Their confidence was not wholly unfounded. “Public-interest advocates traditionally had not relied upon either empirical evidence or sophisticated economic theory to prove their points,” reported Feld, who brings a scholar’s mind and an activist’s energy to his legal work. “They persuaded policy makers and the courts through the gut instinct that when one firm owns two outlets those firms do not genuinely compete. In 1978 the Supreme Court found it self-evident that if one company owned two outlets that those two outlets would not compete and would likely share common views. This was a rationale for blocking cross-ownership. But the neoclassical economics school put a lot of energy into showing that this intuition was wrong. In media economics, the bulk of published articles, especially in theory, but some with a little evidence, argued ownership rules were not necessary and may even inhibit the production of better news products.”
Yet there were serious problems with the commission’s “scientific” method. Much of the FCC’s research was founded on questionable assumptions, including the fact that its economic models were based more on highly disputable market predictions than on actual market data about media use, resulting in hard data built on soft foundations. Sometimes the research results were downright comical. “The commission tried to make a diversity index that would justify deregulation,” Feld recalled. “And they did it in about two months, without much outside help. But the thing made no sense whatsoever. In New York City, the index gave the same market share to the Dutchess Community College low-power television station and the ABC station. It also weighted the impact of different media with a multiplier, and since television is more popular than newspapers, the index claimed that the Dutchess Community College station made more impact than the New York Times. The amazing thing is that they actually used the index anyway. It was a core part of their case for loosening the ownership caps.”
Moreover, on the whole FCC researchers did not operate according to standard rules for scientific research. “They used proprietary data that the commission would not release to other researchers,” Feld explained, with an incredulous laugh. “No one could replicate their studies or validate their findings. The FCC was actually surprised when the Consumers Union asked for the primary data on which their studies were based so they could reanalyze them.”
Feld, a composed and eloquent speaker, sped up his pace furiously as his case against the commission’s approach to policy making unfolded. “The truth,” he exclaimed, “is that the FCC doesn’t do real social science. They spend too much time listening to Heritage [Foundation] and Cato [Institute], and all the freemarket ideologues who do ‘research’ to prove what they already believe. Then they misrepresent their own findings, because they don’t appreciate the complexity of economic models, nor even of the questions they ask. And I’ve seen them distort the research to support the results they wanted.”
The staff of the Media Access Project, which would ultimately lead a legal challenge to Powell’s most ambitious deregulatory initiatives, was convinced that preserving any meaningful consumer protections required not only defending the concept of public interest but also producing persuasive theories and solid empirical research that challenged the chairman’s predetermined positions. “Powell didn’t think that supporters of regulation could make anything beyond the usual appeals to democracy and the need for diversity,” Feld recalled. “He didn’t think there could be a substantive, quantified case made for the sake of diversity, or localism. In point of fact, there was plenty of theoretical and empirical evidence proving not just that further consolidation was a phenomenally bad move, but that existing consolidation had already produced what economists call inefficiency and what the rest of us call monopoly control of information. We went out and began rounding up whatever good research was out there. We got real research from university professors. We read the studies by the Consumers Union. We learned what was wrong with the FCC’s papers. And we stunned Powell when we produced this. He didn’t know what to do.”
AS HE LED THE FCC TOWARD THE 2003 RULING ON OWNERSHIP LIMITS, Powell must have been even more surprised by the attack on his policy agenda mounted by economic libertarians and fellow-traveling free-marketeers who, after witnessing the consequences of the 1996 Telecom Act, were so convinced that gutting ownership limits had produced uncompetitive media markets that they opposed the chairman’s plans to further relax the caps. The most devastating public argument against Powell’s deregulatory agenda came from William Safire, the legendary Republican speechwriter-turned New York Times columnist whose series of articles about the perils of media consolidation captured the attention of political conservatives in the Beltway and media moguls in New York. The poignant and politically influential critic delivered his opening remarks in a March 7, 2002, op-ed.
