A change in Princes is the Joy of Fools. ~ Old Romanian Proverb
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Wednesday, March 16, 2011

Time for the baby to grow up

A little bit more on the NPR scandal, now that it's worked it's way through the twittering ninnies that constitute the Mainstream Media. The major arguments I've been perusing go like this statement from Oregon Democrat Congressman Earl Blumenauer:

"As traditional news outlets lay off reporters and offer less coverage of important topics, public broadcasting is filling the gap, bringing critical news and information to communities across the country," Blumenauer added. "What's more, public broadcasting stations are the only source of free programming that educates our children rather than the many commercial stations simply trying to sell them products. Our communities, our workers and our children would be the true victims of any cuts to funding for public broadcasting."[1]

Road apples. I'll be the first to tell you that Cartoon Network, Nickelodeon and other commercial television shows aimed at children are designed to hold kids' attention long enough for the high-pressure ads to brainwash the wee ones, who will in turn hector their parents for yet more toys. So what? Before you think I'm being too coldly capitalistic, go take a look at the Sesame Workshop. You know, the Big Bird people. You don't think that has become an enormously profitable enterprise with all the deals they have made over the forty-plus years since Oscar first popped out of his garbage can? "Well," you say, "Sesame Workshop is a non-profit organization. Says so right here." Someday, I'll get into that topic, but for now let's say that being a not for profit company does not mean "lacking lotsa cash." They have revenue streams from lots and lots of grubby, moneymaking enterprises paying them for the right to fashion toys, games, books, live shows,  etc. around their lovable characters. That's over and above the fees they are paid by PBS stations to broadcast the show.

Doom! DOOM!
[Actually, I recall a very edgy Nickelodeon cartoon show, Invader Zim, that I liked and it regularly made fun of exactly the scenario I described above. Although it was pulled for ratings declines, I harbor the sneaking suspicion that a network or advertising executive finally watched the show and saw Vasquez clearly lampooning broadcasters like Nickelodeon and their sponsors.]

 Being organized as a non-profit does not mean you are dealing with poor, dedicated idealists who would much rather live out some pure existence than prostitute their values to serve commercial ends. They may in fact be idealists, and some non-profit corporations may be in dire financial circumstances. However, being a non-profit just means you don't pay income taxes on what's left over from your revenues after you pay all your expenses and that you don't pay dividends to stockholders. One way you keep non-profits from not showing a profit is that you pay your executive staff VERY WELL. And whom do you think makes that call? Some of the most highly paid people in the world work for 501(c)3 corporations. And many of those entities get government funding.

And why are we conservatives so upset with the non-profit media outlets? Well, going back to the Brian Montopoli article I quoted above:

Eric Deggans, the media critic for the St. Petersburg Times who also contributes to NPR, said in an interview that he believes NPR makes a concerted effort to be fair in its news coverage. (Deggans stressed that his connection to the network made him less than impartial.)

"When it comes to their opinion shows and their commentary shows and stuff like that, they're focused on kind of a college educated audience," he said. "And they have a very tight focus on who their listenership is, and they're creating shows that speak to those people. I think sometimes people see that focus and they translate that into a liberal bias."

Put another way, we're ignorant and STOO-pid. Sound like anyone else you know of connected to the world of public broadcasting? And unlike Ron Schiller, Deggans IS on the content side of NPR. I live in the Tampa Bay area, the St. Pete Times is a local paper here and is not known for it's right-wing views.

The simple truth is that non-profits are ideologically-driven enterprises, and there is NOTHING wrong with that in my eyes. But they attract people motivated by those ideals and those people in turn seek out others similarly inclined. Ron Schiller did not get his job at NPR just because he liked the salary and the dental plan. He clearly bought into the mission statement. And the people who hired Schiller no doubt wanted to make sure he would fit well within their corporate culture. When he left, he was headed for another non-profit (and yeah, I know it was more about finding work in Aspen where he wanted to settle to be near a significant other, but he didn't go to work for a department store in Aspen). The condemnations of Schiller's candid opinions recorded by Project Veritas coming from his former colleagues as atypical examples of the attitudes of public broadcasting staffers reeks of sanctimonious hypocrisy. The circumstances are more akin to the scene in the film The Dirty Dozen wherein Lee Marvin chides Charles Bronson about his shooting of a deserter: "You only made one mistake: you let someone see you DO it!"

