On December 18th, the Public Broadcasting Service’s flagship station WNET issued a
press release
announcing the launch of a new two-year news series entitled “The
Pension Peril.” The series, promoting cuts to public employee pensions,
is airing on
hundreds of PBS outlets all over the nation. It has been presented as objective news on major PBS programs including the PBS News Hour.
However, neither the WNET press release nor the broadcasted segments
explicitly disclosed who is financing the series. Pando has exclusively
confirmed that “The Pension Peril” is secretly funded by former Enron
trader John Arnold, a billionaire political powerbroker who is actively
trying to shape the very pension policy that the series claims to be
dispassionately covering.
The Wolf of Sesame Street
In recent years, Arnold has been using massive contributions to
politicians,
Super PACs,
ballot initiative efforts,
think tanks and
local front groups
to finance a nationwide political campaign aimed at slashing public
employees’ retirement benefits. His foundation which backs his efforts
employs top Republican political operatives,
including the
former chief of staff to GOP House Majority Leader Dick Armey (TX). According to its own promotional materials, the Arnold Foundation is
pushing lawmakers in states across the country “to stop promising a (retirement) benefit” to public employees.
Despite Arnold’s pension-slashing activism and his foundation’s ties
to partisan politics, Leila Walsh, a spokesperson for the Laura and John
Arnold Foundation (LJAF), told Pando that PBS officials were not
hesitant to work with them, even though PBS’s own very clear rules
prohibit such blatant conflicts. (note: the term “PBS officials” refers
interchangeably to both PBS officials and officials from PBS flagship
affiliate WNET who were acting on behalf of the entire PBS system).
To the contrary, the Arnold Foundation spokesperson tells Pando that
it was PBS officials who first initiated contact with Arnold in the
Spring of 2013. She says those officials actively solicited Arnold to
finance the broadcaster’s proposal for a new pension-focused series.
According to the spokesperson, they solicited Arnold’s support based
specifically on their knowledge of his push to slash pension benefits
for public employees.
The foundation’s spokesperson said PBS executives approached Arnold
“with the proposal for the series, having become aware of LJAF’s
interest” in shaping public pension policy, and moving that policy
toward cutting retirement benefits for public workers.
According to newly posted
disclosures
about its 2013 grantmaking, the Laura and John Arnold Foundation
responded to PBS’s tailored proposal by donating a whopping $3.5 million
to WNET, the PBS flagship station that is coordinating the “Pension
Peril” series for distribution across the country. The $3.5 million,
which is earmarked for “educat(ing) the public about public employees’
retirement benefits,” is one of the foundation’s largest single
disclosed expenditures. WNET spokesperson Kellie Specter confirmed to
Pando that the huge sum makes Arnold the “anchor/lead funder of the
initiative.” A single
note
buried on PBS’s website – but not repeated in such explicit terms on
PBS airwaves – confirms that the money is directly financing the
“Pension Peril” series.
With PBS’s “Pension Peril” series echoing many of the same
pension-cutting themes that the Arnold Foundation is promoting in the
legislative arena, and with the series not explicitly disclosing the
Arnold financing to PBS viewers, the foundation’s spokesperson says her
organization is happy with the segments airing on stations throughout
the country. However, she says the foundation reserves “the ability to
stop funding” the series at any time “in the event of extraordinary
circumstances.”
The news of PBS actively soliciting financing from billionaire
political activists – and custom tailoring original program proposals
for those financiers – follows a
wave of damning revelations
about the influence of super-wealthy political interests over public
broadcasting. Thanks to collusion with PBS executives, those monied
interests are increasingly permitted to launder their ideological and
self-serving messages through the seeming objectivity of public
television.
The stealth Arnold-PBS connection, however, represents a major
escalation in the larger trend. In this particular case, PBS seems to be
defying its own rules and regulations about conflicts of interest. At
the same time, the fact that PBS is obscuring the financial arrangement
suggests the network may be deliberately attempting to hide those
conflicts from its own viewers.