In the world of telecommunications, the urge to converge has led to the creation of worldwide media empires that promised the happy marriage of news and entertainment content with the computer, wireless telephone and video—all supposedly lowering prices to consumers with no restraint of trade or news. Does anyone believe that is what has been happening? In the real world, intimidating “mere size” has become, when not sin itself, the occasion of sin. Today’s any-merger-goes regulators permit cross-ownership of content and distribution while encouraging corporate titans with swollen egos to gobble up competitors or suppliers. Where does this power grab leave the innovative entrepreneur, the small business, the individual talent and the consumer?
Though Safire took a shot at liberals, it was Powell he singled out for bungling his managerial responsibilities. Safire challenged Republicans to stop supporting the relentless expansion of Big Media groups.
With the roundheeled Michael Powell steering the Federal Communications Commission toward terminal fecklessness; with the redoubtable Joel Klein succeeded at Justice’s antitrust division by an assortment of wimps; and with appeals courts approving the concentration of media power as if nothing had changed since President Taft’s day, the checks and balances made possible by diverse competition are being eradicated. The longtime anti-business coloration of liberals reduces their ability to take on the convergence con. It is for conservatives to ask ourselves: Since when is bigness goodness?10
The column stirred up conservatives, but not for long, so in January 2003 Safire fired off another salvo. “You won’t find television magazine programs fearlessly exposing the broadcast lobby’s pressure on Congress and the courts to allow station owners to gobble up more stations and cross-own local newspapers, thereby controlling information residents of a local market receive. Nor will you find many newspaper chains assigning reporters to reveal the effect of media giantism on local coverage or cover the way publishers induce coverage-hungry politicians to loosen antitrust restraints,” he commented, writing the words that so few of his peers had the courage or security to type. But the dangers of consolidation, as Safire explained, were most evident in local radio.
Take a listen to what’s happened to local radio in one short wave of deregulation: The great cacophony of different sounds and voices is being amalgamated and homogenized. Back in 1996, the two largest radio chains owned 115 stations; today, those two own more than 1,400. A handful of leading owners used to generate only a fifth of industry revenue; now these top five rake in 55 percent of all money spent on local radio. The number of station owners has plummeted by a third. Yesterday’s programming diversity on the public’s airwaves has degenerated to the Top 40, as today’s consolidating commodores borrowing public property say “the public interest be damned.”
Safire was well aware that his position on media policy would confuse readers who were accustomed to his assault on excessive government intervention in the marketplace. “Does this make me (gasp!) pro-regulation?” he asked.
Michael Powell … likes to say “the market is my religion.” My conservative economic religion is founded on the rock of competition, which—since Teddy Roosevelt’s day—has protected small business and consumers against predatory pricing leading to market monopolization. One of the Democrats on the FCC, Michael Copps, is concerned that “we’re relying on institutions to cover this debate which have interests in the outcome of the debate.” Republicans in the House, intimidated by the powerful broadcast lobby, don’t admit that some regulation can be pro-business … Perhaps Commerce Chairman John McCain will see T.R.’s trust-busting light and start heavy granulating in hearings—before merger mania afflicts TV and film the way it is debilitating local radio.11
As, in Safire’s words, an “unprecedented torrent of e-mail came roaring in” to his Times mailbox, the crusading columnist continued to elaborate his argument.12 “Aren’t viewers and readers now blessed with a whole new world of hot competition through cable and the Internet?” he asked on the morning of a Senate ownership hearing in May 2003, previewing the “shucks-we’re-no-monopolists line that Rupert Murdoch will take today [when he testifies].”
