[House Hearing, 106 Congress]
[From the U.S. Government Publishing Office]



 
     CORPORATION FOR PUBLIC BROADCASTING AUTHORIZATION ACT OF 1999

=======================================================================

                                HEARINGS

                               before the

                  SUBCOMMITTEE ON TELECOMMUNICATIONS,
                     TRADE, AND CONSUMER PROTECTION

                                 of the

                         COMMITTEE ON COMMERCE
                        HOUSE OF REPRESENTATIVES

                       ONE HUNDRED SIXTH CONGRESS

                             FIRST SESSION

                                   on

                               H.R. 2384

                               __________

                       JUNE 30, and JULY 20, 1999

                               __________

                           Serial No. 106-56

                               __________

            Printed for the use of the Committee on Commerce

                    ------------------------------  





                      U.S. GOVERNMENT PRINTING OFFICE
58-506 CC                     WASHINGTON : 1999




                         COMMITTEE ON COMMERCE

                     TOM BLILEY, Virginia, Chairman

W.J. ``BILLY'' TAUZIN, Louisiana     JOHN D. DINGELL, Michigan
MICHAEL G. OXLEY, Ohio               HENRY A. WAXMAN, California
MICHAEL BILIRAKIS, Florida           EDWARD J. MARKEY, Massachusetts
JOE BARTON, Texas                    RALPH M. HALL, Texas
FRED UPTON, Michigan                 RICK BOUCHER, Virginia
CLIFF STEARNS, Florida               EDOLPHUS TOWNS, New York
PAUL E. GILLMOR, Ohio                FRANK PALLONE, Jr., New Jersey
  Vice Chairman                      SHERROD BROWN, Ohio
JAMES C. GREENWOOD, Pennsylvania     BART GORDON, Tennessee
CHRISTOPHER COX, California          PETER DEUTSCH, Florida
NATHAN DEAL, Georgia                 BOBBY L. RUSH, Illinois
STEVE LARGENT, Oklahoma              ANNA G. ESHOO, California
RICHARD BURR, North Carolina         RON KLINK, Pennsylvania
BRIAN P. BILBRAY, California         BART STUPAK, Michigan
ED WHITFIELD, Kentucky               ELIOT L. ENGEL, New York
GREG GANSKE, Iowa                    THOMAS C. SAWYER, Ohio
CHARLIE NORWOOD, Georgia             ALBERT R. WYNN, Maryland
TOM A. COBURN, Oklahoma              GENE GREEN, Texas
RICK LAZIO, New York                 KAREN McCARTHY, Missouri
BARBARA CUBIN, Wyoming               TED STRICKLAND, Ohio
JAMES E. ROGAN, California           DIANA DeGETTE, Colorado
JOHN SHIMKUS, Illinois               THOMAS M. BARRETT, Wisconsin
HEATHER WILSON, New Mexico           BILL LUTHER, Minnesota
JOHN B. SHADEGG, Arizona             LOIS CAPPS, California
CHARLES W. ``CHIP'' PICKERING, 
Mississippi
VITO FOSSELLA, New York
ROY BLUNT, Missouri
ED BRYANT, Tennessee
ROBERT L. EHRLICH, Jr., Maryland

                   James E. Derderian, Chief of Staff

                   James D. Barnette, General Counsel

      Reid P.F. Stuntz, Minority Staff Director and Chief Counsel

                                 ______

   Subcommittee on Telecommunications, Trade, and Consumer Protection

               W.J. ``BILLY'' TAUZIN, Louisiana, Chairman

MICHAEL G. OXLEY, Ohio,              EDWARD J. MARKEY, Massachusetts
  Vice Chairman                      RICK BOUCHER, Virginia
CLIFF STEARNS, Florida               BART GORDON, Tennessee
PAUL E. GILLMOR, Ohio                BOBBY L. RUSH, Illinois
CHRISTOPHER COX, California          ANNA G. ESHOO, California
NATHAN DEAL, Georgia                 ELIOT L. ENGEL, New York
STEVE LARGENT, Oklahoma              ALBERT R. WYNN, Maryland
BARBARA CUBIN, Wyoming               BILL LUTHER, Minnesota
JAMES E. ROGAN, California           RON KLINK, Pennsylvania
JOHN SHIMKUS, Illinois               THOMAS C. SAWYER, Ohio
HEATHER WILSON, New Mexico           GENE GREEN, Texas
CHARLES W. ``CHIP'' PICKERING,       KAREN McCARTHY, Missouri
Mississippi                          JOHN D. DINGELL, Michigan,
VITO FOSSELLA, New York                (Ex Officio)
ROY BLUNT, Missouri
ROBERT L. EHRLICH, Jr., Maryland
TOM BLILEY, Virginia,
  (Ex Officio)

                                  (ii)


                            C O N T E N T S

                               __________
                                                                   Page

Hearings held:
    June 30, 1999................................................     1
    July 20, 1999................................................    63
Testimony of:
    Brugger, David J., President and CEO, America's Public 
      Television Stations........................................    26
    Burns, Ken, President, Florentine Films......................   110
    Burton, LeVar, Public Broadcasting Service...................    19
    Chester, Jeffrey A., Executive Director, Center for Media 
      Education..................................................    35
    Coonrod, Robert T., President and CEO, Corporation for Public 
      Broadcasting:
        June 30, 1999............................................    10
        July 20, 1999............................................    85
    Courtney, Beth, President and CEO, Louisiana Network.........    32
    Duggan, Ervin S., President and CEO, Public Broadcasting 
      Service:
        June 30, 1999............................................    13
        July 20, 1999............................................    89
    Graham, Timothy, Director of Media Analysis, Media Research 
      Center.....................................................   128
    Jordan, Amy B., Senior Research Investigator, Annenberg 
      Public Policy Center, University of Pennsylvania...........   122
    Klose, Kevin, President and CEO, National Public Radio:
        June 30, 1999............................................    21
        July 20, 1999............................................    91
    Lassman, Kent, Deputy Director, Technology and 
      Communications, Citizens for a Sound Economy Foundation....   115
    Liroff, David, Vice President and CTO, WGBH Educational 
      Foundation.................................................    34
Additional material submitted for the record:
    Corporation for Public Broadcasting, report dated Septenber 
      19, 1999...................................................   148

                                 (iii)

  


     CORPORATION FOR PUBLIC BROADCASTING AUTHORIZATION ACT OF 1999

                              ----------                              


                        WEDNESDAY, JUNE 30, 1999

              House of Representatives,    
                         Committee on Commerce,    
             Subcommittee on Telecommunications, Trade,    
                                   and Consumer Protection,
                                                    Washington, DC.
    The subcommittee met, pursuant to notice, at 10:10 a.m. in 
room 2123, Rayburn House Office Building, Hon. W.J. ``Billy'' 
Tauzin (chairman) presiding.
    Members present: Representatives Tauzin, Stearns, Cox, 
Rogan, Shimkus, Wilson, Fossella, Ehrlich, Bliley (ex officio), 
Markey, Eshoo, Engel, Wynn, Luther, Sawyer, Green, McCarthy, 
and Dingell (ex officio).
    Staff present: Linda Bloss-Baum, majority counsel; Andy 
Levin, minority counsel; and Cliff Riccio, legislative clerk.
    Mr. Tauzin. The committee will please come to order.
    Good morning. Let me begin by thanking in advance our very 
distinguished panel. As you can see, we assemble large panels, 
and our policy has always been that one big, large panel is 
preferable to two, because generally when we have two it's me 
and the panel, everybody else goes away. So this way we share 
some experience together.
    We are honored to have such an esteemed group to testify 
today, actor-producer-director LeVar Burton, representing the 
Public Broadcasting Service. From my home State, my special 
welcome to Beth Courtney, a frequent visitor with us and a dear 
friend. She's President and CEO of Louisiana Network, on behalf 
of America's Public Television Stations.
    We are pleased that all of you have taken the time to be 
with us to help educate us this morning on the important issues 
that affect virtually every American household, the 
authorization of public broadcasting. While you American public 
broadcasters are before the subcommittee this morning to 
educate us about your business, public broadcast stations are 
on airways across America, educating Americans on topics 
concerning everything from the alphabet to zoology. Since 
Congress passed the first Public Broadcasting Act in 1967, as 
an amendment to the Communications Act, Americans have enjoyed 
hundreds of thousands of commercial-free cultural programs from 
public affairs to the performing arts.
    I have long been a supporter of the work you do to provide 
quality, clean, alternative programming that American families 
have come to rely upon every day. I want to assure you that you 
have the ability to continue to provide this tremendous public 
service in the next millennium.
    For this reason, I have introduced the Corporation for 
Public Broadcasting Authorization Act of 1999. The last time we 
enacted legislation authorizing the CPB, over which this 
committee has jurisdiction, was in 1992. The authorization 
expired, of course, in the fiscal year 1996. We have additional 
reasons to focus on this important authorization bill this 
year. The FCC's timetable for broadcast conversation to digital 
format provides that public television stations must transmit 
digital signals by the year 2003. Public broadcasters, simply 
put, need help raising the funds for this costly and 
complicated transition to digital television.
    Last year, Congress appropriated the Corporation for Public 
Broadcasting $15 million, conditioned on Congress passing an 
authorization bill by the end of this fiscal year. It is my 
intent that we do just that.
    And don't get me wrong, although I wholeheartedly support 
the funding for public broadcasting, I also support efforts to 
cut unnecessary programs out of our Federal budget. Clearly, 
this is a beginning of a process to make sure that public 
broadcasters receive critical resources so they can comply with 
the important schedule of digital roll-out and make their 
quality programs available to even more Americans, in fact, 
every day.
    In addition to authorizing the CPB, my bill also funds 
public television facilities program. The PTFP is the only 
Federal capital improvement program for public broadcasting. In 
this day and age of questionable content on hundreds of 
commercial stations, it is more important than ever to assure 
that public broadcasters are able to continue to offer quality 
programming to the maximum number of listeners and viewers 
across the country. Enabling stations to do so with resources 
to keep up with digital technologies will be essential to serve 
the public interest.
    Let me also say the bill before you today is a start of a 
legislative process. As many of you know, I have long explored 
a number of difficult and complicated reform proposals over the 
last few years. And while reform is very highly important to 
me, I think a slimmed down reauthorization is the best 
mechanism to move forward in the near term.
    But I want to assure you that some of the ideas we put out 
for more and more secure public funding of public broadcasting, 
so that public broadcasting can be truly public broadcasting 
and less commercial, less commercialized, less commercially 
supportable type programming, programming that ought to be on 
commercial stations, is a chief goal of mine. As we make this 
transition to digital, there are going to be opportunities for 
us to follow through on those reforms.
    Public broadcasting ought to have some kind of permanent 
trust funding so that public broadcasters have to depend less 
upon commercials and commercial support and commercial 
activities and commercially supportable programming, so that it 
can focus on its public mission. To that end, I will continue 
to put out ideas and to lay them before you and get your 
comments. Mr. Markey has been a tremendous help and advisor and 
counselor and assistant and friend in developing these ideas 
and promoting them. I want to thank him for his work. I also 
want to thank him and Mr. Dingell for joining me today and 
introducing the bill and for working with me, as I said, on 
these initiatives.
    I want to also thank the New York delegation, led by Mr. 
Elliott Engel, for the strong letter of support for public 
broadcasting. I look forward, again, to the testimony of our 
very distinguished witnesses today, and yield now to my friend 
from Massachusetts, Mr. Markey, for an opening statement.
    Mr. Markey. Thank you, Chairman Tauzin. I think we're going 
to have a great hearing today.
    I believe that this legislation underscores the bipartisan 
support that public broadcasting enjoys throughout America. In 
short, the legislation authorizes funding for the Corporation 
for Public Broadcasting at a level not to exceed $475 million 
for fiscal year 2002. In addition, the bill also authorizes the 
funding to assist in converting public broadcasting stations to 
digital technologies at $100 million for each of the fiscal 
years from the year 2000 through 2003.
    This additional money for digital conversion is vitally 
important, as the Federal Communications Commission has set a 
deadline of 2003 for public broadcasting stations to go 
digital. It's my hope that we can begin to provide additional 
money for digital technology as soon as possible, because the 
public stations are under a deadline to go digital and must do 
so without the financial resources available to them that are 
available to commercial stations.
    The legislation also reauthorizes the Public 
Telecommunications Facilities Program Grant program in the 
Department of Commerce, an important program that assists in 
the planning and the construction of public telecommunications 
facilities. I believe that the legislation reinforces the firm 
commitment in Congress to providing an electronic oasis for 
learning and information in what has been called the vast 
wasteland of commercial television.
    Frankly, if public television and radio did not exist 
today, we would probably be up here calling for its creation. 
Free, over the air, non-commercial television and radio are 
indispensable media outlets in our communities today for 
millions of Americans, and especially millions of children and 
their parents. We must remember that telecommunications 
technology can only empower those who can obtain it, or those 
who can afford to get it.
    Not every American family can afford cable. At a cost of 
just $1 per year, per person, what parents and kids get from 
free, over the air public TV and public radio is an incredible 
bargain. To me, the question is not, can we afford it, but 
rather, can we afford to lose it. Safeguarding public 
broadcasting from budget cuts and ensuring that the system has 
the resources it needs to remain vibrant and creative are 
vitally important. I am committed to fighting in the Congress 
to secure such funding.
    Ensuring that the system itself raises its portion of the 
funding, however, in a manner that remains true to the 
fundamental non-commercial nature of the medium is also vitally 
important. I continue to have concerns about what I refer to as 
the creeping commercialism that we have seen from some public 
broadcasting entities in recent years. Corporate underwriting 
was never meant to become advertising. It was meant to be an 
acknowledgment to the viewer or listener of sources of funding.
    Public broadcasting is a national treasure. But we must 
treasure its non-commercial nature. I look forward to hearing 
from our witnesses today as to how we can maintain public TV 
and public radio as a crown jewel of our broadcasting medium.
    Again, Chairman Tauzin, I want to thank you for holding 
this very important hearing, and I'm looking forward to working 
with you. I yield back the balance.
    Mr. Tauzin. I thank my friend. The Chair is now pleased to 
recognize Mrs. Wilson for an opening statement.
    Mrs. Wilson. I would just ask unanimous consent that my 
statement be put in the record.
    Mr. Tauzin. I thank the gentlelady. In fact, the Chair will 
make the unanimous consent request that all members' written 
statements be made a part of the record and that all the 
witnesses' written statements be made a part of the record. 
Without objection, it is so ordered.
    The Chair will recognize Mr. Ehrlich for an opening 
statement.
    Mr. Ehrlich. In view of the Chair's ruling, I will forego 
an opening statement.
    Mr. Tauzin. Thank you, Mr. Ehrlich.
    Mr. Cox?
    Mr. Cox. I have no opening statement.
    Mr. Tauzin. Thank you, Mr. Cox.
    Mr. Dingell is here, the ranking member of the full 
committee and my dear friend from Michigan.
    Mr. Dingell. Mr. Chairman, good morning.
    Mr. Tauzin. Good morning, sir.
    Mr. Dingell. First of all, thank you for recognizing me. 
Second, I'd like to commend you for introducing legislation to 
reauthorize the Corporation for Public Broadcasting. It's a 
fine bill and one that I am proud to co-sponsor with you and 
Mr. Markey and many others on this committee.
    There is great importance to providing adequate funding to 
public broadcasting, and I am delighted we have just begun this 
effort with a bipartisan consensus to do just that. Today, 
Americans are yearning for alternatives which many see as decay 
in the recent quality of programming on radio and television. 
Recently, the House considered legislation that sought to 
impose Government constraints on the content of programming 
transmitted through the electronic media.
    While I certainly cannot defend the intrinsic value of such 
programs containing graphic depictions of violence, sexual 
innuendo and the like, I do believe strongly in the right of 
broadcasters to make and distribute programs of this type, so 
long as they do so within the bounds of the First Amendment.
    Mr. Chairman, in my view, the solution to this problem lies 
not in the censoring of programs we do not like, but rather in 
actively encouraging the development of programs that we do. 
That is precisely why we are here today and precisely what we 
do today, to pledge our support for public broadcasting, a 
service which is devoted its entire history and mission to the 
creation of quality program that inspires, instructs and 
entertains children and adults alike.
    This week, the Annenberg Public Policy Center released its 
annual findings on the state of children's television. I'm sure 
I would find there is no surprise amongst us that the trends 
were found to be discouraging, despite recent commitments by 
commercial broadcasters to increase the amount of children's 
educational programming on television. As well-meaning as those 
commitments may have been, the results bear out the practical 
reality that neither the Congress nor the FCC can mandate a 
wholesale shift in the traditional mind set and mission of 
these inherently commercial programmers.
    By the same token, it came as no surprise that the 
Annenberg study found that non-commercial broadcasters provided 
the highest quality and most educational programming available 
on television. In fact, that study found literally no violence, 
no sex, no offensive language on any of the children's shows 
running on public television. This is a powerful argument for 
us to support public television and the funding which would 
come through this legislation. Indeed, I am unaware of anyone 
who would question the moral or the educational value of these 
programs for our children.
    Mr. Chairman, I thank you for sharing my views, and I thank 
my colleagues for sharing the views of a majority of Americans 
that public broadcasting is an essential service that pays huge 
dividends and that indeed are a strong and a valued investment 
that this Nation makes in itself, its children and its future. 
I commend you for leading this effort. I look forward to speedy 
passage of this bill. And I yield back whatever time remains.
    Mr. Tauzin. I thank my friend, and I think the panel is 
getting the correct impression that you will be preaching to 
the choir today.
    The Chair recognizes the gentlelady from Missouri, Ms. 
McCarthy.
    Ms. McCarthy. Thank you, Mr. Chairman. I want to thank you 
and Mr. Dingell for introducing this reauthorization of public 
broadcasting. I would like to join you as a co-sponsor in this 
great effort and pledge my continued support of public 
television.
    I must confess to all the panelists that that's probably 
the only reason I turn on my television, is because of you. You 
are offering to me and all viewers an unbiased and very 
thorough approach to the issues of the day, to the information 
that we need and of course for our children, for the education 
that they so desperately need in a very changing world.
    So I thank you for all that you do. You are a key resource 
to our democracy. And Mr. Chairman, while joining you as a co-
sponsor, I hope that when we mark up this wonderful bill that 
we could have a discussion about the need for caps at all. 
Because I sat in on a meeting at 8 o'clock this morning where 
we talked about trillions in surplus. This is such a valuable 
tool, I would hate to limit the resources for our future.
    So thank you very much, Mr. Chairman.
    [The prepared statement of Hon. Karen McCarthy follows:]
Prepared Statement of Hon. Karen McCarthy, a Representative in Congress 
                       from the State of Missouri
    Thank you, Mr. Chairman, for holding this hearing today to discuss 
the Corporation for Public Broadcasting Authorization Act of 1999. I 
look forward to hearing the testimony of our witnesses today and to 
ensuring that public broadcasting, including television and radio, are 
adequately funded.
    Public television provides many important services to our citizens, 
including children's programming, educational programming, and arts 
programming. It provides these programs, whether or not a resident 
subscribes to cable or satellite television. Many of our nation's youth 
get an extra boost in their early years learning to count or sing the 
``ABC'' song while watching public televisions shows. As they grow 
older, they might learn about ocean life, classic works of art, or 
literature through public television shows.
    Public broadcasting also offers unbiased, thoroughly balanced 
investigative reports on the top issues of the day, so that viewers can 
make informed decisions about complicated situations. It is a key 
resource of our democracy, allowing for an educated citizenry. I am 
served in my district by KCPT, KCUR, and KANU. These stations provide 
the Greater Kansas City Area with quality, informative programming. I 
applaud these stations for their broadcasting excellence.
    I have advocated for public broadcasting on a variety of levels. 
Recently, I wrote a letter to the Labor, HHS, Education, and Related 
Agencies Subcommittee requesting that the subcommittee's appropriations 
bill for FY 2000 include sufficient funding for both the Corporation 
for Public Broadcasting (CPB) and for the Digital Transition fund 
within CPB. I will remain active in both the appropriations aspect as 
well as the authorization aspect of public broadcasting.
    I am sure that my colleagues agree on the value of public 
broadcasting, and I look forward to reaching a consensus on the best 
way to continue the programming offered by public television. Thank 
you, I yield back the balance of my time.