An affront to PBS rules about “pre-ordained conclusions”
As a
taxpayer-funded entity, PBS’s official rules clearly
prohibit
the funding of programming by a benefactor who “has asserted, or has
the right to assert, editorial control over a program.” Those rules also
do not allow programming to be funded by a benefactor who is
“pre-ordaining the conclusion the viewer should draw from the materials
presented.”
The Arnold Foundation refused to share with Pando the details of its
PBS agreement, but denied that it has editorial control over the
“Pension Peril” series. However, as mentioned, the foundation reiterated
that it reserves the right to cut off funding under the “extraordinary
circumstances.” It is possible that loosely defined phrase may allow the
foundation to halt funding if it does not like the ideological tenor of
the PBS pension coverage it is financing. Such a hovering threat would
seem to represent at least de facto editorial influence.
For PBS’s part, WNET officials refused to provide any details of the
Arnold Foundation-PBS contract with a spokesperson telling Pando that
“such agreements are always confidential.” This refusal came despite
PBS being a public institution that
watchdog groups insist is subject to Freedom of Information Act regulations.
Whether or not the foundation has direct editorial control of PBS
news content, the series still appears to violate PBS’s rules against
“pre-ordained” conclusions.
For example, the series’ title – Pension
Peril - is the
oft-repeated ideological buzzphrase of anti-pension campaigners.
It also inherently pre-ordains the Arnold Foundation’s conclusion that
public pension shortfalls are an imminent emergency (“peril”), even
though
data prove that is not the case. To the contrary, as the
Center for Economic and Policy Research
notes, the shortfalls are “less than 0.2 percent of projected gross
state product over the next 30 years” and “even in the cases of the
states with the largest shortfalls, the gap is less than 0.5 percent of
projected state product.” That’s far less than the amount state and
local governments are spending on corporate subsidies. As
McClatchy Newspapers has noted: “There’s simply no evidence that state pensions are the current burden to public finances that their critics claim.”
Yet, from the Arnold Foundation’s publications to the Arnold-funded
“Pension Peril” series, those subsidies are not labeled an emergency by
PBS programming, but pensions are.
Similarly, in
each episode of the
Arnold/PBS series that has aired, the reporting has followed the Arnold
Foundation’s rhetorical lead by forwarding the idea that pension
benefit cuts should be the primary policy solution to public budget
problems. It does this by promoting the need for cuts to guaranteed
retirement incomes and/or by refusing to mention that pension shortfalls
are
dwarfed by the amount state and local governments collectively spend each year on corporate subsidies (many of which
do not create jobs).
For instance, in the series’
debut report
in November for the nationally aired NewsHour, PBS trumpeted the
Netherlands decision “to make cuts to payments they made to pensioners.”
The program then contrasted that with American public employees, who
the PBS correspondent said “are guaranteed a set payment no matter
whether (pension) funds are there or not.” That latter statement is
belied by
various examples of governments reneging on their pension promises to U.S. public employees.
Likewise, in the “Pension Peril” series’
follow up report
for the NewsHour on Illinois pension cuts, PBS staged a one-on-one
interview with an Associated Press reporter who insisted that the state
is being bankrupted by pension obligations. AP correspondent Sara
Burnett said:
In order to make these payments each year, as you
mentioned in the intro, the state is putting about 20 cents of every
taxpayer dollar into the pension funds. That’s money that could be going
to schools. There are social service agencies that have not been paid
what the state owes them for months at a time. They’ve got a multi—I
think it’s close to eight billion dollar backlog of unpaid bills sitting
in Springfield waiting to be paid because there isn’t money to do it.
Yet, like the Arnold Foundation’s pension policy papers, both PBS’s
“Pension Peril” correspondent and the AP reporter did not mention that
according to
budget data,
pension shortfalls in Illinois are far smaller than the amount the
state is spending on expensive taxpayer subsidies to corporations.
Indeed, there is – and has been – plenty of money for Illinois to pay
its “unpaid bills.” The state is just choosing to spend that money on
huge subsidies to corporations like
Sears and
Google rather than paying its bills or making its required pension payments.
