Marketplace Features

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At the dawn of public broadcasting, visionaries foresaw unfettered creativity and journalistic freedom, a system free of government influence, independent of the marketplace. Problem was, no one figured out how to pay for it. Federal funds simply weren't enough...so we began begging you for money. As government funding became even more scarce, we put our hands out to corporations.

These days, corporate support covers about 15 percent of public radio budgets and is growing. Many worry that could hurt the integrity of news organizations. In the final part of our series, "Commercial Public Radio?", we pull back the curtain on the editorial process at two public radio news organizations, National Public Radio and Marketplace. Producer Sandy Tolan examines the firewalls built to protect national programming.

Tolan: Beneath all the golden rules of good journalism, there's a gold standard.

Dinges: "A news operation operates on money."

Tolan: That's former National Public Radio managing editor John Dinges, now a professor at the graduate school of journalism at Columbia.

Dinges: "Commercial news operations, as well as public radio news operations have to depend on that. And so you have to answer, really, the question of, 'What's the relative influence of our sources of money on our journalistic product?'."

Tolan: No doubt: Money powers good journalism. And money has the potential to corrupt it. Dinges's question is becoming more and more relevant to public radio listeners, as more money from corporations and foundations flows in.

Tolan: NPR, public radio's most prolific producer of national news programming, has seen its corporate contributions rise 700 percent in the last six years, to more than $14 million. And some local stations seek to double their corporate money in the next three years.

Tolan: When you hear all the plugs and slogans that are increasingly prevalent on public radio these days, do you accept corporate and foundation money as part of the cost of doing business? Or, do you worry that all that money that doesn't come from listeners could be tainting the product? Let's begin with the product you're listening to, and its largest single funder, General Electric. Here's Jim Russell, the general manager who oversees Marketplace Productions.

Russell: "GE has been a dream underwriter for us. In 30 years in this business I've just never worked with any company, foundation or other institutions that displayed the level of regard for freedom of the press, editorial independence, autonomy. And I can truthfully say that not in any time in the past decade has GE even suggested a story idea."

Tolan: Let's stop for a second. You're sitting there listening to a program about public radio and that top guy at the program you're listening to tells you there's no influence. Can you believe him? More important, since that top guy will sign my paycheck for this story, can you believe me?

Tolan: There's a couple of things you should know about our editorial process: I'm a freelance reporter and independent producer, hired specifically to produce this series, which I agreed to do because the issue is close to my heart; I've written opinion pieces in The New York Times and elsewhere about the need for public radio to remain independent of undue government and commercial influences. Marketplace senior staffers edited this story, with guidance from our independent advisers. Marketplace General Manager Jim Russell, who you just heard from, is, like you hearing this for the first time.

Tolan: So. Is Marketplace independent of GE? Is Marketplace willing to bite the hand that feeds? The proof, of course, is in the coverage. Russell says GE has been the subject of Marketplace reports in the past, and he's right:

Clip from Marketplace: "The fifth largest company in the US, General Electric, has been indicted by a federal grand jury on for conspiring to fix the global price of industrial diamonds. The company refutes the charge..."

Tolan: This 1994 Marketplace story is one of the few times in the program's history it focused on GE. The piece included an interview with a journalist covering the story, and with a GE spokesman, but no GE critics on tape. The show's producers say that's not unusual, because scrutiny of big business is not the program's main purpose.

Tolan: One of the biggest stories involving GE in recent years received scant coverage from Marketplace. The story was about a national boycott of GE for its past involvement in the nuclear weapons industry. That campaign was left out of a Marketplace story on national boycotts in late 1990, even though it was perhaps the most prominent boycott in America at the time. This prompted the boycott organizers, Infact of Boston, to question Marketplace's editorial independence, and led to a sharp exchange of letters with Jim Russell.

Excerpt of letter from Infact: "It is problematic for a key player in the international business community to actually underwrite a daily report on the day's business news."

Excerpt of letter from Jim Russell: "Not including the GE boycott clearly was a mistake, and our producer readily owned up to it. We make mistakes. It think it is important to cover GE just as we would any other major American corporation."

Tolan: Many mainstream news organizations reported on the Infact boycott. Marketplace did not, until an Infact short documentary on GE won an Oscar, and the boycott call went out to a national audience of some 75 million.

Tolan: Within seven months, GE got out of the nuclear weapons business, and Infact called off the boycott.

Tolan: For its part, GE, which gives $1.2 million a year for Marketplace, more than a quarter of the program's budget, says it has not and would not try to influence marketplace's coverage.

Harman: "It's just not part of what we do to really have anything to do with the editorial content of the program."

