Policy Options Memorandum

POLICY OPTIONS MEMORANDUM

TO: President Barack Obama

FROM: Erin Zix

DATE: May 2, 2016

RE: Media Consolidation and its Negative Affect on Democracy

EXECUTIVE SUMMARY

This policy memo aims to present the issue of media consolidation in the United States and demonstrate the ways the current media ownership harms democracy. The ills caused by the problem are remedied by potential solutions and then further vetted for their potential to cure the problem. A final recommendation is given to determine the most effective policy changes to ensure a fair and unbiased media will serve the interests of the people.

BACKGROUND

The United States faces numerous issues which threaten democracy, but possibly none more insidious than the consolidation of the mass media. It can be argued that many other issues exist because of it: today we do not get the full picture of current events because the corporate entities that control the news are focused on profits, special interests and often times their own political agendas. Citizens in a democracy need access to reliable and unbiased information in order to engage meaningfully with the issues of our times. When the information disseminated over the public airwaves is controlled by the wealthy few, there are serious implications for how citizens experience democracy. Unfortunately, decades of incremental policy changes in favor of corporate elites have brought us to the current dire situation. (Crawford S., 2013) Since the 1980s and particularly after the passing of the Telecommunications Act of 1996, we have seen media ownership dwindle from about fifty companies to a mere six. (Corcoran M., 2016) Corporate ownership of the media can be likened to a form of mind control and censorship, for it is in the best interest of these companies to maintain the status quo and serve special interests. “Media power is political power.” (Bagdikian B., 2004) This statement speaks volumes; the things citizens need to know in order to adequately equip them with the ability to rationalize modern issues is in effect controlled by the people who decide what we see and how we see it. Media frame the debate and deliver the options on how to form opinions. Because of this, the United States has the most politically constricted voting system of the world’s developed democracies. (Bagdikian B., 2004) In order to address media consolidation and its threat to democracy, we must address some of the natural tendencies of the free market that governs it.

PROBLEM #1: MEDIA AND ACCOUNTABILITY

The central flaw of a capitalist economy regulating the media is one that deals with accountability. The big companies that own the media have one goal in mind, namely profits, and are beholden to their shareholders to perform well. This performance is measured by viewership and is ultimately a numbers game. (Corcoran M., 2016) Conversely, freedom of the press is strongly correlated with democracy. At the onset of the American Revolution, the media served as an ally to the people, to act as the force which could challenge the status-quo. In order to have a healthy democracy, free and unbiased media is integral to the balance between democracy and capitalism, to check those in power and serve as the basis of an informed citizenry who can self govern. “The policies, structures, subsidies, and institutions that are created to control, direct, and regulate the media will be responsible for the logic and the nature of the media system.” (McChesney R.W., 1999) The government has an obligation to the public to ensure thatthe content delivered is both truthful and easily accessible to the people. Since the current mass media landscape is most solely focused on profits, we know the market is not the best way to regulate the media.(McChesney R.W., 2004) When content is viewed as a commodity instead of a public service, citizens should feel threatened. Today we are flooded with non-sense over meaningful content, true political discourse obscured by reality T.V. and celebrity gossip (Bagdikian B., 2004). And though it can be argued that the market is delivering what the people want and should not be tampered with, we must also remember that it is the government’s job to protect the people from harms of all kind. For example, while cigarettes are legal and adults have the right to purchase them, restrictions on how they are marketed as well as effective anti- smoking campaigns have emerged to protect people from unwittingly making bad decisions. In this same way, we need the FCC to act as a watchdog for the people, to ensure the moneyed interests are not using our ignorance to sway policy in their favor, at the expense of the people.

PROBLEM #2: MONEY, POLITICS AND TRANSPARENCY

Money has always played a role in politics, but today it is clearly unfair and rigged, affecting the outcomes of political races. Elections are a prime example of how the telecommunications industry is corrupted by the influence of special interest and lobby groups. For every political ad that is aired during an election year, millions of dollars are handed over to the media companies. This flood of money comes by way of Political Action Committees (PACs) and creates an environment where you must pay to play, making it impossible for anyone without millions of dollars to spend to contend in any political race. (McChesney R.W., 2004) Not only does this create an inherently exclusive culture, but it also fosters an environment where our politicians rely on big corporations to make donations on their behalf in order to remain competitive, essentially buying our candidates by way of contributions. This is a way big businesses ensure candidates will push their agendas and write industry friendly legislation once in office. (McChesney R.W., 1999) To make matters worse, the aforementioned PACs are able to mask their identities and avoid explicitly sponsoring candidates. This lack of transparency regarding political contributions makes it easy for companies to own politicians and to ensure legislation goes in their favor. These issues are a serious threat to freedom because the people are given candidates who pander to the corporations who in turn have more political power than the average American. This systematic favoring of the rich must end, but unfortunately this is not where the problems with the telecommunications industry ends.!