Up next was a politically timed “Pension Peril”
segment
just two weeks before the inauguration of New York mayor Bill de
Blasio. In the discussion decrying the New York City’s pension shortfall
as “unsustainable,” PBS did not mention that the city is so flush with
cash it spends a stunning
$4 billion a year on economic development subsidies. In recent years, it has put taxpayers on the hook for
$458 million for professional sports stadiums and hundreds of millions of dollars more for the construction of lavish office towers for
Goldman Sachs and
Bank of America.
Then came the “Pension Peril” segment that aired on the NewsHour on
February 8th. The piece trumpeted a Vallejo, California city councilor who voted to slash pension benefits for her city’s public employees.
The piece cited Vallejo’s budget deficit as rationale for cutting pensions, but did not mention that California’s
$45 billion in annual tax expenditures and its
$4 billion in annual corporate subsidies (many of them
wasteful)
are much bigger than the pension shortfalls its state and local
governments face. Additionally, the piece did not mention that the
state’s retirement system this year posted
huge gains, helping it continue to recover from losses incurred during the financial collapse of 2008.
But most troubling of all, the report on Vallejo promoted the city
councilor’s “campaigning to change (state) law to give cities the right
to negotiate for pension cuts.” PBS’s “Pension Peril” correspondent
noted that the legislator’s coalition is “hoping to get the initiative
onto the ballot” so that cities can unilaterally cut public employee
pensions. What the PBS “Pension Peril” series omitted is the fact that
the “Pension Peril” series’ own benefactor, John Arnold, is the
major financier of the very California ballot initiative PBS was promoting. Arnold’s involvement in that ballot measure follows his
earlier funding of pension-cutting advocacy in California, which PBS also did not mention.
Violating regulations about “interests”
Along with barring editorial control and program financing from funders who want to “pre-ordain” conclusions, PBS’s
rules
also state that “when there exists a clear and direct connection
between the interests… of a proposed funder and the subject matter of
the program, the proposed funding will be deemed unacceptable
regardless of the funder’s actual compliance with the editorial control provisions.”
As one example, PBS says “a series of documentaries, interviews, and
commentary on the subject of drug abuse would not be accepted if funded
by a special purpose nonprofit corporation whose principal mission is to
foster the understanding of drug-related community programs.” As
another example, PBS says “a nonprofit organization whose mission is to
eradicate heart disease or to raise money for leukemia research could
not fund a program designed to educate the public about these respective
illnesses.”
Yet, despite these rules, PBS has solicited and accepted millions of
dollars specifically for pension-focused reporting from the Arnold
Foundation, whose
core mission is about “work(ing) actively in the area of public employee benefits reform” and
convincing
the public that “the way to create a sound, sustainable and fair
retirement savings program is to stop promising a benefit” to public
workers.
When asked about these clear violations of PBS’s own rules, WNET’s
spokesperson would only say: “WNET and other PBS producers approach some
foundations, and not others, for support of particular projects. We
follow PBS rules in every particular.”
Obscuring the Arnold connection
On its website, PBS notes that both its own rules and Federal
Communications Commission regulations require full disclosure of all
funding sources for programming on the public’s airwaves. For all
content, “All underwriters must be identified in video by their name
and/or logo,” says PBS guidelines. Additionally, for programs dealing
specifically with “controversial issues” like pension cuts, PBS
notes that its own rules and FCC regulations require more explicit disclosure.
Despite those rules and regulations, though, Pando could find no explicit disclosure in
any PBS “
Pension Peril”
episodes that the series is
directly
financed by the Laura and John Arnold Foundation, much less that the
foundation’s benefactor, John Arnold, is one of the nation’s biggest
financiers of the ongoing legislative push to slash public pension
benefits.
Likewise, while the PBS News Hour has occasionally mentioned the
Arnold Foundation in a long list of funders at the very end of its show,
it has not mentioned the foundation’s specific financing of
pension-related content or the “Pension Peril” segments; it has not
mentioned the Arnold Foundation in introducing or concluding those
particular segments; and it has not disclosed the Arnold Foundation’s
ongoing legislative advocacy in the national debate over pension policy.
