Dumb and Dumberer 

Why the FCC shouldn’t consolidate without concessions

Thursday, May 29 2003

Imagine a movie advertised as a thriller but lacking suspense, with a plot where the bumbling heroes reward the big bad villains in the end. Little wonder that the script for the FCC’s coming attraction this summer — that June 2 meeting certain to relax longstanding ownership restrictions on Big Media so it can become Monstrous Media — is earning a "thumbs down." What was needed to save the day was Indiana Jones; what we got was Dumb and Dumberer.

It didn’t help that, from beginning to end, the Federal Communications Commission’s about-to-be-formalized decision to favor the moguls seemed a foregone conclusion. Or that it was masterminded by The Son Also Rises — a.k.a. Michael Powell, Colin Powell’s son, the former chief of staff of the Justice Department’s antitrust division who sounded at his first congressional hearing not like the head of a regulatory body but, in the words of one Democratic senator, "the executive vice president of the U.S. Chamber of Commerce" representing the five most powerful media companies. Together, AOL Time-Warner, Disney, Viacom, News Corporation and General Electric control nearly 90 percent of the media outlets that Americans watch. Because of Powell’s ideological intransigence, and Republican control of the five-member commission, the major media conglomerates can further consolidate their stranglehold over our local and national airwaves as well as the infotainment industries.

How stupid of us that the mere mention of the FCC has been the discursive equivalent of Sominex. If only the public had stayed alert to the provision of the 1996 Telecommunications Act requiring the commission to conduct a biannual review of the six rules dictating the amount that the national media can be controlled by a single company. Or awake long enough to see the nightmare of a supposedly open process of opinion gathering by an agency which held only one official public hearing (the rest were unsanctioned) and incurred a perfectly legal if ethically lax $2.8 million tab in travel and entertainment expenses over the last eight years paid for by the very industries it regulates (according to the Center for Public Integrity).

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Even the reasons behind this new round of FCC revisions seemed dense. Not just because Powell, whose mantra has been deregulation, is infamous for stating that the "free market is my religion." Not just because some regulations date back to the 1940s. But primarily because two provisions were invalidated by judicial decisions. In February 2002, a U.S. appeals court ordered the FCC to reconsider the National Television Ownership Rule, which restricts a single company from owning television stations that collectively reach more than 35 percent of the American television audience. Then, in April 2002, yet another federal appeals court instructed the FCC to re-examine the Local Television Ownership Rule, which allows an entity to own two television stations in a market if certain conditions are met.

Powell took the opportunity of the court confusion and made it into a mandate to turn common sense on its head and allow more media deregulation, not less. In many circles, he was painted as a boob, or at the very least pigeonholed as a nepotism beneficiary, after he proved unprepossessing during his first mano a mano with the wily Fritz Hollings in the briefly Democrat-controlled Senate. But six months later at another hearing, Hollings confronted a vastly improved Powell. "His presentation was stronger. He was more savvy, thoughtful and reasoned about it. Hollings walked away very impressed," one of the senator’s aides told the Weekly. "But there was also a part of [Hollings] that was obviously frustrated. He couldn’t talk sense to Powell, who’s dead set on blanket deregulation. Hollings hoped to step beyond the staid and stale debate and discuss innovative approaches. There was an impasse. That’s the problem."

The situation stinks. But even more rotten is that Powell’s controversial proposals — among them, to increase the National Television Ownership Rule from 35 percent to 45 percent, and to loosen the Local Television Ownership Rule so Big Media can go on a buying spree — don’t have any strings attached.

The result will be consolidations without concessions. This is the dumberest.

It would be smart to remember that, since the Radio Act of 1927, this country has required broadcasters to serve the public interest in exchange for the privilege of obtaining an exclusive license to use a scarce public resource: the electromagnetic spectrum. To explain this "gift" in dollars and cents, Wall Street analysts estimate that if the airwaves used by the broadcasters were sold at auction in modern-day times — the way the federal government has been auctioning off other portions of the spectrum in the last decade to cellular-phone companies and other wireless-communications firms — it would bring in $367 billion to the deficit-laden U.S. Treasury.

Even when strings are attached, they’re not enforced. Case in point: In 1996, Congress agreed to "loan" each television broadcaster an additional six MHz of prime spectrum to make it easier to convert to digital television, supposedly so vital to the future of the industry. Republican Senator John McCain subsequently dubbed this "The Great American Rip-Off" — and the extent of the heist became clear when the vast majority of commercial broadcasters (77 percent, according to official figures) failed to meet the May 1, 2002, deadline. Reports say that, at the current pace, broadcasters will be able to keep all of their spectrum, digital and analog, in perpetuity while at the same time thumb their noses at Congress and the American people. Do we really need to see the sequel?

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