    Mr. Tauzin. I thank the gentlelady.
    The gentleman from Ohio, Mr. Sawyer, is recognized.
    Mr. Sawyer. Thank you, Mr. Chairman. Thank you for calling 
this hearing and for introducing the bill. I'm pleased to join 
you as an original co-sponsor, on this initiative. I think 
we've come to appreciate during the last several years when we 
have seen the annual appropriations process being called into 
jeopardy and where we've lacked the multi-year reauthorizations 
that are inherently important for long term sound planning. 
We've come to appreciate what we really might lose if we were 
to lose the strength of public broadcasting.
    Public television and radio tie this country together in 
ways that virtually nothing else does. It spans an economic and 
demographic spectrum of this country like no other medium that 
we have. To lose that would be a crime that our successors 
would not forgive us for.
    I guess perhaps as much as anything, the way in which the 
dollars that we appropriate and authorize through this Congress 
become the leverage that public broadcasters can use in 
generating the real constituency, the contributing 
constituency, in public and private sectors and individual 
contributors all across this country that have made public 
broadcasting perhaps second only to libraries as the home of a 
literate Nation and one that contributes to that level of 
literacy. In that sense, just let me say thank you, and Mr. 
Chairman, I will submit my opening statement for the record.
    [The prepared statement of Hon. Thomas C. Sawyer follows:]
  Prepared Statement of Hon. Tom Sawyer, a Representative in Congress 
                         from the State of Ohio
    Thank you Mr. Chairman for holding this legislative hearing on the 
Corporation for Public Broadcasting Reauthorization Act. I would also 
like to thank our panelists for coming to testify on behalf of this 
legislation.
    Public television and radio tie this nation together. Without them, 
many people in poor and rural areas would be deprived of the 
educational and cultural programs that public television and radio 
provide.
    Current federal funding comprises only a small portion of the total 
budget for public broadcasting. The remainder of the funds come from a 
variety of sources including public-private donations, corporations, 
and state and local governments. However, without federal support many 
stations, especially in rural and poor areas, would be forced to cut 
back their services or completely shutdown their operations.
    Some have claimed that public broadcasting and its programs are the 
domain of the elite. The truth is that public broadcasting is for 
everyone. In fact, nearly one-half of the National Public Radio (NPR) 
listeners come from households with a combined income of $40,000 or 
less a year, and less than a third have college degrees. Public 
broadcasting brings the full range of entertainment, radio and arts to 
people everyday.
    Mr. Chairman, as you know it's been seven years since the 
Corporation for Public Broadcasting received a multi-year authorization 
and that expired in 1996. Since then the Corporation has had to rely on 
the yearly appropriations process to receive funding for its operation. 
Even though the CPB is forward funded by two years, it is extremely 
difficult to operate and plan effectively without a multi-year 
authorization.
    I am proud to be an original cosponsor of this legislation. It will 
provide valuable resources for broadcast stations to upgrade their 
facilities to make the required transition to digital programming. It 
will also allow those stations to leverage federal funds against other 
resources to provide the programming that the Corporation's 
constituency requests.
    Thank you again Mr. Chairman for introducing this important 
legislation. I look forward to hearing from our witnesses.

    Mr. Tauzin. I thank the gentleman.
    The gentlelady from California, Ms. Eshoo, is recognized.
    Ms. Eshoo. Thank you, Mr. Chairman, for your leadership on 
this. I'm proud to be a co-sponsor, and this is an important 
hearing today. It's wonderful to see everyone that has come in 
to testify.
    I'll submit my written statement, but just a few thoughts. 
I can't help but think what a difference, a few political 
seasons make. Just a handful of years ago, we had people 
practically hanging from the rafters, filling the hearing room 
because of what was being considered at that time. More than 
anything else, the American people weighed in. If public 
broadcasting and all that it represents were not one of the 
jewels in the crown of America, then we would not be having a 
calm hearing today. The history that's been written in between 
really would not exist.
    So I'm proud to co-sponsor this. I'm looking forward to 
hearing in the testimony how we help move you on time into a 
digital age, and hearing more of the good news. But I want you 
to know, for someone that is bicoastal, so to speak, and 
commutes every week to California, that WETA and NPR are great 
friends of mine at this end of the country, KQED and everything 
that they represent and do, I'm so proud of. And more than 
anything else, my constituents think so.
    So, bravo, and let us move on so that you have a 
continuation of adding more jewels to the crown. Thank you, Mr. 
Chairman.
    [The prepared statement of Hon. Anna G. Eshoo follows:]
Prepared Statement of Hon. Anna G. Eshoo, a Representative in Congress 
                      from the State of California
    Thank you Mr. Chairman and thank you for your leadership on the 
legislation we are hear to discuss. I'm pleased cosponsor this 
legislation, which authorizes funding for Public Broadcasting through 
the year 2006.
    As you know, Mr. Chairman, I place great importance on the service 
public broadcasting systems provide for the American people. From Big 
Bird to NPR--public broadcasting offers all Americans quality 
programming, and perhaps most importantly, quality programming for 
free.
    It is difficult to measure the return on the investment we make by 
authorizing these funds for the Corporation for Public Broadcasting.
    In fact, I think the return is immeasurable, especially when we 
consider:

 The great number of American children who learn from the 
        characters on Sesame Street, Barney, Arthur and the Teletubbies
 The great number of Americans who receive their news via NPR 
        or the Leher News Hour, and
 The great number of Americans able to receive cultural 
        programming via public broadcasting.
    And all of this programming is commercial free.
    A lot of work must still be done to ensure that public broadcasting 
systems will meet the digital upgrade deadlines. The legislation we 
discuss today takes a very big first step.
    Thank you again Mr. Chairman for your support of public 
broadcasting. I look forward to today's testimony and to seeing this 
bill approved by the full House.

    Mr. Tauzin. I thank the gentlelady. The gentleman from 
Texas, Mr. Green.
    Mr. Green. Thank you, Mr. Chairman. I too, like my 
colleague from Kansas, would like to join in co-sponsoring the 
bill. In my district in Houston, we're served very well by both 
KUHF radio and the public television station. Having been to a 
number of the telethons, fund raisers and every once in a while 
letting me introduce some of the music on KUHF radio to raise 
money. I don't think there is any doubt about the value of 
public radio and television.
    I'm just glad today to join in co-sponsoring, Mr. Chairman, 
and hopefully we will move the bill fairly quickly. Thank you.
    Mr. Tauzin. I thank the gentleman.
    [Additional statements submitted for the record follow:]
 Prepared Statement of Hon. Tom Bliley, Chairman, Committee on Commerce
    Thank you, Mr. Chairman.
    I have always been a strong supporter of commercial-free 
broadcasting. While Americans debate the question of whether media 
content has contributed to excessive violence in our culture, it is 
important to remember that commercial-free broadcasting has been--day-
in and day-out--an oasis of unique, creative, and educational 
programming.
    I commend these programmers for swimming against the tide of the 
coarse programming that has become the staple of commercial 
broadcasting. You perform a valuable public service.
    And as the entire television industry--both commercial and non-
commercial broadcasters--make the transition to digital, your service 
to American communities will become that much more valuable. Digital 
television holds great promise for broadcasters and consumers alike, 
which is why this Committee has backed this transition.
    But the critical question for this Subcommittee is now, and always 
has been, the following: what should be the American taxpayers' burden 
in ensuring that commercial-free broadcasting remains just that, 
commercial-free?
    I have long argued that the American taxpayer should bear a 
declining share of the burden. Public broadcasters have proven that 
their product is popular with American families and corporate 
underwriters. Moreover, it is quite possible that the federal 
government's heavy-handed role in funding public broadcasting ends up 
displacing voluntary sources of funding.
    We should therefore never assume that public broadcasting must 
always remain a ward of the state. Quite the opposite, I urge my 
colleagues to join me in finding ways to ensure that commercial-free 
broadcasting will someday be self-sufficient, free of the ``strings'' 
that always are attached to government handouts.
    I have confidence in the commitment and the talent of commercial-
free broadcasters to ultimately become self-sufficient. This is not to 
say that I would back proposals to eliminate federal funding overnight. 
But neither can I support proposals that would only strengthen public 
broadcasting's dependence on the largesse of the federal government.
    I thank the Subcommittee Chairman for his hard work in this area, 
and for calling this hearing. It is indeed an important matter that 
deserves our attention. I look forward to hearing the testimony of the 
witnesses this morning.
                                 ______
                                 