The answer is no. Many artists, consumers, musicians and journalists know that such protestations of cable and Internet competition by the huge dominators of content and communication are malarkey. The overwhelming amount of news and entertainment comes via broadcast and print. Putting those outlets in fewer and bigger hands profits the few at the cost of the many. Does that sound un-conservative? Not to me. The concentration of power—political, corporate, media, cultural—should be anathema to conservatives. The diffusion of power through local control, thereby encouraging individual participation, is the essence of federalism and the greatest expression of democracy. Why do we have more channels but fewer real choices today? Because the ownership of our means of communication is shrinking. Moguls glory in amalgamation, but more individuals than they realize resent the loss of local control and community identity.13
Safire’s columns, circulated widely online and in syndication, generated thousands of letters—“You should see this stack,” he wrote—and helped to persuade conservative and liberal citizens and policy makers that the FCC was now actively working against the interests of anyone who did not own a major media company. Republican senator Trent Lott, for example, had vigorously supported Powell’s nomination to the commission in 1997, but as both his party’s intellectual leaders as well as rank-and-file supporters registered their disdain for Big Media, the Mississippi leader became a vocal critic of consolidation. “With too much concentration,” Lott warned, using language inspired by Safire’s essays, “companies no longer have to be competitive with rates or product. There would be less incentive to produce something fresh, something different, something priced reasonably or something that caters to another point of view. Already in some markets, advertisers and customers have no choice but to use one particular media outlet … Big national print chains in particular already have virtual monopolies in some places … Expanding concentration of media ownership may be in the best interest of huge Washington or New York-based media giants, but it would not be in the best interest of … media consumers like you and me.”14
While fiscal conservatives complained about the loss of market competition, cultural conservatives charged that consolidation had deprived communities of the chance to control their own broadcast stations, resulting in a glut of nationally syndicated programs that threatened to drive off the air local religious shows, sporting events, and other local programming that Big Media companies were reluctant to program in place of their own content. In North Carolina, Senator Jesse Helms and Representative Richard Burr (who succeeded Helms as senator in 2004) cowrote a blistering editorial insisting that “conservatives recognize the danger of nationalizing broadcast television content” and claiming the “right of local viewers to influence programming.” The southern legislators endorsed the media activism of the Parents Television Council, the Christian Coalition of America, and the National Religious Broadcasters. “Local stations must be empowered to make programming decisions based on community concerns, not forced to march in lock-step with network mandates,” they exclaimed. “We are not willing to silence the voices of local viewers in favor of a single voice from New York or Los Angeles. Are You?”15
Among conservatives, the loudest response to the possibility of further consolidation came from the National Rifle Association (NRA), which in 2003 called the U.S. media system an oligarchy and mobilized hundreds of thousands of its members to write Congress and the FCC with a simple demand: save American democracy by stopping media consolidation and restoring local control. Wayne LaPierre, the NRA’s executive vice president, led the grassroots campaign, stirring members’ fears that conglomerates would crush local voices and calling for all citizens to “speak out vs. FCC while you can.” The NRA conveyed its primary concern in an “Urgent NRA Bulletin” titled “Media Monopoly Alert,” warning that “gun-hating media giants like AOL Time Warner, Viacom/CBS, and Disney/ABC … could literally silence your NRA and prevent us from communicating with your fellow Americans by refusing to sell us television, radio or newspaper advertising at any price.” (In the next year liberal groups would complain that Clear Channel refused to sell them airtime to advocate Democratic causes.) “Minority or unpopular causes—think of women’s suffrage in 1914 or civil rights in 1954—would be downplayed or dismissed to keep viewers watching and advertisers buying,” LaPierre warned. “That’s no way to run a democracy … The only way to stop this is to denounce it from the highest rooftop now, while you still have a voice … Tell everyone the airwaves belong to the American people, and the FCC’s job is to protect the public interest—not big media barons who want a monopoly on public discourse.”16