NOW he tells us!!
I defy anyone at NPR, PBS, or CPB to produce a single individual on the content side or in any part of their organizations that is in fact a real conservative. In fact, I think conservatives would object to working for these organizations for idealistic reasons of their own.

What?! David Brooks? Puh-leeze!

But there is another issue, one of fundamental fairness. It's one thing for a private, profit-making network to target a given demographic. That's a business decision and a risk they take that it will ultimately be profitable, that they will attract their target audience and that advertisers will want to reach that population segment. For all the sturm und drang liberal pundits and political opponents stir up about Fox News, people watch it of their own free will and advertisers choose to buy time. It's the same for the utter lunatics over at MSNBC, who do not even pretend that they are anything but rabid partisans of the Democrat party. It's the same story at any commercial network.   [And while I'm on the subject, the accusations leveled at Fox's alleged bias only demonstrate to me that journalists have become so self-satisfied with their liberal preconceptions that they lack any perspective of what constitutes fair reportage.]   When a public broadcaster skews its content to suit a narrow demographic, it is forcing the rest of the nation to subsidize the audience they serve. They cannot claim that they do it to target a favorable segment of the population for maximum ad revenues.  The only other reasons are that it suits the world view and political aspirations of its producers and its viewers.  If they are the kind of bi-coastal, university-educated, affluent professional that Eric Deggans alludes to above, then I see no reason why they should not bear all the costs of supporting public broadcasting directly, rather than coughing up the occasional funding-drive donation for bragging rights and a tote bag.

Well, let's talk a little about the finances for CPB, NPR, and PBS. I used the 2009 statement for the Corporation for Public Broadcasting as that was all that was available. The PBS and NPR annual reports for 2010 includes the 2009 numbers, so I'll work with 2009 for all three entities.

Both NPR and PBS are essentially content providers or coordinators, they provide the radio (NPR) and the television (PBS) stations with a stream of programs that can be broadcast. NPR gets most of it's money from the network of 910 local radio stations in the broadcast system, which pay NPR for the programming it provides. NPR gets some of it's funding as grants from corporations and foundations, donations, income from its investments, and merchandising, about $60 million in 2009. Neither NPR nor CPB indicate how much is specifically from CPB, but NPR's web page indicates CPB is among the grant makers. NPR does not operate any radio stations itself, but it does operate the satellite distribution system for its programming. NPR also has a separate entity known as The NPR Foundation, a $250 million dollar endowment that distributes its income solely for the benefit of the NPR operating entity, although there are restrictions on certain amounts. [Ron Schiller was both President of the Foundation and also Vice President for Development (non-profit-speak for "fund raising") at NPR.]   In 2009, the Foundation distributed $15 million to NPR, roughly ten percent of NPR's total revenue that year. NPR's revenues from member stations were $2.7 million for dues and $63 million for programming fees. There is one final item identified as "Distribution Services" which totaled $11 million in 2009, and this is for fees paid by the member stations for use of the satellite network it operates. Therefore from it's total revenues of $152 million in 2009, $77 million came from member stations (about half).

[In 2003, NPR and The NPR Foundation  were the recipients of one of the largest single monetary donations to a cultural institution when the late Joan B. Kroc, widow of McDonald's founder Ray Kroc, left them $225 million.  Part of the bequest was put into the NPR Foundation to increase the endowment, much of it was used to expand operations and reduce fees to member stations.  So  Super Size with pride, you ignorant fatties! How's THAT! Michelle Obama?][2 and 3 and 4

PBS was the most weaselly of the three organizations' websites, in terms of being all pomp and puff and very cagey about where it puts the numbers and the details about its operations. In fact, other than the audited annual report (not easy to find), which tends to give out gross numbers and no details, they are not forthcoming with anything approaching the level of information that both CPB and NPR do. According to the CPB report [backed up by Wikipedia] there are about 354 television stations it funds, presumably the bulk are PBS stations. PBS distributes programs to the member stations, but does not have a central production facility of it's own. It commissions some productions; co-produces programs with other entities, including some of the larger member stations (eg, WGBH in Boston, WNET in New York City); and buys programming from entities such as the Sesame Workshop or American Public Television. In addition to colleges, some PBS member stations are owned by state or local governments (and get funding from them) and others may be organized into statewide "subnetworks."[5]

About three-fourths of the radio stations in the NPR network are operated by colleges and draw part of their support from the schools. Many NPR stations are also co-located and jointly operated with PBS television stations, but thanks to PBS, I can't determine how many nor whether they are also at colleges.  The individual public radio and television stations may also get grants from corporations and foundations.   I have no figures in that regard as my focus was on the Triumvirate.