Tolan: Jim Harman, manager of corporate advertising for GE, says the company doesn't get involved in public radio to influence programming. GE wants access to the audience.

Harman: "The most important part of our partnership with Marketplace has really our ability to have a consistent message out there five days a week to a very affluent and influential audience."

Tolan: Contributions from GE and other corporate donors to public radio often no longer come from the charitable wing of the company. More and more, they come from advertising, marketing and PR budgets. Like GE, many corporations are interested in reaching you both with product information, and with a corporate image.

NPR credit: "Support for National Public Radio comes from Archer Daniels Midland Company, bringing Novasoy brand isoflavones to consumers throughout the United States..."

Dinges: "The ADM case is very interesting because it became a kind of test case."

Tolan: Former NPR managing editor John Dinges.

Dinges: "It was one of NPR's first corporate sponsors that were absolutely not non-profit, one of the best examples of a company that wanted their name on NPR because they were seeking to enhance their image, and they used it as part of their creation of the image on ADM."

Tolan: But Dinges points out that despite taking ADM's money, NPR has done plenty of stories on its legal problems.

Clip from All Things Considered: "Archer Daniels Midland, the food processing giant and self-proclaimed 'supermarket to the world,' has garnered enough lawsuits against it to fill a small shopping cart..."

Tolan: NPR senior management won't say how much the network receives from ADM. They say that's confidential. But they acknowledge that ADM's contributions helped make possible the expansion of all things considered to two hours. Marketplace, by the way, also receives some ADM money, and has covered the company's legal problems as well.

Tolan: Yet by far the most frequent presence of ADM on NPR is through its slogan, which some critics say helps clean up the image of a troubled corporation. This is Steven Moore of the libertarian CATO Institute.

Moore: "If you want to have a real squeaky-clean image, one way to do that is go to public broadcasting and underwrite these shows that many people think are pure and uplifting to American values and so on, and I that some of these companies that have had real problems, like ADM, that this is a good way of building up their good will."

Dvorkin: "It bothers me that there might be a confusion about the role of ADM."

Tolan: NPR vice president for news, Jeffrey Dvorkin.

Dvorkin: "But, first of all, the underwriting credits are set two weeks in advance, so there's no way they can have an impact on the news. we don't go to adm and say, gee, you're in the news tonight, do you want us to withdraw your funding credit."

Tolan: Commercial television, by contrast, often will pull an ad, say for an airline, in the wake of a big plane crash. But many public radio journalists say it's not corporations that have the biggest potential to erode the firewall. It's foundations with social and political agendas, says Jeffrey Dvorkin, who target their money for specific purposes.

Dvorkin: "I do worry that the agendas of various foundations tends to skew our coverage in a way that may in the long run have a negative effect on our coverage. and I think we just have to be aware of it, but also be on our guard that we're not allowing one organization or another to define the journalistic agenda for the American people through NPR."

Tolan: One way NPR, PRI and independent producers like me try to prevent that is to have the editorial vision first, then seek the funds. But it's not a perfect system. What happens, for example, when you've raised a lot of money for a big series, and suddenly the bottom drops out of the story? John Dinges recalls the grants NPR received to cover the health insurance debate in the first year of the Clinton administration.

Dinges: "Well, as we all know, the health care debate ended in August, and never reached the floor, and the legislation dropped like a stone and the debate was over. But NPR still had all this money to spend on health care debates. And so there continued to be an enormous stream of pieces."

Tolan: Others at NPR say health care remained an issue for all Americans, and that they're proud of the coverage. Then there are funding sources which don't necessarily dictate coverage, but which might seem like a conflict of interest to listeners.

Tolan: Public Radio International, the other distributor of programming, including Marketplace, accepts money indirectly from the Japanese government, through two foundations. PRI then gives the money to marketplace, which provides for the program's Japan desk. PRI president Steve Salyer says there are no editorial strings attached, and no contact between the foundation and Marketplace staff.

Salyer: "We felt we put in place appropriate safeguards and the nature of this money was independent from direct influence of the Japanese government and I stand by that. I think we made the right decision. If I had felt there was any even remote possibility of editorial influence we would have turned the money down."

Tolan: A few years ago, NPR did turn down that very same money, saying it violated the network's rules about funding from sources with such direct interests.

Tolan: But last year, NPR News took funds from the World Bank to broadcast a series of reports of central concern to the World Bank. The series, about water and development, included interviews with world bank officials. And that raised many eyebrows within the network.

Dvorkin: "It made a lot of us nervous here."

Tolan: NPR News chief Jeffrey Dvorkin says the world bank did not exercise any direct editorial influence over the content of the stories. He says he's proud of the journalism in the series. The stories recently won a prestigious Overseas Press Club award. Still, Dvorkin says, the funding source and the story content were too close for comfort.