Additionally, WNET did
list
the Laura and John Arnold Foundation as one of scores of annual donors,
but did not indicate that, according to the Arnold Foundation itself,
the money is for programming to “educate the public about public
employees’ retirement benefits.” PBS’s only mention of the Arnold
Foundation in connection with the “Pension Peril” series appears to be a
single line at the bottom of one PBS website transcript,
but that line was not mentioned on air, where most of PBS’s viewers are
exposed to PBS content. Beyond that one mention, searches for mentions
of the Arnold Foundation and John Arnold on both
PBS’s website and
WNET’s website turn up no results.
Responding to Pando’s inquiries, PBS officials could provide no
evidence that PBS explicitly disclosed to its television viewers that
the Arnold Foundation is financing the “Pension Peril” series.
The decision to not explicitly tell PBS viewers that the “Pension
Peril” series is financed by the nation’s leading anti-pension
political activist may not be a mere oversight, considering one PBS
official’s private comments’ about the project. According to a source
who met with PBS about an unrelated initiative two months after the
launch of the Arnold-financed “Pension Peril” series, an executive at
the network said PBS was deliberately concealing details of the
Arnold/PBS funding arrangement.
“We were sitting in a meeting talking about another issue and (PBS
officials) were drawing examples of how they were working with other
campaigns, and one of their executives said they’ve got a series called
pension peril coming up talking about the threat of pensions at the
state and local level,” said the source. “I asked who was funding that
project, and the executive said that at this point they are not
disclosing who their funders are, and everybody sitting around the room
kind of paused.”
The source said another PBS official later privately confirmed that
the “Pension Peril” series is being funded by the Arnold Foundation.
A stealth takeover of the public airwaves
A billionaire political activist like Arnold exerting financial – and
thus ideological – control over PBS news programming is the culmination
of a larger campaign by ideological and corporate interests to
politicize public broadcasting. As Pando’s Yasha Levine and others have
documented, on National Public Radio that campaign has involved the
radio network promoting
politically skewed coverage of
political front groups and
corporate interests that are now permitted to finance NPR’s journalism. That trend shows no sign of abating under
NPR’s new CEO,
who came to the job after a career as a financial-industry lobbyist,
Republican Party benefactor and board member of corporate-financed
conservative think tanks.
On PBS, the campaign has been even more intense. During fights over
funding for public broadcasting during the Bush era, one FCC official
told the
Washington Post
that under withering pressure from conservative ideologues and
corporate special interests, the Corporation for Public Broadcasting
became “engaged in a systematic effort not just to sanitize the truth,
but to impose a right-wing agenda on PBS.”
In recent years, this campaign has seen public television stations
ignore PBS’s own rules about editorial control and pre-ordained
conclusions. Indeed, stations across the country have started airing
programming from wealthy ultraconservative foundations and corporate
interests looking to promote their political messages through the PBS
brand.
For instance, on the political front, there has been the
“Free Markets Series”
promoting right-wing icons like scion Steve Forbes, Cato scholar John
Allison, and author Ayn Rand. Championing archconservative economic
ideology, the show is
financed by the John Templeton Foundation, whose namesake was a
billionaire Wall Street investor and which is
run by a
financier of right-wing political causes.
According to the program’s website, in 2012 alone the Free Market
Series “was telecast on PBS affiliates 20,722 times, over 249 stations,
across 43 states and 129 markets, including nine of the top ten Nielsen
markets.”
Similarly, American University’s annual
survey
of public television notes that in 2014, there will be “an extended
slate of documentaries from Bob Chitester, the producer who introduced
Milton Friedman to public TV viewers in 1980.” According to the survey,
Chitester “will bring libertarian perspectives on contemporary issues to
public TV stations with “eight new programs in the works.” Those
include the programs “Unintended Consequences: Evils of the Welfare
System” and “Money and Morality” – the latter described as designed to
show “that the accumulation of wealth does not necessarily lead to
corruption and cronyism.” Chitester’s work is produced by the “Free to
Choose Network.” That organization is funded in part by the
Koch Family Foundations; is headed by a board
comprised of corporate and financial executives; and lists a
panoply of right-wing media voices as its official “fellows.”
