The Global Media

by David Peterson

An interview with Edward S. Herman & Robert W. McChesney, June 1997

Edward S. Herman and Robert W. McChesney are two of the most important critics of the global media scene. A Professor Emeritus of Finance at the Wharton School of the University of Pennsylvania, and a contributor to Z Magazine since its founding in 1988, Edward Herman is the author of numerous books, including a number of corporate and media studies. These include Corporate Control, Corporate Power (1981), the two volume Political Economy of Human Rights (1979) and Manufacturing Consent: The Political Economy of the Mass Media (1988), both of which he co-authored with Noam Chomsky, as well as The "Terrorism" Industry: The Experts and Institutions That Shape Our View of Terror (1989), which he co-authored with Gerry O'Sullivan. Robert McChesney is an Associate Professor of Journalism and Mass Communication at the University of Wisconsin, Madison. McChesney is the author of Telecommunications, Mass Media and Democracy: The Battle for the Control of U.S. Broadcasting, 1928-1935 (1993), and more recently Corporate Media and the Threat to Democracy (1997). Last summer, Cassell published their recent collaboration, a study called The Global Media: The New Missionaries of Corporate Capitalism.

PETERSON: You argue in The Global Media that before we'll ever be able to understand what's new about the "global media," we'll need to understand the "institutions of global capitalism." Well, what are the major institutions?

HERMAN: The major institutions of global capitalism are the transnational corporations (TNCs), the international organizations formed to serve global capital or adapted to that service over time, and the national governments that also work in the interest of global capital. The most important of the international organizations are the International Monetary Fund (IMF), World Bank, and World Trade Organization (WTO), although there are many others. As global capital has strengthened, more and more institutions are bent to serve its interests, and an organization like the WTO, formed under the GATT agreement in the late stages of this evolution, is explicitly designed to serve the needs of global capital.

Global capital wants international trade and investment rights to prevail over the desires of local populations. It also wants to minimize welfare state expenditures, business tax burdens, threats of inflation, union organization, and environmental constraints; and the IMF, World Bank, and WTO strive to carry out these aims. These organizations have a common set of goals, reflecting the power of TNCs, transmitted to them by the national governments serving the same interests.

Both in terms of the depth of the changes that have taken place, and their rapidity, the past two decades have seen major transformations in the nature of corporate capitalism. But which changes have been the most important?

EH: The most important changes over the past several decades have been corporate capitalism's increasingly global perspective and reach, its increasing intolerance of welfare state commitments and labor organization and the social contract, and its willingness to attack these in various modes of intensified class warfare. But the list continues. An increase in the centralization of economic power, both within states and globally, at the same time has been matched by an increasing competition between the media giants, and by their willingness to attack rivals by crossing product lines, vertically integrating, and invading one another's territories.

And whether national or transnational, corporate capital has a certain ideology, a veil that surrounds it that helps it to justify its consequences to its victims.

EH: That's right. The main element in corporate ideology is the belief in the sublimity of the market and its unique capacity to serve as the efficient allocator of resources. So important is the market in this ideology that "freedom" has come to mean the absence of constraints on market participants, with political and social democracy pushed into the background as supposed derivatives of market freedom. This may help explain the tolerance by market-freedom lovers of market-friendly totalitarians-Pinochet or Marcos.

A second and closely related constituent of corporate ideology is the danger of government intervention and regulation, which allegedly tends to proliferate, imposes unreasonable burdens on business, and therefore hampers growth. A third element in the ideology is that growth is the proper national objective, as opposed to equity, participation, social justice, or cultural advance and integrity. Growth should be sustainable, which means that the inflation threat should be a high priority and unemployment kept at the level to assure the inflation threat is kept at bay. The resultant increasingly unequal income distribution is also an acceptable price to pay.

