[Senate Hearing 109-1091]
[From the U.S. Government Publishing Office]
S. Hrg. 109-1091
S. 967, PREPACKAGED NEWS STORIES
=======================================================================
HEARING
before the
COMMITTEE ON COMMERCE,
SCIENCE, AND TRANSPORTATION
UNITED STATES SENATE
ONE HUNDRED NINTH CONGRESS
FIRST SESSION
__________
MAY 12, 2005
__________
Printed for the use of the Committee on Commerce, Science, and
Transportation
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SENATE COMMITTEE ON COMMERCE, SCIENCE, AND TRANSPORTATION
ONE HUNDRED NINTH CONGRESS
FIRST SESSION
TED STEVENS, Alaska, Chairman
JOHN McCAIN, Arizona DANIEL K. INOUYE, Hawaii, Co-
CONRAD BURNS, Montana Chairman
TRENT LOTT, Mississippi JOHN D. ROCKEFELLER IV, West
KAY BAILEY HUTCHISON, Texas Virginia
OLYMPIA J. SNOWE, Maine JOHN F. KERRY, Massachusetts
GORDON H. SMITH, Oregon BYRON L. DORGAN, North Dakota
JOHN ENSIGN, Nevada BARBARA BOXER, California
GEORGE ALLEN, Virginia BILL NELSON, Florida
JOHN E. SUNUNU, New Hampshire MARIA CANTWELL, Washington
JIM DeMINT, South Carolina FRANK R. LAUTENBERG, New Jersey
DAVID VITTER, Louisiana E. BENJAMIN NELSON, Nebraska
MARK PRYOR, Arkansas
Lisa J. Sutherland, Republican Staff Director
Christine Drager Kurth, Republican Deputy Staff Director
David Russell, Republican Chief Counsel
Margaret L. Cummisky, Democratic Staff Director and Chief Counsel
Samuel E. Whitehorn, Democratic Deputy Staff Director and General
Counsel
Lila Harper Helms, Democratic Policy Director
C O N T E N T S
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Page
Hearing held on May 12, 2005..................................... 1
Statement of Senator Dorgan...................................... 15
Statement of Senator Inouye...................................... 1
Prepared statement........................................... 1
Statement of Senator Kerry....................................... 16
Statement of Senator Lautenberg.................................. 2
Statement of Senator Stevens..................................... 1
Witnesses
Adelstein, Hon. Jonathan S., Commissioner, Federal Communications
Commission..................................................... 4
Prepared statement........................................... 5
Cochran, Barbara, President, Radio-Television News Directors
Association.................................................... 28
Prepared statement........................................... 29
Phair, Judith T., President/CEO, Public Relations Society of
America (PRSA)................................................. 36
Prepared statement........................................... 38
Poling, Susan A., Managing Associate General Counsel, Office of
General Counsel, Government Accountability Office.............. 22
Prepared statement........................................... 24
Schlick, Austin C., Acting General Counsel, Federal
Communications Commission...................................... 7
Prepared statement........................................... 8
Simon, Douglas, President/CEO, D S Simon Productions, Inc........ 32
Prepared statement........................................... 34
S. 967, PREPACKAGED NEWS STORIES
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THURSDAY, MAY 12, 2005
U.S. Senate,
Committee on Commerce, Science, and Transportation,
Washington, DC.
The Committee met, pursuant to notice, at 10:04 a.m. in
room SR-253, Russell Senate Office Building, Hon. Ted Stevens,
Chairman of the Committee, presiding.
OPENING STATEMENT OF HON. TED STEVENS,
U.S. SENATOR FROM ALASKA
The Chairman. This is the hearing that I said we would hold
on a bill sponsored by Senator Lautenberg to create a new
section in the Communications Act of 1934 to require
broadcasters, cable, and satellite providers and other persons
to ensure that the origin of prepackaged news stories produced
by our Government is disclosed to the public. The bill would
cover prepackaged news stories intended to be aired within the
United States. It would make it illegal for any person to
remove the Federal agency disclosure required by a provision in
the defense supplemental bill that passed the Senate earlier
this week. That was the Byrd Amendment. It was adopted on the
supplemental.
This hearing will focus on the need to amend the
Communications Act to authorize the Federal Communications
Commission to regulate the news industry's handling of what we
now know as VNR's.
The first panel this morning is the Honorable Jonathan
Adelstein, Commissioner of the Federal Communications
Commission, and Mr. Austin Schlick, the Acting General Counsel
of the Federal Communications Commission.
Senator Inouye, do you have an opening statement?
STATEMENT OF HON. DANIEL K. INOUYE,
U.S. SENATOR FROM HAWAII
Senator Inouye. Thank you very much, Mr. Chairman. I do
have an opening statement. I thank you for calling today's
hearing. May I have my full statement made part of the record?
The Chairman. Without objection.
[The prepared statement of Senator Inouye follows:]
Prepared Statement of Hon. Daniel K. Inouye, U.S. Senator from Hawaii
Mr. Chairman, I want to thank you for calling today's hearing to
examine current practices concerning the use of Video News Releases,
commonly referred to as ``VNRs.''
When used appropriately, VNRs, like written press releases, can
provide television news directors with an important source of
information and video footage that can then be reviewed and edited to
create independent news stories.
Unfortunately, as recent press accounts have documented, the
increasingly ``prepackaged'' and scripted nature of VNRs, sometimes
including actors posing as news reporters, has tempted some news
organizations to air VNRs in full without disclosing the true source of
such information.
Based on these reports, I wrote to then-Chairman of the Federal
Communications Commission (FCC), Michael Powell, in March of this year,
asking the FCC to investigate this matter and to take whatever remedial
action was necessary to prevent television and radio audiences from
being misled.
Roughly one month later, the FCC, under the leadership of its newly
appointed Chairman, Kevin Martin, responded by unanimously adopting a
public notice that reminds broadcasters and cable operators of the
disclosure obligations under the Communications Act and requests
further investigation into the production, provision, and use of VNRs.
Today's hearing lets us examine in greater detail the problems that
arise when VNRs created by government agencies are distributed without
proper disclosure to the viewing public about their true source. This
practice has been criticized by the Government Accountability Office
(GAO) for some time. The GAO has taken issue with the current
Administration's interpretation of when attribution is required.
This is not a partisan issue. Congress passed language as part of
the Supplemental Appropriations bill this past Tuesday that will
prevent Federal agencies from using funds appropriated this fiscal year
to create such prepackaged news stories unless clear government
attribution is provided. While this restriction is only temporary,
other proposals have been advanced that would result in a more
permanent solution.
Mr. Chairman, it was Thomas Jefferson who first noted that
``information is the currency of democracy.'' But its true value to our
society can only be realized if our ethical standards require, and our
laws enforce, a level of transparency and openness that protect the
American public from being misled. As a result, I look forward to
today's hearing and to our continuing efforts to enrich civic
discourse.
The Chairman. Senator Lautenberg, do you have an opening
statement?
STATEMENT OF HON. FRANK R. LAUTENBERG,
U.S. SENATOR FROM NEW JERSEY
Senator Lautenberg. I do. First, I want to thank you, Mr.
Chairman, for holding this hearing. I know that it was taken
off a busy agenda, but you did make a promise, and those who
know you know that you always keep the promise. We have to be
able to trust one another to get things done here. As we see in
these days, it is not always easy.
Well, I am hopeful that soon after this hearing we can move
ahead on a markup of this legislation so we can move it to the
full Senate.
The purpose of the bill that I have introduced with Senator
John Kerry is simple and straightforward. It would stop the
Government from producing covert propaganda. And by the way, I
want to say that this is, to my knowledge, not the first time
that it has been done. So this is not simply a finger pointing
at the present Administration.
Over the past year, the American people have learned of
numerous incidents in which the Administration produced fake
news stories that concealed the Government's role. And we have
also learned of journalists who were paid off to write
favorable articles about Administration policies. The best
known example of journalism for hire was the columnist and
radio commentator, Armstrong Williams, who was paid to write
and say favorable things about the No Child Left Behind law.
And cases of journalism for hire continue to be exposed.
Just this week, we learned that the Department of Agriculture
had paid a writer to produce favorable articles, which were
then placed in publications. The people who read the article
had no way of knowing that these news stories, so-called, were
bought and paid for by the Government.
When President Bush learned about the Armstrong Williams
case, he said it was wrong and he correctly said that the
Administration policies should be able to stand on their own
merits without need to bribe journalists. And we commend him
for that.
When it comes to another form, however, of Government
propaganda, the Administration has been unwilling to shut it
down. That other form of propaganda is the production and
distribution of fake video news reports that conceal the
Government's role. One notorious example of such prepackaged
news stories are the news stories paid for by the Department of
Health and Human Services that promoted the new Medicare drug
law. Not only did this supposed news report contain misleading
and slanted information, but it was signed off as ``this is
Karen Ryan reporting from Washington,'' but Karen Ryan was not
the reporter. She is a public relations consultant that was
contracted to voice over that fake news report. And the fake
news segment gave no indication that it was actually a
Government production.
The Government Accountability Office has determined that
this practice constitutes--and here I quote--``covert
propaganda.'' And it is illegal. The GAO told the Bush
Administration that it must identify itself in these news
pieces. But incredibly, the Office of Management and Budget
sent a memo to all Government agencies saying that it is all
right to hide their sponsorship of these fake news stories.
And that is why John Kerry and I think this bill is
necessary. Our bill tells the Administration that if they want
to produce fake news stories, they have to tell the American
people who made and paid for these stories. President Bush has
said it is the burden of the broadcasters who use prepackaged
news stories to figure out where the VNR came from. I disagree.
Why put the burden on industry when the Government can solve
the problem in a simple and efficient way? The only way to
ensure that the American people know what they are watching is
to include that information in the video itself.
Once again, I thank Chairman Stevens and Co-Chairman Inouye
for staying true to their word, holding this hearing. Again, I
hope that a markup will soon follow. Our staffs have had
productive conversations on this issue, and I am hopeful that
this hearing will lead us to a bipartisan bill so we can soon
move to the full Senate for consideration. Thanks again, Mr.
Chairman.
I look forward to the testimony of our witnesses today.
The Chairman. Thank you very much.
Our first witness this morning is Commissioner Adelstein
from the FCC.
All witnesses' statements will appear in the record as
though read. We appreciate your comments and brevity, if
possible. There will be a vote this morning, I guess two votes
starting at 11:40.
Commissioner Adelstein.
STATEMENT OF HON. JONATHAN S. ADELSTEIN, COMMISSIONER, FEDERAL
COMMUNICATIONS COMMISSION
Mr. Adelstein. Thank you, Mr. Chairman, Mr. Co-Chairman,
Senator Lautenberg. I appreciate your invitation to testify
this morning on a matter of great concern to me and to the FCC.
I think this hearing is especially timely because it can help
us combat the surprising lack of awareness that the law and the
FCC rules require disclosure of who is behind certain paid,
political or controversial programming.
Congress has maintained the principle from the outset of
broadcasting that consumers have a right to know who is trying
to influence them. Sponsorship identification laws date back to
the Radio Act of 1927, making these laws older than the FCC
itself. Congress has maintained an unwavering requirement that
broadcasters must announce who gave them valuable consideration
to air anything. In the case of controversial issue programming
or political programming, the FCC's interpretation of the law
has always required that whenever a third party provides
material to induce its broadcast, the identity of the source
must also be disclosed to viewers. So the seriousness with
which you are treating this matter is entirely consistent with
the historical concern of this committee and of Congress as a
whole.
Because of the need to highlight our rules, I was
especially pleased that last month the FCC voted unanimously to
remind the industry of their legal obligations. With the
leadership of our new Chairman, Kevin Martin, we came together
on a bipartisan basis to alert the industry that we take our
responsibilities in this matter extremely seriously and plan to
enforce the law vigorously. We also sought comments to learn
more about how VNRs are used and whether we need to refine our
rules even further.
A lot of analysts believe that the urgency of this issue
arises in large measure because of the increasing
commercialization of the media. Pressures on the bottom line
are forcing reductions in resources for news operations. And
this creates a void that PR firms are happy to fill with VNRs.
They are cheaper to produce than ads, free to get on the air,
and more effective because they are designed to mimic news
stories. But this can seriously mislead viewers and has
probably contributed to the well documented loss of public
confidence in today's media.
Another symptom of commercialization is seen in the reports
of a rising tide of undisclosed product placements in our
media. I am concerned that there seems to be a lack of
awareness here, too, of the need for disclosure under our
rules. Everyone in the industry would be well served if they
were to review our public notice on video news releases because
those very same rules can apply to product placements.
The focus of today's hearing is on the use of VNRs by
government agencies. As recently as 2002, the FCC reiterated
that disclosure is particularly important when the government
sponsors the broadcast matter. You have heard about conflicting
interpretations between the Justice Department and GAO about
whether unidentified government VNRs violate laws against
covert propaganda. The Commission has no jurisdiction over
these laws and has taken no position. But neither Justice nor
GAO has noted that the failure by broadcasters and cable
companies to identify the source of VNRs could violate the
FCC's sponsorship ID rules. As we said in our public notice,
these companies do have an obligation to disclose the source of
political or controversial VNRs.
If Congress seeks to ensure that the public is notified
about the source of government-sponsored VNRs, legislation such
as S. 967 is necessary to bolster our existing rules. This
legislation would apply whether or not consideration was
exchanged and whether or not controversial or political issues
were involved. It would also prohibit the removal of the
announcement. The bill does not specify the precise nature of
the announcement, but instead leaves it to the FCC to work with
broadcasters to determine how to achieve the right balance
between the public's right to know and editorial discretion.
The bill would not impose any new burden on broadcasters or
cable companies. In fact, it would simplify compliance. It
would ensure that those airing VNRs are aware of the
government's role in producing them. Most importantly, it
addresses the public's right to know the source of the
broadcast so they can make up their own minds about the
information being presented.
Again, Mr. Chairman, thank you for inviting me to testify,
and I would be happy to answer any questions you might have.
[The prepared statement of Mr. Adelstein follows:]
Prepared Statement of Jonathan S. Adelstein, Commissioner,
Federal Communications Commission
Mr. Chairman, Mr. Co-Chairman, and Members of the Committee, thank
you for inviting me to testify before you today about pre-packaged news
stories, also known as video news releases, or ``VNRs.'' The issue of
concern with pre-packaged news stories is that, absent proper
disclosure, listeners and viewers may believe that these stories are
produced by bona fide news organizations, rather than third-parties who
may have a vested interest in the content of the story. As a member of
the Commission charged with overseeing the influential and powerful
medium of television, this issue is one of great concern to me, and I
appreciate the opportunity to share my views.
This hearing is especially timely because, until recently, there
appeared to be a surprising lack of awareness that the Communications
Act and FCC rules already require disclosure by broadcasters and cable
companies of who is behind certain paid material or political or
controversial issue programming.
Because of the need to highlight our rules, I was especially
pleased that we voted unanimously last month to remind broadcasters and
cable operators of their obligations under the law. Under the
leadership of our new Chairman, Kevin Martin, we came together on a
bipartisan basis to warn that we take our responsibilities seriously
and plan to enforce the law vigorously, and sought comment to learn
more about how VNRs are used, and whether there is a need for the
Commission to refine its rules further to protect the public.
Pre-packaged news stories are attractive to busy newsrooms that are
trying to fill longer news windows with fewer journalistic resources,
because they are off-the-shelf, ready-to-go news stories that require
no expenditure by the news outlet. Although government-produced pre-
packaged news stories have been the focus of attention recently,
private corporations also use VNRs to provide information about their
products. Recently, I've read reports about the growing practice of
companies paying to guarantee that a media outlet will air their pre-
packaged news stories. VNRs are thus one symptom of the growing
commercialization of our media.
We are also seeing reports of a rising tide of product placement,
and I'm concerned that there seems to be a lack of awareness of the
need for disclosure under our rules in this area as well. This practice
is likely to increase, given that embedding products within programming
is partly a response to the fact that technology increasingly allows
consumers to view television content how and when they choose. In order
to comply with our rules, advertisers, broadcasters and cable operators
would be well-served to review our public notice on VNRs, since the
same rules can apply to product placements.
In FCC parlance, the issue of ``sponsorship identification'' dates
to the very beginning of broadcast regulation. Congress recognized from
the outset that with the American model of developing broadcast service
along private commercial lines, consumers have a right to know who is
trying to persuade them. As far back as the Radio Act of 1927, and
continuing with the Communications Act of 1934 and subsequent
amendments, Congress has maintained an unvarying requirement that radio
and television broadcasters must announce by whom any valuable
consideration was paid for or furnished. This means that the concept of
sponsorship identification is in fact older than the FCC itself.