LAPIERRE HAD GOOD REASON TO SUGGEST THAT AMERICANS DELIVER their message to the FCC from “the highest rooftop”—there were few other meaningful ways to participate in the policy-making process. The FCC was legally obligated to seek public review before eliminating the ownership laws. Yet Powell, who continued to believe that media policy was the domain of technical experts, economists, and the industry, purposely ignored public opinion and grassroots input on his proposed rule changes—refusing to attend some of the FCC public hearings held before the vote. Powell did, however, keep the FCC’s doors open to Big Media companies and their trade organizations, leaving the unmistakable impression that the commission had been captured by the industries it was supposed to regulate. According to a report published in May 2003 by the nonpartisan Center for Public Integrity (CPI), during the eight months leading up to the commission’s June vote, “the nation’s top broadcasters have met behind closed doors with FCC officials more than 70 times to discuss a sweeping set of proposals to relax media ownership rules,” whereas the two leading public-interest groups working on media policy, Consumers Union and the Media Access Project, “have had only five such sessions.” In the view of CPI’s founder, Charles Lewis, these contributions left little question that “the FCC is in the grips of the industry,” captured by the very companies it was supposed to regulate.17
SURPRISINGLY, TWO COMMISSIONERS, MICHAEL COPPS AND JONATHAN Adelstein, shared the CPI’s view that from the beginning of Powell’s tenure the FCC had embarked on a disturbingly antidemocratic policymaking process. After December 2002, when Adelstein, a South Dakota native, amateur musician, and legislative aide to Senator Tom Daschle, joined the commission on which Copps had served since May 2001, the two Democrats had allied to launch a populist campaign promoting public participation in the ownership debate with the ultimate goal of slowing down Powell’s fast-tracked proposal for shredding the remaining strands in the regulatory net. Copps, a former U.S. history professor who served as assistant secretary of commerce for trade development at the U.S. Department of Commerce during the Clinton administration, publicly expressed his concerns about the FCC’s race to deregulate in September 2002, when Powell issued the Notice of Proposed Rulemaking that signaled his intention to conduct an expeditious biennial review. “I don’t know of any issue before the Commission that is more fraught with serious consequences for the American people than the media ownership rules,” said Copps, in a somber but urgent formal statement worth quoting at length.
There is the potential in the ultimate disposition of this issue to remake our entire media landscape, for better or for worse. At stake is how radio and television are going to look in the next generation and beyond. At stake are old and honored values of localism, diversity, competition, and the multiplicity of voices and choices that undergirds our American democracy. At stake is equal opportunity writ large—the opportunity to hear and be heard; the opportunity to nourish the diversity that makes this country great and which will determine its future; the opportunity for jobs and careers in our media industries; and the opportunity to make this country as open and diverse and creative as it can possibly be.
The Nineties brought new rules permitting increased consolidation in the broadcasting industry, on the premise that broadcasters needed more flexibility in order to compete effectively. These rules paved the way for tremendous consolidation in the industry—going far beyond, I think, what anyone expected at the time. These changes created efficiencies that allowed some media companies to operate more profitably and on a scale unimaginable just a few years ago. They may even have kept some companies in business, allowing stations to remain on the air when they otherwise might have gone dark. But they also raise profound questions of public policy. How far should such combinations be allowed to go? What is their impact on localism, diversity and the availability of choices to consumers? Does consolidation always, generally or only occasionally serve the interests of the citizenry? How do we judge these things?
… I hope we might even consider, as a Commission, holding hearings here and around the country, to speak with Americans and better gauge what the reality of particular media markets is. I don’t want to vote on final rules—and I would be reluctant to vote on final rules—unless and until I feel comfortable that we have the information and the analysis needed to inform our votes. We need as many stakeholders as we can find to take part in this proceeding. I want to hear more from industry, from labor, from consumers, from academe, from artists and entertainers, from anybody who has a stake in how this is resolved. And I think just about everyone, if he or she stops to think about it, has an interest and a stake …
