Nicholas Johnson interview on Firing Line, January 26, 1970

Mr. Buckley: Mr. Nicholas Johnson is the tiger of the Federal Communications Commission, before that, he was the tiger of the Maritime Commission. Before that, he was a member of the law faculty of the University of California, Berkeley, having served as law clerk to Associate Justice Hugo Black, and having graduated from the Law School of the University of Texas, 1958, where he served as article editor of the Texas Law Review. Mr. Buckley: Mr. Johnson has just written an exciting and provocative book called, How to Talk Back to Your Television Set. I interrupt the commercial to make two announcements, Mr. Johnson specified in his contract with the publisher, Little Brown, that all royalties from his book should be given over to court organizations devoted to improving the contribution of television to the quality of American life. Since no such organization exists, I intend to start one tomorrow. The second announcement is that I have a personal interest in a broadcasting company. So now that our respective lives are an open book, we can proceed. Mr. Buckley: Mr. Johnson's thesis is vigorously stated in his book, he seems to think that the American people are being raped by the broadcasters, and that the FCC should do something about it, since Congress won't. I should like to begin by asking Mr. Johnson why he opposed the Pastore bill. Nick Johnson: Basically, I suppose, Mr. Buckley, because this is one instance in which I do support your commitment to principles of free private enterprise and competition. I think by and large, a competitive system works pretty well, when ideas or products have an opportunity to compete in the marketplace, and people have an opportunity to choose. In broadcasting, that's not really possible. It's not possible for everyone who wants to be in the broadcasting business, to be in the broadcasting business. Mr. Buckley: But it's not possible if anybody wants to be in the car business, to be in the car business either, is it? Nick Johnson: But it's certainly much more possible for people to be in a car business, or the cereal business. Mr. Buckley: It takes much more capital to start a car company than it does to buy a television station, doesn't it? Nick Johnson: Yes, I suspect so. Of course, there are barriers to entry in basically all industries, many of which are fostered and encouraged by those in the business. That's true in broadcasting also. But the way in which the broadcasting industry differs from the automobile industry, is that the operators are licensed after all. There are only so many television channels in each major market, and someone must make the choice as to who is to get those. Nick Johnson: Now, the question is, the FCC making the choice, what factors should the FCC look to? In my judgment, the people will be best served if the FCC will intervene on behalf of the public, consider all possible applications, just as we might in the marketplace, if it were truly open for the people to make this choice. Consider all possible applications, and pick that applicant who really indicates that he is going to provide the best service to the public. Now, what the Pastore bill provided, and what the policy statement of the FCC, that subsequently came out provided, was that the incumbent should have a major protection. This was characterized by the New York Times as equivalent to saying that no one could run for public office against an incumbent, until he was first impeached. Mr. Buckley: Is that what you lawyers call a presumption of innocence? Nick Johnson: No, I don't think so, I presume any innocence with regard to broadcasters. Mr. Buckley: That's what my friends tell me. Nick Johnson: I see how your friends are right. Mr. Buckley: Go ahead. Nick Johnson: No, I'd basically finished. It seemed that you would support my commitment to competition in this arena, and I was surprised at the possible suggestion that you didn't. Mr. Buckley: Well, it always struck me about the Pastore bill that in effect, what it was set up to protect people against was expropriation without due process, which has always struck me as a perfectly valid commitment for people, whether they're conservatives or liberals, to be opposed to. You and I know, by simply surveying the price that people pay for broadcasting stations, that they pay for those broadcasting stations on the basis of a historically sanctioned precedent. Namely, that once that bought that broadcasting station, it is theirs, barring some heinous violation of your regulations. Nick Johnson: That's not true at all. Mr. Buckley: It is true, historically. Nick Johnson: I think it's very important. No, it's not at all, that's the way in which it's not true is historically. I think it's very important- Mr. Buckley: How many licenses were revoked in the last 30 years? Nick Johnson: Let's come to that in a moment, because if you want to begin historically, I think we should. And historically, it is very clear that Congress, when putting the Radio Act of 1927 together, and the Communications Act of 1934, was quite aware precisely, and talked about it openly on the floor of the Congress, quite aware of the problem in a democracy if a small group of men are to gain control of the mass media in our society. They saw what was then radio, rather than television, as a form, a means of influencing popular opinion, far more powerful than the newspapers. Nick Johnson: They expressly provided, in the very first section of that portion of the act, dealing with commercial broadcasting, that no one should have any property right in a license, that license should only be for a term. That the airwaves would be owned by the public, not by the licensee. That at the end of his license term, which was originally set for six months, and then extended to one year, and now extended to three years, that at the end of that license term, he must, in the words of the United States Court of Appeals, quite literally run on his record. If the FCC can make a finding, looking at that record, that he has indeed served the public interest and there is no competitor for the station, then his license should be renewed. Nick Johnson: If there is a competitor for the license, the FCC is to compare the competitor with the present licensee, and pick the best one. That's historically the point of beginning. Mr. Buckley: That is quite correctly the theoretical enabling legislation for the FCC. But like so much legislation, it takes concrete form on the basis of how it is administered. And I think you won't deny my generality, which is that FCC has over the years, renewed as a matter of course, applications for renewal, barring some egregious outrage, which they are able to pin on the licensee. Now, on the basis of this, economic reality took shape, and the prices that