Congress Hobbles Shays-Meehan at Broadcasters’ Bidding

by Mike McCabe, Executive Director

February 22, 2002

Sweet pension deals for top elected officials. Political leaders under criminal investigation for allegedly trading votes for campaign donations, misusing public offices for political purposes, creating phantom jobs on the public payroll for political cronies, and destroying public records to cover it all up. Elite law firms hired with taxpayer money to obstruct the prosecutors and the press.

We’ve grown accustomed to reassuring ourselves here in Wisconsin that we’re above this kind of thing. Illinois, sure. Washington, D.C., of course. But not here.

Until now.

What happened to Wisconsin’s squeaky clean politics?

TV happened, that’s what.

So many people are so addicted to television in this day and age that if political candidates want their messages to reach voters, they have no choice but to buy their way onto TV. The cost of TV has made campaigns outrageously expensive and has left politicians forever in need of more and more special interest money to pay for the ads. That pressure to raise money for TV ads is at the root of the scandals that now plague state and national politics.

Broadcasters have shamelessly exploited candidates' insatiable appetite for air time by systematically gouging them in the prices they charge for ads. A Wisconsin Democracy Campaign study shows local stations in Milwaukee, Madison and Green Bay charged 68 percent more than the lowest candidate rate listed on the stations' own advertising rate cards. That’s a premium of nearly $1 million in the final month of the 2000 campaign alone in just three of the state’s television markets.

Candidates are paying these premiums despite a 30-year-old federal law designed to protect candidates from demand-driven spikes in TV ad prices. The law’s intent was to ensure candidates could buy advertising time at the lowest rate offered to commercial advertisers who buy air time in bulk. If the law worked as intended, candidates wouldn’t have to spend so much time begging for contributions and you wouldn’t be seeing public policy traded for campaign donations.

But the law no longer works. By the 2000 election, the so-called "lowest unit charge" safeguard for candidates was poked full of so many loopholes that it was overrun by the selling practices of stations and the buying habits of the candidates and special interest groups involved in issue advocacy advertising.

Nineteen candidates bought nearly 7,300 ads in the 30 days before the November 7 election, paying 11 stations in Milwaukee, Madison and Green Bay almost $2.5 million. If candidates had paid the lowest rate listed on the stations' rate cards, they would have paid just under $1.5 million for the ads. The overcharges averaged more than $137 per ad.

Overcharges averaged 134 percent in the Madison TV market, 57 percent in Green Bay and 15 percent in Milwaukee.

Stations charged candidates even more than their highest listed rate in at least 184 instances, a violation of the spirit if not the letter of the federal law. Green Bay CBS affiliate WFRV went "off the rate card" most frequently, charging more than its highest published rate 128 times.

Our analysis shows stations charge more for ads during periods of peak campaign activity than they do during non-election periods. For example, in the final days of the 2000 election campaign Madison’s CBS affiliate WISC was charging as much as $800 for a 30-second ad during the 6 o'clock news on Saturdays. Right after the election, WISC cut its price for the same ad in the same time slot to $350.

Congress just passed up a golden opportunity to fix the problem. Last March, the U.S. Senate added an amendment to the McCain-Feingold campaign reform legislation that closes the loopholes in the federal "lowest unit charge" law. The amendment took broadcasters by surprise and when the same provision was included in the companion Shays-Meehan bill in the House, the National Association of Broadcasters waged an all-out, 11-month lobbying campaign to strip the measure from the bill.

Within days of the amendment’s passage in the Senate, the NAB and its political action committee began making major contributions to both political parties and members of Congress. Five days after the Senate passed McCain-Feingold with the lowest ad rate guarantee attached, the NAB gave $15,000 apiece to the National Republican Congressional Committee and the Democratic Congressional Campaign Committee. Two days later, the group gave another $2,000 in soft money to the DCCC. Meanwhile, more than $60,000 in checks were distributed to House and Senate members.

The broadcast industry’s money won. While the Senate had voted 69-31 to close the loopholes that have rendered the lowest unit charge law useless, the House voted 327-101 to remove the TV ad rate reforms from the bill it passed. (In Wisconsin’s House delegation, Representatives Tammy Baldwin, D-Madison, Mark Green, R-Green Bay, Ron Kind, D-La Crosse, Thomas Petri, R-Fond du Lac, Paul Ryan, R-Janesville, and F. James Sensenbrenner, R-Menomonee Falls, voted to protect the broadcasters' profits. Only Congressmen Tom Barrett, D-Milwaukee, Gerald Kleczka, D-Milwaukee, and David Obey, D-Wausau, voted to close the ad rate loopholes.)

It’s ironic that as the House mustered the courage for the first time in a generation to pass a bill that aims to reduce the influence of special interests, it bowed to the wishes of one of the most powerful special interests of all – the TV industry – at the expense of our democracy.

But the House vote was not the last word. Over the course of the next year, the Wisconsin Democracy Campaign and reform groups in other states will be working in partnership with the national Alliance for Better Campaigns to build grassroots support for reforms that restore meaning to the public interest obligation broadcasters inherit when they are given – free of charge – exclusive licenses valued at hundreds of billions of dollars to operate on the public’s airwaves.

We'll be working to make sure that next time Congress won’t merely hear from the broadcast industry. They'll hear from the rest of us, too.

WDC Executive Director Mike McCabe
Mike McCabe
WDC Executive Director

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