‘National’ Public Radio’s Local Franchises

If you want a new Cadillac, you can’t go to the General Motors website and order one from the factory. You have to go to a franchised dealer.

And if you are driving your Cadillac on a lonely stretch of Interstate and you want to get your evening news from National Public Radio’s All Things Considered, you can’t tune your satellite radio to its NPR channel and listen. Satellite offers only the B-list NPR shows. To get the top sellers on your radio, you need to tune to a nearby public radio station. Those local stations (often organized into statewide groupings) are NPR’s franchised dealers.

Though things were different long ago, nowadays these arrangements are a lot more important to the franchisees than to the name-brand producers. Recall, for example, the political furor that erupted when GM and Chrysler pared their dealer lists during their 2009 bankruptcies. A more current example is the political battle over funding for public broadcasting, especially for NPR.

Local public broadcasters rely on big-name national programs to attract listeners, contributors, advertisers (pardon me, “underwriters”) and state and local funding, though that last component is in short supply these days. The local stations produce some interesting, informative programming. I particularly enjoyed a recent Vermont Public Radio segment on the technical workings of the power grid, but this is not the sort of thing that induces large numbers of people to sign up for annual memberships. I suspect it actually induces large numbers of people to tune to another station.

If I am one of a small minority who want to hear a program about the power grid, why should you have to pay for it? Why should Wyoming taxpayers subsidize a national producer whose programming could easily be financially self-sustaining, but whose major role is to deliver an audience to Vermont Public Radio so it can afford to air programs about the power grid?

The House of Representatives voted last month to reduce contributions to the federally funded, but private, non-profit Corporation for Public Broadcasting, which provides financial support for television’s PBS and to various public radio producers, including NPR. More recently, it passed a separate bill to prevent local public radio stations from using government money to pay NPR dues or buy programming produced by NPR. Forty-three percent of NPR’s money comes from programming fees paid by stations, compared to only 3 percent from direct federal grants. Thus the restriction could, if passed, lead to a significant drop in revenue for both local stations and for NPR.

The congressional battle over federal funding for public broadcasting is portrayed as a conservative Republican vendetta against broadcasters with a perceived liberal Democratic bias. Some opponents undoubtedly do believe that a score-settling is in order. But this fight is ultimately not about the survival of popular national programming that already has a large and well-heeled audience. All Things Considered is not going away. But some stations that currently air ATC might be, if they lose their privileged access to it.

The federal subsidy for public broadcasting has always been a problem for journalists and commentators, because it gives public officials a license to become critics who also happen to hold the power of the purse. Politicians’ complaints, valid or not, get attention and create suspicion that, indeed, public broadcasting is not free to ignore the wishes of its government paymasters.

“The problem is we’ve seen NPR and its programming veer far from what Americans would like to see as far as the expenditure of their tax dollars,” House Majority Leader Eric Cantor, R-Va., said on the House floor before the vote to cut off NPR’s federal funding.

A week before that vote, NPR’s head fundraiser, Ron Schiller, resigned after he was caught on tape making disparaging comments about Republicans, and, specifically, Tea Party members. He also commented that NPR would be better off without federal money. Then-CEO Vivian Schiller, who is not related to Ron Schiller, resigned a day later, after the comments became known. The tape scandal added to earlier concerns about her political neutrality, raised after she fired “news analyst” Juan Williams for comments he made on Fox News.

Regardless of NPR’s bias, or lack thereof, independent news coverage requires independent broadcasters. I, for one, have no interest in getting my news, commentary or entertainment brought to me by my elected representatives in Congress or by whoever happens to occupy the White House.

Requiring public producers and broadcasters to rely on individual contributions, sponsorships and product licensing would inevitably make them beholden to new interests. But it is a mistake to believe that these producers and stations are now independent because they rely on the government instead, when politicians are, in fact, the people most likely to be interested in controlling programs’ political content.

Audiences, not taxpayers, ought to be responsible for ensuring that the content they enjoy continues to be produced. Those of us who want to know how the power grid works will have to pay up to find out. The rest of the country shouldn’t have to.

About Larry M. Elkin 534 Articles

Affiliation: Palisades Hudson Financial Group

Larry M. Elkin, CPA, CFP®, has provided personal financial and tax counseling to a sophisticated client base since 1986. After six years with Arthur Andersen, where he was a senior manager for personal financial planning and family wealth planning, he founded his own firm in Hastings on Hudson, New York in 1992. That firm grew steadily and became the Palisades Hudson organization, which moved to Scarsdale, New York in 2002. The firm expanded to Fort Lauderdale, Florida, in 2005, and to Atlanta, Georgia, in 2008.

Larry received his B.A. in journalism from the University of Montana in 1978, and his M.B.A. in accounting from New York University in 1986. Larry was a reporter and editor for The Associated Press from 1978 to 1986. He covered government, business and legal affairs for the wire service, with assignments in Helena, Montana; Albany, New York; Washington, D.C.; and New York City’s federal courts in Brooklyn and Manhattan.

Larry established the organization’s investment advisory business, which now manages more than $800 million, in 1997. As president of Palisades Hudson, Larry maintains individual professional relationships with many of the firm’s clients, who reside in more than 25 states from Maine to California as well as in several foreign countries. He is the author of Financial Self-Defense for Unmarried Couples (Currency Doubleday, 1995), which was the first comprehensive financial planning guide for unmarried couples. He also is the editor and publisher of Sentinel, a quarterly newsletter on personal financial planning.

Larry has written many Sentinel articles, including several that anticipated future events. In “The Economic Case Against Tobacco Stocks” (February 1995), he forecast that litigation losses would eventually undermine cigarette manufacturers’ financial position. He concluded in “Is This the Beginning Of The End?” (May 1998) that there was a better-than-even chance that estate taxes would be repealed by 2010, three years before Congress enacted legislation to repeal the tax in 2010. In “IRS Takes A Shot At Split-Dollar Life” (June 1996), Larry predicted that the IRS would be able to treat split dollar arrangements as below-market loans, which came to pass with new rules issued by the Service in 2001 and 2002.

More recently, Larry has addressed the causes and consequences of the “Panic of 2008″ in his Sentinel articles. In “Have We Learned Our Lending Lesson At Last” (October 2007) and “Mortgage Lending Lessons Remain Unlearned” (October 2008), Larry questioned whether or not America has learned any lessons from the savings and loan crisis of the 1980s. In addition, he offered some practical changes that should have been made to amend the situation. In “Take Advantage Of The Panic Of 2008” (January 2009), Larry offered ways to capitalize on the wealth of opportunity that the panic presented.

Larry served as president of the Estate Planning Council of New York City, Inc., in 2005-2006. In 2009 the Council presented Larry with its first-ever Lifetime Achievement Award, citing his service to the organization and “his tireless efforts in promoting our industry by word and by personal example as a consummate estate planning professional.” He is regularly interviewed by national and regional publications, and has made nearly 100 radio and television appearances.

Visit: Palisades Hudson

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