Prepared Statement of Hon. Bobby L. Rush, a Representative in Congress 
                       from the State of Illinois
    Thank you, Mr. Chairman. It is truly an honor to come before you 
today to stress the importance of public broadcasting services to our 
society. I am sure very few individuals in this room can say they have 
not seen Public Television shows, such as the McNeil/Lehrer Newshour, 
Master Piece Theater, Sesame Street, Arthur or even the infamous 
Barney. These shows provide Americans and especially our children with 
quality programming that are free from violence and foul language. In 
addition, the beauty of PBS programs is that they are uninterrupted and 
commercial free. Non-commercial programs provide untainted and pure 
content driven programming that is free from commercial interest.
    As we approach the new millennium, public television stations are 
facing the challenge of making the transition to digital broadcasting 
by the year 2003. This conversion is expected to cost $1.7 billion and 
creates obstacles for non-profit public television stations who are in 
dire need of money.
    The Corporation for Public Broadcasting Reauthorization Act of 1999 
allocates $15 million for fiscal year 1999 and $100 million for each 
fiscal year from 2000 until 2003 to aid in the transition. I am in 
strong support of this legislation. We must ensure that PBS programming 
remain independent and free from commercial influence. Therefore, it is 
imperative that we fund PBS at a level where it can continue to survive 
in a commercially driven arena.
    Thank you, Mr. Chairman.
                                 ______
                                 
Prepared Statement of Hon. Eliot L. Engel, a Representative in Congress 
                       from the State of New York
    Mr. Chairman, I want to thank you and Mr. Markey for holding this 
timely hearing on the Reauthorization of the Corporation for Public 
Broadcasting. It is no secret that I am a strong supporter of public 
broadcasting and in my tenure in Congress, I have done all I can to 
preserve the principles beholden to the Public Broadcasting Act of 
1967.
    I have fought in this Congress to save Public Broadcasting from 
extinction with the help of my colleagues in the 104th Congress. With 
the help of members on this committee, I was successful in the previous 
Congress, in restoring $5 million for the Public Telecommunications 
Facilities Program, which provides much needed assistance to public 
broadcasters in purchasing equipment and hardware.
    However, my passion for public broadcasting is not held by me 
alone. The New York State Congressional delegation in a bipartisan 
effort have sent letters to the Speaker and our committee Chair and 
Ranking member asking for this Reauthorization hearing, because we know 
the role that stations such as MNET-TV in New York, play in our 
families daily life. In a time when we in Congress examine the impact 
of violence, and content within the media, on our children and young 
adults, it is good to know that shows such as Sesame Street, Barney and 
Mr. Rogers continue to provide high quality educational programming 
without disturbing images or stereotypical depictions. In fact, I 
contend that public television is needed more today than ever and it is 
my hope, that my colleagues join me in preserving public television for 
all American families as they make the transition to digital 
conversion.

    Mr. Tauzin. The Chair is now pleased to welcome our panel 
and give you a chance to give us your views and opening 
statements. We would remind you that your written statements 
are already a part of the record, so please do not read them. 
Engage us, Mr. Burton, engage us in conversation here that we 
can come back to you in a dialog.
    So if you can, put the notes away and just talk to us, if 
you don't mind. You each have 5 minutes. We'll start with the 
president and CEO of the Corporation for Public Broadcasting, 
Mr. Robert Coonrod.

 STATEMENT OF ROBERT T. COONROD, PRESIDENT AND CHIEF EXECUTIVE 
          OFFICER, CORPORATION FOR PUBLIC BROADCASTING

    Mr. Coonrod. Mr. Chairman, thank you, and I thank the 
members of the subcommittee as well for the words that we just 
heard.
    Before I make some brief opening comments, I would like to 
recognize the Chair of the Board of the Corporation for Public 
Broadcasting who happens to be with us this morning, Diane 
Blair. In addition to a distinguished panel, as you said, there 
are some distinguished members of our audience as well.
    Mr. Chairman, thank you. This is an opportunity for us to 
continue a dialog that we began last year, and it is a dialog 
that is very important to us. I think the members of the 
subcommittee have already stated many of the reasons why this 
is an important time in the history of public broadcasting. You 
are going to hear from my colleagues on this panel some very 
exciting things about the revolution that is underway, the 
revolution in digital technology, the revolution in new media.
    What I would like to talk about briefly is another 
revolution, the more quiet revolution that is taking place in 
public broadcasting these days. The revolution that has taken 
place in the last 4 years and the way public broadcasters 
around the country have reconsidered how they do business and 
reformed the way they do business and have actually begun to 
institute, and we are making some real progress, Mr. Chairman, 
in the areas that you have identified as important to the 
public broadcasting going forward.
    In the last 4 years, station-based task forces and system-
wide consultations have allowed CPB to create incentive grant 
programs for innovative projects in radio and television. We 
have been able to rewrite the main radio and television grant 
programs to better meet the needs of rural stations. We have 
instituted a one base grant per market policy. This affects 44 
television stations and 18 overlap markets. We have instituted 
a one base grant per licensee policy, which affects 37 stations 
and 16 licensees.
    We have established new outcome based criteria for our 
radio grants programs. The Ready to Learn program has been 
extended from 10 pilot stations to 127 stations now, most of 
whom have full time outreach coordinators. There is now a new 
teacher training channel, free available teacher training 
channel that has been launched.
    The effect of all this, Mr. Chairman, is that public 
television and radio stations are doing business smarter. They 
are becoming much more self-reliant, and they are doing an even 
better job today of delivering the educational and cultural 
programming that is important to all Americans. Programming has 
maintained its excellence, and it has gotten better in many 
ways. Not just from the people who are affiliated with me on 
the panel this morning, but groups like the Independent 
Television Service and the Minority Consortia have demonstrated 
their value.
    One way to look at that is through awards. Last month, 
programs that are distributed by PBS and NPR received 12 of the 
23 George Foster Peabody awards, the most prestigious awards 
available in broadcasting. That was from 1300 entries. So it 
gives you a sense of the quality that we are able to achieve. 
Daytime Emmys, Fred Rogers, Sesame Street, Bill Nye the Science 
Guy, Wishbone, This Old House were all recipients of Emmys.
    And a program that was supported by the National Asian 
American Telecommunications Association, which is a San 
Francisco based group that we support, was nominated for an 
Oscar. So the quality of the programming on public television 
and public radio is better than ever. But we are also making 
real headlines on the Web. PBS has won another Webby for PBS 
Online. The Annenberg CPB project won a Webby for the best 
educational web site.
    So we are doing this in this sort of quiet way as I would 
describe it. But I think it is an important way.
    Let me give you two examples in closing of the kinds of 
things that stations are doing that are really making a 
difference. In Colorado, KRMA and KBDI are developing a joint 
master control facility which will reduce each station's 
individual staff needs and hardware investment now and in the 
future. These are the kinds of reform activities that stations 
have underway.
    In Jonesboro, Arkansas, KASU, a public radio station, has 
received special assistance from CPB to help them meet the new 
outcome based criteria in public radio. Not only did the 
station increase its revenues by 42 percent, but training for 
the news production team was completed just 2 weeks before the 
tragic Jonesboro shootings. KASU reporters were better prepared 
to make local contribution to the national coverage of that 
important story.
    So in sum, Mr. Chairman, we want to continue to work with 
you to improve and refine the system that is undergoing this 
quiet revolution. We believe this legislation will allow us to 
sustain the momentum that we have established over the last 4 
years.
    Thank you, Mr. Chairman.
    [The prepared statement of Robert T. Coonrod follows:]
    Prepared Statement of Robert T. Coonrod, President and CEO, the 
                  Corporation for Public Broadcasting
    Thank you, Chairman Tauzin and Mr. Markey for your work last 
Congress and this Congress to support public broadcasting. We in public 
broadcasting are grateful to you and the members of the Subcommittee. 
Your support is very important both in a practical way, and as a 
tangible symbol of the way public broadcasting joins national interests 
to local interests, and the public sector to the private sector. The 
value and strength of these partnerships are increasing in importance. 
They are the basis of our planning for our transition from a technology 
born in the 1950's to the technology of the 21st Century.
    We appreciate and support your legislative commitment to 
reauthorize the Corporation for Public Broadcasting. CPB was last 
authorized in 1992 for a period that ended in 1996, at which point CPB 
was authorized at a level of $425 million. Our appropriation that year 
was originally $312 million, an amount which was later reduced to $275 
million as a result of a multi-year rescission. Public broadcasting is 
currently operating on an appropriation of $250 million.
    My understanding, too, is that your legislation authorizes a 
special digital conversion fund through CPB to facilitate the 
transition of public broadcasting stations to digital technology. We 
are particularly grateful for this support and for your support for 
reauthorization of the Public Telecommunications Facilities Program: 
our partner in the digital conversion. The need to authorize CPB to 
distribute funds for digital conversion is pressing, both because of 
federal time lines, and because of our keen desire to fully use digital 
technology--technology that lends itself more perfectly to the 
development and airing of excellent, universally available, 
noncommercial programming, rich in educational content, and tailored to 
the interests and needs of local communities. Digital technology will 
revolutionize the medium of broadcast television and radio, public as 
well as commercial. I hope you received a tape of the digital program 
prototypes we circulated to your offices earlier this week. If you 
watch it, you'll understand what all the excitement is about.
    You will hear more from my colleagues about this technological 
revolution. It will be dramatic and will affect everything we do.
    But, I want to use my remaining few minutes to talk about another 
revolution--a quiet revolution. Since our last reauthorization, public 
broadcasting has not stood still.
    In the past four years alone, through station-based task forces and 
system-wide consultations with our public broadcasting colleagues, CPB 
has: created an incentive grant program for innovative television 
practices; created an incentive grant program for innovative radio 
practices; rewritten the main radio and television grant programs to 
better meet the needs of rural stations; instituted a one base grant 
per market policy affecting 44 television stations in 18 overlap 
markets; and, instituted a one base grant per licensee policy affecting 
37 television stations and 16 licensees. We established new outcome 
based criteria for radio station grants; expanded the Ready To Learn 
program from a 10 station pilot project to 127 stations, most of which 
now employ a full time outreach coordinator; helped launch the first 
free teacher training channel in math and science; funded the first 
prototypes of digital broadcasting content; and--in the midst of it 
all--reduced the size of CPB. The effect of all this is that public 
television and radio stations are doing business smarter, becoming more 
self reliant, and doing even better at delivering educational and 
cultural programming for all Americans.
    Programming has maintained its excellence, and, in many ways, has 
gotten better. At CPB we are affiliated with organizations dedicated to 
program development, who are not represented on this panel, but who 
have done excellent work to improve their output; organizations such as 
the Minority Consortia and the Independent Television Service. Last 
month, programs airing on PBS and NPR received 12 of 33 George Foster 
Peabody awards for Broadcast and Cable Excellence granted this year out 
of nearly 1,300 entries. A few days later, Fred Rogers, Sesame Street, 
Bill Nye The Science Guy, Wishbone, and This Old House all won daytime 
Emmys. Earlier this year, a CPB/National Asian American 
Telecommunications Association-funded documentary was nominated for an 
Oscar, and public broadcasters, specifically PBS and Annenberg/CPB, won 
awards for the Best TV Web Site and the Best Educational Web Site. In 
addition, public broadcasting is a leader in the development of digital 
data-enhanced programming.
    As I said, there is a quiet revolution taking place within public 
broadcasting. Allow me to fill out the picture somewhat.
Reforming Station Grant Criteria
    Since 1995, CPB has commissioned a number of task forces of 
talented public broadcasters from diverse economic and geographical 
backgrounds to review our grant policies in both television and radio 
in an effort to increase efficiency, more efficiently use 
infrastructure, and improve our service to the American people. The 
result has been a series of policies generated by public broadcasters 
and adopted by the CPB Board that have quietly reformed the way we do 
business.
    Television grants are made up of two parts: a base grant, which is 
an equal payment to every eligible public television station; and, an 
incentive grant which is based on the amount of nonfederal money a 
station has raised. Base grants have generally been linked to 
infrastructure needs, so in situations where consolidation of 
infrastructure may be possible, stations are being asked to share a 
single base grant.
    For example, in cases where one licensee operates more than one 
station, the task force reasoned that the licensee should be limited to 
one base grant. The CPB Board adopted that recommendation, and in 1996, 
16 licensees from places like Pittsburgh, South Carolina, and Northern 
Virginia went from receiving a total of 37 base grants to a total of 16 
base grants. The money saved is being redistributed to public 
television stations through increases to the incentive grants.
    Also in 1996, CPB in consultation with our public broadcasting 
colleagues, for the first time began to take broadcast signal overlap 
into account when determining grant awards. Today, 44 stations in 18 
markets are in the final stages of a three year phase-in of a one base 
grant per market policy. In many cases, stations that share a market 
are now working together to reduce infrastructure costs. For example, 
public television stations KBDI-TV, in Broomfield, Colorado, and KRMA-
TV, Denver, are developing a joint master control facility, reducing 
each individual station's staff needs and hardware investment now and 
in the future. In Utah, KBYU-TV, Provo; KUED-TV, Salt Lake City, and 
KULC-TV, Salt Lake City; and five commercial television stations are 
building a joint digital television transmission facility. As a result 
of this cooperation, infrastructure costs are being cut and commercial 
broadcasters are investing in a facility that will benefit public 
broadcasters.
    Radio grant criteria were changed to introduce, for the first time, 
minimum audience service standards. These new standards provide 
additional assurance that the services CPB helps fund are meeting 
community needs. KASU-FM, a public radio station in Jonesboro, 
Arkansas, received special assistance from CPB to help them meet the 
new outcome-based criteria. Not only did the station increase its 
revenues by 42%, but training for the news production team was 
completed just two weeks before the tragic Jonesboro shooting. KASU's 
reporters were better prepared to make a local contribution to the 
national coverage of this important story.
Creating Incentives for Innovation
    While grants are being reduced in some cases, more money is 
available for innovative projects. The TV Future Fund and the Radio 
Future Fund provide grants to stations that develop new ways to reduce 
costs or increase revenues. In a recent survey of public radio managers 
and development directors from all sizes of markets and geographical 
locations, 71% said they'd changed the way they do business as a result 
of the Radio Future Fund. For example, KPBS, San Diego, is using a CPB 
Radio Future Fund grant to explore the characteristics of their major 
donors in an effort to identify additional major donors within the 
station's very diverse listening audience. A Television Future Fund 
Project is bringing together WGBH in Boston, WVIZ in Cleveland, GPTV in 
Atlanta, WHYY in Philadelphia, and KUED in Salt Lake City, in an 
experiment to boost local giving through direct mail. CPB funded an 
innovative competition between NPRN, the Nebraska Public Radio Network, 
and SDPR, South Dakota Public Radio, in which the two organizations 
competed to see which could raise a predetermined dollar goal during an 
eight day on-air membership campaign. In two years of competition, the 
stations increased giving by better than 30%.
    The Infinite Outsource project began as a Florida-based effort to 
help stations consolidate membership, fundraising, and database 
management. The program has been so successful that it has grown beyond 
the borders of Florida to become a regional, even national, movement 
that may involve more than 50 public television stations when fully 
implemented. In a similar effort, Alabama Public Television, Arkansas 
Educational Television Network, Georgia Public Television, Louisiana 
Public Television, and Mississippi Educational Network are seeking ways 
to use common resources to discover efficiencies through collaboration. 
In radio, CPB brought together African-American stations to seek ways 
in which these stations could learn from each other and increase 
cooperation. Several radio and television Future Fund projects also 
help stations increase their underwriting support.
    The five most important sources of station revenues are: 
membership, state governments, businesses, CPB appropriation, and state 
colleges. Each source of income is important. The loss of any one of 
them would be devastating. Our challenge is to make noncommercial 
television and radio attractive to all of our supporters: members, 
businesses, colleges, state governments, Congress, and others.
    We want to continue to work with you to improve and refine a system 
that is undergoing this quiet revolution. We believe this legislation 
will allow us to sustain the momentum we have established and to more 
successfully meet the challenge of the next revolution: digital 
broadcasting.
    Thank you again for your commitment to move a reauthorization bill. 
I am pleased to respond to questions at the appropriate time.