Privatization is also viewed as highly desirable in corporate ideology, following naturally from the first two elements-market sublimity and the threat of government. It also tends to weaken government by depriving it of its direct control over assets, and therefore has the further merit of reducing the ability of government to serve the general population through democratic processes. It is of course a coincidence that privatization yields enormous payoffs to the bankers and purchasers participating in the sale of public assets.

The Global Media characterizes the United States as "the country in which market domination of the media has been most extensive and complete." Tell me what, exactly, it means for the "market" to "dominate" the media?

McCHESNEY: It means that capitalists control the media and they do so to maximize profits, often through selling advertising to other large corporations. In most other nations there has been a long tradition of having a large segment of the media-especially broadcasting-removed from commercial control and operated by some sort of nonprofit, noncommercial agency. But it was not exclusively broadcasting. In Scandinavia there has been the practice of subsidizing newspapers and magazines to keep alive diverse points of view. Left to the market, the media system tends to produce a narrow range of viewpoints that comports to those of the upper class, and commercial pressures also downplay public affairs and journalism.

In the current era of neoliberalism all of these subsidies for diverse print media and for nonprofit broadcasting are under attack. Around the world the trend is toward predominately commercial systems. In Germany and Sweden, for example, the public broadcasters have seen their audience shares cut in half in the l990s, as they face new competition from the proliferation of commercial channels on cable and satellite systems. The British Broadcasting Corporation, arguably the most successful public broadcaster in the world, has effectively become a full blown commercial enterprise in its global operations. It is a partner with the U.S. cable company TCI and some of TCI's subsidiaries. The BBC recognizes that it will eventually see its public subsidy cut so it hopes that by becoming profitable outside of Britain it can continue to be a noncommercial venture in the UK. The jury is out on that strategy, but on the surface it seems like the logic of commercialism should soon permeate every aspect of the BBC's being.

Your book also characterizes the U.S. media model as an "outlier"-one that goes beyond any other country's in institutionalizing private ownership of the means of communications in profit-seeking corporations whose major source of revenue, and therefore survival, derives from the advertising dollars of other corporations. How did the U.S. model come about?

RM: Well, the one thing we know for sure is that the current U.S. system is a 20th century development. But it is nothing like the media system we had during the first few generations of the republic. The press system of the early republic was highly partisan and not especially profitable. Many of the major newspapers were subsidized by political parties or by the government through printing contracts. The current system evolved gradually as a commercial entity. By the early part of this century it had become dominated by large firms operating in oligopolistic markets, and advertising had emerged as an important source of revenues. This all followed the logic of capitalism: firms get bigger and eliminate competition to enhance their profitability and reduce risk.

In the past generation the two crucial developments for U. S. media firms is that they have conglomerated and globalized. By conglomeration I mean that the largest media firms all have major holdings in several different media sectors, like film and TV show production, cable TV channels, music production, book publishing, magazine publishing, retail stores, etc. Firms found they had to be conglomerates or they could not compete with their rivals. Globalization refers to the fact that the media industry may be at the forefront of the process of globalization. Firms like Disney and Time Warner did just over 10 percent of their business abroad in 1990 and will do around one-third of their business abroad in 1997. Sometime in the next decade they expect to do a majority of their business outside of the United States.

It is worth noting that the American people did not accept the development of the corporate media system without opposition. There were significant pro tests. Partially as a result of this came the professionalization of journalism, that is, the notion that the news would be provided by trained objective professionals who could not be influenced by media owners or advertisers. In addition, in the 1930s there was a fairly widespread movement to establish a nonprofit and noncommercial radio broadcasting system. It collapsed following the passage of the 1934 Communications Act, which was pushed through with minimal publicity by the powerful radio lobby.

Hand-in-hand with the U. 5. media model goes an ideology that states that thanks to First Amendment guarantees of 'freedom of speech or of the press," neither the government nor the public have any more than a very weak, if any, right to interfere with the free speech of the corporations that own the media. Has this belief always been as widely held as it seems to be today?