Because the stakes here are so incredibly high, it is far more important that we get this done right than that we get it done quickly. I keep coming back to the high stakes involved in what we are doing. Suppose for a moment that the Commission decides to remove or significantly change current limits on media ownership—and suppose our decision turns out to be a mistake. How do we put the genie back in the bottle then? No way.18
As a result of pressure from the dissident commissioners, Powell organized an FCC ownership task force and invited formal comments on the dozen expert research reports that the FCC published on the issue. Yet critics immediately complained that the terms of the debate were at once excessively technical for ordinary citizens and insufficiently transparent for professional analysts, because the commission would not release the original data and outsiders had no choice but to accept the findings at face value. Public pressure forced the commission to release “parts of the data” in October, but Copps, declaring that he was still “disappointed and alarmed” by the FCC’s feeble effort to include citizens’ voices in the debate, continued “banging the drum for a national debate” through town hall meetings throughout the country. Powell was openly hostile to what he considered an antiquated democratic practice. “In the digital age,” he insisted, “you don’t need a 19th century whistle-stop tour to hear from America.”19
Continued opposition to meeting with the public was untenable, however, and finally Powell gave in, agreeing to hold a hearing in nearby Richmond, Virginia, in February 2003. The five-hour event, however, was not exactly what Copps had in mind. Powell framed the forum by asserting his controversial notion that “unless we can re-justify each broadcast ownership rule under current market conditions, the rule goes away,” and for the first few hours prominent experts, including executives from Fox and Clear Channel as well as consumer groups, lectured the audience with prepared statements, relegating citizen comments to the late last hour. But the audience waited patiently for the rare chance to formally express its opposition to cutting ownership limits. “Oligopoly in the fourth estate is a real threat to diversity and the democratic ideals that form the philosophic core of this nation,” said Dr. Allen C. Barrett, then president of the local NAACP chapter. Rain Burroughs, a child-care worker, added, “We don’t want Fox and Viacom owning every station we turn to on the dial,” while Nathan Long, an English instructor, complained that “there are fewer and fewer options and opinions in the news. If you have a corporation saying they are going to represent diversity, and you hear citizens saying, ‘No, they’re not,’ I ask you to seriously consider which you should listen to.”
Concerns such as these might have moved the three Republican commissioners who were leaning toward relaxing the ownership rules to solicit more public opinion on the issue. But, as McChesney, the scholar and cofounder of Free Press reported, “Powell immediately announced that the Richmond hearing provided ‘enough’ input from the public and that it was imperative to get the process completed as quickly as possible … Powell, [Kathleen] Abernathy and [Kevin] Martin would not attend any of the subsquent public hearings on media ownership.”20
The Republicans’ refusal to hold additional open meetings with the public did not deter Copps and Adelstein, who announced that they would conduct their own hearings, independently traveling across the country to hear firsthand how ordinary Americans wanted the FCC to define and protect the public interest. Between March and May, the commissioners attended most of the twelve public hearings on media ownership hosted by civic groups and universities from Los Angeles, California, to Burlington, Vermont. The events were extraordinary, with hundreds of citizens in each city pouring into community centers in a torrent of democratic activity that few other issues could inspire. Yet the ever-vigilant Copps, informed of a survey showing that three-quarters of the American people had not heard about the impending media policy changes, worried that the commission had still failed to reach millions of those who would be affected by its decision. “It’s like a state secret,” he told a capacity crowd at the University of Southern California. “It’s amazing. We will have a new or substantially changed system in place before most people even know it’s up for grabs. And ‘up for grabs’ is the right term, because as I travel around the country holding my own hearings and attending forums like these, I hear about deals in the making, like newspaper-broadcast cross ownership agreements, where the terms are already decided, the deal is done, and all that remains is to fill in the signature blocks after the Commission votes on June 2.”21