On the corporate front it has been a similar trend. Back in 2002, PBS
promoted an economic series funded in part by John Arnold’s old
employer,
Enron. In 2012, PBS’s own ombudsman Michael Getler slammed the network for
“flunking the perception test” when it aired a series sponsored by Dow Chemical that conveniently
promoted Dow’s business interests. A year later, Getler similarly
criticized PBS for airing a documentary about drones that was funded by drone manufacturer Lockheed Martin.
Then came high-profile revelations about WNET’s relationship with New
York Senator Charles Schumer (D) and the station’s then-board-member,
David Koch of Koch Industries. As reported by the
New Yorker,
WNET executives went out of their way to appease the conservative Koch
in advance of the airing of Academy Award winner Alex Gibney’s
documentary, “Park Avenue,” which raised critical questions about wealth
inequality and political corruption in America. Though both Koch and
Schumer rejected requests to be interviewed by Gibney for the film and
though both of them hadn’t even seen the film, WNET made a heretofore
unprecedented move by allowing the pair to append their own personal
criticism to the end of the film.
“It was akin to someone calling the New York Times and being allowed
to put a big ad at the end of an article claiming the whole article is
bunk even though they hadn’t read the article,” Gibney said in an
interview with Pando. “If the Kochs had made a movie and I was angry,
would PBS have run my statement at the end the film? Probably not.”
According to the New Yorker, WNET also invited Koch to appear on an
on-air roundtable to discuss the film yet refused to invite Gibney to
the same roundtable (Koch declined, but the network had a representative
from the
Koch-funded
Manhattan Institute on). The magazine also reported that the blowback
from Koch about Gibney’s film ultimately ended up prompting WNET to help
spike an already-in-the-pipeline public television documentary about
the Koch Brothers themselves.
Now comes news that PBS is actively shaping program proposals in
order to solicit a billionaire activist’s financing for his ideological
campaign to slash public employee pensions. Not only that, PBS is airing
the content financed by that billionaire without explicit disclosure –
and worse, camouflaged in PBS’s ostensibly objective news programs.
A move toward native advertising
In its presentation and integration, the “Pension Peril” series
represents a significant evolution beyond even these aforementioned
stealth infiltrations. Unlike the other examples which do not
necessarily cover breaking news in recurring fashion, the “Pension
Peril” series is an ongoing real-time program on an active and evolving
political campaign that its own benefactor is shaping. Additionally,
unlike the other examples, it represents an insidious kind of
disclosure-free native advertising.
Whereas PBS’s standalone series like POV openly admit that the
content viewers are about to see is a subjective point of view, the
“Pension Peril” series has been broadcast as a part of PBS’s allegedly
objective news programming. That, along with the lack of explicit
disclosure, has served to obscure the content’s financial, political and
ideological links to Arnold and his pension-cutting crusade.
Strategy-wise, this technique mimics the Bush administration’s most controversial television propaganda. As the
New York Times
reported in 2005, the administration spent public resources to produce
“prepackaged, ready-to-serve news reports” that “were subsequently
broadcast on local stations across the country without any
acknowledgement of the government’s role in their production.” In PBS’s
current iteration of the scheme, private special-interest money is now
financing prepackaged news reports. Public resources are then used to
promote those reports on publicly owned stations across the country –
and with little disclosure of the original funding source.
That leaves millions of unsuspecting viewers wholly unaware that the
PBS “reporting” they are watching is not objective news, but instead an
ideological advertisement funded by a billionaire trying to manipulate
public policy.
Update: The Wolf of Sesame Street responds to Pando – much bark, no bite, still stonewalling
[Illustrations by Hallie Bateman]
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