RM: No. Not at all. This is a recent development, one that has much more to do with the power of corporations than it does with the First Amendment or democratic theory. In the early 1940s, when the U.S. Supreme Court first considered whether advertising should be exempt from any government regulation on the grounds that advertising was protected by the First Amendment, the Court voted 9-0 that advertising was not covered by the First Amendment. This was a court that had several right-wingers who detested the New Deal and government regulation. It was seen as absurd that selling something for a profit should be equated with political speech and democracy.

Over the past 50 years the matter has shifted and now the Supreme Court has extended the First Amendment to cover advertising in significant ways. This reflects the power of corporations in our society .

The irony of course is that advocates of this "extension" of the First Amendment argue that the more that is protected from the government. the more freedom there will be and the more likely democracy will prosper. But these proponents have an idiotic, untenable, and myopic view of where power lies in our society. Extending the First Amendment to advertising removes it, as well as corporate power, as legitimate political topics and shrinks the range of political debate to an ever-narrower scope.

The ACLU is the most egregious in this regard. It might as well set up its headquarters on Wall Street because its silly view that there is no reason for public concern about private control over media plays directly into the hands of the largest media firms. In the 1930s Morris Ernst, Roger Baldwin, and Norman Thomas pushed the ACLU in a far more enlightened direction. They argued that corporate commercial control over broadcasting significantly prevented the coverage of public affairs and discriminated against pro-labor and anti-business perspectives. They argued that establishing a viable democratic nonprofit, noncommercial broadcasting system was a First Amendment issue for the ACLU. The ACLU even had a radio committee that lobbied Congress to take control of broadcasting away from capitalists and advertisers. But when the movement failed, the ACLU gradually moved toward its present position of accepting the corporate system as the appropriate model for democracy. But the ACLU did not adopt this modern position because of principled debate; rather, it was adopted due to the admitted inability to defeat the corporate media giants on Capitol Hill. But I doubt anyone at the ACLU today knows this history. To them it seems that protecting corporate power to make money and dominate society is the purpose of the First Amendment and the cornerstone of a democratic society.

Your book calls the U.S. Telecommunication Act of 1996 the "single most important law" affecting not only U.S. telecommunications, but global telecommunications as well. How so?

RM: The 1996 U.S. Telecommunications Act specifically is a global law because, by providing for the deregulation of U.S. markets, it permits the dominant firms to get considerably larger through mergers and acquisitions. And the dominant U.S. firms provide a majority of the dominant global firms. So other countries are now facing a larger and more powerful set of firms, like the merged Nynex-Bell Atlantic, and the proposed merger of AT&T and SBC Communications. All of the media firms have gotten bigger in the past year too.

It is worth noting that the 1996 Telecom Act was rushed through Congress with almost no debate. There was virtually no press coverage outside of the business press and almost no public participation. The only debate concerned which sector-long distance telephone, local telephone, computer firms, broadcasters, or cable companies-would get the best deals in the legislation. That a handful of corporations were being granted the right to rule the entire range of our communication system to maximize profit with almost no strings attached was simply not subject to debate. That's because all the interested parties agreed on that as a given and the public was not invited to the debate.

This was an incredibly corrupt law. The Internet was never discussed at all, but this is the law that provides for the commercial development of cyberspace. The broadcasters, for example, snuck a clause into the law requiring the FCC to give them free spectrum for digital broadcasting. This was outrageous. Even the other communication firms have to pay for the use of their spectrum for the most part. It is incumbent on us to get another telecom bill passed, one that reflects the public interest.

Another major theme of your book is that, much as the rest of the world is moving towards or being pushed towards a socio-economic model similar to that in the United States, so, too, the rest of the world's media are being pushed towards a model similar to that found in the United States.