were paid for stations, whether a small station for which a couple pays $200,000 or some behemoth in New York for which they pay $40-million dollars, is based precisely on that assumption. Mr. Buckley: Surely, you would not deny that if everybody thought, at the end of three years, there was no presumption in their favor over or against other bidders, A, probably they wouldn't have gone into that station in the first instance, and B, they certainly would not have paid the prices, which the law-plus-tradition are actually suggested as reasonable. Nick Johnson: I have difficulty with that statement, I think it's quite right. I think people who buy any property, tend to buy it based upon their own evaluation of what their property rights will be. When that property includes- Mr. Buckley: But it was reasonable. Nick Johnson: -Contracts with the government, or subsidies, or monopoly grants of power and privilege, someone has to make an estimate as to just how firm this contractual relationship is. Highway contractor. Mr. Buckley: I think you're making the point a little bit more debilitated than it needs to be. I'm not saying this is the same as a man- Nick Johnson: My point or your point? Mr. Buckley: Well, what used to be my point, which you tried to turn to your point. My point is that it is not like a highway contractor saying, "I have pleased the City of New York for 18 years, under the circumstances, why can't we presume that I will please them for the next 18 years?" That seems to me as obviously different, especially if the city- Nick Johnson: It's not obviously different, it seems to me quite ... Mr. Buckley: There are fresh roads to be built every year, and the government, the City of New York, asks for bids for that road. Nick Johnson: Ah, but the FCC is supposed to ask for bids, and there is new programming to be programmed every year. Why couldn't a highway contractor come in and say, "Look, here I am, I invested in all this highway building equipment, I got this contract for 10 miles of road, and I just assumed that of course my contract would be extended, and I'd build another 10 miles of road. I have all this valuable property, and it's being confiscated. Under the Buckley principle, I'm entitled to an additional 10 miles." Mr. Buckley: Because he would be very stupid, and I know that you have a very low threshold for stupidity, and so do I. But it is not stupid for perfectly sensible grownup men, who have surveyed the broadcasting business, and the fact that only two stations have not been renewed among the 1200 that there are, over a period of 35 years, all of a sudden to assume that Johnson the avenger is empowered to change things. If that were the case, for one thing, you wouldn't have so many of your colleagues ruling against you on this particular presumption, and certainly you wouldn't have the economic situation that has developed on the basis of a feeling of security. Mr. Buckley: That although you maintain a technical right to pull that license away from somebody, you really the owners in establishing that, that person has outraged the law, or violated the law. Nick Johnson: I just disagree with you, I don't see any reason why we need to agree on everything. So we've started off in this way, and that's perfectly appropriate. Mr. Buckley: Let me ask you this ... Nick Johnson: It's not a theoretical proposition, it's very clear in the law. Anyone who reads the language of the statute must come away with a conclusion that there is no property right, it says so- Mr. Buckley: And the law in Connecticut says that people who commit sodomy will be executed. Nick Johnson: You have a position on that? Mr. Buckley: Yes, I do. I think that nobody pays any attention to that law, and shouldn't. I think that in the case of the FCC law, people, and I mean by that, good citizens, seek to understand the law on the basis of what you lawyers call legal positivism. I.e., how in fact it has been interpreted over the years. For you to come along as a one-man revolutionary force, saying, "Let's have a new law," or rather, "Let's put a construction on this," which has never been put on it before, really puts on you, I think, the democratic burden of taking your case to Congress. Nick Johnson: Well, I don't think that's true at all. You see, one of the things that has happened in the interim, which is quite important, involves the law of standing, so called. This is the question of who has the legal right to come before an administrative agency or a court, and be heard? The FCC has over the years taken the position that the only people who have a right to be heard at the FCC are its friends, the wealthy broadcasters. Mr. Buckley: Why do you say wealthy broadcasters? How about poor broadcasters, do they have a right to be heard? Nick Johnson: If we could find one, I presume you could. Yes, of course. Mr. Buckley: I owned a radio station that lost money for 10 straight years. Nick Johnson: Yes, I once commented on that, as you may recall. Yes. Mr. Buckley: Gleefully. Nick Johnson: No, there was a case that came out of Jackson, Mississippi, in which a station was charged with overtly racist programming. The United Church of Christ complained to the FCC about this, along with citizens in Jackson, and said, "We don't think that license ought to be renewed." The FCC said in effect, "Gee, that's very interesting, and we'll certainly consider your point of view. Now please go back to Jackson." They said, "No, we'd really like to be heard as parties." And the FCC said, "You can't be heard as parties, because you don't have standing. After all, you're just representatives of the public, and this is after all, an agency where we take care of broadcasters." Nick Johnson: As long as they were in Washington, they went over to the United States Court of Appeals, and said, "Hey, we've got this trouble with this agency down the street that seems to say we don't have any right to be heard." The court reversed the FCC out of hand, and said, "They certainly do have a right to be heard. When it becomes obvious to all, as it does to us now," to essentially quote the court here, "that the FCC is incapable of representing the public interest, the least it can do is let the public in to fend for itself." So one must read that court interpretation of the law of standing, in the United Church of Christ case, the first decision, along with the Communications Act of 1934, to understand what it is that the FCC is now doing, and the courts are now insisting we do. Mr. Buckley: Well, Mr. Johnson, I can understand that a court would say that an individual citizen has a right to make a complaint, in respect of anyone that might agree with that particular case, I happen to be sympathetic with it. But I don't see that really, that this affects the argument that we are trying to pursue, namely what