    Mr. Tauzin. Thank you, Mr. Coonrod. We will now turn to Mr. 
Duggan, President and CEO of Public Broadcasting Service. I 
understand you have a demonstration for us as well.

  STATEMENT OF ERVIN S. DUGGAN, PRESIDENT AND CHIEF EXECUTIVE 
              OFFICER, PUBLIC BROADCASTING SERVICE

    Mr. Duggan. Thank you very much, Mr. Chairman. I want to 
express our profound gratitude to you and to the ranking 
member, Mr. Markey, and to your colleagues for having this 
hearing and allowing us the privilege of participating.
    You made a something rueful comment about our preaching to 
the choir. I would like to say on behalf of the preachers that 
we think the choir has made beautiful music this morning. We 
are grateful to all of you for that.
    I am going to make three quick points on the way to an 
exciting demonstration of a perhaps unexpected potential of 
digital television that we hope you will find as interesting as 
we have found creating it. On the way to that demonstration, 
however, I do want to make two or three important points. The 
first one, Mr. Chairman, is that only public broadcasting will 
use the new digital media, has the commitment and the expertise 
to use the new digital media for educational purposes, for 
cultural purposes, for non-profit enlightenment of our 
citizenry.
    All other uses of these media will be commercial, and 
that's fine. We want to create internet billionaires, we know 
it's great for the economy.
    But the only non-profit public service educational use of 
these media will come from public broadcasting. That can only 
happen with your support.
    As other panelists have mentioned, as members of the 
subcommittee have mentioned, this is a time of tremendous 
concern about the impact of media, the vulgarization, the 
violence in media. We want to be, and we believe we are part of 
the solution to that problem. It is only with your generous 
help and support that we can continue to be part of a solution.
    But I think it is important to note in the beginning that 
only public broadcasting is equipped to do that non-profit 
educational use of all media, beginning with radio and 
television but extending to the new digital media.
    The second point that I would make briefly in passing is 
that the clock is ticking, as you pointed out, and as Mr. 
Markey pointed out, on an unfunded Federal mandate. It is the 
intention and the commitment of public broadcasters to raise 
about two-thirds of all the funds we need for the digital 
conversation from other than Federal sources. But we greatly 
need the continuing support of the Congress in this public-
private partnership. We believe that you are committed and we 
are tremendously grateful for the vision and leadership that 
you, Mr. Markey and your colleagues have shown to stepping up 
to the funding of this unfunded mandate.
    As of last week, the public television stations around the 
country had raised about $250 million, $170 million of it, 
something in excess of $170 million, from State governments. 
Those State governments are expecting a match of funds from the 
Federal Government. So we honor you and we're grateful to you 
for stepping up to the plate and helping us with the public 
part of this public-private partnership.
    Universal service which is a commitment of ours, to reach 
every home, if possible every school and college in the country 
with our educational and cultural mission, that universal 
service depends on you. So we are tremendously grateful to you 
for stepping up to the plate.
    The third point that I would want to make is that just as 
public broadcasting has been the wellspring of creativity in 
radio and television broadcasting, inventing whole new genres 
for the public, we want to be that, and we believe we can be 
that wellspring of innovation and creativity in digital media. 
You know, and several members of the panel have mentioned the 
inventiveness and innovation and creativity of public 
broadcasters in inventing things like educational broadcasting 
for children.
    The invention of the historical documentary on television 
was really something that came out of public broadcasting. We 
believe that same creativity and that same innovative power can 
be brought by our service to the new digital media. And in 
fact, we believe that if we do not do it, it may not be likely 
to happen.
    To illustrate that creativity now, Mr. Chairman, and to 
underscore our commitment to being innovators and creators in 
the digital media, I want you, if you will, to turn your 
attention to the screens that you see on either side. Imagine 
yourself last November watching the wonderful Ken Burns 
documentary of Frank Lloyd Wright. That documentary told about 
the life of Frank Lloyd Wright. It did not really tell us very 
much about his work.
    But if you were curious about the work of Frank Lloyd 
Wright, and if you were in seven digital demonstrationsites 
around the country that were properly equipped, you could click 
at the end of that documentary and download an embedded package 
of additional information that came along with the documentary, 
embedded because of the marvelous technological power of this 
digital medium.
    I would like to introduce John Hollar, who is the Executive 
Vice President of PBS for Learning Ventures. He played a role 
with Intel and their colleagues in creating the embedded 
enhanced digital package that went along with Frank Lloyd 
Wright.
    We hear a lot about HDTV. Mr. Chairman, this is EDTV, 
enhanced digital television. And if John Hollar will come 
forward, he can lead us through this new invention that we 
think has tremendous potential for the future of public 
broadcasting and our educational and cultural mission.
    Thank you, Mr. Chairman.
    Mr. Hollar. What you will see, Mr. Chairman, is the last 10 
seconds of the last evening of Frank Lloyd Wright. Then you 
will see a trigger come up at the bottom of the screen, which 
will then take you much deeper into the information related to 
the broadcast.
    [Demonstration proceeded.]
    Mr. Hollar. I will read what it says. It says, to launch 
the PBS Interactive Companion to this episode, press return on 
your keyboard.
    [Demonstration proceeded.]
    Mr. Hollar. Click here on the information button, and you 
get more information from Eric Lloyd Wright.
    [Demonstration proceeded.]
    Mr. Hollar. Here on Fallingwater, we are actually 
transported to the work of architecture itself. There is a 
blueprint of the house, Fallingwater, and if you click on one 
of these red icons, then you actually step into the house 
itself. This is the main living area of Fallingwater. You can 
see, using your cursor, this is a 360 degree interactive tour 
of the home itself. So you can stand in the middle of the 
living room, you can use your cursor to look up at the ceiling, 
or you can look down at the floor. You can tour the entire room 
this way and you can go at your own pace and speed.
    If you click here, you are now looking out to the terrace. 
If you click here, you actually step out onto the terrace at 
Fallingwater. Again, using your cursor, you can look out past 
the cantilevered balconies, out to the water itself, into the 
woods. You can look down over the balcony.
    This is a three-level house. Each floor of the house is 
represented on the blueprint. This is floor two and this is 
floor three. There is a little bedroom here on the third floor, 
which is quite nice. You can see there is this enormous bank of 
windows, so when you wake up in the morning, you feel as if you 
are actually out in the middle of nature.
    I am going to take you very quickly now to the Guggenheim, 
just so you can experience this.
    [Demonstration proceeded.]
    Mr. Hollar. Again, using this same three-dimensional 
technology, you are standing on the floor of the Guggenheim, 
looking up past the balconies to the ceiling. You can use your 
cursor to come down and gradually look at the floor. You can 
look throughout the museum and navigate around.
    You can stand on one of the upper balconies and actually 
see how the artwork in the Guggenheim is displayed. So there 
you are standing on one of the upper balconies. Then you can 
rotate around and look at the other artwork.
    There is a great deal more here. There are outtakes from 
the film, there is a sort of story within the story, full 
digital video clips. There is quite an extensive set of lesson 
plans that are correlated to this actual film that involve 
science and art and technology. There is a chance to bridge 
from this piece out to the internet, so you can learn more 
about Frank Lloyd Wright.
    It is important to emphasize that everything that you see 
here was actually broadcast simultaneously with the program, so 
that this was actually part of the digital signal. It was 
received on a digital receiver. These are available now, and 
these are not futuristic devices. They are available now in 
virtually every electronics store in the country. We really 
believe that this begins to show part of what the real power of 
digital television can be.
    Thank you very much.
    [The prepared statement of Ervin S. Duggan follows:]
 Prepared Statement of Ervin S. Duggan, President and Chief Executive 
                  Officer, Public Broadcasting Service
    Good Morning, Mr. Chairman and Members of the Subcommittee. I am 
Ervin Duggan, President and Chief Executive Officer of Public 
Broadcasting Service. We are grateful to you for the opportunity to 
join this hearing.
Your Leadership
    Mr. Chairman, let me first express our gratitude to you and to the 
Ranking Member, Mr. Markey, for your support for public broadcasting 
over the years and particularly as we enter the digital age. We are 
grateful to have two distinguished leaders as our champions. Your 
respective local stations--Louisiana Public Broadcasting and WGBH 
Boston--represent some of the best of public television: stations 
dedicated to producing unique, enriching programming, and to serving 
our educational mission creatively at the local level.
Public Broadcasting Means Public Service
    I will make a few brief points this morning, and then we would like 
to show you an exciting example of our plans for the digital future.
    Public broadcasters are unique. We are the only enterprise that 
uses media and the public airways to address the most pressing concerns 
of our times: universal access to quality education; appreciation of 
the world's cultural riches and human achievement; and civil discourse 
by an informed electorate. At a time when the popular culture is 
deluged by violence, gratuitous sex and overbearing commercialism, our 
programs are violence-free, commercial-free and treat controversial 
issues responsibly.
    We are consistent leaders in television's most prestigious 
competitions. Last year, for example, we earned far more Peabody 
Awards, duPont-Columbia Awards for television journalism, children's 
Daytime Emmys, and News and Documentary Emmy awards than any other 
television service, broadcast or cable. PBS presents television's four 
highest-rated programs among preschoolers--ARTHUR, BARNEY & FRIENDS, 
TELETUBBIES and SESAME STREET. We are the number one television 
resource for classroom programming in the country, according to three 
consecutive surveys of teachers and librarians by Cable in the 
Classroom. Delivering such high quality programs year after year is a 
tall order. It takes a combination of talent, dedication, experience 
and funding. We very much need and appreciate your support in 
continuing to make this possible and applaud your efforts to 
reauthorize the Corporation for Public Broadcasting and set a strong 
benchmark for its funding.
Digital Spectrum for Public Service: Pioneers, Progress and Plans
    Public broadcasting is also the only enterprise, Mr. Chairman, that 
is committed to using the new digital technology to provide all 
Americans with high quality educational programming services. We are 
embracing digital television, with all its promise and all its 
challenges, as a means of broadening and deepening our mission of 
education, culture and citizenship. In a world of hundreds of channels 
owned and programmed by conglomerates whose chief end is to maximize 
worldwide profits, Congress has the opportunity to ensure that one 
media service will use this public resource to serve the public 
interest with noncommercial, educational content delivered by 
independent, locally-owned community institutions.
    PBS and its member stations officially raised the curtain on the 
digital age last November with PBS Digital Week. PBS Digital Week 
achieved four digital firsts:

 The first national broadcast of a television program shot and 
        edited in high definition--CHIHULY OVER VENICE, from KCTS 
        Seattle;
 The first broadcast of a program with enhanced digital 
        content--FRANK LLOYD WRIGHT, from WETA Washington and 
        Florentine Films;
 The first national program to inform general audiences about 
        digital television--DIGITAL TV--A CRINGELY CRASH COURSE, from 
        Oregon Public Broadcasting; and
 The launch of the first consumer-friendly digital TV website, 
        on PBS ONLINE.
    We are now planning PBS Digital Week 2, slated for this fall. It 
will feature both high definition and enhanced digital television 
programs, online activities and a celebration of our 30th anniversary.
    In addition to using the high-definition programming you have heard 
so much about for our cultural and performance programs, we are 
developing additional digital services with extensive educational 
applications: multicast services, such as the PBS Kids Channel; 
curriculum data services; and ``Enhanced Digital TV'' services. And in 
just a moment, Mr. Chairman, we will demonstrate an example of what we 
call ``Enhanced Digital TV.''
    Public broadcasters have long been leaders in developing and 
testing digital technology and we take seriously our role as an 
educator here as well. In addition to A CRINGELY CRASH COURSE, and the 
user-friendly DTV website I just mentioned, PBS today marks the end of 
its DTV ``roadshow.'' Fifteen months ago, the PBS/Harris DTV Express 
project sent a giant, 18-wheel demonstration truck nationwide 
showcasing the dramatic potential of digital technology. It started on 
Capitol Hill and today concludes a successful 40-city tour that 
included a stop last December at Louisiana Public Broadcasting. The DTV 
Express featured demonstrations of a fully operational digital 
television studio, a ``living room of the future'' and ``a classroom of 
the future,'' all housed inside the 66-foot tractor-trailer. More than 
17,000 people toured the truck and more than 2,300 broadcast 
professionals participated in DTV Express seminars along the way.
A Public-Private Partnership
    Mr. Chairman, public television in America operates mostly on funds 
from non-federal sources. We want and need federal support, however, to 
maintain this superb public-private partnership and to make our 
exciting digital plans a reality for all Americans. We are working hard 
on our end. Seven PBS member stations are already on the air with a 
digital signal and we anticipate that over 30 member stations will be 
broadcasting in digital by the end of next year. Since last November, 
PBS has been showcasing at least one HDTV program in primetime each 
month. Building on last November's broadcast of FRANK LLOYD WRIGHT with 
enhanced digital content, PBS has two additional enhanced digital 
programs in development in 1999: ZOBOOMAFOO, the children's wildlife 
program featuring Chris and Martin Kratt; and WONDERS OF THE AFRICAN 
WORLD WITH HENRY LOUIS GATES, JR. More programs, featuring increasingly 
complex and varied enhancements, are planned for next year. And this 
September we will launch a new channel--the PBS Kids Channel--as an 
interactive broadcast service available to our stations for digital 
multicasting.
    As of June 21--last week--our stations had raised over $250 million 
for their digital transition, much of that total from states that 
recognize the enormous contribution public television makes to their 
educational systems. This is good news, but it is not enough. Our 
transition costs are daunting--estimated at over $1.7 billion for the 
hardware alone. We have pioneers to be sure, and we are determined to 
raise most of the funds on our own, but many stations, especially in 
smaller communities, are only in the earliest stages of assembling the 
necessary resources. They need a federal contribution they can leverage 
with other potential public and private funding sources, or they may 
never make the transition. Universal service, if it is to continue, 
depends on you and your colleagues, Mr. Chairman.
    By November 1, commercial stations in the top 30 markets--reaching 
over 50% of American TV households--are required to be on the air with 
a digital signal. We anticipate that 17 public television stations will 
be broadcasting digitally by the end of this year, reaching 
approximately 25% of American TV households. We must keep pace with the 
digital rollout of commercial broadcasters. If our signal is not 
available to all households with digital televisions, the principle of 
universal service upon which we were founded will be put in jeopardy, 
and the principle of educational use of media will be a dream 
unfulfilled.
    To whet your appetite, we would like to share with you now a 
striking example of what digital television can be. It helps 
demonstrate, we believe, why continuing and enhancing the crucial 
federal stake in public broadcasting is in the best interests of the 
American people--and a great bargain. The following demonstration 
involves an entirely new form of media: the fusion of broadcast 
television with video, text, audio and graphic images into a new 
service called ``Enhanced Digital TV''--not HDTV but EDTV. EDTV is a 
central part of our plans for a vibrant digital future. It is a tool 
that enables us to create entirely new, extremely powerful educational 
applications, from preschool programs to distance learning to PBS's 
most familiar signature series. Let's watch.
    Mr. Chairman, I want to applaud again, in closing, your strong 
commitment to public broadcasting and your leadership on behalf of 
educational media. We at PBS are happy to join our colleagues today in 
thanking you for your support in the past, and in urging your continued 
support as we move into the digital future.

    Mr. Tauzin. Thank you very much, Mr. Duggan. That was an 
excellent demonstration.
    We are now pleased to welcome a star here, Mr. LeVar 
Burton. Mr. Burton, your great work, many of us have followed 
it, from Roots to Star Trek, to the excellent work you do with 
Reading Rainbow. In fact, it was your performance in Roots that 
inspired this Cajun boy to go back to Nova Scotia to find out 
about my ancestors in Acadia. So I sort of journeyed like Kunta 
Tauzin back in time. I found out from whence I came.
    By the way, we were kicked out unceremoniously from Nova 
Scotia, many of us put in indentured servitude and slavery in 
other places unknown. We eventually gathered in Louisiana. As 
we went through that awful experience in Kosovo, I reminded 
some of my friends that I despised the British for all my life 
for having kicked us out of Nova Scotia, until I went up there. 
It's cold. It's very cold. Louisiana turned out to be a pretty 
good place. Crawfish are a lot bigger there.
    Mr. Burton, we appreciate your being with us, and we 
welcome your testimony, sir.

     STATEMENT OF LEVAR BURTON, PUBLIC BROADCASTING SERVICE

    Mr. Burton. Thank you very much, Mr. Chairman, and good 
morning.
    And thank you to the other members of the committee. I 
really enjoyed hearing people with jobs such as yours speak so 
passionately about something that I also love and hold very 
dear to my heart. I really appreciate the feelings and the 
sentiments of the members of this committee, where continuing 
appropriations for public broadcasting and the Corporation for 
Public Broadcasting specifically are concerned.
    And thank you, Mr. Chairman, for the reference to Roots. 
Because it is, after all, a primary example of just what this 
medium offers us in terms of our ability to inspire and 
enlighten ourselves. I truly believe that we have created with 
this link, this global technological web that we have woven 
around ourselves, the most powerful opportunity in the history 
of humankind to not only educate ourselves and each other, but 
really to lift ourselves up and light the way for each other.
    That is after all at the end of the day what I believe this 
medium is for. I have dedicated and committed the last 20 or so 
years of my life to using the medium to its most powerful 
potential imaginable.
    As a father of a 19 year old and a 5 year old, during the 
course of my career and my involvement with public 
broadcasting, I have seen the landscape of television and the 
way we use this medium change. The landscape is forever and 
continually shifting. The one thing that has remained constant 
in my experience is that the heart and the soul of the mission 
of PBS has been unaltered over all of these years.
    In fact, over the 30 years of its existence, it has always 
been that shining light for how we can uplift ourselves and 
light the way for one another. So the support that this 
committee and the general body of Congress and the Federal 
Government at large, the commitment that they have made over 
the years is important. As we move forward into this age of 
convergence, the convergence of the digital medium and the art 
of storytelling, it is going to be increasingly more important 
for us to receive your very benevolent support.
    I can't stress strongly enough that the future is one of 
our own making. The link between that which we imagine and that 
which we manifest, that which we create in life, is 
inextricable. I get the sense from you, Mr. Chairman, that you 
are also a Star Trek fan.
    I know that the reason we have in life today the flip 
phone, that cell phone, is because some kid grew up watching 
Star Trek and saw Captain Kirk reach behind to that place on 
his hip and pull that thing out and call Scotty on the ship. 
That kid then grew up, became an engineer and designed a device 
that is as common to us today as the bread toaster.
    So the link between that which we dream, that which we 
imagine and that which we manifest is absolutely a part of the 
human experience. The people who work in PBS have always 
demonstrated that they have the ability to imagine the world in 
a place that is healthy and safe for children. As we move 
forward into this age of convergence, I know that it is those 
people that you have been in this partnership with over the 
years in terms of your funding support, those people are the 
ones that are going to use these new digital technologies for 
the greater good and benefit of America's children.
    Your continued and undying support is not only appreciated, 
but it is necessary and essential to America's kids. I thank 
you.
    [The prepared statement of LeVar Burton follows:]
    Prepared Statement of LeVar Burton, Public Broadcasting Service
    Good morning, Mr. Chairman and Members of the Subcommittee. I am 
LeVar Burton. Thank you for inviting me to testify on an issue about 
which I feel deeply: the importance of public television in the lives 
of children.
    You probably know that for years, I have produced and hosted a PBS 
children's series called Reading Rainbow, which celebrates the wonder 
of books. You may not know, however, that I once entered the seminary 
and still have a tendency to preach. So this morning's testimony may 
sound more like a sermon than a recitation on public policy. I hope you 
don't mind.
    In addition to my work for PBS, I have participated in the 
commercial television business for many years, and it has been good to 
me. I am proud of the things I and others have done in the commercial 
arena that stir the imagination and encourage the soul. But commercial 
television alone will never make the best use of this powerful and 
pervasive medium, especially when it comes to children.
    In the past three years, commercial television has discovered that 
kids are good business, and new channels, video games and web sites 
have flooded the marketplace. But all too often, the commercial media 
has brought to the children's digital table the same old recipe that 
created the need for public television three decades ago. They largely 
provide content designed to seduce young viewers for relentless product 
pitches from eager advertisers. What we need instead is content 
designed to grow young minds into thoughtful individuals and caring 
human beings.
    That's where public television comes in and that's why I'm here 
today. It's about the kids. It's about their future. About seeing in 
every one of them a seed of greatness. And doing whatever we can--and 
whatever it takes--to nurture that seed.
    I come here today because I know what public television provides 
stands in stark contrast to what our young people are learning from 
commercial TV, the Internet, movies and today's music. Let's not kid 
ourselves here . . . all of these media influences are educational. The 
question is . . . ``What is it teaching and how does it impact the 
world in which we live?''
    On Monday of this week I attended a day-long seminar on children's 
television sponsored by the Annenberg Public Policy Center of the 
University of Pennsylvania. The Annenberg Center released its annual 
survey of the state of children's television, and the results speak for 
themselves.
    For the fourth year in a row, PBS programs were judged by far the 
highest quality and most educational in all of television. The 
researchers found no violence, no foul language, and no sexual innuendo 
in any PBS series, and our programs presented a much wider diversity of 
characters than could be found on other TV networks.
    In addition to the uniquely valuable content of PBS programs, 
public television is profoundly important for another reason. I remind 
you that one out of every five American children still lives in 
poverty. Few of them have access to the technology and resources that 
can give them a better chance to make it in life. Only one broadcaster 
is dedicated to reaching out, bridging that divide and creating an 
accessible on-ramp for every child. That broadcaster, of course, is 
PBS.
    In a media landscape that is forever shifting, public television 
has managed to maintain its commitment to the goals and ideals under 
which the enterprise was originally conceived. Our mission has always 
been to simply do what's best for children. And in the faithful 
execution of that mission, we have earned and kept the public trust.
    That trust is still strong and vibrant. Four years ago, the public 
spoke up for public broadcasting when its federal funding was 
threatened. And today, nearly 5 million Americans contribute to their 
local public television stations, making ordinary citizens the largest 
single source of revenue for public broadcasting.
    Nonetheless, public television has reached a crossroads. It is 
faced with the exciting opportunity--and daunting challenge--of making 
the transition to digital broadcasting. You know how much it costs and 
how difficult it will be for PBS and its stations to do it without 
federal support.
    Mr. Chairman and members of the Committee, I appeal to you today to 
do your part to keep public television a forceful and civilizing 
alternative to the commercial media. It's a brave new digital world out 
there--and public television requires your assistance both to survive 
and to prosper. More important, America's children need your help to 
keep alive the only television service that truly serves their needs. 
As the saying goes, we have come too far, worked far too hard and 
invested much too much to slow down or turn back now.
    Thank you.

    Mr. Tauzin. Thank you. I would remind you, too, we have a 
member of our body, our good friend from Ohio, who regularly in 
the House calls upon Scotty to beam him up.
    We are now pleased to welcome Mr. Kevin Klose, the 
President and CEO of National Public Radio.