EH: Yes, and the two processes are closely linked. The socio-economic model is one of market hegemony, minimal state provision, the supplanting of the citizen by the consumer, and a commercial media providing the entertainment-cum-advertising culture appropriate to the socio-economic model. In much of the rest of the world public broadcasting has been important, so that one of the crucial global struggles in recent years has been over the status of public broadcasting. Public broadcasting has been under steady attack by the dominant forces of global capitalism and is being weakened and displaced by commercial, advertising-based media.

The spread of the U.S. media model to the rest of the world is weakening their public broadcasting systems in countries where these are important, and strengthening the commercial media and the domination of advertisers in shaping media performance and standards. What it means for the rest of the world is more light entertainment, sex and violence on TV, and a lightening up of other media forms, with a parallel weakening of the public sphere-hard news, investigative reporting and documentaries, debates on public and community issues, enlightening children's programs, and the like. The rest of the world can look forward to a growing culture of entertainment and perhaps, in Neil Postman's phrase, "amusing themselves to death."

The U.S. Trade Representative Charlene Barshefsky cheered last February's signing of the telecommunications agreement at the World Trade Organization as "one of the most important trade agreements of the 21st Century." Then she added: "U.S. companies are the most competitive telecommunications providers in the world. They are in the best position to compete and win under this agreement." Might Barshefsky's elation tell us something else about the nature of the agreement?

EH: Yes. The telecommunications agreement of last February is a coup for powerful global providers of telecom services. It is essentially a market opening agreement, with clear benefits to the big boys who can participate, less clear benefits to the consumers and societies in the countries opening their doors. There may be efficiency gains, but there may be reduced universality of service, greater unregulated monopoly power, and a loss of national autonomy.

In Latin America a similar process was crucial in bringing about the domination of commercial broadcasting and assuring that the European model of strong public broadcasting did not prevail. From the earliest years U.S. equipment manufacturers, advertisers, broadcasters, and publishers pushed the governments of the region toward commercial systems, so that public broadcasting was marginalized or never came into existence at all, preempted by a commercial system, as in Brazil.

The experience of Brazil was a telling one. In our book we characterize it as a case of "media neo- and sub-imperialism." As just noted, a commercial system was installed from the beginning, with U.S. help and under U.S. pressure. By the early 1960s, U.S. transnationals already had a major presence in the Brazilian economy, Brazil's media included. In the years prior to the 1964 coup, Brazil's media had been heavily penetrated by U.S. economic and political agents. The O Globo newspaper, Brazil's largest, was receiving infusions of cash from Time-Life, and may have been CIA-controlled. Time-Life justified its invasion of the Brazilian media by the need to combat what it referred to as "Castroism."

Following the 1964 coup, the Globo media empire was born and grew to virtual monopoly status. The junta supported Globo financially and in regulatory practice, and the media giant served the military and Brazilian elite well. During the dozen years following the coup, Brazil's commercial media system was consolidated and integrated into the global system. Ad based and concentrated, this system is a servant of the Brazilian elite and is destined to inculcate the individualist, consumerist ideology of the neoliberal order.

India provides an important contrasting ex ample. There, the British model was imported and a public broadcasting system was imposed and became a heritage of the colonial system after the British exit. Admittedly, its performance has not been inspiring, but it is regrettable to see it being commercialized rapidly without having realized the potential of a more autonomous public broadcasting system such as developed in the imperial country.

A little earlier, Ed Herman mentioned the "public sphere, " a concept that you use widely in your book, and that you draw from the German philosopher Jurgen Habermas. You write that by the "public sphere, " you mean "all the places and forums where issues of importance to a political community are discussed and debated, and where information is presented that is essential to citizen participation in community life. But your analysis is anything but sanguine about the fate of the public sphere in the United States.

EH: We are definitely not optimistic at this juncture. The U.S. model entails a displacement of the public sphere with entertainment. Advertisers don't like public sphere programs, which do not provide a good selling environment and do not draw as heavily as mayhem and sex. We have a 70-year record in this country of the gradual abandonment of "public service" programming under the pressure of market interest.