ought to be the presumptions in a situation like this. Now, when you license somebody to operate a radio station, or a television station, he has to make a whole series of affirmations. Among those affirmations are that he will not use his radio station for, in ways which are obviously contrary to the public interest, for instance racism, that kind of thing. Mr. Buckley: Now, if somebody is caught guilty of that particular offense, it strikes me at least, that he has an obvious complaint to take before you. But I understand really that your philosophy is going considerably beyond that point. Nick Johnson: It's not my philosophy, it's the Communications Act of 1934. Mr. Buckley: Well, I know, the Communications Act of 1934. Nick Johnson: Surely, you believe in law and order, don't you? This is after all the law. Mr. Buckley: Well, the law, as somebody told us, is what the Supreme Court tells us it is. Nick Johnson: You have an alternative to that? Mr. Buckley: I believe along with Blackstone, that the law is in part usage, and that under the circumstances, nobody can give sound advice as to what the actually says, without for instance, finding out what previous judges have said it was, and how in fact it has been used. Nick Johnson: That's in fact what I mean, the law is drafted as interpreted by the courts, and the FCC, clearly sustains the position that I'm espousing here. Mr. Buckley: Of course, the FCC has most recently ruled rather, I was about to say joyfully against you, but emphatically against you, leaving you rather lonely. I don't know that in court- Nick Johnson: In what particular instance did you have in mind? Mr. Buckley: For instance- Nick Johnson: Not that there are not a good many that you couldn't find. Mr. Buckley: I was thinking about the one in which they said they would not consider an application by Mr. Jones to take over the station of Mr. Smith, unless Mr. Jones is able to show that Mr. Smith has followed policies which are, other than substantially, in agreement with what it is that he set out to do. Nick Johnson: It would seem to me that policy statement would rather make my position, rather than yours. If the law was in fact as you declared it to be, then why would the policy statement have been necessary? The policy statement presumably changed the law from what it was, to what it is now after the policy- Mr. Buckley: You know the answer to that, but let's for the sake of the audience, pretend that you don't. But what was happening in Washington was a big, everybody was uptight over the Pastore bill. A lot of people said, "Look, goddammit, we've got to have some clarification of policy here." So the Pastore people, as I understand it, said, "Okay, we'll withdraw our bill, if you will tell us that there is a presumption in favor of the guy who owns this particular station getting it again after three years, unless he's just a villain." This is what happened. Nick Johnson: I think we really have to be clear at this point to the people who are watching this, if they don't already know it, is just a simple declaration of the awesome economic and political power, which is held by the broadcasting industry, that far exceeds that of any other industry ever in the history of our country. Mr. Buckley: I agree. Nick Johnson: To get essentially any piece of legislation they want out of Congress, now that's a very frightening thing. It's precisely what Congress was afraid of in 1934, and it's come to pass. Mr. Buckley: Well, now, wait a minute. Because in point of fact, every broadcaster in the United States wanted the Pastore bill to pass, and it wasn't passed. So you've just finished contradicting yourself, that's all right, it will happen again. Nick Johnson: I appreciate your confidence, but what do you think was the effect of the policy statement, if not in effect an act of the Pastore bill? Mr. Buckley: You see, the paradoxal thing is I really agree with you on practically everything, it pains me to do so, but it seems to me that what you really are is an aristocratic paternalist. Nick Johnson: Somehow I've never thought of myself in that [crosstalk 00:17:06]. Mr. Buckley: I'll show you what you mean. For instance, you said- Nick Johnson: You'll show me what I mean? Mr. Buckley: Yeah, because I don't think you realize what you mean. You said, "It is the manifest duty of the licensing authority, in passing upon applicants for license, or renewal thereof-" Nick Johnson: I never said it was the manifest duty. Mr. Buckley: That's quote-unquote, it's from your book, if you want to review it. Nick Johnson: Where is that? Mr. Buckley: I didn't take the page number down, "To determine whether or not the applicant is rendering or can render an adequate public service. Such service necessarily includes broadcasting of a considerable portion of programs devoted to education, religion, labor, agricultural, and similar activities concerned with human betterment." Nick Johnson: This was the policy statement of the FCC in 1960, which some of which I would agree with, some of which I would disagree with. Mr. Buckley: You quoted it approvingly, well, if you want to modify that, would you want to do it right now? Do you agree with this, or don't you agree with this? Nick Johnson: Well, I would like to wait and see what you're going to find objective, concession to the shortness of life. Mr. Buckley: I'm all for agriculture- Nick Johnson: -My anticipating it. Mr. Buckley: I'm all for agriculture, and I'm all for labor, and I'm all for education, all for religion, but I happened to tune-in in New York to a station, an FM station, and where they start talking on that station, I get terribly annoyed. I tune-in because they more or less guarantee it's an all music station, WNCN, and every now and then, all of a sudden, they bring in the piano player. I love the piano player, but I don't want to hear him talk, I want to hear him play. But as I understand it, WNCN might have to bring in agricultural experts, because otherwise, Commissioner Johnson is going to give you a hard time. Nick Johnson: Well, that's big nonsense. Mr. Buckley: Is it? Nick Johnson: Of course. Mr. Buckley: Why is it big nonsense? Because it says right here, quote-unquote, "Necessarily includes a certain proportion of ..." Nick Johnson: That's a policy statement that was enacted by the FCC long before I arrived, and indeed, had been renunciated by the FCC long before I arrived. Mr. Buckley: You reputed- Nick Johnson: Yes. We now have basically three categories of programming that the licensee must indicate what percentage he's going to program. News, public affairs, and all other programming, that is other than entertainment and sports. This incident, I'd be very interested in your judgment on this, Commissioner Cox and I have taken the position that a licensee who proposes to have less than