Having castigated his colleagues for neglecting to do appropriate outreach, Copps also blamed the media for avoiding the story of its own political controversy.22 Not only had Big Media companies purposely kept Americans in the dark about the social and political stakes of media concentration; they had also established a “climate of fear” among their employees, making journalists, editors, and producers aware that critical coverage of consolidation could cost them their jobs. “It has been a revelation to me that there are media professionals with strong feelings about the downsides of consolidation for the American people who are afraid to speak for fear of retribution,” Copps reported. “I hear privately that speaking out on this issue would cost many people their careers.” “Sometimes it’s implicit,” added Adelstein. “It’s clear to them that it’s not a career advancing move to write a story that challenges the policy that is being promoted by their boss.”23
AS THEY CROSSED THE COUNTRY, COPPS AND ADELSTEIN LEARNED THAT ordinary Americans were less inhibited about voicing dissatisfaction with their local offerings and opposition to further consolidation. “Of the hundreds of citizens I heard from,” Adelstein reported, “many extremely articulate, not one of them stood up to say, ‘I want to see even more concentration in our media ownership.’ Not one.”24 When the commissioners returned from their “whistle-stop tour,” they heard again from a purple coalition of grassroots organizations that had delivered their demands for deconcentrating the media to Washington, D.C., with approximately 750,000 e-mails and letters arriving at the FCC before its June 2 vote. “Judging from our record,” said Adelstein, “public opposition [to relaxing the ownership caps] is nearly unanimous, from ultra-conservatives to ultra-liberals and virtually everyone in between.” Even Chairman Powell acknowledged that he had heard the nation’s democratic wish. “I will concede the point that we had strong amount of e-mail and news that expressed concern,” he said on national television. “If you pulled any one of these postcards out of our bins, what you would have read is that there’s a general anxiety or concern about consolidation.”25
Liberal media reform groups such as Free Press, the Center for Digital Democracy, and Fairness and Accuracy in Reporting (FAIR) made sure that progressives were leading the letter-writing campaign. “We were just a little fish at the time,” recalled Josh Silver, of Free Press. “But we got our Web site up in time to do a petition before the FCC vote, we were sending out press releases, and we were doing outreaches all over the place. We needed a partner with real constituents to get the letters out, though, and I thought MoveOn would be perfect. I called Eli Pariser [executive director of MoveOn.org Political Action] and had McChesney call Wes Boyd [cofounder of MoveOn.org and MoveOn.org Civic Action]. We all met at a restaurant in New York and worked things out over coffee. MoveOn didn’t really have a media policy agenda at the time, but they understood that their constituents cared about this, and they were immediately receptive.”26
On May 8, 2003, MoveOn.org launched the “Stop Media Monopoly” petition, its first campaign on media ownership issues. “On June 2, the Federal Communications Commission is planning on authorizing sweeping changes to the American news media,” the group’s solicitation letter explained. “When we talk to Congresspeople about this issue, their response is usually the same: ‘We only hear from media lobbyists on this. It seems like my constituents aren’t very concerned with this issue.’ A few thousand emails could permanently change that perception. Please join us in asking Congress and the FCC to fight media deregulation.” The response was overwhelming. “So many people responded so quickly that we could tell this was a hot issue,” Pariser told me. “Our members sent the letter on to friends, they signed the petition, and then joined MoveOn. The strength of that petition drove us to get more involved. It totally surprised us. The FCC rule making was not where we thought the energy was going to be. We thought it was going to be a side issue with a few respondents. But it turned out to be a core issue for our constituents, one of the biggest petitions we’d done.” Although MoveOn.org had only been organizing around media ownership for a few weeks, its petition generated around 250,000 letters in one week. “We sent so many comments to the FCC that we crashed their server,” Pariser recalled. “They’re not used to receiving hundreds of thousands of e-mail comments at a time.”
