Recovery : Media and Campaign Finance

Barry, My Liege :

It is time to consider requiring that the media which receive its frequency allocations from the Federal Government provide free campaign ads to political campaigns.

Since the public owns the frequencies, the public has the right and duty to ensure that they are used in the public interest. It is the responsibility of the Federal Communications Commission to ensure that the public interest is protected.

The FCC is failing its duty.

At the moment, media receives billions of dollars in revenues from political campaigns. One estimate is that the 2012 election will cost $ 8 Billion ; much of that will go directly to media outlets to buy political ads.

Using a very rough guess of 75% of campaign finance going to media buys, which means media will receive $ 6 billion this year alone.

It is bad enough that the media receives an indirect subsidy from the government through political ads, but the bigger problem is that the politicians who write our laws must raise that money from campaign donors in order to be elected.

Politicians who receive campaign contributions are naturally disposed to consider the interests of their campaign contributors when writing legislation.

The question then becomes this : What exactly do donors want that is contrary to the public interest?

There are at least three things that moneyed interests can obtain through campaign contributions that damage the public interest.

First - Monopoly.

Campaign donors seek laws and regulations which enable them to obtain or expand a monopoly or oligopoly. The deleterious effects of monopoly profits were discussed earlier in this space. Monopolies and oligopolies harm the public interest simply because they exist.

Second - Favorable treatment from legislators and regulators.

Jamie Dimon of J. P. Morgan recently testified before Senate and House committees about a large loss made by his bank. The questions were embarrassing for the country. There were no questions which reflected the public interest, only questions which allowed Mr. Dimon to gloss over any potential dangers to the public from his bank's incompetence.

My Liege, you will not be surprised to learn that Mr. Dimon and his family have given $400,000 to Congressional campaigns since 1998. Some of those contributions went to the very Congress persons who questioned Mr. Dimon. Some of the questioners had received $2,000 from the Dimon family.

Now, we can only imagine what happens to the public interest when legislators and Presidential candidates must raise $ 8 Billion in one campaign.

Third - Writing Legislation.

The American Legislative Exchange Council [ALEC] is a group composed of legislators at State and Federal levels and corporate lobbyists who convene and propose laws for State and Federal governments. Some of the laws proposed by ALEC have been adopted word for word by various States.

Fortunately, public pressure has encouraged some corporations to withdraw from ALEC and its influence is waning. But, we can expect that another similar effort will be launched in the near future.

Proposed Solution

The above argues for overall campaign finance reform, and it is well needed.

This space suggests an alternative method to achieve positive public interest results : namely, requiring the media to provide free political as part of their licensing.

It is not expected that this will be easy inasmuch as it will be very effective.

Your faithful servant,