    STATEMENT OF KEVIN KLOSE, PRESIDENT AND CHIEF EXECUTIVE 
                 OFFICER, NATIONAL PUBLIC RADIO

    Mr. Klose. Thank you very much. I am honored to be 
testifying before you today, and thank you for your support and 
authorization of this bill which our member stations fully 
support and will work very hard to assist in any way they can 
toward its passage.
    Mr. Chairman, I was born in Canada, and fortunately, my 
parents came south as well under perhaps different 
circumstances.
    I come before you today, this is the first time I have 
appeared before this body in this capacity. I came to National 
Public Radio from 25 years of journalism at the Washington Post 
and former President of Radio Free Europe and former Director 
of International Broadcasting for the U.S. Information Agency. 
What brought me to National Public Radio was the notion of 
direct public service to the people of the United States such 
as is fulfilled every day by NPR, by its great journalists and 
cultural presenters.
    I think in the 7 months I have been at NPR, I've looked at 
our coverage of the Kosovo crisis and tragedy, at our coverage 
of future events and of the past in America, program segments 
such as Lost and Found Sound, which appears every week and 
recaptures sound from the past century of the sound era, and 
presents it in new ways to our listeners and to the citizens of 
the United States.
    I think as well of the presentations of Performance Today, 
which presented the Martin Luther King Memorial Concert in 
Atlanta, and received nationwide an astonishing response for 
the power and majesty of that concert in January. National 
Public Radio binds us together as a Nation, as a democracy and 
as communities in unique ways. We are a membership 
organization, as you know, with more than 600 stations among 
our membership, more than 350 direct members. It is a unique 
organization that reflects the dynamism, the multicultural, 
multifaceted nature of our extraordinarily changing democracy.
    As we go forward into the new era of digital, we go forward 
with the commitment with our colleagues in public broadcasting, 
understanding that NPR is not only a public service, but as Mr. 
Markey said, a national treasure. It has a unique relationship 
to listeners and to citizens in this country, because radio is 
a unique medium.
    As a former print journalist who has spent most of this 
decade in radio broadcast, I can tell you that the unique power 
of radio to reach people is that we are a companion to people. 
We are not just a neighbor or friend or information service, 
because radio is ephemeral, you can be doing other things in 
your lives while listening to the radio. It can present ideas 
to you with impact and continuity and contact with your life 
that cannot be matched by any other medium.
    As we look forward in the digital age, we are reaching out 
with support of CPB and with the involvement and interactivity 
of our member stations to address the digital age in new ways. 
We recently signed a series of agreements with such digital 
partners as Microsoft, AOL Online, Apple and others to find new 
ways to present our powerful materials which help the Nation in 
its democratic dialog and present ideas and issues in unique 
and relevant ways. We have recently signed an agreement to 
create two channels of news and information and current affairs 
broadcasting and entertainment broadcasting on a new satellite 
radio corporation called CD Radio, which will be available soon 
in automobiles, new models, and as it is retrofitted into 
current models. We see that as an enormously promising new 
secondary way that we can reach audiences and bring audiences 
to our member stations in unique ways.
    We also have created a very powerful presence on the 
internet. We will continue to develop our internet presence, so 
that member stations can find and link both to new partners in 
the internet cyberworld and also find audiences in new ways 
that will bring to those audiences the presence of our local 
stations in their own web site with powerful identities and 
powerful presences. National Public Radio must be a partner 
with many new partners in this new world, and we will go 
forward with your support, sir, and with the support of our 
colleagues in public broadcasting.
    Thank you very much for this opportunity to testify.
    [The prepared statement of Kevin Klose follows:]
 Prepared Statement of Kevin Kloss, President and CEO, National Public 
                                 Radio
                              introduction
    Chairman Tauzin, Congressman Markey and other members of the 
Subcommittee, thank you for inviting me to speak to you on behalf of 
National Public Radio (NPR) and the nearly 600 public radio stations 
airing NPR programming across the country. This is my first opportunity 
to address you since joining NPR as President and CEO in December of 
last year. As you know, NPR is a private nonprofit organization that 
produces and distributes shows such as Morning Edition', All 
Things Considered', Performance Today', and 
distributes Car Talk and FRESH AIR.
    We are also a membership organization, representing approximately 
600 noncommercial educational radio stations throughout the United 
States. NPR member stations are independent and autonomous, licensed to 
a variety of non-profit organizations, communities, colleges, 
universities and other institutions. The majority of NPR member 
stations are licensed to educational institutions.
    Thank you for holding this hearing and providing a chance to 
comment on the authorization of public broadcasting. Recently I was 
quoted in Broadcasting and Cable magazine, saying that NPR ``is beyond 
public service--it's a national treasure.'' I truly believe that. We 
have been successful, working in partnership with our local stations, 
to intertwine national programming from NPR and other programming 
sources with local voices and stories that connect listeners to their 
communities. Each member station is guided by the shared public service 
mission to educate, inform, entertain and designs its format to best 
serve its audience.
    For over thirty years, public radio has set the standard for 
comprehensive and enlightened reporting, as well as the production of 
cultural programs that celebrate the human experience. Public radio is 
not driven by what will necessarily garner the highest ratings, rather, 
we are committed to reaching listeners in unique ways and promoting 
discussion on important subjects that may not otherwise receive 
mainstream attention. Through your support on a variety of issues, 
especially the funding challenge of a few years ago, we have been able 
to continue to produce and air programs that enrich, engage, and 
entertain the American public.
    Like our friends in public television, NPR and its member stations 
are excited about the possibilities of digital service and ``new 
media''. We are eager to work with Congress in this area of new 
technologies. There are wonderful ways public broadcasting can better 
serve the American public by embracing developing technologies.
    Five years ago we created a New Media department at NPR. Our goal 
was simple, to extend NPR programming into the online arena and create 
new interactive opportunities using the latest technology. Utilizing 
our resources and collaborating with third party partners, we are well 
positioned to expand our outreach to the American public, provide 
additional educational and information services for current audiences 
and work alongside our stations so that they can do the same.
    Our main Web site now has about 300 thousand users a week who view 
nearly one million pages and listen (through their computers) to 200 
thousand audio files. In the last year we formed strategic alliances 
with America Online and Yahoo. We are also working with Microsoft to 
help our member stations begin online audio streaming. The future is 
exciting and we will be a part of it.
    Only weeks ago, NPR joined in an agreement with CD Radio that will 
enable NPR, member stations and independent producers to develop 
innovative programs for a national satellite radio service. Estimates 
place CD radio's potential audience in excess of 20 million U.S. 
listeners within five years.
    The agreement with CD Radio offers many benefits to member stations 
including the opportunity to gain a national audience for locally-
produced programs, acquire new listeners through cross-promotion, 
access research generated by CD Radio and NPR, and share in potential 
new revenues. NPR has already requested and received-program 
submissions from member stations for the new satellite radio channels, 
and will be requesting additional submissions in the coming months.
    These initiatives have been taken with the concurrence of our Board 
of Directors, 10 of the 17 directors are station managers from across 
the country.
    Public broadcasting has always been a federal/local partnership. We 
hope the final authorization legislation will continue to support and 
enhance this important partnership.
                               objectives
    Continued federal support through the authorizations of public 
broadcasting programs, specifically the Corporation for Public 
Broadcasting (CPB) and the Public Telecommunications Facilities Program 
(PTFP), as well as authorizing a new digital public broadcasting 
program, are vital to continuing the important work of public 
broadcasting.
    Reauthorizing CPB--Thank you for recognizing the importance of 
reauthorizing CPB, which has been without an authorization since 1996. 
At that time, the amount approved for the program was $425 million. We 
support an authorization level of 40 percent of non-federal financial 
support, not to exceed $475 million a year for fiscal years 2002-2006.
    CPB grants are essential to maintaining the vital role our stations 
play in their communities. The majority of CPB dollars designated for 
public radio go directly to local stations to support local 
programming, community outreach activities, and local artistic and 
cultural organizations. Funds from CPB allow public radio to reach 
underserved populations with programming such as radio reading services 
for the blind and quality news and cultural programming to rural 
communities often bypassed by cable and satellite services. In this day 
of consolidation of commercial radio ownership, there is an even 
greater need for the localism that has long characterized public radio.
    According to the latest CPB ``Public Broadcasting Revenue Report 
for Fiscal Year 1997'', federal money accounts for fifteen percent of 
public radio's revenue, a small but important piece of the funding pie. 
The largest single portion of public radio revenue is from listeners' 
contributions, accounting for twenty-nine percent. Business support 
accounts for fourteen percent, universities and colleges nineteen 
percent and foundations seven percent. Support also comes from state 
and local governments (five percent and three percent, respectively).
    For Fiscal Years 1999 and 2000, public radio cost each American 
twenty-three cents a year. This is less than the cost of a public 
telephone call or an edition of most daily newspapers. A 1997 Roper 
Starch Worldwide poll showed, when given a choice of 20 services, 
Americans judged public radio and television the second and third best 
value in return for federal tax dollars spent. Military defense ranked 
first.
    As stated earlier, after CPB administrative costs, almost all of 
the federal money is directed to local stations. Public radio receives 
twenty-five percent of the federal appropriation and public television 
receives seventy-five percent. Of radio's portion, ninety-three percent 
goes directly to local public radio stations. The other seven percent 
of radio funds remains in a CPB fund to support national programming 
through a competitive grant process. CPB funding assists public 
broadcasting stations to produce local programming and to purchase 
national programs.
    Stations rely on federal funding to acquire a variety of quality 
noncommercial educational programming. Cultural programs such as 
Performance Today' offer listeners thoughtful insights into 
the world of classical music together with great concert performances.
    To mark the dawn of the new millennium, NPR has begun airing a 
year-long series called Lost and Found Sound'. Two of the 
most notable installments aired so far were the ``Gettysburg 
Eyewitness'' and ``Lindbergh, Collie, and Me''. The former featured a 
unique recording of William V. Rathvon, who as a nine-year-old boy, 
watched and listened as Abraham Lincoln delivered his address at 
Gettysburg in November 1863. The story was told in 1938 and recorded on 
a 78 r.p.m. record. The second story showcased Minnesotan Xandra Kalman 
and her husband Collie, who were on vacation in Paris on May 21, 1927. 
It was her wish to be at Le Bourget Field when Charles Lindbergh landed 
there that day . . . and she was. She later told the story to her 
children and grandchildren and recorded it on audio cassette. Included 
in this series is the ``Quest for Sound,'' a call to NPR listeners to 
send in their home recordings of sounds of the last one hundred years. 
Their contributions will be the basis of stories that capture the 
rituals and sounds of everyday American life over the last century.
    For public radio, every federal dollar leverages over $5 from non-
federal sources. That is a five to one return on the federal investment 
in quality programs and services, making it perhaps, one of the best 
investments of tax dollars. Federal money is crucial because it helps 
public radio stations plan, produce and acquire programs that attract 
non-federal funding sources.
    Reauthorizing CPB for the amount and years proposed will help 
strengthen the system for the future.
    Reauthorizing PTFP--Reauthorization of PTFP, the only federal 
capital improvements program for public broadcasting, is essential. 
This small but effective program is an excellent example of a public/
private partnership that works. It operates on a matching grants basis 
and to date, it is the only federal program making funds available for 
the acquisition of digital equipment, while also maintaining analog 
service. It is administered by the National Information 
Telecommunications Administration (NTIA), within the Department of 
Commerce. It is fitting that PTFP resides with the agency charged with 
spectrum management and thus has the technical expertise to make 
informed engineering decisions, especially on a case-by-case basis. Its 
history makes it an excellent candidate to help public broadcasters 
transition from analog to digital broadcasting, without duplicating a 
spectrum technical staff elsewhere in the government.
    One of the hallmarks of the program is its dedication to rural 
service. In fact, grants for bringing first service to a region are 
given the highest priority. According to NTIA, a public radio signal 
reaches 90% of America, while a public television signal reaches 95% of 
our nation's population. The technological revolution has yet to reach 
many of these regions, cable wires have yet to be laid and digital 
satellite service is still too expensive for wide-spread use. For these 
areas, public radio may be the only source of affordable news and 
cultural programming available.
    Our NPR member stations are counting on PTFP to help them prepare 
for a digital future, while at the same time keep them on the air 
broadcasting in analog. Since 1984, the program has financed over 700 
public radio projects, totaling nearly $60 million. Many of you serving 
on this subcommittee have had the opportunity to write in support of 
PTFP grants and understand the importance of continuing this operation.
    Public broadcasting supports a PTFP reauthorization of $35 million 
in fiscal year 2000, $110 million in fiscal year 2001, $100 million in 
fiscal year 2002, $89 million in fiscal year 2003 and such sums as may 
be necessary for 2004.
    Authorizing a Digital Public Broadcasting Program--The inclusion of 
a substantial digital authorization will be a key element of this 
legislation. We are excited about our move into the digital age and the 
opportunities and challenges before us. As you know, public 
broadcasters estimate that the total digital conversion will be $1.7 
billion.
    So far public radio has identified an estimated $70 million in 
digital broadcast related costs. Our early numbers indicate $60 million 
is needed to assist in public radio's conversion to digital 
transmission and at least $11 million to help stations defray tower 
dislocation costs and maintain analog broadcasts.
    Digital Radio--While public television is operating under a mandate 
to convert to digital broadcasting by 2003, public radio has no similar 
directive. However, a decision on digital radio transmission technology 
is just around the corner. Currently, the U.S. is in the process of 
developing a technical standard for digital radio with efforts centered 
on In-band, On-Channel or ``IBOC''. Conversion to digital transmission 
as is now occurring in Europe, Canada and Australia, however, is only a 
part of the final link in the digital revolution taking place 
worldwide. As the communications marketplace experiences even greater 
growth, public radio must be poised to take advantage of new and 
emerging digital production, transmission and distribution technologies 
that can offer programming services to listeners in ways not previously 
imagined.
    The transmission technology currently at the forefront is commonly 
called ``Digital Audio Broadcasting'' (DAB) which delivers compact 
disc-quality sound free of interference and noise to listeners. DAB 
will allow radio stations to upgrade their delivery of audio 
programming. For example, digital radio will provide more reliable AM 
and FM transmissions, less subject to the effects of geography, terrain 
and man-made interference. This feature is particularly important in 
rural areas, where there would be little or no broadcast service 
without public broadcasting. Moreover, digital will permit public 
stations to transmit ``smart radio'' signals that deliver data messages 
along with the audio program. Digital data may be used to provide 
continuous specialized information, such as weather, traffic, music 
titles, program or emergency information on a local basis, in a wide 
variety of forms, text, audio and graphics.
    Impact of DTV on public radio--Allow me to explain about the impact 
of DTV conversion on public radio stations. Congress' mandate to 
convert television stations to DTV will result in many radio stations 
currently co-located on a television tower having to move from these 
leased towers. Many public radio stations' transmitters are located on 
broadcast towers owned by television stations.
    As television stations convert to digital, they are adding new 
digital transmitter antennas to their existing towers that enable them 
to launch digital broadcasts. Meanwhile, television is required by the 
government to maintain existing transmission equipment on these towers 
in order to continue offering an analog service. If there is no room 
left on a tower or if it is unable to support the combined weight or 
size of the new and the existing transmitter antennas, public radio 
stations will be forced to move. There are two options, lease space on 
another tower or build a new one.
    Although it is still too early to know all the factors involved in 
such forced relocations, our stations surveyed report at least $11 
million in costs overall to maintain current broadcasts. Again, this 
cost estimate will surely change as DTV conversion progresses and radio 
stations have a better sense of their tower situations. The actual 
costs will depend on the actions of other commercial and public 
television and radio stations.
                               conclusion
    Public broadcasting is poised to deliver bold new services through 
new technologies, but our goals cannot be realized without continued 
federal financial support. Passage of legislation that includes CPB and 
PTFP reauthorization, as well the creation of a new digital public 
broadcasting program will demonstrate your commitment to public 
broadcasting's future. We do not want to be left behind; the investment 
is too great, the potential too enormous to ignore. As we approach the 
dawn of a new millennium, public radio looks forward to working with 
you to create an even more dynamic and vibrant system to serve an ever-
expanding listenership in our ever-changing America.

    Mr. Tauzin. Thank you, Mr. Klose.
    Next we have David Brugger, the President and CEO of 
America's Public Television Stations. David, welcome, and we 
welcome your testimony, sir.