The unprecedented outpouring of bipartisan opposition to more deregulation undermined the legitimacy of Powell’s determined push to cut the caps. For the chairman could not deny that he was ultimately accountable to the American people, as he had gone on record saying that when the FCC makes policy decisions, “the input of individual citizens is invaluable. They can file comments and express those views on the record. And we can use them. Part of what they have to count on is for us to be their surrogate.”27 Yet Powell showed no signs of the conflict in his own position as he kept the FCC racing toward the scheduled June 2 vote. After keeping Copps and Adelstein in the dark for months, he released the proposed rule changes to the other commissioners—but not to the public, which again was kept out of the process—on May 12, giving his colleagues the absolute minimum time for review required by law. McChesney wrote that “Copps and Adelstein immediately asked for a delay of the vote, a ‘traditional right of commissioners,’ which had never been denied in anyone’s memory. Powell rejected the request, citing counsel by his Republican colleagues on the Commission, Abernathy and Martin.”28
As the date of the decision approached, public demands for a more democratic media policy-making process reached a din. “Let’s debate this out in the open, take polls, get the president on the record and turn up the heat,” wrote William Safire in his May 22 column. Copps sounded a similarly desperate note. “We are on the verge of dramatically altering our nation’s media landscape without the kind of national dialogue and debate these issues so clearly merit,” he warned. “If FCC Chairman Powell continues to insist that the roll be called on June 2 … the FCC will have voted on this, changed the rules, reconfigured the media landscape, and told the world that, sorry, there’s no opportunity or time for public comment on what has been voted into place. Right after that, prepare to see a veritable gold rush of media company buying and selling … I just wonder who is going to be America’s broker in all this? Somehow I had the quaint idea that maybe the FCC was supposed to pay some attention to that.”29
The decision Copps feared turned out much as he predicted: on June 2 the FCC issued an order that bore not a single mark of the public’s input. Voting along party lines, Commissioners Martin and Abernathy joined Chairman Powell to form a three-to-two majority over Copps and Adelstein, recommending that Congress eliminate the ban on cross-ownership, raise the national cap on television station ownership from 35 to 45 percent of the national market, and allow one company to own three television stations in one town. That evening, PBS reported that the proposed laws represented “the most sweeping changes in the nation’s media ownership rules in a generation,” allowing “a single company [to] conceivably own up to three television stations, eight radio stations, the cable television system and cable TV stations, and the only daily newspaper in a single city.” North Dakota senator Byron Dorgan, who had became an outspoken critic of media consolidation after observing Clear Channel’s role in the Minot disaster, complained: “This is a big deal. It’s going to affect what the American people can see, can hear, can read … Seldom have I seen a regulatory agency cave in so completely to the big economic interests.” Trent Lott, his Republican colleague, simply stated that “this is a mistake.”30
Copps and Adelstein issued bitter statements on the decision. “I’m afraid a dark storm cloud is now looming over the future of the American media,” wrote Adelstein. “This is the most sweeping and destructive rollback of consumer protection rules in the history of American broadcasting … This plan is likely to damage the media landscape for generations to come. It threatens to degrade civil discourse and the quality of our society’s intellectual, cultural and political life. I dissent, finding today’s Order poor public policy, indefensible under the law, and inimical to the public interest and the health of our democracy.” Copps also condemned the order as an act of “radical deregulation” that ignored the public will. “I dissent to this decision,” he wrote. “I dissent on grounds of substance. I dissent on grounds of process. I dissent because today the Federal Communications Commission empowers America’s new Media Elite with unacceptable levels of influence over the media on which our society and our democracy so heavily depend … Where are the blessings of localism, diversity and competition here? I see centralization, not localism; I see uniformity, not diversity; I see monopoly and oligopoly, not competition.”
But Copps knew that the order had to clear several hurdles before becoming law, and he had faith that the public calls for regulatory protection would lift the bar for final approval. “This Commission’s drive to loosen the rules and its reluctance to share its proposals with the people before we voted awoke a sleeping giant,” he declared. “American citizens are standing up in never-before-seen numbers to reclaim their airwaves and to call on those who are entrusted to use them to serve the public interest … The media concentration debate will never be the same. The obscurity of this issue that many have relied upon in the past, where only a few dozen inside-the-Beltway lobbyists understood the issue, is gone forever.”31
COPPS WAS PRESCIENT. LESS THAN FORTY-EIGHT HOURS AFTER THE FCC announced its deregulatory order, all five commissioners assembled before the Senate Committee on Commerce, Science & Transportation, which had demanded that the agency explain its decision. The committee chairman, John McCain, opened the meeting by reminding the commissioners that despite his “long voting record in support of deregulation” and general belief “in letting markets, not government, regulate the way businesses operate,” he was skeptical about their proposal. “The business of media ownership, which can have such an immense effect on the nature and quality of our democracy, is too important to be dealt with so categorically. And I have come to believe that there must be some limits on media ownership to avoid what we have seen happen in radio.” Commissioner Martin, whom some conservative critics of consolidation had pressured to dissent, defended the order as “our best attempt to respond to the courts’ admonitions and our Congressional mandate by recognizing the availability of new media outlets, evaluating their impact on these core goals, and modifying our rules as appropriate.”