The Commission adopted its first rules on sponsorship
identification in 1944. Since that time, our rules have of course
evolved some, but have never deviated from the core requirements. Our
rules have always required that whenever programming is aired for
consideration, the fact of sponsorship and the identity of the sponsor
must be disclosed. Our rules have also always required that, in the
case of controversial issue or political programming, whenever any
material or service has been furnished to the station as an inducement
to broadcast such programming, the fact that such material or service
was furnished and the identity of the source be disclosed. In 1960,
Congress generally excluded property or services provided to
broadcasters free or at nominal charge from the scope of consideration
that triggers the disclosure requirement--except for controversial
issue or political programming. As the Commission has acknowledged in
the past, disclosure is especially important with this type of
programming. As a result, for over sixty years, our rules have required
a disclosure to be made, in the case of controversial issue or
political programming, whenever any material or service of any kind,
regardless of cost, is furnished to broadcasters as an inducement to
air that programming. As recently as 2002, the Commission also
reiterated that disclosure is particularly important when the
government is the sponsor of broadcast matter.
In 1960, Congress also revised section 317 to impose a due
diligence requirement on broadcasters to obtain from their employees,
and others they deal with directly in programming, the information they
need to make the required sponsorship identification announcement. The
Commission has implemented the express requirements of section 317, and
has extended its sponsorship identification rules to cable operators
for ``origination programming,'' or programming subject to their
exclusive control.
The seriousness with which this committee is treating this matter
is entirely consistent with the historical concern of the Committee and
Congress as a whole.
In recent months--as evidenced by today's hearing--much attention
has been given to the appropriateness of Federal departments and
agencies using pre-packaged news without clear disclosure of the
government's role in creating the VNRs. Conflicts within the government
about whether this activity is or is not consistent with laws against
using appropriated funds for propaganda have arisen, with the
Department of Justice and the Government Accountability Office reaching
different legal conclusions on the matter. The Commission has no direct
jurisdiction regarding the propaganda laws, and therefore has taken no
position on it. I reiterate, however, that no matter what view one
takes in that debate, the Commission itself has stated clearly in our
recent Public Notice that broadcasters and cable companies do have an
obligation to disclose the source of political or controversial issue
programming when the source has furnished material to them as an
inducement for broadcasting that programming.
Legislation such as S. 967, the Truth in Broadcasting Act of 2005,
would be an effective complement to our existing sponsorship
identification rules. The bill would explicitly and unambiguously
require Federal agencies that produce pre-packaged news stories to
announce, within the news stories themselves, that the government is
the source of the stories. This requirement would apply whether or not
consideration was exchanged, and whether or not controversial or
political issues were involved. The bill would also explicitly and
unambiguously prohibit the removal of the announcement. This
announcement would satisfy the disclosure requirements under our rules,
such that the bill would not impose any new burden on broadcasters and
cable companies, and, in fact, would appear to simplify compliance. In
sum, the bill would ensure that Federal agencies disclose their
involvement in pre-packaged news stories, that broadcasters and others
airing stories are aware of the government's involvement, and, most
importantly, that listeners and viewers understand the nature and
source of the information being presented.
Again, Mr. Chairman, thank you for inviting me to testify today. I
am happy to answer any questions you may have.
The Chairman. Thank you very much.
Now we will hear from Mr. Schlick, who is the Acting
General Counsel for the FCC, please.
STATEMENT OF AUSTIN C. SCHLICK, ACTING GENERAL COUNSEL, FEDERAL
COMMUNICATIONS COMMISSION
Mr. Schlick. Thank you, Chairman Stevens, Co-Chairman
Inouye, and good morning, Senator Lautenberg. Thank you for
this opportunity to address issues surrounding video news
releases, or VNRs.
As Commissioner Adelstein noted in his testimony, the
Commission has adopted rules under the Communications Act that
further the public's right to know the source of broadcast
programming. The Act and the Commission's implementing rules
establish disclosure requirements that apply to sponsored
programming regardless of its source. Our rules are not
specific to Government-sponsored programming.
My testimony this morning will summarize the existing
Communications Act provisions and FCC rules that apply to
sponsored programming. I also will describe the Commission's
recent public notice and request for comment on this topic.
Sections 317 and 507 of the Communications Act address
sponsorship identification. Section 317(a) generally requires
broadcast stations to make an announcement at the time they
broadcast any material in exchange for ``valuable consideration
. . . directly or indirectly paid, or promised to or charged or
accepted by, the station so broadcasting.''
Section 317(a)(1), however, establishes a proviso that
services or property furnished without charge or at a nominal
charge for use in connection with a broadcast do not trigger
this general obligation of mandatory disclosure unless they are
furnished in exchange for promotional identification in the
broadcast. This proviso covers, for example, music recordings
or video provided without charge for use on the air such that
there is no disclosure obligation if there is no special
promotion by the station.
Consistent with the specific statutory authorization in
section 317(a)(2), the FCC has provided by rule that
sponsorship identification additionally is required and
programming cannot be exempt under the proviso in subsection
(a)(1) if the programming involves political material or
discussion of controversial issues of public importance. In the
case of political or controversial issue programming, the
commission thus requires sponsorship identification even when
the program material is provided to the station for free and
without any special promotion by the broadcaster.
Section 507 of the act requires disclosure to the station
when a station employee accepts consideration for the
broadcasted matter over the station. Disclosure obligations
also extend to those involved in producing, preparing, or
supplying program matter that is intended for broadcast. A
broadcast licensee that receives disclosure pursuant to section
507 must make a sponsorship identification announcement even if
the licensee does not itself receive consideration.
Under section 317(c), a licensee also must exercise
reasonable diligence to obtain sponsorship information from its
employees and other persons with whom it deals directly.
Section 317 and the FCC's rules additionally address the
content of sponsorship announcements. When an announcement is
required, the licensee must fully and fairly disclose at the
time of the broadcast the program matter was sponsored, paid
for, or furnished and by whom or on whose behalf the
consideration was supplied or promised.
Finally, the Commission's rules established for cable
operators a set of sponsorship identification requirements that
are based on the requirements for broadcasters under section
317.
With respect to enforcement, if the commission determines,
after investigation, that an entity holding a commission
authorization has violated the sponsorship identification
rules, it may impose administrative sanctions. Those sanctions
may include monetary forfeitures of up to $32,500 per violation
and the initiation of a license revocation proceeding.
Section 507 itself establishes civil and criminal penalties
for violation of its disclosure requirements, with a
possibility of a fine up to $10,000 and as much as a year of
imprisonment.
The FCC recently has received a large number of requests to
investigate the use of VNRs by broadcast licensees and cable
operations in light of the sponsorship identification rules.
Several of those requests have come from Members of this
Committee.
On April 13, 2005, the Commission unanimously adopted and
released a public notice that reminded the industry and the
general public of the sponsorship identification rules. The
notice also requested public comment on issues specifically
relating to VNRs and whether there are alternative or better
means, in addition to the FCC's current rules, by which the
Commission could ensure proper disclosure of sponsorship
identification. The comment period closes on July 22, 2005.
These comments will help the Commission enforce sponsorship
identification requirements and better assist Congress in its
deliberations on this issue.
I will be happy to answer your questions.
[The prepared statement of Mr. Schlick follows:]
Prepared Statement of Austin C. Schlick, Acting General Counsel,
Federal Communications Commission
Chairman Stevens, Co-Chairman Inouye, and members of the Committee,
thank you for this opportunity to discuss issues surrounding video news
releases (VNRs).
Consistent with the requirements of the Communications Act, the
Commission has adopted rules that further the public's right to know
the source of broadcast programming. The rules establish disclosure
requirements that apply to sponsored programming regardless of its
source, and are not specific to government-sponsored programming. I
will summarize the existing Communications Act provisions and FCC rules
that apply to sponsored programming. I also will describe the
Commission's recent issuance of a public notice and request for comment
on this topic.
Statutory Provisions and Rules Governing Sponsorship Identification
Sections 317 and 507 of the Communications Act address sponsorship
identification. Section 317(a) generally requires broadcast stations to
make an announcement at the time they broadcast any material in
exchange for ``valuable consideration . . . directly or indirectly
paid, or promised to or charged or accepted by, the station so
broadcasting.'' Section 317(a)(1) includes an exception to this general
requirement, providing that `` `service or other valuable
consideration' shall not include any service or property furnished
without charge or at a nominal charge for use on, or in connection
with, a broadcast unless it is so furnished in consideration for an
identification in a broadcast.''
Section 507 requires disclosure to the station when there is an
exchange of consideration or an agreement to accept consideration
involving a station employee. Disclosure obligations also extend to
those involved in producing, preparing, or supplying program matter
that is intended for broadcast. If any such person receives or provides
consideration for the inclusion of program matter, disclosure up the
chain of distribution is required. A broadcast licensee that receives
disclosure pursuant to Section 507 must make a sponsorship
identification announcement even if the licensee did not itself receive
consideration. In addition, under Section 317(c), a licensee must
exercise reasonable diligence to obtain sponsorship information from
its employees or from other persons with whom it deals directly.
Section 317 and the FCC's implementing rules--which are found at 47
C.F.R. Sec. 73.1212--also address the content of sponsorship
announcements when they are required. When the licensee airs the
program, it must disclose that program matter was sponsored, paid for,
or furnished, and by whom or on whose behalf the consideration was
supplied or promised.
Under a specific statutory authorization in Section 317(a)(2), the
FCC has established special disclosure rules for programming that
involves political material or the discussion of a controversial issue
of public importance. Political and controversial-issue programming is
not covered by an exception to the disclosure requirements that
Congress established in Section 317(a)(1).
Generally, as stated above, sponsorship identification is required
where consideration is provided in exchange for the broadcast of any
material. However, as also noted above, sponsorship identification is
not necessary under Section 317 if property or services that otherwise
might qualify as consideration are furnished ``without charge or at a
nominal charge for use on, or in connection with, [a] broadcast,'' and
the provider of the property or services does not receive special on-
air identification or promotion. This exception covers, for example,
music recordings or video provided without charge for use on the air,
if there is no special promotion by the station.
In the case of political or controversial issue programming,
however, the Commission has required sponsorship identification even
when the program material is provided to the station for free and
without any special promotion by the broadcaster. The FCC's rules also
establish special requirements for sponsorship announcements and
record-keeping in connection with political or controversial-issue
programming.
Finally, in Section 76.1615 of its rules, the Commission has
established for cable operators a set of sponsorship identification
requirements that are based on the requirements for broadcasters under
Section 317.
Enforcement
With respect to issues of enforcement, if the Commission determines
after investigation that an entity that holds a Commission
authorization has violated the sponsorship identification rules, it may
impose administrative sanctions. Those sanctions potentially may
include monetary forfeitures of up to $32,500 per violation, and the
initiation of license revocation proceedings. Section 507 itself
establishes civil and criminal penalties for violation of its
disclosure requirements, with the possibility of a fine of up to
$10,000 and as much as a year of imprisonment.
The April 13, 2005 Public Notice
The FCC has received a large number of requests to investigate the
use of VNRs by broadcast licensees and cable operators in light of the
sponsorship identification rules. Several of those requests have come
from members of this Committee.
On April 13, 2005, the Commission unanimously adopted and released
a Public Notice that reminded broadcast licensees, cable operators, and
others of their sponsorship identification obligations. The Public
Notice also requested public comment on various issues relating to the
use of VNRs, including: how VNRs actually are used in programming; the
terms on which they are provided to broadcasters and cable operators;
whether mechanisms are in place to ensure that broadcasters and cable
operators are notified about payments in connection with the production
and provision of VNRs and about the identity of entities that provide
political and controversial issue material; and whether there are
alternative or better means--in addition to the FCC's current rules--by
which the Commission could ensure proper disclosure.
The Commission encourages interested parties to participate in its
new proceeding on VNRs and to address these questions. Initial comments
are due on June 22, 2005; reply comments are due on July 22, 2005.
These comments will help the Commission enforce sponsorship
identification requirements, and better assist Congress in its
deliberations on this issue.
Thank you for this opportunity to discuss the Commission's
sponsorship identification rules and the April 13, 2005 Public Notice.
I will be happy to answer your questions.
The Chairman. Well, thank you very much.
Now, Commissioner Adelstein, as I understand it, on I think
it was the 15th--what day was it? On the 13th of April, the FCC
finished an inquiry into VNRs used by broadcasters, cable, and
satellite providers, and it asked for comments on this matter
from the industry, with the comment cycle to end on July 22.
Now, in view of that request and the Byrd Amendment, which was
passed by 99 votes on the floor of the Senate, which provides
for a period between now and September 30th of this year that
any agency must have a clear notification, what is the rush?
Why should we pass other legislation now?
Mr. Adelstein. Well, it depends on the objectives of
Congress. If the concern is government disclosure, the Byrd
Amendment, to some extent, would deal with that for this year.
It does not, as you know, deal with it on a permanent basis
because it only applies for one year. The Byrd Amendment also
does not contain the level of disclosure requirement that is
contained in the Lautenberg bill, S. 967, which requires that
the basic disclosure run throughout the entire period of the
VNR.
The Chairman. But is that not what your commission is
looking into? You have asked for comments by the industry and
they have until July 22 to respond. What is the rush? Why
should we have an amendment adopted now or pass out a bill now
that, if passed, would end your investigation and we would not
know the comments of the industry unless we held a rather
exhaustive hearing on this bill?
Mr. Adelstein. Again, it depends on the objectives of
Congress. We do not have authority currently to compel
government agencies to do anything regarding VNRs. We only have
an obligation to ensure that broadcasters, if the VNR turns out
to be political or controversial, to----
The Chairman. But you had the authority to make the request
of the industry to have comments on a policy position you
unanimously adopted. Is that not right?
Mr. Adelstein. That is correct, yes.
The Chairman. Now, you are really asking Congress to
interrupt that comment period and to act now before the people
involved have expressed to the commission what should be done
on this issue.
Mr. Adelstein. Well, I am not necessarily asking Congress.
I am just informing Congress that if it is interested in
disclosure by government agencies, we do not have authority
over them, and I do not believe we are really requesting
particular comment on them, because the law, as it is currently
structured, really only applies, in this case, to broadcasters'
obligations, and we do not have a clear ability to compel
Government agencies to disclose.
If Government agencies determine that an item is
controversial or political, if in the judgment of broadcasters
it is not, there is a question as to whether or not it then can
air publicly. Then there can be a subsequent determination
based on complaints that it was political.
The Chairman. Have there been any comments so far?
Mr. Adelstein. I have not seen any comments so far, but we
do have a series of comments on an earlier item, a notice of
inquiry, that we put out on the localism issue regarding
payola, which is the same statute. We have a number of comments
on that docket.
The Chairman. Well, let me ask Mr. Schlick. We all voted
for the Byrd Amendment and it was adopted the day after we had
the discussion here on the Lautenberg amendment that was
offered to S. 714. That provision is very simple really. Unless
otherwise authorized by existing law, none of the funds
provided in this act or any other act--which means it would
carry forward I think to the end of 2006, but that is another
matter--may be used by a Federal agency to produce any
prepackaged news story unless the story includes a clear
notification within the text or audio of the prepared packaged
news that the prepackaged news story was prepared or funded by
that Federal agency.
Now, Mr. Schlick, does that not sort of cover the situation
right now until we figure out what the scope of any rule or
authorization by Congress to make a rule should be?
Mr. Schlick. Mr. Chairman, that legislation, as well as S.
967, addressed the specific question of the production of video
news releases, and potentially other press releases, by
Government. Our rules are targeted, and the central provisions
I have described, section 317 and 507, are targeted, at the
obligations of broadcasters who present the programming and the
public's right to know at the time of the broadcast who it is
who is speaking to persuade them. So they address different
questions, and it is a policy question for Congress the extent
to which it chooses to additionally regulate the production
specifically by the Government. Our rules apply generally
regardless of the source of the programming.
The Chairman. Well, but this says no agency can use any
money that it gets from any act of Congress to produce any such
story unless there is notification. What is wrong with that?
Mr. Schlick. Again, Mr. Chairman, these are policy
questions before Congress at this point and the FCC's
responsibility is the administration of the statutory
requirements that already exist and apply generally to
licensees in particular, as well as those who produce
programming that is ultimately broadcast.
The Chairman. Do you agree with me that that says no agency
is going to produce those during this year with Federal funds?
Mr. Schlick. That is my reading, Mr. Chairman.
Senator Dorgan. Mr. Chairman, may I ask a question about
your inquiry? You indicated that you felt the Byrd Amendment
would apply to the next fiscal year? It was offered to the
supplemental, and my expectation----
The Chairman. It says 2005, but if another act comes along
that contains funds before this law expires, I take it it would
apply to those funds too. We think it expires on September 30th
but it may carry forward.
Senator Dorgan. This year.
The Chairman. Yes.
Senator Dorgan. Well, that is my understanding because the
supplemental deals with this fiscal year----
The Chairman. But it says, or any other act. So there is a
question there how far it goes forward.
Senator Inouye.