 STATEMENT OF DAVID J. BRUGGER, PRESIDENT AND CHIEF EXECUTIVE 
         OFFICER, AMERICA'S PUBLIC TELEVISION STATIONS

    Mr. Brugger. Thank you, Mr. Chairman. I represent America's 
public television stations across the country. We thank you 
very much not only for your introduction but for Mr. Markey's 
co-sponsorship and all of the co-sponsors today who are signing 
onto this bill.
    It is certainly a critical need. Like Congress, public 
broadcasters are rooted in their local communities. I spend a 
lot of my time, probably a good 40 percent sometimes, more of 
my time on the road, working with local boards and local 
stations. A lot of my job is to work with them in terms of 
facilitating their own strategic planning. I listen to their 
concerns, I work with them on helping them plan for the future 
in terms of being a resource of what is going on, what the 
expectations are from Washington, and listen to what their 
expectations are.
    A lot of times I think we forget that these are just local 
citizens who are volunteering their time, thousands of them on 
the board and hundreds of thousands of them who are 
volunteering their time for all kinds of work at the local 
stations. They are involved not just to help raise money. They 
are really involved because they are concerned about the 
services, how is their community going to be represented, what 
kinds of local productions can they do that will help all of 
the institutions in their community. Many of the boards are 
very representative of all of their communities in terms of the 
social institutions, the businesses, and others who care about 
public media.
    What they are looking for, of course, is also the Federal 
participation. They know what they can raise and what they are 
doing at the local level, they know how they are helping to get 
dollars from their States. But they are very concerned about 
the critical funding and the leverage that Federal funds 
support, and the matching basis that they can then use as a 
Federal commitment to go out and raise other funds.
    That is why this reauthorization is so critical, especially 
for stations in the smallest communities. For some of the 
larger stations, it may represent about 10 to 14 percent of 
their budget. When you get out into the small stations in the 
rural communities, you're talking about going up to 40 percent 
of their budget are the Federal dollars that they are now 
getting in community service grants through the Corporation for 
Public Broadcasting.
    That is why this bill is so important. Because it really 
looks at three different components here. It has the CPB 
community service grant. It has the funds that stations are 
using for local programming in terms of their local community, 
the production costs and the way to help them survive and to 
get PBS services.
    They are also looking at digital television. Somebody 
mentioned before that we are looking at a three-pronged effort 
here. We are looking at $770 million from the Federal 
Government as a matching fund, out of a total of $1.7 billion 
that the stations have to raise in order to convert to digital. 
We are also looking at what the possibilities of that are. As I 
work with station boards, they are planning right now on what 
they can do with all of those channels. They are looking at 
children's channels for preschool. They are looking at K-12 in 
terms of high school education, college credit courses that 
they want to work with their local community colleges and other 
universities in helping the adult learner continue their 
education.
    They are certainly looking at the local public affairs 
possibilities. They have sort of what they are calling the 
state span or city span sometimes with the school boards and a 
lot of the other institutions in town, so that the citizens of 
that community can learn more about their public institutions 
and be more involved as responsible citizens.
    They are also looking at the possibilities for interactive 
data, for the teacher support, for the outreach that they are 
able to do with other community institutions as they fight 
youth violence, drug abuse and other issues in their 
communities.
    The third component, of course, is the facilities program 
that has been so key to all of the stations over the years. The 
facilities program started in 1962, even before there was a 
Corporation for Public Broadcasting, helped start to build the 
steel and wire structures that are broadcasting to your local 
communities. Now we are looking again for that kind of matching 
help, so that stations can really serve their communities with 
this kind of digital technology in sort of the unlimited ways 
that we do not even know at this point all of the possibilities 
that this technology can bring to local communities.
    So we thank you very much for this bill, and we thank you 
for recognizing the critical needs of the stations.
    [The prepared statement of David J. Brugger follows:]
   Prepared Statement of David Brugger, President and CEO, America's 
Public Television Stations; Beth Courtney, President and CEO, Louisiana 
  Public Broadcasting, Chairman, Board of Trustees, America's Public 
    Television Stations; and David Liroff, Vice President and Chief 
Technology Officer, WGBH Educational Foundation, Boston, Member, Board 
           of Trustees, America's Public Television Stations
    I want to thank you, Mr. Chairman, and the members of the 
subcommittee for your past support for public broadcasting. Local 
stations have built a priceless asset--a public broadcasting system 
that reaches virtually the entire country over the air and free(and 
brings educational and informational programs to urban and rural 
America with the help and support of Congress.
    Like members of Congress, public broadcasters are representatives 
of, and deeply rooted in, our local communities. We are responsive to 
the unique concerns of our citizens--from urban neighborhoods to rural 
countryside and everything in between. With the help of this committee, 
public broadcasters will continue to hold their place in this 
aggressively commercial multimedia culture as the one publicly 
supported, nonprofit institution dedicated to education, culture and 
citizenship.
    I am testifying today to ask the subcommittee to reauthorize two 
very important programs for public television--the Corporation for 
Public Broadcasting (CPB) and the Public Telecommunications Facilities 
Program (PTFP), and to create a new grant program to assist public 
broadcasters in the conversion to digital broadcasting.
The Prologue
    With roots going back to the earliest days of radio and television, 
America's public broadcasters have played a unique role in a media 
industry otherwise built on consumer advertising and mass market 
entertainment. Into the 1960s, as television evolved into three major 
networks and a handful of independent commercial stations, publicly 
funded television provided the one clear alternative, focusing on 
education and culture, public affairs and the performing arts. In 1967 
Congress passed the Public Broadcasting Act as an amendment to the 
Communications Act of 1934. With this legislation Congress laid the 
cornerstone for the future of noncommercial educational broadcasting.
    Of course, commercial television had popular shows and beloved 
characters--the best of them are woven into the fabric of our culture. 
But only public television could introduce children to a Mr. Rogers, 
Big Bird or Kermit; provide a front-row seat at Masterpiece Theatre, a 
day on a Civil War battlefield or a night at the opera. Freed of 
commercial constraints, public broadcasting forged an award-winning 
record of educational value and pioneering innovation built on 
quality--a quality that viewers appreciated and to which other 
broadcasters aspired.
    Now, with the advent of powerful new digital technologies, the 
media world has begun a new, exponential expansion--allowing the 
commercial marketplace to slice the audience into even smaller niches. 
But if past history and recent experience are any guides, more channels 
don't necessarily mean more quality choices.
The Digital Age
    The world of media and telecommunications is undergoing an historic 
transition to a new technical standard of digital broadcast. Unlike 
today's broadcast system, digital technology allows a quantum leap in 
the amount of information that can be sent at any one time on a single 
channel. Many think of digital as ``High Definition TV''--a movie 
screen-like picture of breathtaking clarity and detail. But those of us 
in public television are even more excited about the other features of 
digital technology.
    For public broadcasting, the expanded digital spectrum allows us to 
break free from today's technological limits on the amount and variety 
of educational programming we can make available to Americans of all 
ages.
    For example, a local public television station could--on any given 
day--broadcast a slate of award-winning learning programs like Arthur, 
Barney and Friends, and Sesame Street--all designed to help pre-school 
children develop the social and intellectual foundations for success in 
the classroom.
    And during the very same hours, the same station could broadcast a 
whole curriculum of high-school and college-credit and professional 
development telecourses--from American history and plant biology, to 
marketing communications and social psychology--all designed to put 
lifelong learning within reach of every adult in America.
    At the same moment, the same station could also provide regular 
coverage of state and local government, congressional town meetings and 
school board debates--all designed to help restore a sense of active 
citizenship that's essential for a healthy democracy.
    That same station could continue to broadcast an eclectic mix of 
programs that entertain and enlighten, inspire curiosity and improve 
daily life. All of these programming choices would come with an 
interactive stream of data--from study guides and classroom materials 
to expert advice and legislative information--transforming the TV set 
from an appliance for passive viewing into a tool for active learning.
        Mississippi ETV is one of at least seven public television 
        stations currently broadcasting an experimental digital signal. 
        Digital television will not only offer additional channels for 
        TV programs but will also allow for expansion of current 
        services and provide avenues to reach out to audiences beyond 
        broadcast via electronic technologies. For example, Mississippi 
        ETV is currently developing a CD-ROM to accompany the linear 
        ITV (Instructional Television) series Media Mania. With digital 
        technology, the CD-ROM can be accessed through enhanced TV 
        along with the television lessons. Web site development to 
        provide additional information about the programs adds to the 
        impact of traditional TV productions.
An Unfunded Mandate
    For the entire television industry, the eventual promise of digital 
may be great, but the start-up will take a major capital investment in 
new transmitters, cameras, videotape decks and other expensive 
equipment. Implementing the 1997 budget reconciliation legislation, the 
Federal Communications Commission has determined that public television 
stations must begin broadcasting a digital signal by 2003. The public 
broadcasting industry estimates the total cost of conversion to be $1.7 
billion.
    Public television stations are seeking $770 million over five years 
in federal assistance, about 45 percent of the total estimated 
conversion costs. We are seeking funds through the Public 
Telecommunications Facilities Program (PTFP) at the Department of 
Commerce as well as the Corporation. The PTFP funding will help local 
stations to construct basic ``pass through'' facilities. For a station 
to customize a national program schedule to meet the needs of its local 
communities and to insert its own programs, however, additional ``local 
insertion'' equipment will have to be installed. Stations are seeking 
the funds for this equipment through the additional funds requested at 
CPB. These funds will also assist in the production of new digital 
programming.
    It is imperative that public broadcasters get a significant 
commitment from Congress this year in the form of an authorization. 
Some stations have already started to convert in order to comply with 
the FCC deadline and will need federal assistance to complete their 
efforts. These stations also are incurring the additional costs of 
broadcasting in two formats. Other stations, especially those in small 
towns and rural areas, cannot even consider major equipment purchases 
until they obtain a firm financial commitment from Congress. Without 
federal help, these stations will not be able to construct digital 
facilities and will go dark after the transition period when Congress 
reclaims their analog channels.
    To fulfill this mandate, public broadcasters are doing their part, 
seeking financial support from a range of public and private sources--
foundations and corporations, loyal viewers, entrepreneurial endeavors, 
and state and local government partners. To date, public TV stations 
have raised more than $160 million from state and local governments to 
enable their transition to digital.
    Individual stations are undertaking major fundraising campaigns to 
raise the majority of capital needed to meet the conversion mandate. 
But fulfilling the public service goals for digital TV clearly depends 
on the federal government playing its historic leadership role in 
committing funds. Federal support sends a signal to these potential 
funders that there is indeed a real and urgent need for support to 
ensure the viability of public television in the digital era.
    For publicly chartered, nonprofit institutions, which, by design, 
lack access to private capital markets and commercial advertising 
revenue, the digital transition presents a dangerous double bind. 
Diverting resources from existing educational programs that these 
funders already support threatens services on which Americans have come 
to rely. But failing to make the investment would mean many would be 
denied the enormous educational promise of digital television.
    Reauthorizing public television funding, including a special 
authorization of $770 million (over five years) to help defray less 
than one-half the cost of the digital transition, is more than a matter 
of the public need or federal responsibility. It is essential to 
ensuring that this remarkable new technology fulfills its advertised 
potential for improving the lives of American families and communities.
    For more than three decades Congress has made a long-term capital 
investment in a technologically competitive public television system. 
Since 1962 it has provided funding for a facilities program, initially 
as a result of the Educational Television Facilities Act of 1962. 
Currently, the Public Telecommunications Facilities Program (PTFP) is 
administered through the Commerce Department's National 
Telecommunications and Information Administration (NTIA).
    Between 1991 and 1993 Congress made an additional investment in a 
new national satellite interconnection and in the local facilities 
needed to make it work. This has been a wise investment in American 
communities, as local public stations have used these facilities to 
provide valued educational and public service programming. It makes no 
sense to allow this unique resource to wither when the potential future 
benefit is even greater. This year Congress also appropriated money for 
the replacement of the NPR satellite that failed last year.
Innovative Uses of Technology in the Public Interest
    Public television's values will not change in a digital world. We 
will build on our track record of providing the best programming and 
services to educate and enlighten audiences. We pioneered the nightly 
in-depth news discussion program, the dramatic mini-series and the 
history and science documentaries that have all been copied on 
commercial broadcast and cable networks. We also will continue to be a 
leader in using new technology for the public interest. Public 
television was the first to provide closed captioning, the first 
television network to have a digital satellite distribution system, the 
first to use descriptive video for the sight impaired, and the first to 
develop descriptive video and stereo broadcasting. In fact, WTTW 
Chicago was the co-inventor of stereo broadcasting (with Telesonics) 
and was the first television station to broadcast in stereo.
    Public broadcasters are already developing prototype educational 
applications for digital technology without regard to whether the 
application has quick or guaranteed financial return.
        In Chicago, WTTW will be able to extend the outreach of its 
        community programming initiatives 100-fold, allowing for 
        greater viewer access and interaction. Digital technology will 
        position WTTW as a central learning hub linking it with other 
        institutions throughout Illinois to strengthen their respective 
        missions. For example, WTTW's arts programming (including its 
        award winning weekly series, Artbeat,) can be linked digitally 
        with the Art Institute of Chicago and other web sites, allowing 
        viewers to print out materials on a related topic directly from 
        their digital television printer or computer.
    Local public television stations and PBS have joined together to 
create the award winning PBS ONLINE, one of the largest and most 
popular Web sites anywhere on the net. We have more than 30,000 pages 
of information related to public television programming and links to 
companion sites, as well as a wealth of original material that 
encourages both informal and formal learning. With digital television, 
this material can be made available to all Americans.
Children's Educational Services
    Public television continues to be honored as the leader in quality, 
educational, non-violent programming for children. Local public 
television stations implement the PBS Ready to Learn Service by 
combining seven to nine hours per day of quality children's programming 
with the kind of hands-on human outreach that is essential for 
effective teaching and nurturing of preschoolers. It's specifically 
designed to ensure that every child arrives at school with the basic 
tools necessary for success in the classroom.
    The Ready to Learn Service has grown to 127 participating stations 
reaching more than 93 million homes. In the past four years, Ready to 
Learn stations have conducted more than 8,572 workshops in their 
service areas. Local station outreach coordinators have trained more 
than 300,000 parents and childcare providers, caregivers and educators 
to use the programs to reinforce learning skills ultimately reaching an 
estimated 37 million children across the country. With digital 
technology Ready to Learn and other K-12 services can be expanded and 
enhanced.
    The KQED Educational Service in San Francisco operates one of the 
largest instructional television (ITV) services in the country, serving 
2,500 schools, 28,000 educators and over 620,000 students with hundreds 
of video programs. With teacher input on the selection of programs, 
KQED licenses and broadcasts more than 80 instructional television 
(ITV) series--over 1000 individual episodes.
    In Southern California, KCET sponsors the Ready to Learn Preschool 
Education Project, a comprehensive educational outreach project that 
focuses around multiple PBS children's programs such as Sesame Street, 
Storytime and Puzzle Place. Over the past five years, the KCET 
Community Relations and Outreach department has been actively working 
with families in the community to motivate young children to learn. 
KCET is particularly invested in helping children from low income or 
limited English speaking communities and in enriching the knowledge and 
educational resources of preschool and elementary educators and 
childcare providers who serve these children. To date, through its 
Ready to Learn Service, KCET has conducted over 111 teacher training 
workshops in both in English and in Spanish, trained over 3,650 
teachers and in turn reaching over 22,000 children in Southern and 
Central California
    Mississippi ETV's Ready to Learn service is designed to help 
parents, teachers, and other caregivers use public television to help 
children love learning, thereby advancing the national education goal 
that all American children start school ``ready to learn.''
    In one three-month period Mississippi ETV conducted 23 statewide 
workshops reaching 1,056 participants and distributing 700 books to 
children. In K-12 education (from 1994 to 1997), Mississippi ETV helped 
to train 16,000 teachers in 1,270 schools and reaching over half a 
million students.
    Partnerships help Mississippi ETV extend its reach. For example, in 
conjunction with NASA /Stennis Space Center, Mississippi ETV has 
provided teacher training and sponsored the Interactive Video classroom 
and Remote Sensing Awareness Project. Working with Mississippi State 
University Mississippi ETV has developed a web site for online 
Calculus.
    Studies conducted with children, families and caregivers who have 
participated in Ready to Learn show that parents who have attended a 
Ready to Learn workshop read with their children for longer periods, 
read more for educational or informational purposes and took children 
to the library or bookstore more often than they had prior to the 
workshop. Parents and children do not get that kind of hands-on support 
from commercial broadcast or cable networks.
Highest quality, non-violent programs
    Earlier this month Congress engaged in a significant debate on the 
possible contributing factors to a culture of youth violence. We 
commend Congress for devoting time and thoughtful discussion to this 
important and timely topic. We respectively suggest to this committee 
that continued support for public television be considered as part of 
the answer. The actions of this committee can provide parents with a 
guaranteed safe haven and alternative to commercial media.
    In recent years, a level of violence and vulgarity that would have 
been unimaginable in previous generations has coarsened our popular 
culture. From ``Jerry Springer'' and ``Mortal Kombat'' to Marilyn 
Manson and ``gangsta rap,'' much of what kids see and hear in the 
commercial media presents a special challenge not only to responsible 
parents, but to everyone who cares about the education and early 
development of our young people. For they see the effect in the 
classroom and schoolyard, on city streets and suburban malls--in a 
decreased receptivity to learning, a lessened respect for authority and 
a diminished regard for distinction and greatness. Indeed, even as 
crime rates have come down, youth violence continues to grow.
    The quality of our popular culture and its corrosive impact on 
children is a concern that transcends politics and party labels. And 
whether or not one looks for answers in more responsible parenting or 
more responsible leadership in the movie, music and television 
industries, one demonstrable, unalterable fact remains: public 
television is the one and only place parents can depend on for quality, 
educational, non-violent programming for children.
    The public television's line-up of children's programs was honored 
with more children's Daytime Emmy Awards in 1998 than all of the 
commercial broadcast and cable networks combined and just recently 
received more awards than any of the cable and broadcast networks at 
the 1999 Daytime Emmy's. It's a line-up of programs that doesn't need 
warning labels. Instead, they offer welcome mats of educational value 
to children and safe harbors for concerned parents. While the 
commercial broadcast networks strain to meet the FCC requirement of 
three hours of high-quality, educational programs per week, most public 
television stations broadcast seven to nine hours of quality children's 
program per day.
    Public television programs are created and produced to teach 
children how to read and do math, learn history and science, as well as 
help them develop the critical skills to learn from adults and interact 
with their peers. The Annenberg Public Policy Center of the University 
of Pennsylvania, in its June 1998 analysis of children's television, 
found that ``PBS was the only venue that was virtually violence-free in 
its children's programming.''
    A recent addition to the Ready to Learn schedule is ``Zoboomafoo,'' 
a new wildlife series for preschoolers. It was created by the Kratt 
Brothers, hosts and creators of the internationally acclaimed ``Kratts 
Creatures.'' The ``Zoboomafoo'' Web site goes beyond the traditional 
uses of interactivity, featuring sound and animation, songs and animal 
games and is proving especially popular with young children.
    In short, at a time when a primary focus of our national concerns 
and public investment is on improving the lives and futures of the 
youngest Americans, there is no better investment than in the only 
Digital TV system that truly puts children first.
Adult Learning and Training
    Public television actively contributes to the competitiveness of 
our nation's economy and to workers' productivity by providing a 
variety of educational services and programs for adult learners. Nearly 
90 million American adults lack the higher level reading skills 
frequently demanded in the workplace.
    The GED ON TV program is an excellent example of what public 
television does best. Produced by the Kentucky Network since 1975 and 
currently offered by 54 percent of public television stations, the GED 
ON TV series has had a tremendous impact on the nation's economy. Over 
the past five years, more than two million people across the nation 
have enrolled in GED ON TV. The estimated economic impact of these more 
productive workers exceeds $12 billion.
    Following state budget cuts, the Georgia Department of Corrections 
started to offer GED using the KET programs. Today the course is 
offered at 18 male and three female institutions. Last year 3,200 
inmates took the test. They also use KET's ``Teach an Adult to Read'' 
series which helps inmates become tutors, resulting in ``an increase in 
self-esteem,'' among inmates.
     Louisiana Public Broadcasting even offers courses to help 
teachers teach better. The PBS Mathline online service helps math 
teachers learn new teaching skills and incorporate National Council of 
Teachers of Mathematics (NCTM) standards through video clips 
demonstrating best practices and electronic messaging with peers around 
the country.
     Project Interact, a joint effort of LPB, Southeastern 
Louisiana University and the Louisiana Department of Education, is a 
satellite telecourse that helps teachers become certified in Special 
Education.
     Through the National Teacher Training Institutes, LPB 
demonstrates hands-on, interactive ways to use online technology and 
instructional video in math and science classrooms. LPB also houses the 
Louisiana Educational Technology Resource Center, established by the 
legislature in 1996. The LETRC helpdesk assists teachers and 
administrators with questions about implementing technology in their 
schools. LETRC also provides free, hands-on Internet training for 
teachers in the eight-parish Baton Rouge area.
    In the future, with the expanded educational possibilities of 
Digital TV, the long-term impact on the nation's economic productivity 
can be extraordinary.
    The U.S. Department of Education has committed $15 million to the 
five-year PBS initiative ``Literacy Link,'' which will combine video 
and on-line service to help those adults improve their learning and 
workplace skills while providing teachers with on-line guides to 
materials; video conferences and other professional development aids.
    Every year distance-learning telecourses are broadcast by public TV 
stations and beamed by satellite from PBS and the CPB/Annenberg Project 
to two-thirds of the colleges and universities in the United States. In 
1998-99, roughly 500,000 adult degree candidates participated in those 
courses--a marvelous use of technology on a scale unimaginable only a 
few years ago. Since 1981 more than 4 million adults have earned 
college credit using public television's Adult Learning Service 
telecourses.
    A particular project of the PBS Adult Learning Service is one 
called ``Going the Distance,'' which enables students to earn a degree 
through college credit telecourses. During 1997-98, 62 public 
television stations in partnership with 180 colleges in 40 states 
offered the service and the first student to earn a college degree 
using Going the Distance courses graduated in May 1998.
                               conclusion
    For more than 30 years Congress has invested wisely in public 
broadcasting. We now have a strong system of public television stations 
that reaches 99 percent of American households, giving viewers tools to 
improve and enrich their lives.
    As we move into the digital era and a new millennium, the potential 
for expanded lifelong learning opportunities for all Americans using 
the resources and expertise of public television is limitless. We urge 
this committee to renew its leadership role and authorize funding for 
CPB, PTFP and digital conversion to ensure that public television 
stations remain viable in the 21st century.
    Thank you.