one-percent public affairs programming, at least ought to be sent a letter of inquiry by the FCC, to ask why in his judgment that serves the needs of his local community. Now, would you be offended at a regulation of that sort? Mr. Buckley: I'll tell you why a little later, if I may, I would be, because I've got the absolute solution for all our problems. Nick Johnson: Marvelous, why didn't you put that out in the early part of the program, and give us a chance to think about it? Mr. Buckley: Because I think that the analysis that we've seen right now, will contribute to the cogency of my proposals, in due course. Nick Johnson: I see. Mr. Buckley: But meanwhile, you say for instance in your book, "To say that current programming is what the audience wants, in any meaningful sense, is either pure double talk, or unbelievable naivety." Nick Johnson: I did say that. Mr. Buckley: You make an extremely intelligent case. Nick Johnson: Thank you, can we move on to the next point then? Mr. Buckley: No, no, no. Because it seems to me plain, that what the "audience wants" is really what you don't think it ought to want. Nick Johnson: That's not true at all. Mr. Buckley: I think it's very hard to say about a station that I'd say gets a 50% rating, i.e., 50% of all people have their sets turned on, or turned onto the Beverly people. Nick Johnson: I think it's the Beverly Hillbillies. Mr. Buckley: Beverly Hillbillies, yes. Now, you may not like that program, and I may not like that program, but what is it that makes you say, not only say, but to denounce people who disagree with you as naïve, or using double talk, that people don't want that program? Nick Johnson: I think the point is this, let me contrast with what we have with what's available in Great Britain, if I may just briefly, because I think it will make the point. In Great Britain, there is commercial television service, and there are two channels of BBC. British television has on it the same kind of trash that we do, if anything, they have a wider diversity of trash than we. Giving people really a choice of gradations of trashy programs. They have series shows, many of them the same ones that we televise. They have American films, they have musical variety type programs, they call light entertainment. Mr. Buckley: Only their trash [inaudible 00:21:50], isn't it? Nick Johnson: Well, yes. That's the one point we might develop. But the point is that in addition to that programming, there is also, on the commercial network as well as on BBC, and on BBC1 as well as on BBC2, there is a choice. There is more of a choice every evening on British television than probably on American television in a month. NBC puts on something called First Tuesday once a month, BBC1 puts on the equivalent every night, it's called 24 Hours. Mr. Buckley: You're talking about something completely different from the question I asked you. Nick Johnson: Not at all, because you're asking about choice. Mr. Buckley: I agree with you. Nick Johnson: I'm saying, [crosstalk] says, the choice you never know is the choice you'll never make. The American people don't know that television can be different from what they see between 7:00 and 11:00 PM every evening. No one's ever shown them what the alternatives would be. And when they do- Mr. Buckley: Look, the fourth foundation ... Nick Johnson: As with a National Geographic program, or a Reichert program on Japan, people watch it, the audiences turn out. And they do in Great Britain, and I have no reason to believe they wouldn't continue to here. Mr. Buckley: Commissioner? Nick Johnson: Yes. Mr. Buckley: Wait, the Standard Oil backed a program here in New York over a period of several years, and it was always a play, Chekhov, Shakespeare, and the ratings sank just out of sight. After a while, Standard Oil said, "Well, you know, we love Chekhov, but in point of fact, we simply can't pay for so small an audience." And this is in New York. Nick Johnson: For every instance like that- Mr. Buckley: My partner and I ran a good music station in Omaha, Nebraska, lost our shirts for years. My point is that there weren't enough people to opt for it. Now, if what you're saying is that, as the chairman of the FCC, says that TV is a vast educational wasteland, god knows, I agree with you. But I don't think that you go can on from there to generalize as you did, that people who say that this is what the public wants, are naïve or using double talk. Nick Johnson: No, what I mean is very simply this, it's not just that ... For every Standard in Jersey that is not going to put on Chekhov because of low ratings, there is a Firestone that would be delighted to have continued the Firestone hour, but was not permitted to be a network. Or a US Steel that would be delighted to continue its programming, but is not permitted to. Or a Xerox, which can't get space on a network, and has to go out and sign up individual stations to play Xerox programming. Mr. Buckley: Why weren't they permitted to? Nick Johnson: Because the networks believe they can profit maximize by keeping that programming off, and putting on something that will pick up a little bigger audience. But the sponsor is quite willing to sponsor it, the sponsor- Mr. Buckley: At his rate. Nick Johnson: I beg your pardon? Mr. Buckley: You mean, at his rate? Nick Johnson: No, no, I mean at the going commercial rates. Mr. Buckley: If CBS say, says, "I've got to have $150,000 for this hour," and Firestone offers $100,000 ... Nick Johnson: No, no, Firestone offers $150,000 under my hypothesis, and CBS says, "If we put on the Firestone hour, we will have five million fewer people watching, and therefore the program that follows the Firestone hour will have a lower audience, because of the flow through of audience, and therefore we don't want your crummy program on the air." But don't tell me that the sponsors don't want this stuff on, because they really do, and they can't get it on. Mr. Buckley: What makes the sponsors philanthropic, but not the broadcasters? Nick Johnson: They have different motives. Mr. Buckley: Why? Why do they have different motives? Why is Standard Oil more philanthropic than- Nick Johnson: It's not philanthropic, it has different purposes. If you're a Xerox Corporation, you're not trying to reach the same audience that Lever Brothers is. You are quite prepared to settle for different people, just as those who advertise on good music radios, they're quite prepared to advertise there, or to reach the people who are listening to that station. This is precisely the point I'm trying to make. I'm not just talking about Chekhov plays, I'm talking about the whole spectrum of American interest. Mr. Buckley: You're not angry at Chekhov, are you? Nick Johnson: No, no, not at all. We don't have much on television about people interested working with automobile engines