Senator Inouye. Mr. Adelstein, under the Communications
Act, you indicated that there are a lot of private companies
who are paying media outlets to guarantee that their
prepackaged news stories are carried?
Mr. Adelstein. That is correct.
Senator Inouye. Now, who has the obligation to provide the
disclosure that this is prepackaged? Is it the one distributing
or the one broadcasting?
Mr. Adelstein. In this case it would apply to both. Section
507 of the Communications Act requires that anybody involved in
the distribution chain who pays for the placement of any
material on broadcast airwaves has an obligation to report that
to the broadcaster or to the person with whom they are dealing
at the broadcast station. So 507 obligations apply both to the
distributor of the VNR, as well as to the broadcast entity
which, in response to the report that it gets from somebody who
pays for that purpose or has knowledge of it, is required under
law to disclose the source of that material.
Senator Inouye. Would that obligation apply to the
Lautenberg provision?
Mr. Adelstein. It would not because the Lautenberg
provision actually covers it from the outset. Because the
disclosure would be within the VNR, it automatically takes care
of the need by the government to disclose. Of course, in this
case, the government generally does not provide any
consideration in exchange for it, but the Lautenberg provision
deals with all the broadcaster's obligations. If that
legislation is adopted, then there is no need for any
disclosure because it is already within the VNR itself.
Senator Inouye. In the disclosure, who determines what is
political in nature or controversial?
Mr. Adelstein. Well, in the first instance, it is
determined by the broadcasters themselves. We are, under the
law and under court precedent, obligated to try to defer to the
reasonable interpretations of a broadcaster. If we receive a
complaint that a particular kind of VNR is political, then we
investigate it and have to determine basically whether or not
it was a reasonable use of discretion. We do not determine
whether or not we think it is political--rather, we determine
whether or not the broadcaster, in saying that it was not
political, was exercising reasonable judgment.
Senator Inouye. So then the final word is with the
broadcaster?
Mr. Adelstein. The final word is with us and then with the
courts, but the broadcaster has the initial word. They have to
make the initial determination.
Senator Inouye. Have you ever had this experience?
Mr. Adelstein. Not in my tenure there. I believe that there
have been court cases that have affirmed our right to do so.
Occasionally, the courts have actually overturned the FCC on
individual court cases saying that we did not give sufficient
deference to broadcasters in their determination as to what was
reasonable. But generally speaking, the courts have upheld the
constitutionality of this approach.
Senator Inouye. Do you have many allegations of violations
in your files?
Mr. Adelstein. We do not have a lot. This year we have a
much larger amount than we normally have. The Armstrong
Williams situation and the whole VNR situation has led to, I
think, 57,000 complaints. We received 18,000 complaints
involving the Armstrong Williams matter, but generally
speaking, there are much fewer than that every year.
Senator Inouye. Well, Mr. Chairman, I will wait for another
time. I am finished.
The Chairman. Pardon me. I was trying to find out what the
Armstrong Williams matter was. I was showing my ignorance.
Mr. Adelstein. There were allegations that Armstrong
Williams violated section 507 and 317 by speaking----
The Chairman. Because he was paid?
Mr. Adelstein. Because he was paid and it was not
disclosed.
The Chairman. Senator Lautenberg.
Senator Lautenberg. Thanks, Mr. Chairman.
The one thing I would appreciate, Commissioner Adelstein,
is if you would confirm the fact that the FCC rule that is now
in place only affects industry. It does not affect government.
Am I correct?
Mr. Adelstein. Well, in terms of the disclosure
requirement, our disclosure requirements go to the broadcaster.
Senator Lautenberg. And you were very clear. Just for the
edification of my colleagues, I wanted to make certain that we
are placing no additional burden on the broadcasters with our
bill. All we say is to the government very simply, just say
that it is a product of the U.S. Government. And the notion
that maybe they do not want to do it suggests that it is
designed to deceive. That is my interpretation.
I want to confirm something else, Mr. Adelstein, and that
is that the Byrd Amendment does expire on 9/30/05, as is
written. That is clearly the condition. Now, the Chairman
raises an issue about whether or not it could have life after.
I cannot think of any reason why we would want to proceed with
something that leaves such questions. What is in the public
interest for the government to hide its role in the production
and distribution of these news stories?
Mr. Adelstein. Well, the FCC actually on two occasions, as
recently as 2002, has stated very clearly that the government
is, in fact, held to almost a higher standard. I will read to
you from the 1977 case that was reiterated in 2002 from the FCC
as a unanimous body. ``We believe that the public is
particularly entitled to know when the Government is using tax
dollars to persuade it.'' That has been the FCC policy.
Senator Lautenberg. But, again, the omission of that kind
of identification or disclaimer is very clear that it is
designed to publicize or propagandize the issue. Otherwise,
there could be no reason for withholding a disclaimer. It does
not serve the public interest at all not to be aware of the
fact that this is a Government publication. Am I correct?
Mr. Adelstein. Well, you can certainly make that argument.
I think that it is very important that the public knows if the
Government is behind something. In the case of political or
controversial programming, of course, it is already required to
be disclosed, but the problem is that if we do not have this
rule in place in advance, there is a judgment call as to
whether or not something is political or controversial, and
something could air and then complaints could arise.
Subsequently, we could find that it should have been disclosed
but it was not. But at that point it has already been basically
run on the air, and the people have seen it. It is too late to
take that harm back.
Senator Lautenberg. When commercial sources produce VNRs,
which are used, they are always designed to enhance a product
or enhance a position or enhance a skill. And there is no doubt
about who produces it. They want it to be known as their
production. Am I correct?
Mr. Adelstein. Well, in many cases, actually, private
commercial entities do not want it known that they are behind
it because if they can avoid that, then it is seen as much more
legitimate. It looks like a news story. They are designed to
mimic news stories, and it comes with the credibility of a news
story. So if they can hide the fact that it is actually a
hidden advertisement, I think it makes it actually more
effective from a PR perspective. That is why we need to be so
vigilant, to make sure the public knows who is behind it.
Senator Lautenberg. Yes. But that is part of your
supervision and responsibility, to make sure people know from
whence these products come. Right?
Mr. Adelstein. Right.
Senator Lautenberg. What burden do you see Government
having as a result of the legislation that we have proposed
here? Could you imagine it would have any additional cost to
Government?
Mr. Adelstein. It does not seem particularly costly to run
a disclosure along those lines, and it would prevent some of
the confusion that we currently are seeing.
Senator Lautenberg. I want to be sure that this disclaimer
could be as simple as ``made for or paid for by the U.S.
Government,'' just in small print underneath large enough to
see from a reasonable distance. So not having it would seem to
me to have an overt mission, and that is to help confuse people
about the fact that this is, again, a Government program to
politicize or to publicize something.
As I said before, this is not new and we all know that. It
has been used in the past by, I think it is fair to say,
Democratic Administrations as well as Republican. But if one
sees people passing a red light and lots of people doing it,
you do not say eliminate red lights and that would take care of
things. Not at all. That usually makes you more energetic to
enforce these things.
Mr. Chairman, I hope it is clearly understood that we are
not looking to place additional burdens on the FCC or on the
broadcasters or on industry generally. It is just a question of
fairness for the citizens.
Thanks, Mr. Chairman.
The Chairman. This Senator remembers so often that the last
Administration put out VNRs about my State and how it was so
pristine and how it should not be disturbed. They were hawking
the extreme environmental position to oppose us on the Arctic
National Wildlife Refuge, to oppose us on drilling, to oppose
us on so many things. I would love to have that disclosed. You
better believe. There is no question in my mind I would like
everyone to know where that propaganda comes from.
So the question is not that. The question is your bill and
what it does, and that is what we are trying to figure out.
Senator Dorgan.
STATEMENT OF HON. BYRON L. DORGAN,
U.S. SENATOR FROM NORTH DAKOTA
Senator Dorgan. Mr. Chairman, thank you very much.
First, let me thank the representatives from the FCC.
My attention to these issues, I would say, Mr. Chairman,
came from the Armstrong Williams situation. I was startled to
learn that one of our agencies in the Federal Government had
paid a syndicated columnist $240,000 in order to promote the
Administration's No Child Left Behind agenda. That contract was
not disclosed to the public. We learned it only because USA
Today filed a Freedom of Information Act request and got a
document that told us this agency, the Department of Education,
had engaged with a syndicated columnist and paid him nearly a
quarter of a million dollars. As a result, that columnist wrote
good things about No Child Left Behind, had television programs
that trumpeted No Child Left Behind. It was kind of journalism
for hire and I think is kind of the underbelly of the way
journalism would act in these areas.
I think journalism is a wonderful occupation. Most
journalists take very seriously their responsibilities, but
this was clearly beyond the pale and I think startled
everybody. It was part of a $1 million deal, as I understand.
This payment to Armstrong Williams for $240,000 was part of a
$1 million deal with the Ketchum public relations firm that was
contracted to produce video news releases as well.
Let me say that my colleague from New Jersey was accurate
when he said this is not just about this Administration. It has
happened before, but all of us ought to be concerned--and I
think we all are--about making sure people understand where
information comes from.
The Chairman. Senator, this does not amend the payola
legislation.
Senator Dorgan. No, I understand that.
The Chairman. That is already being investigated and it is
already against the law.
Senator Dorgan. I understand that. My point is the origin
of this controversy was developed with Armstrong Williams being
disclosed on the front pages of our newspapers, a syndicated
columnist who was paid $240,000 to promote something that he
then used in his columns and on his television show. From that,
then we got into this discussion about the video news releases
and other issues. That is the reason I think that prompted the
Byrd Amendment and it has also prompted a bill here in the
Senate, on which we have a hearing today.
I do want to ask a question about concentration in the
media. My sense is that much of the use of video news releases
by newsrooms who normally would not use that is now coming
because of additional concentration in the media where the
bigger enterprises are, at least, beginning to take apart
newsrooms and newsrooms are more likely to say, yes, give me
some VNRs. I can just fill my space with video news releases. I
would like to ask Mr. Adelstein whether that is your judgment
as well, and is there evidence to support that?
Mr. Adelstein. Well, there does appear to be. A lot of
analysts believe that there is increasing pressure on these
newsrooms. They are finding less and less resources, and in
fact, sometimes they have to fill longer news windows.
Increasingly, according to many reports, they are filling them
with things like VNRs that are created by somebody else. These
come at no cost to the broadcast entity. The issue is that
these companies are under increasing pressure to meet quarterly
earnings reports. They are chasing the bottom line and it is
extremely competitive. If they can shave a little of money off
here or there, we are seeing them do that. You are seeing the
boundary and the line between news and information increasingly
blurred, more sensationalism, and less serious news and
coverage of what is happening in local communities.
Senator Dorgan. If I may say, the Project for Excellence in
Journalism did an analysis, which included 1998 to 2002, which
would have included both Administrations, and they were trying
to evaluate with local news directors what kind of use of video
news releases was being done and what kind of information was
disclosed about that. They found a quarter to a third of news
directors showed video news releases and disclosed the source
occasionally, rarely, or never. So that is pretty substantial.
There is a great op-ed piece about this by Marion Just, a
professor of political science at Wellesley College, and the
Director of the Project for Excellence in Journalism. I will
just read one paragraph. I happen to share this view.
``Local broadcasters are being asked to do more with
less.'' These are quotes. ``And they have been forced to rely
more on prepackaged news to take up the slack. So we do not
have to search very far to discover why the Administration has
succeeded so well in getting its news releases on the air. The
public companies that own TV stations are so intent on
increasing their stock price and pleasing their shareholders
that they are squeezing the news out of the news business.''
That means there is a much more receptive environment for
the use of VNRs and I think makes it even more important that
there be full disclosure. That is why I have supported the
Lautenberg-Kerry proposal and think that the Congress does need
to act.
Mr. Chairman, thank you.
The Chairman. Senator Kerry.
STATEMENT OF HON. JOHN F. KERRY,
U.S. SENATOR FROM MASSACHUSETTS
Senator Kerry. Mr. Chairman, thanks a lot for holding the
hearing. I apologize for being late, but we have the Bolton
nomination before the Committee and I am going to have to go
back to that at some point.
I just want to make a couple comments and see if we cannot
find some common ground here.
There is no question that Federal agencies are increasingly
producing and distributing literally hundreds of so-called
video news releases. This is agency-wide and hundreds of them
are going out now. Most often these segments are broadcast with
no disclosure at all that they were written or produced by the
Federal Government.
I heard you saying just as we came in--and I think it is
generally accepted here that the Federal Government should not
be in the business of manipulating public opinion with fake
news reports, with news reports that appear to be official news
reports and they are not, paid for by public dollars, created
by public relations experts, broadcast without proper
disclosure, all of which the American taxpayer is funding
without even knowing that this is not a legitimate news report
they are seeing.
And they are pretty slick. We all know they are geared and
done in a way that makes it look like it is a reporter
interviewing somebody. It has a purpose, and the purpose, I
regret, is not just to inform. It is also to leave people with
the impression that this is sort of a news station or a
legitimate part of the currency of our news.
All of us cherish that. We cherish the independence of the
flow of information in America. We have laws about propaganda.
So it is not a partisan issue. I want to emphasize that. I
was not aware but we learned and were equally shocked to know
that this was going on in the Clinton Administration. I was not
aware of that. I think that shows the problem. It sort of
underscores that it is inappropriate for anybody to be doing
it.
So we also know that the Senate unanimously supported the
Byrd Amendment to the supplemental appropriations bill. In
short, Democrats and Republicans have come together recognizing
the problem and wanting to be part of the solution. But the
Byrd Amendment is only a temporary fix. It is a 1-year deal. It
expires on September 30th of this year. And the Commerce
Committee needs to, obviously, look at the oversight role of
the FCC, the industry that is involved, and the conflicting
legal interpretations that we have from GAO and the
Administration. It is our responsibility to try to come up with
a piece of legislation that deals with it.
Now, that is why Senator Lautenberg and I have joined
together to put this bill together. It simply requires that any
prepackaged news story that is produced by a Federal agency
identify the U.S. Government as the source of the story. I know
the majority, your staff, Mr. Chairman, has worked closely with
ours to try to come up and see if we cannot craft language that
is acceptable.
It is pretty simple. It is pretty straightforward. The
operative section is really section 342, line 8, and it says
very simply: ``Disclaimer Required. Any prepackaged news story
produced by or on behalf of a Federal agency that is broadcast
or distributed by a network organization, broadcast licensee or
permittee, or multichannel video programming distributor in the
United States shall contain an announcement supplied by the
Federal agency''--that is very important--``within the
prepackaged news story that conspicuously identifies the U.S.
Government as the source for the prepackaged news story.''
We are not requiring the broadcaster to do this. We are
requiring the Federal agency to do this. The agency, which we
have every right in the world to make a requirement as to
appropriate disclosure, is required to put the disclosure on
it. So there is no interference with the broadcaster's rights,
et cetera. It is simply acknowledging the truth of what the
broadcaster is being given to broadcast at the expense of the
American taxpayer, at the behest of a Federal agency. It is
that simple.
And there is a page of some definitions. We can work on
them if there are problems in the definitions.
But every American is entitled to know the source of
prepackaged information that is broadcast and characterized as
news. Otherwise, the viewing public is being misled and we are
engaging in official propaganda. Every taxpayer has a right to
know if their tax dollars have been used to produce the so-
called news that they are watching.
Now, I asked the FCC to investigate this, and last month
the FCC launched a public comment period to look at the VNRs,
and that is a positive step. But FCC Commissioner Adelstein
said at the time that the appropriateness of Government-
produced news segments and disputes among the branches of the
Federal Government is ultimately an issue for Congress to
decide. We have got to decide this.
The problem is we have conflicting views within the Federal
Government.
The GAO found that the Federal agencies should not produce
prepackaged news reports that ``conceal or do not clearly
identify for the television viewing audience that the agency
was the source of those materials because they violate existing
laws dealing with propaganda.''
The Justice Department in what I believe--and I think any
common sense interpretation by any member of this committee
would have to agree--is really a sort of tortured legal
analysis which likens a prepackaged news story to nothing more
than a print press release. Well, that is just ridiculous on
its face. The source of a press release is absolutely clear in
the title and heading of a press release. More important, as
far as I know, in a press release no one pretends to be
somebody else. It comes from a specific person. No actor
pretends to be a reporter. No actor pretends to be a citizen.
In short, a press release does and should state a point of
view, but a press release does not intentionally hide its
source or the identity of the speakers. So a press release is
not fake news. A news clip, prepackaged and produced without
disclaimer, is.
The White House has, frankly, attempted to split hairs with
this complicated legal interpretation that says to the agencies
go ahead and continue to deceive the public and you can
continue to deceive broadcasters and you can continue to
produce false news stories. Well, that is just not right, and I
think every one of us knows it is not right.
I am open to any suggestions as to how we find the
appropriate language, but it is critical to have some form of
disclosure that leaves no doubt in the mind of the American
public what is happening.