PROBLEM #3: LACK OF DIVERSE OPINIONS AND GAPS IN MEDIA COVERAGE !

With just a handful of companies determining the content broadcasted, it is not surprising that we are left with a reduction in scope of the topics, perspectives, and alternatives covered in public discourse. Journalists are employed by fewer entities, making their jobs as investigators uncertain: rather than risk their paycheck to report controversial news that could shape public perception on a topic, they are forced to comply with whatever watered-down versions the owners deem appropriate. (Berger A., 2012) Companies do not want bad press, but since they essentially are the press, they can control what we see, omit important details, and put afavorable spin on how they report. We have also seen a decline in local news reporting: thousands of jobs have been lost due to the homogenization and nationalization of news. (AFL- CIO Executive Council) This also has implications for local elections; the consolidation of the media not only produces less informed citizens, but also less engaged and civic minded constituency. When the people are unaware of the issues, candidates and elections in general, democracy suffers.

OPPOSITION

Critics of the above assessment may claim that media consolidation is actually good for the consumer. They might argue that services have been made more affordable and more efficient because of media consolidation. To debunk this theory, we only need to look where the corporations are putting their massive amounts of money: campaign spending and further attempts to consolidate by way of buying more companies, not to provide faster and cheaper services. (Ludwig M., 2013) And with so few companies dominating the scene, we can only expect further collusion between them, allowing them to set their own prices amongst one another.

It could also be argued that the media is a reflection of the public desires: it is only giving us what we ask for. While this might be true, the media is one of those public services that must be upheld with dignity and truth. It should not be looked at as a commodity because so much relies on it. While many people are skeptical of too much government control, today we have a kind of authoritarianism by the rich; we are being oppressed by the corporations who seek to own everything. We must not think of information as a commodity but as a public service. It would be irresponsible to defer to superficiality over meaningful content.

SOLUTION: LIMIT MERGERS IN THE TELECOMMUNICATIONS INDUSTRY

One possible solution to the structural issues relating to media consolidation is to crack down on the abuse of policies set to protect the industry from the negative influences of conglomeration. To start, the FCC could change the ways it approves mergers in the industry:

Under FCC ownership rules, one company cannot own more than one TV station in a market with fewer than eight independent owners, and one party cannot own more than two of the top four major stations in a single market. To bypass these rules, companies such as Sinclair and Raycom set up shell companies to buy licenses while remaining under economic and editorial control of the parent company. The companies also use "local marketing agreements" to sell stations content produced in other newsrooms, allowing stations to gut newsrooms to maximize profits. (Ludwig M. 2013)

Rather than allowing for companies to use loopholes to conduct business covertly, strict adherence to the written law could restore diversity within the telecommunications industry. Furthermore, the FCC can and should adopt a stronger licensing system for companies to access the airwaves. The current system allows for renewals without the original intention of the time periods in the first place: rather than automatically renewing a license, the FCC must ensure that the basic tenets of journalism are upheld and emphasize the need for independent broadcasting, local programming, public service programs on air and service to minorities exists. With these values in mind, we see access to a variety of mainstream news sources brining back meaningful public discourse.

SOLUTION: CLOSE REVOLVING DOOR BETWEEN REGULATORS AND INDUSTRY

Another solution to the problem of mass media consolidation would be to close the revolving door that exists within the telecommunications industry and the government agencies tasked to regulate it. Thomas Wheeler, current FCC chairman, was the former president of the National Cable and Telecoms Association (NCTA) and the Cellular Telecoms and Internet Association (CTIA), both anti-net neutrality lobbies. Philip Verveer, the current FCC Senior Counsel, represented Sprint and Comcast as legal counsel. Meredith Baker, former FCC Commissioner, now works at Comcast as the Senior Vice President of Government Affairs. These are only small handful of instances of the blatant corruption within the government agency tasked to regulate such a critical component of democracy. (commoncause.org, 2016) The FCC must be completely committed to protecting democracy and understanding the ills associated with media monopolization. This cannot be possible when those writing the laws move on to reap the monetary benefits as high ranking officials for the companies they previously regulated.

