Who Should Pay for FCC to Play? A Recent Report about Industry-Sponsored Trips for FCC Officials Has Raised Eyebrows, but a New Provision Would Put Commission Travel on the Tab of Taxpayers

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Byline: Vanessa Pierce, INSIGHT

There has been an unprecedented backlash since the June 2 decision of the Federal Communications Commission (FCC) to deregulate media ownership. A bipartisan coalition in the U.S. House of Representatives voted 400-21 to roll back the broadcast-ownership provision of the new rules. This rule says a single company may not own TV stations that consume more than 45 percent of the market (formerly it was 35 percent). A Senate committee agreed, added further caveats in S 1046, and sent the matter to the floor.

Sen. John McCain (R-Ariz.), chairman of the Senate Commerce, Science and Transportation Committee, meanwhile threw something else into this roiling mix, adding a provision to the FCC Reauthorization Act (S 1264) that would prohibit members of the telecommunications industry from paying for the expenses of FCC officials attending the industry's special events. McCain's decision to add the provision was based in part on a report by the nonpartisan Center for Public Integrity (CPI), an investigative-journalism group, that claims $2.8 million was spent over eight years by the telecommunications industry, universities and international organizations to send FCC officials to trade shows and conventions held at vacation destinations. The report also suggested a questionable relationship between these travels and the June 2 ruling by the FCC.

Critics of big media say concern about multimillion-dollar ingratiation is legitimate since the changed ownership restrictions could result in market monopolies. The FCC claims the report is "misleading" and denies any wrongdoing.

It is important carefully to review the CPI report and evaluate it for fairness and balance because S 1264 is based partly on it and, if it is passed, taxpayers would be the ones footing the bill for the travels of FCC officials to major media-industry events.

The CPI report, called Well Connected: A Report on the Frequent Travels of the FCC and Other Telecommunications Issues, documents trips costing more than $250 that were paid for by sources other than the FCC and identifies 2,500 "industry-sponsored" trips during the last eight years. Most trips were to destinations such as Las Vegas, New Orleans and New York City. Project Manager John Dunbar tells Insight that CPI spent three years investigating the telecommunications industry as a whole and that its federal regulator, the FCC, deserves similar scrutiny.

According to FCC spokesman Richard Diamond, it is not uncommon for commission officials to travel as part of their oversight function. The trade shows and conventions tend to be attended by industry executives and personnel with a wide variety of viewpoints. Traveling to attend these events is important because it "gives us the opportunity to get outside the [Washington] Beltway and hear from people about the real effects of [FCC] policy in the real world," he tells Insight. Traveling is routine among all the regulatory agencies and each has to comply with the federal law that specifies the procedures for accepting payments from outside sources. It was just happenstance that the FCC was the target of this investigation, and the report does state that the "trips appear to have been legal under government guidelines."

Nevertheless, the CPI report has raised public concern and critics on both the left and right tend to worry about chummy relationships between regulators and the industry they oversee. One of the apprehensions is that wining, dining and other entertainment seems to be linked to these events. The report cites one event in which the Consumer Electronics Manufacturers Association spent more than $45,000 to bring 27 FCC officials to an electronics show in Las Vegas, where they were housed in the glitzy Bellagio Hotel & Casino. "It's silly to say [FCC officials] don't lose some of their objectivity when they are being wined and dined like they are at these industry events," says Mark Cooper, director of research at the Consumer Federation of America. …