Now, I know I have used my time. I will go in the next
round with any questions I have.
The Chairman. If the Senator has to leave, I will be
pleased to let you ask questions now, if you wish.
Senator Kerry. Well, I thank the Chairman.
The Chairman. I only want to make one statement, Senator
Kerry. I do not know that there has been any allegations of any
false news stories here. That allegation is new to me.
Senator Kerry. Well, fake news in the sense, Mr. Chairman--
I understand what you are saying. It may well be that what they
are putting out is true. I understand that. That is not what I
am saying. But if it is not a reporter appearing to be a
reporter, it is by definition fake, even if the news is true.
Often it is very one-sided. I have seen some of the clips
and the news is often very one-sided. It has no counterpoint of
view, and sometimes the facts are, in fact, incorrect, and we
can document that. So I think the key here is really getting at
the disclosure, which raises the standard of truth-telling at
the same time as you do that.
But I thank you for letting me ask a couple questions.
Acting Counsel Schlick, would the disclosures of the Truth
in Broadcasting Act, as currently set out, meet the terms
outlined in your April 13, 2005 public notice? Would what we
have set out meet those terms that you set out?
Mr. Schlick. Your legislation, Senator, addresses a
somewhat different question. It might be helpful for me to
contrast our current rules, which were the subject of that
public notice, from S. 967.
As applied to video news releases--our current rules track
very closely quite detailed provisions in section 317 and 507
of the Communications Act. So applying those provisions in
section 317, the rules generally do not require disclosure of
sponsorship identification, unless there is some consideration
exchanged in addition to just the provision of the programming
or the video news release, or unless the broadcaster gives some
special identification in exchange for the programming.
Senator Kerry. Can I stop you there for a minute?
Mr. Schlick. Yes.
Senator Kerry. Your public notice says that broadcasters
``generally must clearly disclose to members of their audience
the nature, source, and sponsorship of the material that they
are viewing.'' Correct?
Mr. Schlick. That is correct.
Senator Kerry. Now you are telling me that that is limited
exclusively to where there is an exchange of money.
Mr. Schlick. Under section 317, there is a proviso which
Congress added in 1960. Specifically, the controversy at that
time was the payola and----
Senator Kerry. I agree. But the interest is not. The
interest we are trying to get at is not defined by the exchange
of money. It is defined in the act of putting out the news.
Correct? The disclosure is for a purpose.
Mr. Schlick. As I understand, Senator, that is right.
Senator Kerry. Why would the disclosure be limited to an
exchange of money?
Mr. Schlick. I am describing existing law, Senator, and
under existing law, if the programming is not political or
controversial--and that is----
Senator Kerry. But that is not what I am asking you. What I
am asking you is whether what we have set out would meet the
terms of your requirement on disclosure, leaving out the money.
Just does it meet the terms of the nature, source, sponsorship
of material?
Mr. Schlick. If sponsorship identification is required
under our rules, then certainly the labeling required by S. 967
should satisfy that requirement. Right now our statute that we
implement does not require sponsorship identification in a
number of instances that would be covered by S. 967.
Senator Kerry. I understand that, which is precisely the
sort of hole that we are looking at plugging here right now.
But what I am trying to get at is, is the terminology that we
have set forth adequate to require disclosure of the nature,
source, and sponsorship of the material they are viewing? It
would meet the standard of disclosure that you have set out,
would it not?
Mr. Schlick. I think it would, Senator.
Senator Kerry. Commissioner Adelstein, FCC rules specify
``a greater obligation of disclosure in connection with
political material and program matter dealing with
controversial issues.'' Correct?
Mr. Adelstein. That is right.
Senator Kerry. What guidelines determine whether the
subject matter of a VNR or ANR is political or controversial?
Mr. Adelstein. Well, it would really be guided by case law.
There is a series of decisions that we made mostly under the
fairness doctrine, which has since been done away with by the
FCC, but there is very serious case law.
I mentioned earlier that there is a requirement that we
defer to the broadcaster's initial determination as to whether
or not it is political or controversial. And if there are
complaints raised that they made an incorrect assessment in the
first instance, we go back and look into that and determine
whether or not we think it was a reasonable assessment by the
broadcaster that it was political or not. The problem is that
if we make that determination later, the information has
already been broadcast over the air. The public has already
seen it, and the harm is already done.
Senator Kerry. So, in other words, it is complicated and
unclear. It depends on the case law and it is sort of up in the
air.
Mr. Adelstein. That is right.
Senator Kerry. So my question to you is, would full
disclosure of the Government as the source for all audio and
video material, as proposed in the Truth in Broadcasting Act,
not guard against taxpayer-funded publicity or propaganda
without requiring any kind of complicated oversight regulatory
system? It is pretty straightforward.
Mr. Adelstein. It would greatly simplify it because I think
it is difficult for a broadcaster to determine if some of these
things are controversial. They do not want to spend the time
digging through the case law.
Senator Kerry. Well, it all depends on the legal
interpretation.
Mr. Adelstein. Right.
Senator Kerry. So you get into a lack of clarity that winds
up leading to misinterpretation.
Mr. Adelstein. You already see a distinction between GAO
and OMB as to what the interpretation is.
Senator Kerry. It seems to me that this is really one of
the simplest things that we get to deal with around here. We
have a lot of complicated issues to deal with, but this is
pretty straightforward. Either the Government is funding stuff
legitimately and letting people know it or it should not be
because it is deceptive and subject to, obviously, political
interpretation. If you have disclosure, which is the right of
the American people to know the source of news, where it is
coming from, if it is news, they can discount it. It does not
say you cannot do it. It just says you have got to know where
it is coming from. Is that not a pretty fair and simple
standard?
Mr. Adelstein. That is the principle that has been embodied
in legislation that has been approved by this committee and by
Congress since 1927. In an unwavering series of laws, the
Congress has always required disclosure of material like this
so that the public knows who is trying to influence it. So this
would be consistent with that history.
Senator Kerry. Has self-regulation of broadcasters ever
proven adequate?
Mr. Adelstein. That is a broad question. In this case,
there does appear to be a loosening of the way that people are
behaving. That is why it was so important we came together on a
bipartisan basis to alert broadcasters and everybody in
industry of their legal obligations because I think there was a
lack of awareness about it.
Senator Kerry. This is a question for both of you, my last
question for now. Mr. Chairman, I would love to be able to
submit a few questions in writing, if it is possible.
The Chairman. Yes, sir. We have four other witnesses.
Senator Kerry. I know that. So the last question is could
the FCC, Library of Congress, or the National Archives, any one
of them, take on the creation and maintenance of a publicly
accessible central archive of all Government-funded VNRs?
Mr. Adelstein. It seems that would be a simple thing for
Congress to set up.
Senator Kerry. Mr. Schlick?
Mr. Schlick. I imagine it would be possible, yes, Senator.
Senator Kerry. Do you think it is useful? I mean, if the
Government is funding all of these things, is it not important
to have some sort of central repository? People can have
accountability for them.
Mr. Adelstein. You could make them available online. That
would make it very easy for people to access and know where
they come from. That would be another form of disclosure that
could complement the kind of disclosure required by S. 967.
Senator Kerry. Do you want to comment or not, Mr. Schlick?
Mr. Schlick. No. I would agree with Commissioner Adelstein.
Senator Kerry. Great. Thank you very much. Thank you,
gentlemen. Thank you very much, Mr. Chairman.
The Chairman. Thank you.
In the interest of time, thank you very much, gentlemen. I
have asked Senator DeMint if he wanted to ask questions now,
but because of the time constraint, I ask that the next four
witnesses come to the table. We will listen to all four of you
and then have questions, to the extent we can, before the votes
start.
The next four witnesses are Ms. Susan Poling, the Managing
Associate General Counsel of the GAO; Ms. Barbara Cochran,
President, Radio-Television News Directors Association; Mr.
Douglas Simon, President and CEO of Simon Productions
Incorporated; Ms. Judith Turner Phair, President and Chief
Executive Officer of the Public Relations Society of America.
We appreciate all of you coming. I do hope you understand our
problem here.
Ms. Poling, let us begin with you, if you will. You are
from the GAO. Is that right?
STATEMENT OF SUSAN A. POLING, MANAGING ASSOCIATE GENERAL
COUNSEL, OFFICE OF GENERAL COUNSEL,
GOVERNMENT ACCOUNTABILITY OFFICE
Ms. Poling. I am. Good morning, Chairman Stevens, Senator--
well, I do not see Senator Inouye right now--and members of the
Committee. My name is Susan Poling and I am responsible for the
appropriations law decisions and opinions at the GAO. I am
honored to be here today to discuss our recent legal opinions
regarding the use of prepackaged news stories by Federal
agencies. Mr. Chairman, I am going to make this brief statement
orally. In addition to the written testimony, I would like to
have the two opinions and the circular be made part of the
record.
The Chairman. They will all be made a part of the record.
We cannot make the video part of it, but the statements of all
four of you are part of the record.
Ms. Poling. That is fine.
As the members of this committee may know, GAO has been
interpreting appropriations law and issuing opinions since
Congress created it in 1921. Since 1951, when the prohibition
on the use of appropriated funds for publicity or propaganda
was first enacted, GAO has issued over 25 opinions interpreting
the prohibition. In the past year, GAO addressed, for the first
time, the issue of whether prepackaged news stories violate the
prohibition on the use of appropriated funds for publicity or
propaganda.
We found that the two agencies we examined violated the
prohibition by producing prepackaged news stories that did not
identify to the target audience, that is, the television-
viewing public, that the agency was the source of the material.
So what are prepackaged news stories? They are complete
audiovisual presentations that are designed to be
indistinguishable from news segments broadcast to the public by
independent television news organizations. Actors or voice-over
specialists portray reporters. For example, a Government
contractor concludes a segment saying, ``from Washington, I'm
Karen Ryan reporting.'' She is not a reporter. She is a paid
Government contractor.
There is also usually a script that the TV news anchors can
use to introduce the story during a broadcast, and video news
releases also contain slates and B-roll. Our opinion goes to
the prepackaged news stories because we did not find problems
with the slates and B-roll that we reviewed.
Prepackaged news stories permit the creators to maintain
some control over their message. They are also cheaper than
actually purchasing broadcast advertising.
GAO addressed the use of prepackaged news stories in a
decision regarding VNRs of the Department of Health and Human
Services. The prepackaged news stories were part of an HHS
campaign to inform Medicare recipients about the new
prescription drug legislation. We also looked at similar
prepackaged news stories produced by the Office of National
Drug Control Policy as part of its national youth anti-drug
media campaign.
Now, GAO has long recognized that agencies have a right and
perhaps even a duty to inform the public about their policies,
programs, and activities. In both cases that we reviewed, GAO
did not legally object to the contents of the news stories
themselves, and we affirmed that the agencies have a right to
inform the public of their programs and activities.
However, we found that the story packages were targeted to
the TV viewers and clearly designed to be aired exactly as the
agency had prepared them, but they contained no identification
to alert the TV viewers to the fact that the agency was
actually the source of the purported news story. In both cases,
no disclosure was made to the TV-viewing audience. As a result,
the audience did not know that they were watching news programs
about the Government that were, in fact, prepared by the
Government. We concluded that production and distribution of
prepackaged news stories that concealed the agency's role in
producing the story was covert propaganda and, therefore,
violated the prohibition on the use of appropriated funds for
publicity or propaganda.
In preparing these two decisions, our literature search and
informal research showed that the use of VNRs and prepackaged
news stories was commonplace in the Government. The Comptroller
General decided to issue a circular letter to heads of all
cabinet departments and Federal agencies to remind them of
their duty to disclose the source of the materials that they
disseminate to the public.
To sum up, first, the critical element of covert propaganda
under the appropriations prohibition is concealment of the
agency's role in sponsoring the materials.
Two, agencies have a right to disseminate information about
their policies and activities, but not covertly.
And three, agencies may use prepackaged news stories to
disseminate information if there is clear disclosure to the
television-viewing audience that the material was prepared by
the agency.
I would like to close with a quote from the Comptroller
General. He said, ``Deceptive video news releases strike a blow
to the good Government principles of transparency and
accountability that are essential for a healthy democracy. The
Government's credibility is enhanced by openness and the public
is enriched by full and open debate. These actions also enhance
public trust in the Government.''
Mr. Chairman, that concludes my formal remarks and I would
be glad to answer any questions.
[The prepared statement of Ms. Poling follows:]
Prepared Statement of Susan A. Poling, Managing Associate General
Counsel, Office of General Counsel, Government Accountability Office
Chairman Stevens and members of the Committee:
Thank you for the opportunity to be here today to discuss the legal
opinions recently issued by the Government Accountability Office (GAO)
regarding the use of prepackaged news stories by Federal agencies. In
the past year, GAO has issued two legal opinions on the production of
video news releases (VNRs) that included prepackaged news stories by
both the Department of Health and Human Services (HHS) and the Office
of National Drug Control Policy (ONDCP). In both of these instances, we
concluded that the agencies violated the Federal government-wide
prohibition on the use of appropriated funds for purposes of publicity
or propaganda not authorized by Congress. In addition, in February, the
Comptroller General sent a circular letter to the heads of all Federal
agencies to alert them to our recent opinions and to remind them of the
prohibition on publicity or propaganda.
Background
Since the 1990s, VNRs have become a popular public relations tool
for private corporations, nonprofit organizations, and government
entities to disseminate information, in part because they provide a
cheaper alternative than more traditional broadcast advertising and are
welcomed by some local news stations in smaller markets with
significant budget restraints.
VNRs Contain Slates, B-Rolls, and Prepackaged News Stories
While the use of VNRs is widespread and widely known by those in
the media industry, the quality and content of materials considered to
constitute a VNR can vary greatly. Generally, a VNR package may contain
several items, including a series of video clips, known as B-roll
footage; title cards containing relevant information, known as slates;
a prepackaged news story, sometimes referred to as a story package; and
other promotional materials.\1\ These materials are produced in the
same manner as television news organizations produce materials for
their own news segments. By eliminating a news station's production
efforts and costs of producing an original news story, VNR creators can
find stations willing to broadcast a favorable news segment on a
desired topic.
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\1\ For example, the Office of National Drug Control Policy (ONDCP)
video news releases that we examined contained television
advertisements and public service announcements.
---------------------------------------------------------------------------
The B-roll footage and slates are intended to assist news stations
in producing their own news stories, while the story package is a pre-
assembled, ready-to-air news story that is often accompanied by a
suggested lead-in script for the anchor. Even if a broadcaster does not
use a story package or scripted materials in full, the production of a
professionally complete news story provides a framework for the message
conveyed in the final broadcast, which allows the producer, in this
case, the Federal agency, to assert some control over the message
conveyed to the target audience--the viewer of the broadcast.
The popularity of VNRs may be attributed to the ease with which the
materials may be distributed. While some packages are distributed
directly from the source to television stations, satellite and
electronic news services, such as those provided by CNN Newsource,
facilitate distribution to a number of news markets in a short period
of time. Broadcast stations subscribe to these services, which provide
journalist reports and stories and advertising, in addition to VNR
materials. While the news services label VNRs differently than
independent journalist news reports, there apparently is no industry
standard as to the labeling of VNRs. In fact, some news organizations
that broadcast the HHS VNR indicated that they misread the label or
they mistook the story package as an independent journalist news story
on CNN Newsource.
HHS VNRs Included Narration by Contractors Posing as Reporters
GAO examined three VNR packages that HHS made available to local
news organizations. The VNRs consisted of three videotapes with
corresponding, printed scripts; two of the videotapes were in English,
and one was in Spanish. The B-roll footage on each of the English
videotapes was exactly the same and contained footage of President
Bush, in the presence of Members of Congress and others, signing the
Medicare prescription drug legislation into law, and a series of clips
of seniors engaged in various leisure and health-related activities,
including consulting with a pharmacist and being screened for blood
pressure. The English videotapes also included clips of former HHS
Secretary Tommy Thompson and Leslie Norwalk, Deputy Administrator of
the Centers for Medicare & Medicaid Services (CMS), making statements
regarding changes to Medicare. The Spanish videotape includes clips of
statements by Dr. Cristina Beato of CMS, instead of Thompson and
Norwalk.
The two English VNRs contained different story packages, each
narrated by Karen Ryan, an HHS subcontractor, who was not affiliated
with a news organization. The first story package focused on CMS's
advertising campaign regarding the prescription drug legislation. The
suggested anchor lead-in stated that ``the Federal Government is
launching a new, nationwide campaign to educate 41 million people with
Medicare about improvements to Medicare.'' The lead-in ended with
``Karen Ryan explains.'' The video portion of the story package began
with an excerpt of the television advertisement with audio stating,
``it's the same Medicare you've always counted on plus more benefits.''
