March 14 (Bloomberg) -- A famous 1973 cover of National Lampoon showed a dog with a revolver held to its head, with the caption, “If you don’t buy this magazine, we’ll kill this dog.”
To hear defenders of publicly subsidized media, Republican efforts to cut funding to National Public Radio (NPR) and the Public Broadcasting System (PBS) puts a gun to the head of Big Bird. That doesn’t have to be the case.
The Corporation for Public Broadcasting, created by Congress in 1967, provides public funds that cover about 15 percent of operating costs for public radio and television. In fiscal year 2011 its federal appropriation is $430 million, up from $300 million in 2000.
The corporation supports hundreds of radio and television stations, not just the biggest names, NPR and the PBS. By law, about 66 percent of the money it receives from its federal appropriation goes to individual public television and radio stations by direct grants.
This year it will spend $73 million, or 17 percent of its federal funding, on television programming through grants to organizations such as PBS -- home to Big Bird’s “Sesame Street” -- and the Independent Television Service, and $29 million, almost 7 percent of funding, on radio programming by organizations including NPR, Public Radio International and American Public Media. (Public broadcasters also get some federal funding through other sources, plus funding from state and local governments.)
Funding for public radio and television is a legacy of the 1960s, and Republicans have long sought to eliminate it. They argue that taxpayer dollars shouldn’t support biased coverage -- last week’s firestorm over comments by a senior NPR official only added to proof of the network’s liberal bias -- or compete in a space that is also populated by private enterprise.
When House Speaker Newt Gingrich and congressional Republicans threatened to cut funding for public radio and television in 1995, Hillary Clinton, then the U.S. first lady, brought out the big guns.
“I don’t really care what the speaker says about me,” she said. “I wish he would leave Big Bird alone.”
Any choice between public funding and the survival of Big Bird is a false one. Democrats and Republicans alike have not thought through the economics of public support.
“Big Bird is nearly 30 years old, and it’s time to leave the federal nest,” former Republican Representative Steve Largent said in 1999.
Big Bird Business
Largent got it wrong. It’s in the public interest to support the arts and education, and if Big Bird helps bring in lots of money in the process, he helps public broadcasting support other, less-profitable artistic offerings.
The numbers back this up. According to the fact-checking website PolitiFact.com, the Sesame Workshop, which produces “Sesame Street,” raked in $140 million in revenue in 2008, about 90 percent of which was from non-governmental sources.
Republicans are wrong when they argue that there is no economic justification for government support of “Sesame Street.” Beginning with its initial airdate on PBS in 1969, it pioneered modern children’s programming by encapsulating early education concepts in a fun, theatrical wrapper. There’s clearly a role for the government to provide a public good when markets may fail to do so.
When a painting hangs at a museum supported by public money, it’s there for everyone to see, rather than in the living room of some billionaire. If the museum didn’t exist, only a few might ever be inspired by the great masterpieces. Public money can also be justified to safeguard the interests of future generations.
The key is that great art creates a public benefit that exceeds the private benefit. Shakespeare might have made some money from his plays, but the benefit to all future generations has clearly, vastly outstripped his own profit. Accordingly, one might expect public markets to under-produce great works of theater and art -- a solid justification for public support.
Public radio and television, then, are defensible to the extent that they serve the public good by enriching the arts. NPR and PBS, however, wandered far from this mission, providing news content that is mostly indistinguishable from that provided by left-leaning for-profit enterprises.
Public money for news programming can’t be justified; nobody would seriously argue that the market fails to produce it. Elected officials should maintain support for public radio and television programming that focuses on arts and education while prohibiting the use of public funds to support news or commentary.
This way, Big Bird is safe and doesn’t have to share his nest.
(Kevin Hassett, director of economic-policy studies at the American Enterprise Institute, is a Bloomberg News columnist. The opinions expressed are his own.)
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