Another Knife in The News
We live in an era when big money controls most of our lives. Oligopolies of four or five dominant firms control vast swaths of our economy—and our lives. Transportation, banks, pharmaceuticals, hospitals, food producers and distributors are just a few with which we are all familiar. We, the consumers, pay the price for their market power. While most of us suffered during the pandemic, these giants were lapping up enormous profits. The New York Times just reported that the largest banks reported “bumper profits” in the first quarter of this year—would you believe JPMorgan’s were 52%? Airline profits are similarly in the billions. Ditto oil and gas, the big guys profiting to the tune of tens of billions of dollars per quarter. And I don’t think I need to tell anyone about the hardships the big grocery chains are wreaking on people trying, often desperately, to buy enough food to feed their families. People work longer hours and still can’t keep up with the cost of living.
Sitting atop this backdrop of economic imbalance are Wall Street hedge funds and private equity firms that daily manage hundreds of billions of dollars, leveraging debt to acquire companies, then firing workers, and stripping the carcasses of American industry for asset sales.
This destructive way of running our economy is bad news in many sectors. Nowhere is it more pernicious than in communications and the media. We have seen business consolidation run riot in recent years in just about every part of our communications ecosystem. Telephones, radio, television, and now the internet have fallen into the hands of a few huge conglomerates which have gobbled up, shrunk, and very often closed America’s independent media outlets. We look around now and see news deserts without the supply of local news and information a democracy needs to flourish. Ours is certainly not flourishing right now! Whole communities are without the news they need. Coverage of local governments and statehouses has diminished to a shadow of its former self—and this is an era when state legislatures crank out hundreds more pieces of legislation than our stymied Congress.
I was a commissioner at the Federal Communication Commission for more than a decade and I had a front-row seat to this carnage. Most of that time, I was in a minority, voting against merger deals that were contrary to the public interest standards the FCC was supposed to be protecting. Instead, it often abetted them—and it wasn’t only Republican FCCs that made the wrong calls. I was the only commissioner to vote against the gigantic Comcast-NBCU merger that saw traditional media and the new media of the broadband internet join hands and create monopolies in many areas of the country.
Now we have another giant merger being proposed. Two massive Wall Street funds, Standard General and Apollo Global Management have set out to purchase the second-largest local tv station group in the U.S.—Tegna. The merger would be a disaster from the get-go. It’s another attempt of private equity to take over our nation’s newsrooms. I would call it predatory.
According to communications law, the job of the FCC is to approve or deny such transactions based on the criterion of whether it advances the public interest. The private equity giants behind this particular proposal make no credible case that the transaction would serve the public interest. The idea should be not to avoid harm, but to advance the common good.
The FCC requested the proponents of the deal to provide more information that is needed so the agency would have the real facts before it. The response it received was utterly lacking in real substance. The FCC, also trying to better understand the financial legerdemain of the byzantine financing being proposed to close the deal, has sent the package for further examination through an FCC administrative hearing so it would have what is necessary to make an informed decision. The companies protest this will take too long and endanger the merger, but had they responded credibly to the requests for information the FCC asked for, we would not have needed the administrative hearing.
Luckily, journalists, consumers, and civil rights leaders have come together to block the transaction. The NewsGuild-CWA, the National Association of Broadcast Employees and Technicians (NABET-CWA), together with Common Cause, the United Church of Christ Media Justice Ministry, are contesting the deal, and the matter is presently in the courts—where we hope justice will prevail. Predictably, though, Standard General and its Wall Street allies have launched a massive lobbying, public relations, and litigation campaign. They have now made it personal and nasty, by trying to undermine FCC Chairwoman Jessica Rosenworcel, one of the ablest public servants in Washington (I know: many years ago she worked for me at the FCC).
It’s one thing, bad as it is, for special interest moguls in other industries, like oil and gas, to wield so much influence in our nation. But media—news and information—is the fuel democracy runs on. An informed electorate is the prerequisite for successful self-government. This merger runs roughshod over the public interest. It must not be allowed to proceed.
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