[Here in Tampa, WUSF is both a PBS TV station and an NPR radio station, located on the campus of the University of South Florida (Go Bulls!) Additionally, USF has acquired a second radio station, WSMR, which it plans to use as an NPR station servicing the Sarasota area.][6]

In 2009, PBS received $200 million from member stations for programming and other services. Grants and contributions (including unspecified CPB grants) were $55 million, royalties and video rights of $55 million, $16 million in other services, losses from investment activities of -$53 million and something identified as "Imputed value of donated broadcast rights" of $229 million, for total revenue of $503 million in 2009.

However, the imputed income is an accounting adjustment for the value of programming ultimately acquired by PBS but paid for by direct grants from other entities. Think of it this way: Someone buys a car and gives it to you as a gift. You spent no cash, but you got something of value, so you recognize the value of the gift as income that year.  Whether to include this in their total revenue or not is problematical because I do not know how much of the third-party money was from CPB, or from member stations who get funding from CPB. To be conservative, I'm going to treat it all as non-CPB money. Therefore, from total revenue of $503 million, member fees constitute $200 million or forty percent.

[Oh BTW, perusing the expense side, how about the $41 million PBS spent in this category: "Promotion – Represents institutional and program promotion and press efforts intended to increase awareness of the value of public television . These activities provide public television stations with a broad array of promotional support, including on-air promotional spots, print and radio advertising, press support and the coordination of public television’s educational message and positioning." (emphasis added) I smell some $avings][7-pg.13]

The Corporation for Public Broadcasting is the recipient of the large direct grant from the Federal government among the three entities, $400 million in 2009. There were also Federal grants labeled "Radio Interconnection" of $27 million and "Digital," of $35 million, which were targeted for specific upgrades to the both radio and television broadcast technologies. CPB also had investment income of $9 million, Dept. of Education grant of $1 million, and refunds of prior grants of $12 million, for total revenue in 2009 of $484 million.

For 2009, the CPB gave direct grants to radio stations of $59 million and to television stations of $203 million. $20 million was used by CPB to pay General and Administrative expenses. If one omits the non-recurring Federal grants for system upgrades, and assuming that everything besides G&A expenses is spent in support of public broadcasting, then $402 million of the CPB's revenue for 2009 is available for operating expenses.

If Congress had de-funded CPB-that becomes $2 million.

Put another way, if the 2009 revenues for NPR and PBS are combined, $152 + $503, the combined revenue of both public broadcasting network operators is $655 million. Remove $400 million and that total becomes $255 million, a reduction in funds of sixty-one percent.


Some little Lefty will bawl that I'm messing with the numbers and I should stick to the operating grants. But hear me out: CPB uses most of it's funds to support public broadcasting in one way or another. Operating grants to NPR and PBS are one thing, but all of the rest of its funds are used in some way to support the endeavor of public broadcasting, upgrading infrastructure, producing programs, etc. If CPB is not there to provide the funds, some other entity will have to provide it. Or the funds must be done without. And activities will decrease.

I've tried to be as conservative as I could with numbers and footnotes, as I am not familiar with the finances and do not have access to relevant details. The public broadcasting Triumvirate of PBS, NPR, AND CPB have very convoluted funding arrangements, so it's often hard for outsiders to discern exactly where money is coming from and where it's going.  But pull funding from CPB and it's like you have have turned the water source off at the main and all the taps within the structure have suddenly, simultaneously gone dry.  

Ok, they still have corporate and foundation grants, funding from various state and local governments, revenues from sales and licensing deals, so it's not quite dry; but the system as constructed cannot survive.  This is the dirty little secret that the public broadcasters don't want you to see and why they have gone into high gear to head this freight train off at the switch. It puts the lie to their assertion that government funding doesn't matter to them.