Karen Ryan then explained, ``That's the main message Medicare's
advertising campaign drives home about the law.'' As more clips from
the advertisement appeared, Karen Ryan continued her narration,
indicating that the campaign helps beneficiaries answer their questions
about the new law, the Administration is emphasizing that seniors can
keep their Medicare the same, and the campaign is part of a larger
effort to educate people with Medicare about the new law. The story
package ended with Karen Ryan stating: ``In Washington, I'm Karen Ryan
reporting.''
The second English story package focused on various provisions of
the new prescription drug benefit and did not mention the advertising
campaign. The anchor lead-in stated: ``In December, President Bush
signed into law the first ever prescription drug benefit for people
with Medicare.'' The anchor lead-in then noted, ``There have been a lot
of questions about'' the new law and its changes to Medicare and
``Karen Ryan helps sort through the details.'' The video portion of the
news report started with footage of President Bush signing the
legislation, and Karen Ryan's narration indicated that when it was
``signed into law last month, millions of people who are covered by
Medicare began asking how it will help them.'' Next, the segment
included footage of Tommy Thompson, in which he states that ``it will
be the same Medicare system but with new benefits.'' Karen Ryan
continued her narration, stating ``most of the attention has focused on
the new prescription drug benefit . . . all people with Medicare will
be able to get coverage that will lower their prescription drug
spending . . . Medicare will offer some immediate help through a
discount card.'' She also told viewers that new preventive benefits
will be available, low-income individuals may qualify for a $600 credit
on available drug discount cards, and ``Medicare officials emphasize
that no one will be forced to sign up for any of the new benefits.''
Karen Ryan's narration then led into clips of Thompson and Norwalk
explaining other beneficial provisions of the new law. The second story
package also ended with, ``In Washington, I'm Karen Ryan reporting.''
The Spanish-language materials contained the same three items as
the English language VNRs--a B-roll, slates, and a story package. After
the B-roll segments, the story package segment appeared. This segment
was considerably longer than its two English counterparts, focused on
prescription drug benefits, and was narrated by Alberto Garcia, who is
also an HHS subcontractor, not a reporter. The anchor lead-in was
similar to the second English story package, except the anchor
indicates that Alberto Garcia ``helps sort through the details.'' The
video segment began with the footage of President Bush signing the
prescription drug bill into law, as Alberto Garcia narrated that after
signing the law, millions of people who are covered by Medicare began
asking how the new law will help them. The remainder of the story
package contained footage of Dr. Beato and of seniors engaged in
various activities. During the video clips of seniors, Alberto Garcia
narrated that the prescription drug benefit will be available in 2006
and that drug discount cards will be available in June 2004 and that
``[p]eople with Medicare may be able to choose from several different
drug discount cards, offering up to 25 percent savings on certain
medications.'' Alberto Garcia concluded his report, stating: ``In
Washington, I'm Alberto Garcia reporting.''
ONDCP Prepackaged News Stories Were Narrated by Contractors
Unaffiliated with News Organizations
For the ONDCP legal opinion, GAO examined eight VNRs, seven of
which included prepackaged news stories, in addition to B-roll footage
and slates. Each of ONDCP's news stories included narration by an
unseen person, identified as Mike Morris, Karen Ryan, or Jerry Corsini.
The narrator explained that he or she was ``reporting'' on various
ONDCP activities and on various issues related to the use of marijuana
by teenagers. Each story was accompanied by proposed ``lead-in'' and
``closing'' remarks to be spoken by station news anchors. Many of the
suggested anchor remarks included a phrase like, ``Mike Morris has the
story,'' or ``Mike Morris has more.'' ONDCP informed us that the
narrators were hired to read the scripts for the prepackaged new
stories, as prepared for and approved by ONDCP. Like the HHS VNR
narrators, none of these narrators were affiliated with any news
organization at the time the stories were produced or distributed.
The various ONDCP story packages touched on the addictive nature of
marijuana, the risks of marijuana use to teenagers, an open letter to
parents that was sponsored by ONDCP regarding marijuana, the increased
use of marijuana by teenagers during the summer, the dangers of driving
a vehicle while under the influence of marijuana, and the respiratory
health risks of smoking marijuana. Most of the story packages featured
statements by ONDCP Director John Walters and/or various drug experts.
The suggested anchor closing remarks directed viewers to an anti-drug
website and a toll-free telephone number.
GAO's Legal Opinions
In May 2004, GAO first addressed the use of prepackaged news
stories in an opinion \2\ issued to HHS regarding VNRs it had prepared
as part of a campaign to inform Medicare recipients about the new
prescription drug legislation.\3\ In a subsequent opinion issued in
January 2005, we addressed the VNRs produced by ONDCP as part of its
National Youth Anti-Drug Media Campaign.\4\
---------------------------------------------------------------------------
\2\ In addition to auditing and evaluating programs and activities
of the Federal Government and investigating matters related to the use
of public money, GAO is also responsible for settling all accounts of
the Federal Government. 31 U.S.C. Sec. Sec. 712, 717, 3526. Pursuant to
this accounts settlement authority, the Comptroller General issues
legal decisions and opinions to Federal agencies and Members of
Congress regarding the proper use of Federal funds.
\3\ B-302710, May 19, 2004 (retained in Committee files).
\4\ B-303495, Jan. 4, 2005 (retained in Committee files).
---------------------------------------------------------------------------
Agency's Right to Disseminate Information Does Not Include Covert
Propaganda
In both of these legal opinions, we concluded that production and
distribution of prepackaged news stories that concealed the agency's
role in producing the story violate the publicity and propaganda
prohibition. While GAO has long recognized that agencies have a right
to inform the public about their activities and to defend the
Administration's point of view on policy matters,\5\ there are several
statutory limitations on an agency's information dissemination, one of
which is the publicity or propaganda prohibition. This prohibition, the
first version of which was enacted in 1951, is usually contained in
annual appropriations acts. It states that, ``No part of any
appropriation contained in this or any other Act shall be used for
publicity or propaganda purposes within the United States not
heretofore authorized by the Congress.'' \6\
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\5\ See, e.g., B-304715, Apr. 27, 2005; B-302504, Mar. 10, 2004; B-
184648, Dec. 3, 1975.
\6\ See, e.g., Consolidated Appropriations Act, 2005, Pub. L. No.
108-447, div. H, title VI, Sec. 624, 118 Stat. 2809, 3278 (Dec. 8,
2004).
---------------------------------------------------------------------------
In applying this prohibition, GAO affords agencies a great deal of
discretion in their informational activities. However, GAO has, through
50 years of decisions, identified a number of specific activities that
are barred by the publicity and propaganda prohibition. One of the main
targets of this prohibition is agency-produced material that is covert
as to source.
Our opinions have emphasized that the critical element of covert
propaganda is concealment of the government's role in producing the
materials.\7\ GAO has concluded that agencies have violated the law
when they undertook activities such as distributing suggested
editorials to newspapers or hiring pundits to write commentaries
without acknowledging the government's sponsorship.\8\ In these cases,
even though the newspapers that printed the opinion pieces may have
been aware of their source, the newspaper readers did not know of the
agency's role in producing the materials.
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\7\ B-229257, June 10, 1988.
\8\ See, e.g., B-223098, Oct. 10, 1986; B-229069, Sept. 30, 1987.
---------------------------------------------------------------------------
Unattributed Prepackaged News Stories Violate Publicity and Propaganda
Prohibition
Similarly, in the case of the story packages produced by HHS and
ONDCP, the target audience--the viewing public--was unaware that the
material was produced by the government. The story packages were
clearly designed to be aired exactly as the agency produced them and
were intended to resemble traditional news stories. They were narrated
by government contract personnel who portrayed reporters and included
suggested anchor lead-in scripts, announcing it as a news story by the
purported reporter, which facilitated the unaltered use of the story
package.
Most importantly, the story packages contained no statement or
other reference to alert television viewers to the fact that the agency
was the source of the purported news story. These characteristics may
lead viewers to believe, wrongly, that the piece was an actual news
story produced by the local television station and narrated by a real
reporter. Therefore, we concluded that the prepackaged news stories
constituted covert propaganda and that HHS and ONDCP both violated the
prohibition on the use of appropriated funds for publicity or
propaganda.\9\ Furthermore, because the agencies had no appropriation
available for covert propaganda, HHS and ONDCP also violated the
Antideficiency Act, which prohibits obligations in excess of available
budget authority.\10\
---------------------------------------------------------------------------
\9\ Although both HHS and ONDCP pointed to specific statutory
provisions that authorized them to disseminate information to the
public, GAO concluded that such provisions did not authorize them to
produce unattributed news stories. In both opinions, GAO also concluded
that the B-roll footage and the slates did not violate the publicity
and propaganda prohibition because they were designed to be viewed and
utilized solely by the news organizations, and the agencies had
properly disclosed their role in the production of the materials to the
stations.
\10\ 31 U.S.C. Sec. 1341(a).
---------------------------------------------------------------------------
In both of these opinions, we also noted:``In a modest but
meaningful way, the publicity or propaganda restriction helps to mark
the boundary between an agency making information available to the
public and agencies creating news unbeknownst to the receiving
audience.'' In fact, the appropriations prohibition is not the only
marker that Congress has enacted to delineate the boundaries between
the government and the free American press.\11\ Statutory limits on the
domestic dissemination of news reports produced by the Federal
Government reflect concern that allowing the government to produce
domestic news broadcasts would infringe upon the freedom of the press
and constitute, or at least give the appearance of, an attempt to
control public opinion.\12\
---------------------------------------------------------------------------
\11\ See, e.g., 22 U.S.C. Sec. Sec. 1461, 1461-1a (restricting the
domestic dissemination of news reports originally created by the
Government for broadcast abroad).
\12\ B-118654-O.M., Apr. 17, 1979.
---------------------------------------------------------------------------
HHS and ONDCP both commissioned and distributed prepackaged news
stories and introductory scripts about their activities that were
designed to be indistinguishable from news stories produced by private
news broadcasters. In neither case did the agency include any statement
or other indication in its news stories that disclosed to the
television viewing audience (the target of the purported news stories)
that the agency wrote and produced those news stories. In other words,
television-viewing audiences did not know that stories they watched on
television news programs about the government were, in fact, prepared
by the government. We therefore concluded that those prepackaged news
stories violated the publicity or propaganda prohibition.
Circular Letter Advised All Agencies of Duty to Disclose Source of
Materials
In addition to the HHS and ONDCP opinions, the Comptroller General
issued a circular letter to the heads of all cabinet departments and
Federal agencies in February of this year to alert agencies to our
opinions on prepackaged news stories and to remind them of their duty
to disclose the source of materials that they disseminate to the
public.\13\ GAO decided that a government-wide circular would be
appropriate given the increasing use of VNRs by the Federal Government.
In fact, our research showed that VNRs have been produced by a wide
range of Federal departments and agencies, from the Department of State
to the Census Bureau to the Transportation Security Administration.
---------------------------------------------------------------------------
\13\ B-304272, Feb. 17, 2005 (retained in Committee files).
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Mr. Chairman, this concludes my prepared statement. I would be
happy to respond to any questions regarding our opinions that you or
the Committee may have.
The Chairman. Do you want to show your video now or later?
Senator Lautenberg. I had hoped, Mr. Chairman, we could
show it now as part of this testimony.
The Chairman. It is about 3 minutes. Right?
Ms. Poling. What you are going to see here is the complete
video news release, but we can probably shorten it.
The Chairman. Let us not shorten it. Let us show it all.
Let us just see it. OK?
Ms. Poling. OK. First it contains slates. I was just going
to explain the parts of it. There are no words with this
section.
This is the video news release. What we are pointing out is
that there are parts of video news releases. This is slates.
This is just text feed that can be used by the programmers when
they put together a news program.
Then you will see some B-roll, which is various kinds, but
what you are going to see first, I think, are public officials
making statements. We do not have any problems with this.
Then you are going to see a public service announcement
which does identify exactly that this is a product of the
Department of HHS.
This is the ad.
[Video shown.]
Ms. Poling. That was the ad.
This is the prepackaged news story. The rest is B-roll.
Senator Lautenberg. Can we hear it or not?
Ms. Poling. The text is irrelevant. It is really the
visual.
The B-roll consists of pieces that the television news
studio can use to put together its own story.
That is the end.
The Chairman. What is the disclaimer?
Ms. Poling. I did not hear you.
The Chairman. Thank you very much.
Ms. Cochran.
STATEMENT OF BARBARA COCHRAN, PRESIDENT,
RADIO-TELEVISION NEWS DIRECTORS ASSOCIATION
Ms. Cochran. Thank you, Mr. Chairman, members of the
Committee. I am Barbara Cochran, the President of the Radio-
Television News Directors Association. Thank you for inviting
me to appear today on behalf of the electronic journalists,
educators, students, and executives who comprise RTNDA, the
world's largest professional organization devoted exclusively
to electronic journalism.
As you know, our members are on the front lines in managing
the news operations of radio, television, cable, and other news
distribution organizations. We are committed to providing
accurate and credible news stories. That commitment includes
appropriate identification of materials used in our stories.
Credibility is our stock in trade. If our viewers and listeners
cannot trust our stories, they will tune us out, literally.
The appropriate use of third party video and video news
releases is not a new subject for our members. We have sought
to address questions of when and how to use these materials for
more than 15 years. Our consistent policy adopted in 1989 has
been that clear and complete disclosure of outside materials
must occur, and this policy is incorporated in our code of
ethics.
With the recent and public reports concerning
governmentally produced and funded videos, we revisited and
expanded upon the guidelines. A copy of these guidelines is
attached to my written testimony. News directors have reviewed
the guidelines with their staffs and they have reviewed their
procedures to ensure material is properly identified.
Some of these recent reports may leave the mistaken
impression that unidentified VNRs are widely used. Based on my
conversations with news directors, little outside material is
used in the dozens of stories and many hours of news
programming that stations produce each and everyday. When third
party material is used, it is most often excerpted or used as
background footage, the kind of B-roll that we just saw, and it
is attributed. Rarely are entire releases used and even more
rarely is the source not identified.
Even so, some mistakes were made. In part, these miscues
can be traced to technological changes that have made the
distribution of audio and video materials more complicated and
led to difficulties in ascertaining the points of origin. In
many of the reported cases of unlabeled material, the station
or the news director has told me that all future material will
be identified.
Whatever the causes or reasons, I can report that steps are
being taken to reemphasize and endorse full disclosure. News
organizations and producers have changed and are changing the
distribution procedures to make sure that material is clearly
labeled when it is sent out.
In the newsroom, news directors and journalists also have
taken steps to ensure adherence to the RTNDA guidelines. And in
addition, we will work with the FCC as it seeks comments on
appropriate ways to improve source identification and
disclosure.
RTNDA members are committed to the appropriate
identification of third party materials, and we believe that
the current guidelines and the reinvigorated practices of our
members will adequately and properly support this commitment
and ensure that the public is fully informed. Accordingly, we
do not believe that Government action is needed, at least not
at this time.
Determining the content of a newscast, including when and
how to identify sources, is at the very heart of our
responsibilities as electronic journalists, and these decisions
must remain far removed from Government involvement or
supervision. The Government must be cautious in considering any
action through legislation or regulation that could interfere
with journalist judgment or otherwise influence or dictate news
decisions or content. Any such action must be a last resort,
not an initial reaction. RTNDA urges you, therefore, not to
respond to the mistakes of a few by imposing rules that could
affect the selection and presentation of newsworthy material.
We have every incentive today to protect the integrity of our
news broadcasts by fully informing our viewers. The policy
guidance and procedures are in place to address the recent
missteps and to fulfill our responsibilities. Government
intervention, while well intended, is unnecessary and could be
harmful.
Thank you.
[The prepared statement of Ms. Cochran follows:]
Prepared Statement of Barbara Cochran, President,
Radio-Television News Directors Association
Mr. Chairman and members of the Committee, I am Barbara Cochran,
President of the Radio-Television News Directors Association (RTNDA).
Thank you for inviting me to appear before you today to discuss S. 967,
the Truth in Broadcasting bill introduced by Senator Lautenberg and
cosponsored by other Senators, including members of this committee,
Senators Kerry, Boxer and Dorgan.
RTNDA is the world's largest professional organization devoted
exclusively to electronic journalism. RTNDA represents local and
network news executives, educators, students and others in the radio,
television and cable news business in over thirty countries. I have
worked as a journalist in Washington for nearly 30 years and have held
management positions in print, radio and television. I was managing
editor of the Washington Star, Vice President for news at National
Public Radio, executive producer of ``Meet the Press'' at NBC News, and
vice president and Washington bureau chief at CBS News. I became
president of RTNDA in 1997.