either, which doesn't happen to be one of my particular interests. We don't have as broad a diversity of the political spectrum represented, as ought to. You're about the only show that purports to be a conservative spokesman, whatever conservative means. Mr. Buckley: Purports? Nick Johnson: Purports, yeah. I'll get into, if you'd like, later on. I thought I would develop that before I proposed it at the end of the show. Yes. No, we have different regions of the country, we have different education levels, we have different age levels. We have people in old folks' homes that have needs that are different from young preschool kids. We have the black community in many of the largest cities in this country, that have programming needs that are different. You put all these minorities together, and they make up the public. Nick Johnson: Now, what the networks try to do is go out and reach the lowest common denominator programming, that is not so inoffensive that people, so offensive that people will turn it off. Then of the three programs that just barely meet this threshold, it is true, the people will watch the one that they find the least mediocre of the lot. You see? But to say that people really positively respond to that in the way that they will seek out a television program that really contributes something to their life in a meaningful way ... Mr. Buckley: I'm sorry, Mr. Johnson. Nick Johnson: That's all right. Mr. Buckley: You said they would respond. Nick Johnson: I'm just saying that I think that is, can be fairly characterized as either double talk or naïve. You can see the interest that American people have in music, in the records that are sold, that are not played. In books and magazines, the ideas that are discussed, that never find their way onto television. The writers, America's best writers are not writing for television. I think you can document the proposition that the broad range of interests and talents and points of view that are embodied in America, and are represented in other art forms, in the theater, in books, in magazines, in music, are simply not displayed on television. Mr. Buckley: Okay now, I read somewhere in a profile about you that you have very busy authors, that you're surrounded by magazines like the New Republic and the Nation. The New Republic and the Nation are magazines, which have been published respectively about 100 years and about four years, or vice versa. They have achieved a grand total, between them, a stipulation of about $200,000. So therefore, they are magazines which lose money, and are magazines which require people like you to survive. Mr. Buckley: Now, when you're dealing with a massive situation, in which you need to spend $2, $3-million dollars a year in order to keep something going, you've got to have more people, more customers, more readers, than for instance, simply the people who read the New Republic and the Nation. The solution has always struck me as very obvious, which is of course pay TV. In 1959, I went down and addressed your distinguished group of commissioners, urging a pay TV. It seems to me that this solves everybody's problems. It allows the small minority to patronize whoever it is that they want to patronize, and it allows those broadcasters who want to broadcast free, go ahead and broadcast free, and certainly gives you a running nickel-and-dime check on the part of the people for the kind of entertainment they desire, or the kind of education they want. Mr. Buckley: Why haven't you been more vigorous in promoting that? Nick Johnson: We have, as a matter of fact. I quite agree with you. We have, recently, within the last few months, enunciated a policy that is in effect a go-ahead for pay television. You're quite right that the 13 years preceding that announcement were marked with delay for a variety of reasons, that also involved the intervention of Congress on occasion, whenever we were poised and ready to act in this field. But I quite agree with you theoretically, a part of the problem with American television, commercial network primetime television, is precisely what you say. Nick Johnson: There is not marketplace mechanism by which people can register their choice, among the variety of programming that might be available to them. All they can do is look at the three programs that are paid for by advertisers, not by the viewers, and select- Mr. Buckley: Well, the viewers pay for it ultimately, of course. Nick Johnson: They certainly do. The nonsense that we have free television in this country is ridiculous. We have a $20-billion dollar investment in receiving sets, which exceeds by 40-fold the investment of the industry in its own transmitters and studio equipment. Mr. Buckley: $2.5-billion dollars a year in advertising. Nick Johnson: Yeah, $2.5-billion dollars a year in advertising that's picked up. Mr. Buckley: Would you explain to us, because incidentally, when I appeared before the FCC in 1959, I was told my one commissioner that I obviously wasn't up on the fact that just a few months before, the FCC had made it easy for anybody that wanted to go into paid TV, to do so. Then of course, we know what happened. There was the catastrophe in 1964, out in California, when the effort was seriously made. But what is it that you have now done that really makes it possible to have paid TV, and why is it that we haven't had paid TV stations sprouting up all over the place, if you've licensed them? Nick Johnson: Well, there are really a couple areas in which this is taking place. One is the growth of cable television, which ultimately may be the means for bringing to the viewer the kind of programs for which he pays, the character that you're describing [crosstalk 00:32:01]. That's right, but if you- Mr. Buckley: If you and I wanted to go out tomorrow and start a pay TV station in New York, could we? Nick Johnson: Yes. Mr. Buckley: How? Nick Johnson: By applying under the FCC's rule, which provides that in any community with five stations or more, one of the independent stations may, part of the time, provide programs- Mr. Buckley: Why part of the time? Nick Johnson: I don't know. Mr. Buckley: Why'd you throw that in? Nick Johnson: Because it's the way we ease into these things, you understand that. Part of the time, provide programs that have not formerly been available in that market for pay to viewers. Mr. Buckley: Why that? Nick Johnson: That's partly to ensure that the public will not start paying for something it's now getting on an advertiser supported basis. Mr. Buckley: Why not? Nick Johnson: For political purposes presumably, because- Mr. Buckley: So the Chekhov play couldn't run under your new system, because it had been previously available free? Nick Johnson: No, no. This principally would apply to sports I presume, if the World Series had been available free in the market