Dvorkin: "If we were to do it again I think we'd have to think longer and harder about it. it was a project that was clearly about some of the issues that the world bank was doing, and I think it blurred the line."

Tolan: Maintaining the firewall between news and fundraising requires vigilance. As the corporate and foundation money grows, public radio journalists all have to resist the most powerful form of censorship: self-censorship.

McChesney: "Basically you internalize the values, that some things are good programming, some things aren't."

Tolan: Media scholar Robert McChesney is author of the forthcoming "Rich Media, Poor Democracy." McChesney: "If you're going out to corporations to try and get them to bankroll an increasing portion of your activity, you don't want to go out and show them a product that is something that they aren't going to stand for. That basically violates their values and principles. They aren't going to write a check for that."

Dvorkin: "I don't think any reporter or editor goes out on a story or sits down to write an intro and has this looming vision of a corporation behind him or her trying to straighten the editorial line.

Tolan: NPR vice president for news, Jeffrey Dvorkin.

Dvorkin: "It doesn't happen like that. People, I think, here feel very independent and very protected from those kind of influences."

Tolan: In the end all of us in public radio struggle with a basic truth: you can cover what you can raise money to cover. That doesn't mean the coverage has to be narrow. Most funding is not targeted for specific issues. But the fact is it's easier to raise money for some things -- science, the environment, business, policy issues -- and a lot harder to raise money for an investigative reporting unit, for example. There is really no public radio equivalent to sixty minutes or public television's front line.

Tolan: But ultimately the question is broader: how does the money influence where we point our microphones? This is Jay Allison, award-winning independent producer and maker of hundreds of documentaries and features for public radio.

Allison: "The problem is that in order to raise a lot of money you have to appeal to a lot of people. You have to show corporations or foundations or even government endowments that you have a lot of listeners. So you need a mass audience and you need mass appeal. Unfortunately some of the voices that we want to hear from need to hear from may not be appealing."

Tolan: Many of us within public broadcasting yearn for a day when we can just concentrate on holding the microphone in one hand, without having the other hand out for money. Mark Crispin Miller, media studies professor at New York University, says without full public funding for non-commercial broadcasting, compromise is inevitable, no matter how high the firewalls.

Miller: "They cannot really protect us against fires unless and until public broadcasting is genuinely independent. And very comfortably funded. When it stands alone, when it becomes truly unassailable and does not need handouts from GE or Archer Daniels Midland or from a truculent Congress year after year."

Tolan: Miller and other advocates of public broadcasting reform say there are other alternatives: one would require commercial broadcasters to subsidize a genuinely independent public system, through fees paid for their access to the public airwaves. Another would sharply increase federal funds. Right now annual federal funding for public broadcasting in the U.S. amounts to $1.18 per American -- compared to $31 in Canada and $38 in Japan. But John Dinges says under the current arrangement, relying too heavily on government funding, even when it is supposed to be protected from political influence, can have a chilling effect.

Dinges: "It's absolutely insidious. It's what has infected every national broadcast system in the world that I know of. They are all affected by the political give-and-take in the source of their government funding."

Tolan: Some national broadcasters do better than others in protecting their systems from political influence. But even the BBC has had repeated battles over the years with the British government. And Jeff Dvorkin, who for years worked in a government-funded system for the Canadian Broadcasting Corporation, says he thinks the U.S. system of multiple funding sources works.

Dvorkin: "What's the alternative? We've created a very viable broadcasting system in the united states. Is it perfect? Is it an entire work of art that is not sullied by other considerations? No, but I don't know of any place that is."

Tolan: There are nearly twice the listeners as there were to public radio just ten years ago. Research shows that listeners come out of hunger for credible news and information. Bigger numbers can mean better coverage of social issues and politics and international stories. Yet some in public radio believe the numbers game makes us play it too safe -- not as much investigation, fewer controversial voices of all stripes, more straight reporting of simply what happened in Washington or on Wall Street -- overall, less willingness to take chances.

Tolan: But also, many would say, more reliable and journalistically sound. It's like we've reached middle age. And it seems, most of us have. And so has our audience. We're playing to you, and to ourselves. Your demographic, your values and lifestyles, overlap a lot with ours. In public radio, we reach only a slice of the public -- highly educated people, boomers mostly, with disposable income, far from the broad swath of America people dreamed about at the beginning. Rather, it's a bit like in an echo chamber. Inside the chamber, perhaps we need to ask, are we challenging you enough? Are we challenging ourselves?

Tolan: I'm Sandy Tolan for Marketplace.