Contrary to the claims of the market beneficiaries of this transformation, it has not been catering to "what consumers want," because a very substantial minority want public service programs, and many others believe that such programs ought to be available. It's what proprietors and advertisers want. The corporate system prefers a culture of entertainment and light news mixed with serviceable propaganda to a public sphere that would address serious issues.

So, in your eyes, corporate control and manipulalion pose a serious anti-democratic threat?

EH: Yes. But the real problem isn't "manipulation." The real problem lies in the normal operations and effects that corporate media have on the public sphere, and with the structural changes now going on, which are putting in place profoundly undemocratic arrangements. The Enlightenment project is one of people moving into control of their lives, winning their emancipation through knowledge and action, whereas transnational media corporations want the conditions that have prevailed in the United States for decades to extend everywhere, with people treated strictly as audiences to be sold to advertisers. The contradiction between the project of the Enlightenment and the project of transnational media corporations is immense. The global media are carrying out what we might call an "entertainment revolution" which is implemented strictly from above. They are surely not agents of a democratic "information revolution. "

And therefore contrary to Nicholas Negroponte, Alvin Toffler, Newt Gingrich, and a host of other luminaries who praise the democratic miracles awaiting us on the Information Superhighway. The two of you would argue that, given the current political climate in the United States (not to mention the rest of the world), the "egalitarian potential" of the "media revolution" isn't likely to be realized.

RM: That' s correct. Although some technologies-like digital communication, say-have immense influence over societies, they do not have magical powers. Unless there is explicit social policy to develop cyberspace as a noncommercial, nonprofit entity, it is going to be taken over by the most powerful elements in our society. That is exactly what is happening. The largest computer, telecom, and media firms are doing everything in their considerable powers to see the Internet brought within their empires. A telling sign was Microsoft's purchase of WebTV and its billion dollar investment in Comcast, the cable TV company. Right now the smart money seems to be betting that the Internet can be used as a commercial entertainment medium like television, in addition to being a business tool and a place for commerce.

All that stuff from a few years ago about how the Internet was going to create some democratic Valhalla and eliminate the corporate communication giants might as well as have been written in the 15th century. That is just nonsense. The Internet is be coming a hierarchical commercial entity. Some people will have full service, others lower-grade service, and still others none at all. Yet, at the same time, the Internet is a remarkable and revolutionary tool for activists. It will continue to be just that. But we can not extrapolate from the activist experience to the society as a whole. Not unless we get policies to enforce that as a goal.

"The ultimate goal [of media activists]," The Global Media concludes, "must be the establishment of a global, nonprofit public sphere to replace, or at least complement, the global commercial media market." But that sounds far more utopian than practical. Doesn't it?

RM: To the contrary, I think that the most utopian notion is that the market system can ever provide the basis for a democratic society. Everywhere across the world democratic left parties and movements are battling neoliberal "free market" policies. In almost all cases these democratic forces have highlighted taking control of the media from corporations and advertisers as central to the project of building a democratic society. In Sweden, New Zealand, Australia, India, Brazil-the list goes on and on-there are viable left parties and movements that are talking about ways to build and develop nonprofit, noncommercial, and democratically accountable media systems. They are finding considerable popular support for these positions. In view of the global trend toward a commercial media system there is every reason to believe this will be an area of democratic political activity. Can they succeed? Who knows, but what other choice is there? When you see the scope of these activities, you become decidedly optimistic.

The United States is the laggard in media activism. So, based here in the most depoliticized society on earth-with the possible exception of Russia-it is easy to think social change is impossible. But even here there has been tremendous growth in media activism and political activism in the 1990s . Perhaps the period we are in now is like the civil rights movement in the early 1950s, when it appeared to be quiescent but in fact we now know it was laying the foundation for the great victories to follow. At any rate, I think the best has yet to come.

David Peterson is a freelance writer from the Chicago area, a regular contributor to Z, and a contributor to Chicago Ink.

Media Control and Propaganda