before, you couldn't then immediately put it on paid television the next year, so forth. Mr. Buckley: How about the following year? Nick Johnson: I don't know what the provision is, but there is some period of time during which this can't be done. There would have to be a period in which the World Series was not available to market at all, before it could then be picked up by paid television, which is unlikely. The point is that in addition to over the air pay television stations, it is also highly probable in my judgment that this material will be made available by cable distribution systems. Where you pay $5 a month to get all the channels brought into your home, and an additional fee per program, or per additional channel for programming that is not otherwise available to you. Nick Johnson: We have provided for both of these in our rules, in our cable television proposal, indicated that you could have advertiser supported and subscriber supported programming. We also have the proposal for over the air pay television. Mr. Buckley: Now, why would I have to apply to you for a license? Why couldn't I just go ahead? Is it because Congress requires that? Nick Johnson: Essentially, yes. That's the short answer. Mr. Buckley: As I remember it, in California, they weren't using the airwaves, they were piping the stuff in through the telephone lines or something. Of course, you control them too, don't you? Nick Johnson: Well, yes, after a fashion. Mr. Buckley: Don't be so modest. Nick Johnson: Well, I'm not really being modest, we do have the responsibility. It's just that as you ask these questions, I'm reflecting on what in fact happens at the FCC. Once again, I think that it's terribly important to make the point of the way in which agencies function in Washington. A phenomenon of the sub-government, for example. The fact that in areas of government in which policies are made that affect large quantities of money, and small quantities of people, a sub-government will sprout up. This may involve defense contracts, it may involved maritime subsidies, it may involve airline routes from the CAB, it may involved allocation by the FCC of television stations. Nick Johnson: But the phenomenon is the same, in the broadcasting field, the power rests not with the people, not with Congress, not with the president, but with a small group made up of a trade association, in this the National Association of Broadcasters, a trade magazine, in this case, Broadcasting Magazine, a government agency, in this case, the Federal Communications Commission, some Congressional Committee and staff and so forth. A subdivision of the Washington Bar, known as the Federal Communications Bar Association in this instance, and then various hangers on, public relations firms and lobbyists. Mr. Buckley: They tend to oppose pay TV, don't they? Nick Johnson: Well, they tend to oppose anything that's not what they already have. Basically, our policy on cable television for example, was to discourage the growth of cable television, until the large broadcasters owned it. At which point, we eased the rules and permitted to grow. This is the pattern. You couple with this, with the brazen disregard of the public, that even is bold enough to come around to the FCC, as in the United Church of Christ case out of Jackson, Mississippi, and you begin to get a sense of how rigid and tight and under a rock this whole business is. The sub-government is a very closely knit symbiotic incestuous, literally going to marry ... Mr. Buckley: Sure. I've said that about democratic parties for years. Nick Johnson: About democratic parties? Mr. Buckley: The Democratic Party has run Congress your way for the last 35 years, except for a couple years. Nick Johnson: You find the Democratic Party is somehow different from parties- Mr. Buckley: How many Republican parties do you have on your commission? Nick Johnson: I now have- Mr. Buckley: As of a couple months ago. Nick Johnson: No, no, the FCC must be as a matter of law, evenly divided between Democrats and Republicans, there is nearly so, as one can divide seven men. Mr. Buckley: How many is that? Nick Johnson: That's three to four, if you want me to help you with that. Political science is your field I guess, isn't it? Yes. Mr. Buckley: I think it was an act of great generosity by the Democratic Congress to allow a couple Republicans, it's more than they do up on the Hill. But my point is, that- Nick Johnson: It's because there are very few Republicans up there, that's the difficulty. We always have this balance in the FCC, but you have to elect them to Congress. Mr. Buckley: You have really a very paradoxal position here, because it's awfully hard I think to say about broadcasters, who put out programs, which according to your book, are listened to an average of five-and-a-half hours per day, by the average American. So much so, that a guy or a child who, apparently according to your book, starts looking at television when he's two, I didn't know there were that many precocious- Nick Johnson: The programming's really aimed at someone of the two year old level. Mr. Buckley: He's going to watch it for nine years before he dies, nine solid years, around the clock. That being the case, it seems to be awfully hard to say to these broadcasters that they aren't giving, that they're not serving the people. Nick Johnson: It's what they're serving the people. Mr. Buckley: All right. Nick Johnson: It's a tasteless gruel, that's what they're serving. That's the problem. Mr. Buckley: I know, I know, but this is a cultural problem, which is something very, very different. Nick Johnson: No, I think it's simply a problem- Mr. Buckley: Certainly, the beginning is to liberate those who are willing to pay a few cents to get something different. You and I both agreed a moment ago. Nick Johnson: No, we agree on that. Mr. Buckley: They're not going to be paying more than they are anyway, because every time you look at Corn Flakes- Nick Johnson: The problem is more of corporate greed, the problem is one of corporate greed. Mr. Buckley: No, that's ridiculous. Nick Johnson: Why? What's ridiculous about it? Mr. Buckley: The trouble is you sound like Huey Long sometimes. Nick Johnson: Huey Long, really? Mr. Buckley: Yeah, yeah. Nick Johnson: I don't think I have a Southern accent. Mr. Buckley: He said, "The existing system is government of the people, by the rich, for the corporations." Straight populism. It's no more greed, than the politician. The politician's just as greedy as a businessman, they go and they give a speech, and they promise the whole bloody world, they're greedy for votes. In their own way, they're just as despicable as the greedy monopolists. Nick Johnson: But when we talk about the area of the human mind, you're talking about environmental pollution. This pollution of millions of