As you well know, the members of RTNDA are on the front lines in
managing the news operations of radio, television and other electronic
news distribution organizations. News directors are responsible for
determining what stories will be covered as well as when and how these
stories will be presented. News organizations often receive news topic
suggestions and materials from third parties. These inputs are not a
significant source of news for most operations, and they do not replace
the important and substantial news-gathering activities of our members'
organizations. In the case of audio clips and video footage, these
inputs can, however, provide useful material that the news organization
could not have obtained on its own. For example, a hospital may provide
footage of its operating room or NASA may provide a graphic depiction
of a space mission. When third party audio or video is submitted to a
news operation, the news director or a news staff member who has been
assigned that responsibility must determine the newsworthiness of the
material, and he or she must judge whether and how to use this
material.
On behalf of my membership, I want to express our appreciation to
the Chairman for scheduling this hearing to provide an opportunity to
discuss the appropriate role of the government in the treatment of
VNRs. We also appreciate the initiative taken by Senator Lautenberg and
the other sponsors of S. 967 to ensure that VNRs distributed to
broadcasters and other programming distributors contain information
concerning their source. As Commissioner Adelstein recently said, ``it
is up to Congress if it chooses to further strengthen the
responsibility of government agencies to disclose more fully that
material is government-produced.''
As news directors, we appreciate the policy rationale for the
disclosure requirement imposed on government agencies that prepare and
release ``prepackaged news stories,'' as contemplated by S. 967 and
contained in Senator Byrd's amendment to the recently passed
supplemental appropriations legislation.
The issue of how to use material from video and audio news releases
is one RTNDA has grappled with for more than 15 years. As electronic
journalists, RTNDA members are committed to providing the public with
accurate and credible news stories. In 1989, RTNDA's Board of
Directors, whose members are news executives from across the country,
adopted a policy that calls for clear and complete disclosure of the
origin of any outside material that is used in a news story or news
program. This policy was incorporated into the RTNDA Code of Ethics and
Professional Conduct when it was revised in 2000. The statement is
unambiguous. The Code says that professional electronic journalists
should ``clearly disclose the origin of information and label all
materials provided by outsiders.''
Last year, when it was first disclosed that a few stations had used
a video news release produced by a Federal agency without disclosing
the origin, possibly because the origin was not clear, the RTNDA Ethics
Committee decided to expand its guidance on the use of outside audio
and video material. Over the past 12 months, the Committee developed
guidelines for newsrooms as they consider whether to incorporate this
material into their own stories or programs. The guidelines were
released at our annual convention in April. I have attached a copy of
the guidelines to my statement and ask that it be included in the
hearing record. (ATTACHMENT) The main principle is unchanged: material
from outside sources must be clearly identified to the audience.
The guidelines are intended to help with the editorial decision-
making about whether the material should be used in the first place.
Recent events have highlighted the importance these guidelines. In
March, the New York Times reported that the Federal Government was
sending an unprecedented number of video news releases to local
stations and they found evidence that some stations were using the
releases without altering them or identifying them. Unfortunately, as
the story was spread through other news media, the impression grew that
the use of unidentified audio and video from government agencies was a
rampant practice. That is not the case. Based on conversations with
news directors over the past two months, I believe stations use very
little outside material among the dozens of stories and hours of news
programming they produce each day. Of the material they receive, far
more comes from corporate sources than government agencies.
Furthermore, the material is far more likely to be used as background
footage or excerpted in stories that the news rooms produce themselves.
Very rarely are releases used in their entirety. Technological changes
have made the distribution of audio and video material more complicated
and sometimes made it more difficult to ascertain the point of origin.
Providers have taken steps to make sure that, even in newer, digital
formats, this material is clearly labeled.
Nonetheless, the reports that originated with the New York Times
challenged the credibility of local news. As a consequence, news
directors have met with their staffs, reiterated their policies and
made sure everyone in the newsroom understands that if such material is
used it must be identified. We believe RTNDA's guidelines will be
helpful in facilitating those newsroom discussions.
Because electronic journalists operate as trustees of the public,
underlying our VNR guidelines is the basic tenet that the public must
be properly informed. News operations are primarily concerned with the
collection and accurate reporting of relevant news stories to their
listeners and viewers. In the vast majority of cases and operations,
news is collected directly by the news staff. Even when third party
video or audio is received, it generally will not be used by a local
news organization if similar material can be obtained directly by the
station or through a network feed. Our guidelines reflect and reinforce
this practice. When a judgment is made that third party video is
relevant to a news story and cannot be obtained through a news source,
our guidelines call for the clear disclosure of the origin of the
material--and this disclosure applies to all sources of third party
materials, including private parties, corporations and all levels of
government. The guidelines cover a broad range of situations and VNR
materials. They seek to protect the editorial integrity of the audio
and video aired, to avoid commercialization of news stories, and to
otherwise guard against third party influence of news content.
We believe that these guidelines help to ensure that the public
receives the highest quality and most accurate information and is fully
informed as to the source of third party material. Our members have
renewed their efforts to honor their commitments to these guidelines
and to their responsibilities as electronic journalists. Significant
market forces compel them to do so--credibility with their listeners
and viewers is their stock in trade.
As the bill reflects, sections 317 and 507 of the Communications
Act of 1934 confer disclosure authority and responsibilities on the
Federal Communications Commission with regard to sponsorship
identification by broadcasters, cable operators, producers and others
subject to its rules. The FCC recently issued a ``reminder'' to these
entities of their obligations to comply with the FCC's rules. The FCC's
release stated that its ``rules are grounded in the principle that
listeners and viewers are entitled to know who seeks to persuade
them.'' RTNDA supports this public right to know and our guidelines are
designed to achieve this goal of clearly disclosing ``the nature,
source and sponsorship'' of news material viewed by the public. The FCC
also is seeking comment on appropriate ways to improve the disclosures
and the situations covered thereby. RTNDA looks forward to the
opportunity to submit comments and to work with the FCC and others to
ensure the public receives clear and accurate disclosure--and most
importantly--that the public has clear and unfettered access to
relevant information.
The determination of what to include in any particular newscast
constitutes the very core journalistic function of a broadcaster, and
is a matter far removed from government supervision. The Government
must be cautious, therefore, in taking any action that would interfere
with the editorial judgments of electronic journalists or otherwise
dictate news decisions or content. RTNDA urges you, therefore, not to
respond to the mistakes of a few by imposing rules that could very well
restrict the ability of professional journalists to select and present
newsworthy material to the public. Electronic journalists have every
incentive to protect the editorial integrity of the audio and video
they air without government intervention.
In closing, I believe we share common goals--a free press and an
informed public. I look forward to working with you to develop the best
ways to achieve and protect these goals.
Attachment
RTNDA Guidelines for Use of Non-editorial Video and Audio (April 2005)
Television and radio stations should strive to protect the
editorial integrity of the video and audio they air. This integrity, at
times, might come into question when stations air video and audio
provided to newsrooms by companies, organizations or governmental
agencies with political or financial interests in publicizing the
material. News staffs should find answers to the following questions
when making decisions to broadcast video or audio produced and/or
supplied by non-editorial sources.
RTNDA's Code of Ethics and Professional Conduct states that
professional electronic journalists should ``clearly disclose the
origin of information and label all material provided by outsiders.''
The following guidelines are offered to meet this goal.
News managers and producers should determine if the station
is able to shoot this video or capture this audio itself, or
get it through regular editorial channels, such as its network
feed service. If this video/audio is available in no other way
but through corporate release (as in the case of proprietary
assembly line video), then managers should decide what value
using the video/audio brings to the newscast, and if that value
outweighs the possible appearance of ``product placement'' or
commercial interests.
News managers and producers should clearly disclose the
origin of information and label all material provided by
corporate or other non-editorial sources. For example, graphics
could denote ``Mercy Hospital video'' and the reporter or
anchor script could also acknowledge it by stating, ``This
operating room video was provided by Mercy Hospital.''
News managers and producers should determine if interviews
provided with video/audio releases follow the same standards
regarding conflicts of interest as used in the newsroom. For
instance, some releases might contain interviews where subjects
and interviewers are employed by the same organization.
Consider whether tough questions were asked and if the subject
was properly questioned.
Before re-voicing and airing stories released with all their
elements and intended for that purpose, managers and producers
should ask questions regarding whether the editorial process
behind the story is in concert with those used in the newsroom.
Some questions to ask include whether more than one side is
included, if there is a financial agenda to releasing the
story, and if the viewers and/or listeners would believe this
is work done locally by your team.
Producers should question the source of network feed video
that appears to have come from sources other than the network's
news operation. Network feed producers should supply
information revealing the source of such material.
News managers and producers should consider how video/audio
released from groups without a profit or political agenda, such
as nonprofit, charitable and educational institutions, will be
used in newscasts, if at all. Can this material add valuable
insight to local stories? Has it been issued to be aired
locally and credited to the issuing organizations. Will viewers
find it to be useful information?
Developed by the RTNDA Ethics Committee
The Chairman. Mr. Simon.
STATEMENT OF DOUGLAS SIMON, PRESIDENT/CEO,
D S SIMON PRODUCTIONS, INC.
Mr. Simon. Thank you, Mr. Chairman, Senator DeMint, Senator
Lautenberg. It is an honor for me to be here.
I would like to disclose that my company has produced
public relations video for both the current Bush Administration
and the Clinton Administration. Just like Government
dissemination of print press releases, Government video news
releases and B-roll packages are a necessary tool to keep the
public informed, whichever political party is in power. But
this legitimate tool must not be abused and disclosure is
critical.
The first video news releases, or VNRs, were created in the
late 1940s, and the first Federal agency produced VNR that I
remember personally watching was during the Nixon
Administration. When Neil Armstrong walked on the moon, no
network had a camera crew at the Sea of Tranquility. NASA
provided the footage and no one complained.
I have been invited by this committee to examine this bill
based upon existing law and existing practices in the news
industry. Regardless of VNR vendor practice, the overwhelming
majority of producers and reporters at TV stations know the
origin of VNR video before deciding to air it, and there is a
simple reason for this. Reporters will not air the video if
they do not know the source. They insist on disclosure.
Now, while the broadcast decisionmakers know the source,
their station managers may not. The analogy I make is that the
publisher of a newspaper probably does not know what is on page
5 of the Metro Section. That is why, when asked about a
controversial Government piece airing on their station, the
news directors honestly say, you know, I do not know. I had no
idea. Well, they know now and I think that is a very positive
development.
There have been loopholes that have allowed some Government
video to reach journalists via network newsfeed services with
the broadcasters possibly confused about its origin. These
loopholes are being closed. Newsfeeds are now passing that
information along to their affiliates.
Now, as a VNR producer and distributor, you might expect
that I am against any regulation that affects our industry
practice. I am not. While many in the PR industry may disagree,
I believe when Government is involved, and even in the private
sector, not only do the journalistic gatekeepers need to know
the original funding source of VNR material, the public has a
right to know as well. That being said, increased Government
control over news broadcasts is not a hallmark of democracy.
The Truth in Broadcasting bill will decrease, not increase,
the information available to the public. It will limit, not
expand, the transparency of Government activities. The bill
calls for the FCC to create the design, presentation, and
language of a disclaimer that news stations would be required
to air throughout the entire segment. Rather than deciding
whether the story or a portion of it should air, based on news
standards, stations will be factoring in whether they are
comfortable changing the look of their broadcast. Depending on
the politics of the Administration in power and in their
viewing area, broadcasters may feel pressure if they run or do
not run Government video.
This bill could result in the Government altering the
format of the video it produces to avoid disclosure
requirements. Worse, Government may turn to unregulated third
parties or pop-up think tanks to become the source of video and
escape restrictions.
If legislation is needed, rather than regulate and possibly
threaten broadcasters, I would encourage that you draft the
Transparency in Government Use of PR Video Act. Obviously, I am
not a legislator with that title. This act would require all
Government video distributed to news stations, whether VNR, B-
roll, or otherwise, be posted on a Government website where the
public could access it, not just the small percentage of
viewers who may end up seeing it on their local news. The FCC
Commissioner at today's hearing already is on record saying it
would not impose financial burdens on Government.
Other things to consider. E-mail and fax pitches on behalf
of the video news releases should disclose that the U.S.
Government produced the package.
The videotape could include a graphic identifying the
Government as the source of the video at the front of the tape,
as is current industry standard, the VNR without graphics, and
a second version of the video on the tape with the disclaimer
burned in over the entire video. This will avoid confusion and
give broadcasters the option of how its disclaimer should look
without the threat of Government sanction.
This suggested approach will dramatically increase
transparency in Government, allow the dissemination of more
accurate information to millions more people, and preserve our
freedom of the press.
Voice-overs in VNRs have been an industry convention for
more than 40 years. The focus on fake reporters, in terms of
the public good, misses the core issue. The public has the same
right to know what our Government does when a voice-over is
recorded on a VNR as when it is not.
And VNRs are not fake news because they are not news. A
video news release is a communications tool by an interested
party to get its message on television. When that interested
party is the Government, the public has the right to know, and
this is true whether it is factual information or what some
would call propaganda.
I believe these goals can be achieved without limiting the
rights of broadcasters. Thank you very much.
[The prepared statement of Mr. Simon follows:]
Prepared Statement of Douglas Simon, President/CEO,
D S Simon Productions, Inc.
Thank you. I'd like to start by disclosing that my company, D S
Simon Productions, has produced video news releases or VNRs for Federal
agencies during both the Clinton and current Bush Administrations.
It is said that the first VNRs were created in the late 1940s. The
first Federal Agency produced VNR that I remember personally watching
was during the Nixon Administration. When Neil Armstrong walked on the
moon no network had a camera crew at the Sea of Tranquility. NASA
provided the footage. No one complained.
I have been invited by this committee to examine this bill based
upon existing law and existing practices in the news industry.
Regardless of VNR vendor practice, the overwhelming majority of
producers and reporters at TV stations know the origin of VNR video
before deciding to air it. There's a simple reason for this. Stations
won't air the video if they don't know the source. They insist on
disclosure.
While the broadcast decision makers know the source, their station
managers may not. The analogy I make is that the publisher of a
newspaper may not know what is being written on page five of the metro
section. That is why when asked about a controversial government video
airing on their news programs, News Directors honestly answered they
didn't know. They know now and I view this as a positive development.
There have been loopholes that have allowed some government video
to reach journalists via network newsfeed services with the
broadcasters possibly confused about its origin. These loopholes are
being closed. Changes in broadcast practices now require this funding
information to be passed on to the affiliates.
As a VNR producer and distributor, you might expect that I am
against any regulation that effects our industry practice. I'm not.
While many in the PR Video Industry disagree, I believe, when
government is involved, and even in the private sector, not only do the
journalistic gatekeepers need to know the original funding source of
VNR material but the public has the right to know. That being said,
increased government control over news broadcasts is not a hallmark of
democracy.
I am concerned the ``Truth In Broadcasting'' bill will decrease,
not increase the information available to the public. It will limit,
not expand the transparency of government activities. The bill calls
for the FCC to create the design, presentation and language of a
disclaimer that news stations would be required to air throughout the
entire segment. Rather than deciding whether the story, or a portion of
it, should air based on news standards, stations will be factoring in
whether they are comfortable changing the look of their broadcast.
Depending on the politics of the Administration in power, and in their
viewing area, broadcasters may feel pressure if they run or don't run
government video.
This bill could result in the Government altering the format of the
video it produces to avoid disclosure requirements. Worse, government
may turn to unregulated third parties or pop-up think tanks to become
the source of the video and escape restrictions. The most serious risk
is increasing government control over broadcast news limiting freedom
of speech--especially when coupled with the recent FCC Notice of April
13th which held stations could be subject to fine when failing to
disclose the source of ``matter furnished to them'' which could be
applied to any information broadcasters receive.
If legislation is needed, rather than regulate and threaten
broadcasters I would encourage that you draft the ``Transparency in
Government use of PR Video Act.'' This act would require:
All government video disseminated to news stations whether they
include pre-packaged news stories or not be posted on a government
website where the public could access it.
All e-mail and fax pitches on behalf of placing the video would be
required to disclose that the package is produced by the U.S.
Government.
The video tape would include a graphic identifying the government
as the source of the video at the front of the tape, the VNR without
graphics and a second version of the video on the tape with the
disclaimer burned in over the entire video. This will avoid confusion
and give broadcasters the option of how its disclaimer should look
without the threat of government sanction.
This bill will dramatically increase transparency in government,
allow the dissemination of more accurate information to millions more
people and preserve our freedom of the press.
Voice-overs in VNRs have been an industry convention for more than
40 years. The focus on ``fake reporters'' in terms of the public good
misses the core issue. The public has the same right to know what our
government does, when a voice-over is recorded on a VNR and when it is
not.
Much also has been made of ``fake news'' which conveys a powerful
but false image when applied to VNRs. The truth is that what we provide
for government clients is not news, fake or otherwise. It is paid
advocacy. I hope we can agree that third-party video of all kinds is
advocacy whether you believe it is factual information or propaganda. I
call on you to seriously consider these recommendations and focus your
attention on government behavior as opposed to setting limits on
broadcasters. Thank you.