This was a longer effort than I thought it would be when I started, but I had to finish it to make my points, and I'm glad I did.

One more thing. The advocates for public broadcasting have been making the rounds talking about how the member stations of public broadcasting are often the only source of community information in rural areas. This is utter nonsense and based on a false premise. In 1967, when the Public Broadcasting Act was passed, the idea was to have a network of over the air broadcasters of radio and TV scattered across the land. This model is 44 years old and hopelessly dated.  It's stagnant and needs to be rethought in light of the technological advances since 1967.  There was no penetration of cable, no satellite TV, no satellite radio, no fiber optic connections, cable and telephone carriers weren't competing to deliver the same services. There were three major television networks and some local channels, not the plethora available to every home these days. Hell, we no longer even broadcast over the air the same way since the FCC mandated digital broadcasts.

 As for being the information source for rural areas, that is a big-city stereotype about country folk being poor ignorant, helpless hayseeds who need the guidance of sophisticates from the urban East and West. Even thirty years ago, people in rural areas were using six-foot parabolic dish antennas to access television from satellites that far exceeded local over-the-air offerings. Today, there are competing providers for the small, fixed-dish satellite services that vie with cable for the variety of their programming.

 And what about the idea that these three entities are the only sources of non-commercial (and presumably unbiased) reporting?  Well, I have a question. What about C-SPAN?  Those three channels actually let you see what Congressmen and Senators say (if you can stand it), rather than letting Nina Totenberg play carefully edited snippets and then tell you what it means. And they show events that appeal to both the political right and left, talk with authors who have written books from every point of view, host panels that discuss current events and take calls from viewers. Who funds C-SPAN?  No, the big difference between C-SPAN and the Triumvirate is that C-SPAN is raw and public broadcasting is very, very carefully polished.
There are so many changes in communications technology since this model was created in response to that outdated law. Mandatory broadcast spectrum changes have opened up subchannels for carriers in the digital spectrum. High def radio. And let me not forget, the Internet. So many ways to deliver content. PBS and NPR themselves have widgets for smart phones. No access?

Why not develop a regional strategy for reaching rural areas? Why support 910 radio stations and 354 TV stations? Use regional hubs, deliver the broadcast over cable nationally. Does HBO need 350 facilities to deliver its programming to anyone who wants it? Or use the subchannels available to digital broadcasters (which PBS already is, to target children and such). In my area, one of the two PBS TV stations, WUSF, has gone all digital even carried on cable; it's only available on my one digital tuner, the televisions with basic cable don't get that station. That sure doesn't fit into the 1967 model. Make a deal with SiriusXM for special access to public broadcast content, make it less costly than a regular subscription. After all, they already have fund drives for "subscribers" on NPR and PBS, so make it a formal subscription.

Resistance is f-u-t-i-l-e!
Ah, but maybe that's the problem: the Progressivist model that public broadcasting was designed around is one where everyone pays regardless, your only choice is whether or not you accept the "benefits." At it's core is an authoritarian mindset, never mind the fluffy Muppets on the cover. The more libertarian notion of paying for what you use is anathema to that way of thinking. It has to be "free," which really means "no charge to access."  In my books, $400 million in Federal dollars is a pretty expensive "free."

You need local reporters? Why not let them work from home, send them on assignments as needed regionally? If small hand held cameras or even Skype set-ups are used by the major networks, why not public broadcasting? Rent studio space as needed.

Consolidate facilities. WUSF radio, the college-based station I mentioned above, recently bought  WSMR, another station south of Tampa Bay and they are converting it to NPR to service the Sarasota area and to help them change format for WUSF, one station classical and the other jazz when not broadcasting NPR conent.  Fine, but they are also keeping separate studio facilities rather than stream content to a local broadcast antennae from their existing facility, saving the operating cost of another location.  Why?

Last but not least-accept advertising. You don't have to be NPR all day. There are cable networks that share channels according to the time of day. Why not public broadcasting?

In other words-ADAPT!

But they don't think that way. Because we consistently allow them to avoid it. It isn't because they cannot meet the same needs with different strategies. It's because they prefer it the way it is.


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