Such bureaucratic language could not calm Senator Ernest Hollings, the committee’s ranking Democrat, who called Powell a “fraud” and accused the three Republican commissioners of turning the FCC into an “instrument of corporate greed.” Nor did it impress Senator Ron Wyden, who said the order “rings the dinner bell for the big media conglomerates who are salivating to make a meal out of the nation’s many small media outlets.” Again, Free Press and MoveOn.org rushed to the Hill to remind congressional leaders of the widespread opposition to deregulation, impressing the representatives with their heaping bags of letters from citizens. “We lobbied every committee that was working on media,” said Silver. “We had to be aggressive, because so much was on the line.” Surprsingly, their work paid off immediately. In late July 2003, the U.S. House of Representatives, in a 400-to-21 vote, backed an appropriations bill that would preserve the national television ownership limits. Without this intervention, quipped Democratic representative Edward Markey, the FCC’s rules would “make Citizen Kane look like an underachiever.”32
Big Media companies have powerful allies, however, and Powell’s order was not dead yet. Whereas President Bush, during the previous year, had quietly supported a rollback on ownership restrictions, now he spoke loudly, threatening to use his executive veto power for the first time if Congress did not restore the FCC’s decision. The stakes were high, and Bush used the threat to instruct fellow Republicans where they should stand. Both Viacom and Rupert Murdoch’s News Corporation, the right-wing conglomerate that had consistently backed his administration, were already broadcasting to more than 35 percent of the national audience, and they would be legally obligated to sell off many stations if the caps were not increased or their waivers were not extended. The Tribune Company had also received waivers to operate beyond the standard ownership limits, and if Congress upheld the cross-ownership ban it too would have to sell off some of its properties or renew its waivers. On the other side, media reformers and civic organizations were invested as well, with Free Press, MoveOn, the Parents Television Council, and the NRA rallying their constituents for another round of letter writing. By the fall, American voters had sent another 1.5 million letters to the FCC and Congress, demanding that they withstand executive intimidation and preserve the ownership restictions.
A dizzying series of political chess moves followed. The Senate moved the FCC rules into an omnibus appropriations bill that was already packed with other contentious issues, making it unlikely to pass; then, under heavy pressure from the White House, congressional Republicans brokered a late-night “compromise” in which the television cap rose to 39 percent—raising suspicions that it was specially made for Viacom and the News Corporation, which conveniently would not have to let go of any stations. Congress appeared headed for an about-face when Senators Lott and Dorgan pushed through a rarely used “resolution of disapproval” under the Congressional Review Act, in a 55-to-40 vote that effectively overturned the FCC order. But the House leadership refused to bring the resolution to the floor, and the issue stalled.
Then the media reform movement made its move. On behalf of a small, Philadelphia-based low-power radio collective called the Prometheus Radio Project, the Media Access Project had petitioned the U.S. Court of Appeals for the Third Circuit to review the FCC’s decision. “The Commission’s Order is arbitrary and capricious in a number of respects,” the petition states. “It also violated both the Communications Act and the Administrative Procedure Act’s public notice requirements. Petitioner respectfully requests that the Court reverse and remand the FCC’s Order to the extent that it unlawfully repeals the prior ownership rules and adopts new ownership regulations, reinstate the prior ownership rules, and grant all other relief as may be just and proper.”33
On September 3, 2003, the Third Circuit Court announced that it would issue an immediate stay on the FCC order, blocking implementation of all proposed rule changes until it reached a verdict. Major media companies, industry trade associations, and civic organizations immediately began drafting briefs for the federal appellate court that would decide the matter—at least until the next regulatory review process or an appeal to the U.S. Supreme Court. No one questioned the significance of the outcome. “In one motion,” said Blair Levin, a media analyst for the firm Stifel, Nicolaus and a former FCC chief of staff, “everything that the FCC approved could be completely wiped out.”34