Supplemental Information
Who I am Speaking on Behalf of
It is an honor for me to be here today. While I have long been
active in promoting ethical practices within public relations and
currently serve as Vice President of the Public Relations Society of
America's New York Chapter, I am here in my capacity as President & CEO
of D S Simon Productions, a company that I founded 19 years ago on July
4, 1986.
VNR Industry Practices
The industry custom for how VNRs are produced has been established
since the late 1960s. It includes an edited package with a voice-over
that a station could air in part or in whole or simply use as a
reference when they create a story using third-party video. We see
approximately five percent of the VNRs we distribute airing in their
entirety and an even smaller number using the actual voice-over we
recorded. The goal of a VNR project is to receive the widest possible
airings of the key messages contained within. Given the small
percentage of airings where an entire video is used, a well-crafted VNR
offers stations maximum flexibility in using the story as they see fit.
In some cases, a station will use the video to support a story angle
that is either unrelated to or even in opposition to the intended
messaging in the Video News Release. This is an accepted risk in our
industry and combined with the station option not to use the video, is
one of the best safeguards at avoiding overly commercial or overly
biased information being disseminated.
The VNR tape typically includes additional sound bites and footage
as well as background information, as a graphic and contact information
for a journalist to fact check. Depending on the story and budget, some
projects will not include a scripted package but will simply include
footage, sound bites and background information. This is commonly
called a ``B-Roll'' package.
Once the video is produced, it is delivered to news outlets via
satellite, direct mail or some of the newer digital distribution
systems. The third aspect of the process is notifying the media that
the story is available. This is done by, e-mail, fax, phone pitches and
wire services. The fourth part of the process is monitoring of usage.
This is done primarily through an electronic encoding signal (much like
closed captioning) that is invisible to the viewer at home but allows
Nielsen Media Research to report back to us which stations have aired
VNR video and when. Secondary monitoring services are also used.
I can state emphatically that almost 100 percent of the broadcast
decision makers we deal with know the original funding source of the
video we provide them. We include notification about the original
funding source in our e-mail and fax pitches in addition to labeling on
the video itself.
Broadcast Industry Practice
The Radio-Television News Directors Association (RTNDA) has issued
new guidelines. CNN Newsource, CBS Newspath and Fox NewsEdge also sell
time to VNR distributors on their newsfeed services. CBS has always
labeled this video as a corporate feed and identifies the funding
sponsor to its affiliates. CNN now has VNR video and its own video on a
separate interface so a station cannot pull a VNR thinking it was CNN
content. This change was made after the infamous ``Karen Ryan video''
for the Department of Health and Human Services. The Fox NewsEdge
affiliate feed now includes a ``Courtesy of '' banner on all third-
party video sent out to its affiliates.
In a survey of 132 broadcast producers and reporters D S Simon
Productions completed in April of this year before the FCC Notice was
issued, they told us that if they receive even a pitch that does not
reveal the sponsor almost 80 percent never use the story that follows.
The Proportion of Unlabeled Government Video to Broadcast News Content
How much government produced VNR content is the public actually
seeing that is controversial or unlabeled? From conversations I've had
with representatives of monitoring services no more than 10 percent of
news is VNR footage. Of that, less than two percent comes from the U.S.
Government. If half of that is controversial, unlabeled government
material we are talking about 1/20th of one percent of news content
being a concern. There is strong evidence the source of this video is
increasingly communicated to viewers based on changes in broadcast
practices.
The Threat to Broadcasters if This Bill is Adopted
The most serious risk is increasing government control over
broadcast is news limiting freedom of speech--especially when coupled
with the recent FCC Notice of April 13, which held stations could be
subject to fine when failing to disclose the source of ``matter
furnished to them'' which could apply to any information broadcasters
receive. Depending on how it is interpreted, stations could be subject
to fines if they aired a report based upon an unnamed source or
whistleblower.
My Suggestions for a ``Transparency in Government Public Relations
Video Act'' to Improve the ``Truth In Broadcasting'' bill
This act would require all government video disseminated to news
stations whether they include pre-packaged news stories or not be
posted on a government website where the public could access it. It
could be made available in libraries so people who do not have Internet
access would be able to view it at no charge. This posting would
include the script or transcript of sound bites as well as slate
information.
All e-mail and fax pitches on behalf of placing the video would be
required to mention that the package is produced by the U.S.
Government.
The video tape would include a graphic identifying the government
as the source of the video at the front of the tape, the VNR without
graphics and a second version of the video on the tape with the
disclaimer burned in over the entire video to avoid confusion and to
give broadcasters the option of how its disclaimer should look without
the threat of government sanction. Phone and e-mail contact information
of a spokesperson from the Federal agency providing the video would
also be included.
If you are concerned about partisanship, you could allow the Senate
majority and minority the option to appoint one spokesperson to
contribute one sound bite to the video for balance.
The monitoring data detailing which stations broadcast portions of
the video could also be made public.
Broadcasters would be encouraged to comply with the guidelines
established by the RTNDA for use of third-party video but not required
to do so.
This bill would dramatically increase transparency in government,
allow the dissemination of more accurate information to millions more
people and preserve our freedom of the press.
The Chairman. Ms. Phair.
STATEMENT OF JUDITH T. PHAIR, PRESIDENT/CEO,
PUBLIC RELATIONS SOCIETY OF AMERICA (PRSA)
Ms. Phair. Thank you, Mr. Chairman. Mr. Chairman, Senator
Lautenberg, Senator DeMint, my name is Judy Phair and I am
President and CEO of the Public Relations Society of America.
It is a great privilege and honor to appear before you today,
and I thank you for inviting me.
I want to testify before you on a subject of paramount
importance to all of us: ensuring the free flow of information
from Government to citizens that is an essential and core part
of our democracy.
I represent 20,000 men and women working in the public
relations profession in every State of the Union, men and women
who are committed to using their professional skills to help
enhance communications and dialog between organizations,
businesses, government, not-for-profit entities, and the
communities, constituencies and the public they serve. We also
have 8,000 student members on 260 college and university
campuses across the Nation.
Our mission is to advance the profession of public
relations, a profession that has as its foundation exactly what
Senator Kerry was describing earlier this morning, that
important free flow of information throughout society. We are
committed to the responsible and ethical practice of public
relations, and each of our members signs a code of ethics that
focuses on honesty and full disclosure, and we have attached
that code of ethics with my written testimony. That code helps
govern our daily work, which involves the use of many tools and
tactics to deliver information and frame the dialog between
organizations and their publics. That is extremely important in
the context of S. 967, which addresses one important tool in
the public relations process, and that is the video news
release, or VNR.
Society recognizes that as part of strategic communications
planning, video news releases can, in fact, be valuable tools
promoting that free flow of information. Just as paper news
releases, which we discussed also in earlier testimony, are
used in print journalism and follow the style of print
journalism, VNRs utilize a format that is suited to electronic
media. Both print and video news releases deliver information
to the public via the news media in formats that are suitable
to those media.
But we also believe that VNRs should be produced and
disseminated with the highest levels of transparency, candor,
and honesty. In order to foster open communication leading to
informed decisionmaking, we must do more than simply funnel
information through the media to the public. We must reveal the
sponsors for causes and interests represented and disclose all
financial interests related to the VNR. We believe that the
great majority of public relations professionals and the firms
they work for hold this view and do practice full disclosure of
sources and sponsors to the broadcast media. Therefore, we see
no issue regarding the codification of a practice that
Government communications professionals and their contracted
agents should already be doing. And that codification is indeed
what your bill does.
We support the intent of the legislation, which would
require full disclosure of the sources for Government VNRs.
However, our concern is that some of the provisions go beyond
mandating the full disclosure of Government involvement and the
clear identification of sources of information contained in
these releases. The portions of the bill that are of greatest
concern to PRSA regard how this disclosure would be made. We
believe that those provisions may have the unintended
consequence of actually impeding the flow of important
information to the public.
We believe that public relations professionals involved in
producing video news releases should provide broadcasters with
all the information they need in order to decide the best way
to use the information contained in the releases.
Broadcasters should have the ultimate responsibility for
providing disclosure to the public. That disclosure could come
in many forms, depending on the content and context of the VNR
and the broadcaster's news production format, as long as the
result is to let the public know the sources of information. By
prescribing the specifics of disclosure to be used in the
production of Government-sponsored VNRs, S. 967 could make the
process so onerous or the end results so inappropriate for
broadcast use that stations might not use VNRs at all, thus
limiting the free flow of information.
PRSA believes the Government should not hold broadcasters
to a different standard in presenting news to their viewers
than those standards that print media impose on themselves.
We have long advocated the ethical, honest production of
video news releases and full disclosure of their sponsorship.
It is an issue that is of vital importance to this industry,
and we are working constantly to keep that disclosure bar set
high for our members and by example for others in this
profession. VNRs have been used successfully, with full
disclosure sources of information, for conveying information to
the public about several important programs. For example, VNRs
were effective components of public service campaigns on such
issues as labeling over-the-counter drug supplements, seat belt
usage, online tax return filing, and cancer detection and
prevention.
Public relations exists as a profession today because it
has established a level of trust with the media and the public.
In our role of providing information to the public, often
through media outlets, that is essential. And we do believe
that imposing rigid requirements and specifications on the
information we provide to the public will not best serve that
public interest.
I would certainly be happy to take questions, and thank you
very much, Mr. Chairman and members of the Committee.
[The prepared statement of Ms. Phair follows:]
Prepared Statement of Judith T. Phair, President/CEO,
Public Relations Society of America (PRSA)
Mr. Chairman and members of the Committee:
On behalf of the Public Relations Society of America I thank you
for the opportunity to submit this testimony concerning S. 967.
PRSA represents 20,000 public relations professionals in business,
government, education, nonprofit and other sectors. Our membership is
divided into ten regional Districts with 114 local Chapters in the
United States and the District of Columbia. We're governed by a board
of directors that is elected by members. Our 8,000 plus-member Public
Relations Student Society of America has 260 Chapters on campuses at
colleges and universities throughout the United States.
The mission of PRSA is to advance the profession of public
relations and public relations professionals through education,
innovation and adherence to a strong code of ethical behavior. The PRSA
Member Code of Ethics is signed by each member as a prerequisite to
join. It guides them in their daily activities in the practice of
public relations.
That's extremely important in the context of S. 967, which
addresses one important tool in the public relations process--the Video
News Release, or VNR.
Like members of this committee, our members are well aware of the
issues surrounding the production of VNRs by government entities or
with Federal funds. And our position on VNRs is probably similar to
those of each member of this committee.
Our Society recognizes that, in strategic communications planning,
video news releases can be valuable tools promoting the free flow of
information. Just as ``print'' news releases follow the style of print
journalism, VNRs utilize a format that is most adaptable to electronic
media. Both print and video news releases present information in a way
that is preferred by these respective media and that meets public
information needs and interests.
But we also believe that VNRs should be produced and disseminated
with the highest levels of transparency, candor and honesty. To provide
open communication that fosters informed decision, we must do more than
simply funnel information through the media to the public. We must
reveal the sponsors for causes and interests represented and disclose
all financial interests related to the VNR. We believe that most of our
members and the 120,000 men and women practicing public relations in
the United States today hold that view.
Therefore, we see no issue regarding the codification of a practice
that government communications professionals and their contracted
agents should already be doing.
Our concern with S. 967 is that some of its provisions go beyond
what appears to be the intent of the legislation--that is, to require
full disclosure of government sponsorship of VNRs and clear
identification sources of information contained in those releases. The
portions of the bill of greatest concern to PRSA reference how this
disclosure would be made. We believe those provisions may have the
unintended consequence of actually impeding the free flow of important
information to the public.
We believe that public relations professionals involved in
producing video news releases should provide broadcasters with all the
information they need in order to decide the best way to use the
information contained in the releases.
Disclosure to the public is ultimately the responsibility of
broadcasters. It could come in many forms, depending on the content and
context of the VNR and the broadcasters' news production formats, and
as long as the result is to keep the public totally informed about the
sources of information. By proscribing the specifics of disclosure to
be used in the production of government-sponsored VNRs, the S. 967
could cause some broadcasters not to use the information at all.
PRSA believes the government should not hold broadcasters to a
different standard in presenting news to their viewers than those that
print media impose upon themselves.
PRSA has long advocated the ethical, honest production of video
news releases and full disclosure of their sponsorship. It's an issue
of vital importance to our industry and we're working constantly to
keep the disclosure bar set high for our members and, by example, for
others in our profession. VNRs have been used successfully--with full
disclosure of sources of information--for conveying information to the
public about a number of important public programs. For example, VNRs
have been effective components of public service campaigns on such
topics as labeling of over-the-counter drug supplements, seat belt
usage, online tax return filing and cancer detection and prevention.
Public relations exists as a profession today because it has
established a level of trust with the media and the public. In our role
of providing information to the public--often through media outlets--
that trust is essential.
We can be ``trusted'' only if we work diligently to earn trust. We
believe that imposing rigid requirements and specifications on the
information we provide to the public will not best serve the building
of this trust.
Thank you.
______
Statement of the Public Relations Society of America (PRSA)
on Video News Releases (VNRs)
Extensive discussion was focused in recent weeks on a Video News
Release (VNR) produced by the Department of Health and Human Services
(DHHS) pertaining to the recently enacted Medicare drug bill. Content
of the video release touched off partisan debate and discussion but
also raised ethical questions about the use of VNRs. Because VNRs are a
basic public relations tool used by corporations, organizations and
other entities to provide news content to television stations and thus
communicate with the public, PRSA believes that it is important for
there to be a better understanding of the role and usage of VNRs.
Three principles are at work here:
A VNR is the television equivalent of a press release and,
as such, should always be truthful and represent the highest in
ethical standards.
Producers and distributors of VNRs and the organizations
they represent should clearly and plainly identify themselves.
Television stations airing VNRs should identify sources of
the material.
Background: The VNR is the video equivalent of a press release, a
written document sent to the media. The VNR is designed specifically
for TV stations and consists of many elements including a complete
story with visuals and narration/voiceovers, a suggested written
script, added video that can be used by the station and suggested ways
the story can be localized. Public relations professionals have
produced VNRs in this manner for more than 25 years, and media outlets
have used them on a regular basis.
Issue in Question: One of the issues raised about the DHHS VNR was
the inclusion of a sign-off identification at the completion of the
story that uses the words ``reporting.'' This has caused some confusion
among people who question whether someone who is not actually a
reporter should be identified in a manner that could suggest that he or
she is a journalist. While this is often done when VNRs are produced,
we agree that this can be considered confusing and/or misleading.
PRSA Position:
1. Organizations that produce VNRs should clearly identify the
VNR as such and fully disclose who produced and paid for it at
the time the VNR is provided to TV stations.
2. PRSA recommends that organizations that prepare VNRs should
not use the word ``reporting'' if the narrator is not a
reporter.
3. Use of VNRs or footage provided by sources other than the
station or network should be identified as to source by the
media outlet when it is aired.
PRSA supports use of VNRs as useful public relations tools. They
will continue to be effective when adhering to the highest standards of
practice as described above.
About PRSA
The Public Relations Society of America (www.prsa.org), based in
New York City, is the world's largest organization for public relations
professionals helping to advance the profession and the professional.
Its nearly 20,000 members, organized into 116 Chapters nationwide, 18
Professional Interest Sections along with Affinity Groups, represent
business and industry, counseling firms, independent practitioners,
military, government, associations, hospitals, schools, professional
services firms and nonprofit organizations.
______
PRSA Position on VNRS Overall
Free Flow of Information--Protecting and advancing the free flow of
accurate and truthful information is essential to serving the public
interest and contributing to informed decision-making in a democratic
society. VNRs are among the many tools used to ensure that information
flows freely.
Full Disclosure--Open communication fosters informed decision-
making in a democratic society. We must be honest and accurate in all
communications, reveal the sponsors for causes and interests
represented and disclose all financial interests.
PRSA Position on U.S. Senate Bill S. 967
PRSA supports the spirit of legislation that ensures the
free flow of accurate and truthful information and requires
full disclosure of sponsors and financial interests. However,
disclosure by broadcasters could come in many forms, depending
on the content and context of the VNR and how it fits into the
individual entities' news production formats. Then all VNRs
would serve the purpose of keeping the public totally informed
about the sources of information.
PRSA believes the government should not hold broadcasters to
a different standard than print media in presenting news to
their viewers.
PRSA is concerned that such regulation could spill over into
the private sector and inappropriately impose tighter
regulation on the media, which could raise serious First
Amendment constitutional questions.
Again, while PRSA supports the spirit of Senate S. 967, PRSA
believes that more robust self-regulation of VNRs by
broadcasters is the optimum way to manage the issue of full
disclosure.