SOLUTION: TRANSPARENCY IN POLITICAL ADS AND CAMPAIGNS

More transparency regarding money and the political process would also positively benefit American democracy. While information regarding political ads and contributions is available online, the process of finding this out can be cumbersome and time consuming. By forcing the names of the companies and individuals behind campaign ads (“in-ad disclosure”) (commoncause.org, 2016), the people would know right away where the funding and support is coming from. This knowledge would help the people make connections between candidates, the issues, and those who are pushing an agenda.

ANALYSIS OF SOLUTIONS AND THEIR EFFECTIVENESS

The third option is the most obvious option to exclude. While transparency in the media might help the country gain more insight to the political process, it does little to address the specific ills associated with media consolidation. Furthermore, overturning Citizen’s United would also do little to address the underlying issue. Even if people were given more information about candidates and their campaigns, it is hard to see how this would in effect bring more diversity to the news and broadcast media itself. The aims of this paper seek to fix the problem with too much media in too few hands, and the option to bring full disclosure regarding campaigns is overall an ineffective solution to a much larger problem.

A better but yet still less desirable option is the idea of closing the revolving door within the industry. There is no denying that a strong and robust FCC must keep itself in check with regards to determinations of media mergers, but there have been few instances of outright corruption in the FCC over the years. Another important factor to consider is the education and knowledge of regulators, much of which they would likely not gain without exposure to the industry. While strong oversight is crucial, deep industry knowledge from the private sector has often played a positive role in the ability of regulators to effectively address these issues. Working for Time Warner or ComCast does not automatically mean the person will be corrupt, and it ignores the specific industry knowledge that comes with years of work in the field.

FINAL RECOMMENDATION

After careful consideration of the facts, the strongest solution to the problem of media consolidation is to strengthen the FCC’s commitment to limiting mergers in the telecommunications industry. This would entail revisions of the Telecommunications Act as well as repeal of many of the lax regulations that have allowed for such big companies to exist. Companies would not be allowed to test the loopholes by way of shell company and subsidiary; instead, bans could be placed on abuse of power. Breaking down the current media landscape would allow for more diversity in programming and more diversity of opinions. This would also result in less boundaries to entry for minorities and women, because often the thing that holds them back is capital. If the largest companies are no longer as large, money would no longer be the deciding factor of who gets and maintains access to the airwaves.

TIME FRAME

The option of strengthening the FCC and limited mergers does not come without caveats. The process itself might be particularly grueling, as it would be incredibly difficult to break up already existing institutions. While this is the best solution overall, it will also require a lot of time and money to accomplish. It will also take the commitment of a progressive congress as well as president, to ensure the initiatives are undertaken and that the public interest is upheld.

CONCLUSION

It is the job of the government in a democracy to uphold standards of truth, morality and justice. The FCC should not fall beholden to special interests. Instead, the regulatory agencies overseeing media and communications should extend laws to protect the most important component of democracy. Access to factually accurate news is critical for a healthy democracy; it is what our citizens rely on to make informed decisions about their lives and their politics. In the current climate, the conversation is framed by those who have an interest in swaying policy. Corporations cannot be trusted nor expected to self-regulate in a way that serves the public good. Media reform would undoubtedly lead to a broader democratic reform on all issues. Today we call on you for action. We ask for your commitment to the people, a commitment to a public service that is necessary for our survival as the greatest country in the world. We ask that you revisit the laws enacted over the last three decades to empower the people by removing it from the wealthy and elite. In order to give the people a chance to grapple with the issues of our times, we must have a transparent and unbiased media delivering the news.

Thank you for your time and consideration.

References

Bagdikian, Ben H. The New Media Monopoly. Boston: Beacon Press, 2004. Google Books. Web. 16. Feb 2016.

Berger, Arthur A. Media and Society: A Critical Perspective. Plymouth: Rowman & Littlefield Publishers, Inc., 2012. Google Books. Web. 16 Feb. 2016.

Corcoran, Michael. “Democracy in Peril: Twenty Years of Media Consolidation Under the Telecommunications Act.” Truthout.org. Truthout, 11 Feb. 2016. Web. 16 Feb. 2016.

Commoncause.org. (2016, January 28). Media and Democracy: Democracy Wire Retrieved from state_or_national=483903345&spstate_or_national=483903345&spissue=486060197&spcampai gn=&spstartDate=&spendDate=