Is the FCC DOA?

Today, Reynolds and McChesney address the future of airwave regulation. Previously, they debated newspaper viability, the state of contemporary news media and the value of traditional journalism. Tomorrow, they’ll discuss media consolidation and other issues.

Shortest possible answer
By Glenn Harlan Reynolds

Is there any role for the FCC in the 21st century?

No.

Oops, that’s not going to get me to my assigned 500 words, or even close. And it’s not quite true anyway. There’s a role for the FCC, in terms of setting technical standards and assigning spectrum—though that could probably be undertaken just as well by private bodies and auctions—but that’s about all.

But there’s not much of a role for the FCC in doing what the FCC mostly does: Policing who is allowed to use the airwaves, and trying to regulate the content of broadcasts. In the 21st Century, the twin arguments for an FCC role, limited broadcast spectrum and public ownership of the airwaves, have become obsolete. Broadcast spectrum isn’t limited—most towns have room for more TV and radio broadcasters than they can economically support anyway. (Your real information-industry monopolist in most towns is the local newspaper, which the FCC won’t touch.) And the public “ownership” of the airwaves—why? The public didn’t discover them. Neither did the government.

Happily, the FCC’s role is getting smaller, as more and more “broadcast” material reaches people through other channels: cable TV, satellite radio, the Internet, etc. Unhappily, the FCC—like any business in a declining market—has shown some signs of wanting to expand its regulatory authority to these new channels of communications so that, presumably, if Janet Jackson’s nipple is exposed anywhere, anytime, the FCC can punish someone.

It’s no accident, I think, that the most vibrant and fast-growing communications media are in the areas that are the least regulated. Bureaucratic mission creep may explain why the FCC wants to bring these new areas under its dominion, but a more sensible policy would cut back on the FCC’s current authority.

I don’t think I’m up to 500 words yet, but this is an easy one: The FCC doesn’t do much good now, and expanding its authority won’t do much good in the future. The best thing for American media would be to limit the FCC to a purely technical role.

Glenn Harlan Reynolds is Beauchamp Brogan distinguished professor of law at the University of Tennessee, creator of instapundit.com, and author of An Army of Davids: How Markets and Technology Empower Ordinary People to Beat Big Media, Big Government, and Other Goliaths.

We need genuine public servants
By Robert W. McChesney

On this question I believe we have reached a point, Glenn, where you and I are in clear disagreement.

Part of it may be that I read more into the question than you do. The real question implied here, in my view, is whether the government writ large, not just the FCC, has any role to play in our communications system in the 21st century? With the combined magic of digital technology and free markets, can we simply eliminate the government’s role altogether? Then won’t we all be set free?

The inaccurate assumption here is that the United States has always had (or should have) a natural “free market” media system, and the government has periodically intervened for technical reasons—like a limit to the amount of airwaves that can be allocated for radio or TV stations. Now with the magical Internet, the conventional wisdom goes, there is no longer any justification for government involvement. The free market should be left alone to work its genius unencumbered by bureaucrats.

The problem is that we do not have a free market media system in the United States. We never had one. We never will. What we have developed over the course of our history is a profit-driven media system—but it is not free market. And it is barely competitive in an economic sense of the term.

Our media system is not a “free market” because it is built largely upon extraordinary government subsidies. The government has been in the middle of building our media system from the beginning. Perhaps no other industry this size has anywhere near as much direct and indirect government support and involvement. Consider the value of monopoly licenses to radio and TV channels or monopoly cable TV franchises. Or consider the value of copyright protection, a government created monopoly privilege. We are talking tens of billions of dollars in annual subsidies. The list goes on and on.

I am not opposed to government subsidies. I think they are unavoidable. Like Madison and Jefferson, who instituted enormous printing and postal subsidies to spawn a vibrant press, I believe they are the price of building a democratic media culture. The problem in recent times is that the policymaking process has gotten so corrupt that the giants firms that dominate media and telecommunication give back very little in exchange for the bounty bestowed upon them. We hear a lot of PR hokum about brilliant entrepreneurs and free markets. But huge corporations like AT&T and Comcast were created based on government monopoly licenses. Their “competitive advantage” comes with owning politicians and regulators, not serving consumers. They are doing everything they can to use their domination of politicians to lock in control over the Internet, and make it their private fiefdom. They want to terminate the egalitarian genius of the Internet, Glenn, which captivates both of us. These firms would not know a free market if it kicked them in the butt.

Even if someone wanted to create a truly “free market” media system, were that possible or desirable, it would require massive public intervention in the policymaking process and a radical overhaul of our regulatory structure. It would also require extensive government involvement to establish and maintain competitive markets. This may be why none of the so-called free market thinks tanks are for a “free market” system except in their PR blitzes. Otherwise, they carry water for the AT&Ts and Comcasts of the world.

And whatever the strengths of a profit-driven media system, it also presents clear problems for our society. The profit-driven system tends toward hyper-commercialism, and, as I have discussed the past three days, it has left journalism in a deep and prolonged crisis. Markets and digital technology cannot solve these problems on their own.

We are always going to have policies and regulations—the key question is whose values and interests those rules are going to represent. For too long media policies have been made in the public’s name but without the public’s informed consent. My group, Free Press, believes that the public must play a role in core media policy issues, ranging from media ownership and public broadcasting, to postal policy and the rules that will shape the future of the Internet.

The FCC is the poster child for corrupt policy making. For decades it has doled out the monopoly licenses and goodies to wealthy firms without any public awareness or involvement. In the past four years, with the emergence of the media reform movement, the FCC is now finally facing public scrutiny. Some members, like Jonathan Adelstein and Michael Copps, revel in the new level of popular involvement, because they are genuine public servants. Others detest any interference with the golden relationship whereby FCC members use their stint in “public service” to grease the revolving door for a very high-paying industry position once they leave office. This has been true for Democrats as well as Republicans.

Returning to the original question, yes, we need the FCC, and the government—but we need them to reflect policies determined by an informed public debate. If the public does not make these policy decisions, I assure you our good friends at AT&T and News Corp. will. That is the challenge of our times. How this media reform movement proceeds will go a long way toward determining what type of journalism we have and what sort of Internet we have for decades to come.

Robert W. McChesney is a professor of Communication at the University of Illinois. He is the co-founder and president of Free Press.