American minds every day by a medium that could do more, that could do better, that could have a sense of responsibility, and could provide some- Mr. Buckley: Why don't we simply repeal the First Amendment, and outlaw bad literature for instance? Your hero Hugo Black, as you call him in your book in one of the interviews, is an absolutist on the matter of no interference at all with what it is that people want to read, and what they want published. Why any interference at all in what they want to broadcast? Nick Johnson: Well, the Supreme Court has said only last year in the Red Lion case that the First Amendment does not sanction corporate censorship in a medium now open to all. I think that's the issue here. It's not that these people are not to be able to put on some of this material, it's that they not ought to be able to keep off the other material. It's the problem of corporate censorship. Mr. Buckley: Mr. Johnson, you know something? There are more networks and syndicates in television and radio than there are publishers of books, actually. So that in fact, there's plenty of competition. The trouble is, the discretion's law, the bad writing out the good, and the only correction for it is to allow the minority his rights, and the only way to do that is pay TV. I'm very glad that you ... Nick Johnson: But before we get to the question of pay TV or cable television, or a strengthened and more viable public broadcasting system in this country, any one of which could open up diversity and make a more meaningful choice, you're still confronted with the fact that you have three corporations in this country that have a virtual stranglehold on the programming that most Americans are in fact watching. Mr. Buckley: Look, maybe I share some of, you and Agnew and I, as I said before, feel very much the same way on a lot of matters. But it's like saying three automobile manufacturers manufacture 99% of the cars bought in America, I agree with you, but still, you don't even regulate the networks as I understand it. So if anybody wants to start a fourth network, as somebody tried a couple years ago, it's a matter of reaching out there and finding out whether there are people who want it badly enough. If there are people who want it badly enough, it will start, if there are not, it won't start. Nick Johnson: But that in part is a function of the corporate practices that have been permitted by the FCC to grow up over the years, to give the networks the oligopolistic power that they have in the market now, to drive out essentially any competition. Mr. Buckley: You mean giving them the right to own five stations? Nick Johnson: Well, the contracts they have with the affiliates, their control over ever facet of the television business, from the ownership of the writers, to the ownership of the stations. The limited number, their ability to affiliate with nothing but VHF stations. Mr. Buckley: I don't know that there's any network that has seen more power than the New York Times or the Washington Post. Nick Johnson: Of course, of course. You were the one who was citing that in this really extraordinary characterization of literature to be found in my office, which I should note, includes also Fortune and Wall Street Journal, and Human Advance. Mr. Buckley: National Review. Nick Johnson: What is that, the National Review? Yes. I've even been known to be seen with that on rare occasion, yes. Mr. Buckley: They just weren't picked up by this particular writer. Nick Johnson: No, they weren't. He was of your bias, and he noted those things, and used them unfairly I felt. Well, if your concern is circulation figures, compare the circulation of the New York Times with any show that only got an audience the circulation that the New York Times gets every day. Mr. Buckley: It would be out. Nick Johnson: It would be very quickly off the air. There's just no comparison in the power. Mr. Buckley: You never used to give me 30 seconds of latitude. Mr. Greenfield. Mr. Greenfield: Just a question for you, Mr. Buckley, because it has to do with competition, which is a virtue I take it now you extol in the breach rather than the observance, there's a station- Mr. Buckley: I didn't call it that, but go ahead. Mr. Greenfield: Okay, it means you don't practice what you preach. Mr. Buckley: Why? Mr. Greenfield: I'm going to tell you why, let me set it up. There's a station in a large city, which is now being challenged by a disparate group of what you call I guess bleeding heart reformer liberal types. Mr. Buckley: I never used that word, but go ahead. Mr. Greenfield: Okay, I think I can find them all in National Review, but okay. This challenging group, group of challengers, has proposed, and we can't bring Nick Johnson into this, because he has to decide eventually, but assume, and one can't quell with assumptions as you say, a very challenging new kind of programming, involving everybody including blacks, suburbanites, kids, conservatives, radicals, what have you. The station their challenging is pretty well recognized as easily the worst station in any large metropolitan city, just dreck. They make a profit because sponsors advertise on that station too. Mr. Buckley: Because it's so bad? Mr. Greenfield: No, because it's such a large city that even the tail audience that they have makes it profitable to advertise, you know, for the advertiser and those people. But assume that the new group would just provide, on anybody's standards, much better programming. Now, what you seem to be saying is that the mere fact that this other group has gotten for free a license three years ago, entitles it to go on permanently producing dreck, instead of giving another group a chance to perform better programming, which if they don't do, the FCC can then take away that license and give it away to yet another group. Why? Mr. Buckley: To begin with, we don't know how much they spent, let's say during that three years, in order to make this a property of which other people want to occupy, point one. Point two, when they- Mr. Greenfield: That's no point at all. What is the difference how much they spent, if in fact they've been producing is terrible? Mr. Buckley: It makes a difference in justice, assuming this- Mr. Greenfield: Why? There's companies that spend $4-billion dollars making a plant that pollutes a river, does that make a difference? Mr. Buckley: It certainly makes a difference if we decide all of a sudden we're going to take that plant away from them, unless they were breaking the law. Mr. Greenfield: The law against pollution was there 30 years ago, and never enforced. Mr. Buckley: The point is that, I think Mr. Johnson and I covered this, which is that people understand the law on the basis of how it's been commonly interpreted. Mr. Greenfield: No, they've ignored the law. Mr. Buckley: No, they haven't ignored