Members of Senate Commerce Committee
http://commerce.senate.gov/about/membership.html
PRSA Official Position on VNRs
http://www.prsa.org/_News/leaders/vnrs0404.asp
PRSA Code of Ethics
http://www.prsa.org/_About/ethics/index.asp?ident=eth1
______
Public Relations Society of America--Member Code of Ethics 2000
Professional Values
Principles of Conduct
Commitment and Compliance
This Code applies to PRSA members. The Code is designed to be a
useful guide for PRSA members as they carry out their ethical
responsibilities. This document is designed to anticipate and
accommodate, by precedent, ethical challenges that may arise. The
scenarios outlined in the Code provision are actual examples of
misconduct. More will be added as experience with the Code occurs.
The Public Relations Society of America (PRSA) is committed to
ethical practices. The level of public trust PRSA members seek, as we
serve the public good and advocate for our clients, means we have taken
on a special obligation to operate ethically.
The value of member reputation depends upon the ethical conduct of
everyone affiliated with the Public Relations Society of America. Each
of us sets an example for each other--as well as other professionals--
by our pursuit of excellence with powerful standards of performance,
professionalism, and ethical conduct.
Emphasis on enforcement has been eliminated. But, the PRSA Board of
Directors retains the right to bar from membership or expel from the
Society any individual who has been or is sanctioned by a government
agency or convicted in a court of law of an action that is in violation
of this Code.
Ethical practice is the most important obligation of a PRSA member.
PRSA Member Statement of Professional Values
This statement presents the core values of PRSA members and, more
broadly, of the public relations profession. These values provide the
foundation for the Member Code of Ethics and set the industry standard
for the professional practice of public relations. These values are the
fundamental beliefs that guide our behaviors and decision-making
process. We believe our professional values are vital to the integrity
of the profession as a whole.
Advocacy
We serve the public interest by acting as responsible
advocates for those we represent.
We provide a voice in the marketplace of ideas, facts, and
viewpoints to aid informed public debate.
Honesty
We adhere to the highest standards of accuracy and truth in
advancing the interests of those we represent and in
communicating with the public.
Expertise
We acquire and responsibly use specialized knowledge and
experience.
We advance the profession through continued professional
development, research, and education.
We build mutual understanding, credibility, and
relationships among a wide array of institutions and audiences.
Independence
We provide objective counsel to those we represent.
We are accountable for our actions.
Loyalty
We are faithful to those we represent, while honoring our
obligation to serve the public interest.
Fairness
We deal fairly with clients, employers, competitors, peers,
vendors, the media, and the general public.
We respect all opinions and support the right of free
expression.
PRSA Code Provisions
Free Flow of Information
Core Principle
Protecting and advancing the free flow of accurate and truthful
information is essential to serving the public interest and
contributing to informed decision making in a democratic society.
Intent
To maintain the integrity of relationships with the media,
government officials, and the public.
To aid informed decision making.
Guidelines
A member shall:
Preserve the integrity of the process of communication.
Be honest and accurate in all communications.
Act promptly to correct erroneous communications for which
the practitioner is responsible.
Preserve the free flow of unprejudiced information when
giving or receiving gifts by ensuring that gifts are nominal,
legal, and infrequent.
Examples of Improper Conduct Under this Provision
A member representing a ski manufacturer gives a pair of
expensive racing skis to a sports magazine columnist, to
influence the columnist to write favorable articles about the
product.
A member entertains a government official beyond legal
limits and/or in violation of government reporting
requirements.
Competition
Core Principle
Promoting healthy and fair competition among professionals
preserves an ethical climate while fostering a robust business
environment.
Intent
To promote respect and fair competition among public
relations professionals.
To serve the public interest by providing the widest choice
of practitioner options.
Guidelines
A member shall:
Follow ethical hiring practices designed to respect free and
open competition without deliberately undermining a competitor.
Preserve intellectual property rights in the marketplace.
Examples of Improper Conduct Under This Provision
A member employed by a ``client organization'' shares
helpful information with a counseling firm that is competing
with others for the organization's business.
A member spreads malicious and unfounded rumors about a
competitor in order to alienate the competitor's clients and
employees in a ploy to recruit people and business.
Disclosure of Information
Core Principle
Open communication fosters informed decision making in a democratic
society.
Intent
To build trust with the public by revealing all information
needed for responsible decision making.
Guidelines
A member shall:
Be honest and accurate in all communications.
Act promptly to correct erroneous communications for which
the member is responsible.
Investigate the truthfulness and accuracy of information
released on behalf of those represented.
Reveal the sponsors for causes and interests represented.
Disclose financial interest (such as stock ownership) in a
client's organization.
Avoid deceptive practices.
Examples of Improper Conduct Under this Provision
Front groups: A member implements ``grass roots'' campaigns
or letter-writing campaigns to legislators on behalf of
undisclosed interest groups.
Lying by omission: A practitioner for a corporation
knowingly fails to release financial information, giving a
misleading impression of the corporation's performance.
A member discovers inaccurate information disseminated via a
website or media kit and does not correct the information.
A member deceives the public by employing people to pose as
volunteers to speak at public hearings and participate in
``grass roots'' campaigns.
Safeguarding Confidences
Core Principle
Client trust requires appropriate protection of confidential and
private information.
Intent
To protect the privacy rights of clients, organizations, and
individuals by safeguarding confidential information.
Guidelines
A member shall:
Safeguard the confidences and privacy rights of present,
former, and prospective clients and employees.
Protect privileged, confidential, or insider information
gained from a client or organization.
Immediately advise an appropriate authority if a member
discovers that confidential information is being divulged by an
employee of a client company or organization.
Examples of Improper Conduct Under This Provision
A member changes jobs, takes confidential information, and
uses that information in the new position to the detriment of
the former employer.
A member intentionally leaks proprietary information to the
detriment of some other party.
Conflicts of Interest
Core Principle
Avoiding real, potential, or perceived conflicts of interest builds
the trust of clients, employers, and the publics.
Intent
To earn trust and mutual respect with clients or employers.
To build trust with the public by avoiding or ending
situations that put one's personal or professional interests in
conflict with society's interests.
Guidelines
A member shall:
Act in the best interests of the client or employer, even
subordinating the member's personal interests.
Avoid actions and circumstances that may appear to
compromise good business judgment or create a conflict between
personal and professional interests.
Disclose promptly any existing or potential conflict of
interest to affected clients or organizations.
Encourage clients and customers to determine if a conflict
exists after notifying all affected parties.
Examples of Improper Conduct Under This Provision
The member fails to disclose that he or she has a strong
financial interest in a client's chief competitor.
The member represents a ``competitor company'' or a
``conflicting interest'' without informing a prospective
client.
Enhancing the Profession
Core Principle
Public relations professionals work constantly to strengthen the
public's trust in the profession.
Intent
To build respect and credibility with the public for the
profession of public relations.
To improve, adapt, and expand professional practices.
Guidelines
A member shall:
Acknowledge that there is an obligation to protect and
enhance the profession.
Keep informed and educated about practices in the profession
to ensure ethical conduct.
Actively pursue personal professional development.
Decline representation of clients or organizations that urge
or require actions contrary to this Code.
Accurately define what public relations activities can
accomplish.
Counsel subordinates in proper ethical decision making.
Require that subordinates adhere to the ethical requirements
of the Code.
Report ethical violations, whether committed by PRSA members
or not, to the appropriate authority.
Examples of Improper Conduct Under This Provision
A PRSA member declares publicly that a product the client
sells is safe, without disclosing evidence to the contrary.
A member initially assigns some questionable client work to
a non-member practitioner to avoid the ethical obligation of
PRSA membership.
Resources
Rules and Guidelines
The following PRSA documents, available online at www.prsa.org
provide detailed rules and guidelines to help guide your professional
behavior. If, after reviewing them, you still have a question or issue,
contact PRSA headquarters as noted below.
PRSA Bylaws
PRSA Administrative Rules
Member Code of Ethics
PRSA Member Code of Ethics Pledge
I pledge:
To conduct myself professionally, with truth, accuracy,
fairness, and responsibility to the public; to improve my
individual competence and advance the knowledge and proficiency
of the profession through continuing research and education;
and to adhere to the articles of the Member Code of Ethics 2000
for the practice of public relations as adopted by the
governing Assembly of the Public Relations Society of America.
I understand and accept that there is a consequence for misconduct,
up to and including membership revocation.
And, I understand that those who have been or are sanctioned by a
government agency or convicted in a court of law of an action that is
in violation of this Code may be barred from membership or expelled
from the Society.
____________________
Signature
____________________
Date
The Chairman. Thank you very much, all of you.
My first question to all of you is how long have VNRs been
used in the industry. Ms. Poling, did you look back in other
Administrations?
Ms. Poling. No. Our study was very narrow. We were asked to
look at certain video news releases and we did so. So there
were just two. However, we did see some from the Clinton
Administration, but we were not doing a study that focused on
that.
The Chairman. The rest of you in the industry, how long
have these been used by the industry?
Mr. Simon. Sure, Mr. Chairman. As I noted in my testimony,
I have been told the first VNRs were in the late 1940s and they
became popular in the 1950s, 1960s. I had one source who said
they thought President Kennedy had used video like this in his
campaign in the 1960s, but I could not confirm that
independently. But it has been a common public relations tool
basically since television news started to play such a
prominent role.
The Chairman. I assume you are all familiar with the
provision that is in the defense supplemental appropriations
bill that was passed, signed by the President. The Byrd
Amendment requires Federal agencies to clearly label
prepackaged news stories that they produce. The difference
between that and this bill, this bill would require in video
that there be a cutline that appears constantly throughout the
use. All the footage would have this on it, contrary to the
political ad where there has to be a cutline at the end saying
this was paid for by the candidate. What about that?
First, can you live with the Byrd Amendment? We all voted
for it. Can you live with it?
Ms. Cochran. Senator, yes. We have no objection to the Byrd
Amendment.
Ms. Phair. Mr. Chairman, neither do we.
Mr. Simon. I have no objection to the Byrd Amendment, and I
think it makes sense when applied to this issue.
The Chairman. Now, in terms of this constant exposure on
prepackaged news stories, what is going to be the impact of
that on anything, just something like we just saw now?
Ms. Cochran. Senator, I will begin. I think you heard from
the colleagues here that imposing this kind of one-size-fits-
all solution to a video is problematic. In some instances, a
uniform description may not even be the most accurate
information that you could give the public. I think the public
benefits from learning exactly what Federal agency has
originated the material. One example that I use is NASA
animation of a space shot, and it is used very widely in
television stories because it helps the viewer understand and
it is the most authoritative source coming from NASA.
The Chairman. Pardon me just a moment. We have got a
limitation on time.
The term ``prepackaged news story'' means a complete,
ready-to-use audio or visual news segment designed to be
indistinguishable from a news segment produced by an
independent organization. How can you distinguish it? I do not
understand. Could you live with that? The test would be if it
was designed to be indistinguishable from something that you
produce.
Ms. Cochran. I think it is problematic because that is not
how these packages are used. Often segments are used. Everyone
is not as considerate as the example that we saw, as to send B-
roll and excerpts that can be used by themselves. So often the
prepackaged material is broken down and used. Bits and pieces
of it can be used. If it has that labeling on it, then it
becomes very problematic.
The Chairman. Ms. Poling, in the definition section, it
says, ``The term `agency' has the same meaning given such term
in section 551 of title 5, United States Code, and includes the
Executive Office of the President.'' That ``and'' is not
normal.
Ms. Poling. Repeat the question. The ``and'' is what?
The Chairman. The clause that starts with ``and includes
the Executive Office of the President'' is not normally within
the definition of an agency. Is it?
Ms. Poling. GAO has no comments on the bill, but just from
a legal perspective, you are correct. It is not normally
included in the definition of an agency.
The Chairman. So this is the entire purpose of the bill, to
include this and make sure that it applies to the Office of the
President.
Senator Lautenberg.
Senator Lautenberg. Thanks, Mr. Chairman.
The intention of the bill is to make all Government
agencies responsible.
The Chairman. It does not apply to Congress. You have
extended it to the President of the United States, but not to
Congress.
Senator Lautenberg. Well, in the case where we see the
abuse of this information, we do not have in the Congress
opportunities to issue VNRs independently. No broadcaster is
going to take something that comes from my office or your
office and put it on the air and say that the situation in
Alaska regarding drilling----
The Chairman. Mine do.
[Laughter.]
The Chairman. We issue them every week.
Senator Lautenberg. You were so lucky to have the
endorsement of how beautiful Alaska is, and I can see that you
were happy with that. So I am content to exempt Alaska from
some of these things.
[Laughter.]
Senator Lautenberg. But in all seriousness, I am really
surprised to hear some of our friends at the table suggest that
this could be an interference in the free flow of information.
What is better for the public than to know exactly who is
saying what? You can produce it. There is virtually no
interference. We deliberately did not place any burden on the
broadcasters.
As a matter of fact, despite the technology, Ms. Poling,
what do you think of Mr. Simon's comment about technology being
able to sort things out in a different way so that it is more
discernible when they get a piece of VNR to produce?
Ms. Poling. I am not sure I have a view on this.
What we would say at GAO is that it is important that these
prepackaged news stories--and I believe his goes beyond
prepackaged news stories--identify the source of the Federal
agency. We think that is essential.
Senator Lautenberg. We say in our legislation that it ought
to be run as long as that VNR runs. If it runs for 10 seconds,
it should be on there for 10 seconds. If it runs for 30
seconds, it should be on there for 30 seconds.
Mr. Chairman, there is no doubt about the attempt to
deceive when we hear Karen Ryan say--she does not say I am
doing this for the U.S. Government. She said I am Karen Ryan.
The idea is to imitate. And if we have to see that clip again,
it would be fine with me. But it is designed to imitate a
reporter. Otherwise, why present it that way?
Ms. Poling, some of that we know was legitimate news. The
President signing a bill. I do not have any problem with that.
That is picked up by the news cameras themselves. But when it
is a story to sell something and you show the pharmacy and so
forth, that can, even stretching the imagination a little bit,
say, well, OK, it is part of a news clip as long as it is
developed by the station itself, the broadcaster.
I would appreciate hearing from GAO on this. Is there any
harm that comes from identifying that this is a piece of a
Government production? Do you see any burden on the broadcast
industry as a result of that?
Ms. Poling. Well, our study did not deal with the broadcast
industry at all. But the basic principle underlying our
opinions is that the agencies must disclose themselves to the
targeted audience which is the television-viewing audience. We
think it is very important that there be disclosure so that the
audience can assess the information, which I also heard from
other members of the panel up here, and also that the taxpayers
have a right to know when the Government is speaking to them.
Senator Lautenberg. Ms. Cochran, several news directors ran
the Karen Ryan piece without realizing that it was Government-
sponsored VNR. Would it not be simpler for your news directors,
your group, if the Government simply included a clear
disclaimer in the story itself?
Ms. Cochran. We are all in favor of that kind of
disclosure. I think what we are concerned about is the specific
prescription as it appears in the bill because we think it
limits the editorial decisions, if you like, just the look of
how that disclaimer or that disclosure will appear on the air.
We think that how that looks on the air should be in the hands
of the people producing the news.
Senator Lautenberg. Well, to me it would seem more
appropriate if we had a uniform standard and said, OK, this is
it. I would be happy, Mr. Chairman, to work with people from
the industry, keeping in mind that our mission in this bill is
very clear. It says that transparency is the objective and that
if it is produced by the Government, let us not fool anybody.
Again, we acknowledge that it happened--I did not realize
Mr. Simon was old enough to remember what might have happened
in the Nixon days. Of course, you and I remember it clearly.
The Chairman. It is nice to work with kids like you.
[Laughter.]
Senator Lautenberg. You are looking at 40 percent of the
veteran population of World War II sitting here.
[Laughter.]
Senator Lautenberg. If we could arrive at the most
convenient way of displaying it, but one that is visible and
one that tells the story, Mr. Chairman, I would be happy to do
it and work with you. You have been eminently fair because I
know that you do not fully agree here, but you are at least
willing to have the problem aired. So I am grateful to you. I
would submit if we have a chance to work this over in the next
few weeks, I think that if the Byrd Amendment was so
acceptable, then the least we ought to do is try to make it
permanent, improve it if we can, but not to let it terminate
and then have to worry about what happens after September 30.
The Chairman. It has been our announced intention to try to
make the Byrd Amendment permanent because it is acceptable, and
I think it meets the objectives of the original issue. And I
will be willing to join you at any time in making that
permanent.
But in any event, if that is not acceptable, it would be my
feeling that this committee ought to wait for the outcome of
the comment period that the FCC has established, and we will
take the bill up at the end of July after we receive that,
before the August recess, if it is necessary. If we do not
adopt the Byrd Amendment permanently, we will take it up
sometime in July after the comment period is over.
But let me thank you all for your testimony. I appreciate
your courtesy very much. There is a vote on.
[Whereupon, at 11:47 a.m., the Committee was adjourned.]