the law. Mr. Greenfield: Yes, they have. Mr. Buckley: No, they haven't. Mr. Greenfield: Mr. Johnson wants to start enforcing it. Mr. Buckley: If they have ignored the law, then I say, go ahead and take the license away from them. Mr. Greenfield: Then you agree with Mr. Johnson. Mr. Buckley: No, because Mr. Johnson would not want to ask the courts to interpret this, he wants to interpret it all by himself. Mr. Greenfield: Mr. Johnson knows the courts eventually interpret it under the Judicial Review Article under the Agency Act, they have to review it, it's part of the law. Mr. Buckley: Now look, Mr. Greenfield, we can play games, or we need not play games. The fact is for 35 years, this kind of thing didn't happen. It started to happen about a year ago. Mr. Greenfield: You could have said that about slavery in 1863, I don't see what point that is. Mr. Buckley: Let's have a civil war, if you want a civil war, let's have a civil war. Mr. Greenfield: Let's just abolish slavery, let's take licenses away from programs. Mr. Buckley: You don't win the civil war by fear. Mr. Greenfield: Let's take licenses away from stations that really don't do anything but a terrible job, like the law says. Mr. Buckley: Yeah, but a terrible job, for instance, I happen to think that your mayor does a terrible job, should we simply take away- Mr. Greenfield: And he was reelected, wasn't he? Mr. Buckley: All right, then who is to say that this particular television station isn't going to have more viewers than the one you want to propose? Mr. Greenfield: The law says that the FCC is supposed to say, subject to judicial review, that's what you don't understand. Mr. Buckley: We're rehearsing an argument we already- Mr. Greenfield: Rehashing, right? Yeah. Mr. Buckley: Miss Duffy. Miss Duffy: Mr. Johnson, what do you think is the more easily implemented solution to the television blight? Pay TV or the British system of nationally owned broadcasting that would present better programs? Nick Johnson: Let me summarize a number of proposals, if I may, which are obviously taken care of at greater length in the book, How to Talk Back to Your Television Set, which is after all, the purpose of that particular volume is to answer that very question. You can come up with institutional realignments. One is the Public Broadcasting Corporation, which would provide a BBC-like choice in America. I think basically everyone agrees that we ought to move ahead with that as fast as possible, and we ought to be thinking in terms of budgets more like $500-million dollars a year, which is roughly one-percent of our public education budget. Ban budgets like $10-million dollars a year, which was all that President Nixon was prepared to ask for. Nick Johnson: Basically the Japanese and the British are spending 100 to 200-times as much on public broadcasting, as America has so far been prepared to spend. Second institutional realignment is what I've called the one-third rule. This would be a requirement of the FCC, that one-third of all the networks programming in primetime would have to be something other than the lowest common denominator entertainment, commercially laden fare that they're now putting out. It wouldn't drive it off, just give the people a choice. Give them two channels with trash, and one with something else at all times. Nick Johnson: But the principle force here is always, in a government agency that's dominated by the industry it's supposed to regulate, is going to have to rest with the people. Mr. Buckley: Why is it dominated? Are the parties corrupt, Mr. Johnson? Why is it dominated? Nick Johnson: Because of the sub-government phenomenon, which we covered. Mr. Buckley: We didn't cover it satisfactorily, why are your colleagues corrupt? Nick Johnson: I did not say- Mr. Buckley: You say it's dominated by the industry it's supposed to regulate. Nick Johnson: Let's get that straight. Mr. Buckley: I'm grown up, and I can infer from the meaning of words, you said- Nick Johnson: [crosstalk] with great agility- Mr. Buckley: You say they are dominated by the industry they're supposed to regulate. Nick Johnson: That's right. Mr. Buckley: Maybe we should replace the FCC instead of the station in whatever town Jeff is worried about. Nick Johnson: I think the choice is, do you want to have firmer regulation by the FCC, more precise prescriptions of programming content from the FCC, or would you rather return this to the marketplace and to the people, and to participatory democracy, and let the people work these problems out in their local community? I would prefer the ladder, Mr. Buckley would prefer the former. Mr. Buckley: No, no, on the contrary. Nick Johnson: I would like to see the people have more power in this area, I would like to see the people know what those powers are, and that's part of the purpose of this, How to Talk Back to Your Television Set. To let people know about the Fairness Doctrine, let them know about the license renewal process, let them know what their legal rights are, because they're not going to find about them from watching television. Mr. Buckley: Well, they're watching you, I hope. Nick Johnson: Primetime commercial network television. Audience: If the FCC is one of the villains here, why don't we abolish the FCC? Nick Johnson: There are some who have proposed that. Mr. Buckley: Milton Friedman has very concretely. Nick Johnson: Yes, and basically I find a great deal very compelling in Mr. Friedman's argument. Mr. Buckley: Abolish it in 1973. Nick Johnson: That's the date when my term expires, I really don't care, I'm not looking for a reappointment or a job in the industry, it should be obvious. If you could make this industry more like the magazine business, through cable television, through pay television, through viewer access of computer controlled libraries of videotape, et cetera. Audience: Hasn't the FCC prevented that from happening though? Nick Johnson: Yes, that's right. That's precisely its purpose, is to protect the broadcasting institute. Mr. Buckley: Why do you say it's its purpose? Nick Johnson: Historically. When the ICC was established, and the railroad president complained to the attorney general, and he said, "What are you doing to us, establishing this agency to regulate us?" The attorney general explained, "You really don't understand, you will name the men the who are appointed to this agency, and you will determine what they do, and set their budgets. This will enable you to meet in ways that would otherwise violate the antitrust laws, and agree to industry wide practices. Whenever you're charged with injuring the public in some way, you can defend and respond by saying that a government agency has found this to be serving the public interest." Mr. Buckley: Thank you, Mr. Johnson, very much, and thank you, ladies and gentlemen, members of the panel.