    Mr. Tauzin. Thank you, David.
    Next, clearly one of my favorite presenters of all time, 
Ms. Beth Courtney, President of Louisiana Network. Beth is not 
just my favorite naturally, but we have to be friends, she is 
now in possession of the most dangerous bit of video tape that 
I have ever produced in my life. Beth, I promise to be your 
friend forever if you will never make copies of that thing.
    Ms. Courtney.

   STATEMENT OF BETH COURTNEY, PRESIDENT AND CHIEF EXECUTIVE 
                   OFFICER, LOUISIANA NETWORK

    Ms. Courtney. Mr. Tauzin refers to, one of the things we do 
of course around the country is we do public affairs programs. 
We had a conversation about various forms of tax reform. I have 
wonderful video tape on him that indeed, as you go out in live 
television, it is an exciting opportunity but fraught with 
difficulties.
    I will tell you, it is a pleasure to be here this morning. 
I was there at a hearing that was not quite as friendly. Many 
of us remember that. Mr. Burton and I were both testifying, 
it's where I called him Geordi, I was humiliating my daughter 
the entire time by calling him by the wrong name. I'm glad to 
have the opportunity this morning to actually speak to all of 
you and thank you so much for your support.
    Mr. Chairman, Mr. Markey, and the other members of this 
committee, it is a wonderful opportunity to be here to tell you 
how excited we are about this new digital environment, and also 
to tell you that we are making active plans. One hundred 
seventy-five million dollars has been committed by 21 States 
already, looking to you for some sort of also Federal match in 
this exciting partnership. In Louisiana, we just ended our 
session, yes sir, no sir, yes ma'am, no ma'am, we're polite in 
Louisiana. And they also appropriated $3 million for our 
conversion, with a commitment to do even more.
    We have had commitments from Alabama, Arkansas, Maine, 
North Carolina, Connecticut, Illinois, across this country we 
are planning for that digital conversion. And we are committed 
to using it to address issues and problems of concern across 
this country.
    I was thinking as we were discussing the problems of 
violence, and I know you all have had many concerns about how 
we might address some of the difficult situations we have been 
having in this country. But you know, when the Littleton 
situation came forward, we had already produced a documentary 
for teachers to use with a teacher guide on conflict resolution 
and how you handle violence. We fed it out especially for 
teachers across the State. We had teacher guides for them to 
have conversations, for parents to use. We were already 
prepared, because that is the business we are in. We want to 
use this powerful medium, media now, to do good things in our 
States.
    I guess a couple of key examples, we have along with our 
colleagues in Mississippi, chosen a couple of the poorest 
parishes, the poorest counties in Mississippi, where we are 
trying to infuse technology into the curriculum. In Catahoula 
Parish, and you know that has great difficulty, we have been 
working with them to use web services, public television 
programs, teacher training for the internet. We have now raised 
the scores above the national average on the fourth grade Iowa 
tests. Measurable results, I think something that is very 
important for all of us to do.
    The other thing I guess I as thinking is, I think we are 
constantly in public broadcasting in an election cycle, 
something all of you can appreciate. Our record is on the line, 
we are examined and criticized, sometimes we are praised, and 
we are constantly raising money.
    I think that is what we are all about in public 
broadcasting. But what we are trying to do is good, as I know 
you all are. We are trying to make a difference in the lives of 
the people of this country.
    I always try and bring you one good story. Last time I 
talked about a young man who had never been outside the State 
who watched Where in the World is Carmen San Diego. The new 
story I have for you is a young man came back to Louisiana in 
December to do some duck hunting, something they are wont to 
do, all of our husbands do. And I would say that this young 
man, Paul Groves, flew into December just from the stage of the 
Metropolitan Opera, where he was starting in The Magic Flute, 
to do a little duck hunting and sing for his friends.
    At this small gathering in Lake Charles, Louisiana, he 
stood up and he said he was introduced to opera on public 
broadcasting. He thanked me before everybody there and said, 
that's where he was given his inspiration to want to do this.
    If we can inspire people, if we can make a difference 
because we have prepared to deal with violence and conflict, 
then we are serving our trust for you.
    But it is going to be exciting and difficult for us to get 
over this next big hump for digital conversion. Because the 
cost to convert for some stations is more than their annual 
budget. So it is a big chunk for us to be doing.
    But we are planning, appropriating and building. And with 
all of your help, because you are the people who understand 
this new technology, we have been trying to explain it to my 
legislators, and I have sort of succeeded. But what we have to 
do is share the complexity and the possibilities of this with 
everyone. And I thank you so much for your support.
    Mr. Tauzin. I can just imagine, Beth, your trying to 
explain high technology to Hunt Downer. He's the speaker of the 
house.
    Ms. Courtney. But they appropriated.
    Mr. Tauzin. A former roommate of mine, a real low-tech guy, 
I must say. He's said worse about me, I'm sure.
    We are now pleased to welcome Mr. David Liroff, Vice 
President and Chief Technology Officer of WGBH Educational 
Foundation in Boston, Massachusetts. Mr. Liroff.

STATEMENT OF DAVID LIROFF, VICE PRESIDENT AND CHIEF TECHNOLOGY 
              OFFICER, WGBH EDUCATIONAL FOUNDATION

    Mr. Liroff. Thank you, Mr. Chairman. I am delighted to be 
appearing in support of this bill. I would like particularly to 
acknowledge Mr. Markey's long-time support of public 
broadcasting and of WGBH. Your support has been instrumental in 
helping us to serve both New England and the Nation with public 
service media for many years.
    Just as the Telecommunications Act of 1967 allowed the 
fledgling Public Broadcasting Service to emerge in the analog 
world, this bill will be a foundation for public service media 
in the digital world. I would like to direct my comments 
specifically to the provisions of the bill which authorize 
digital funding to be administered by CPB and by PTFP.
    The authorization for these programs, which are $415 
million for CPB and $334 million for PTFP, totals roughly 45 
percent of the estimated digital conversion cost for public 
broadcasting. These figures are based on an exhaustive study 
that was done by the PBS engineering committee in 1997, and it 
included a survey both of commercial and public broadcasting 
transition costs. It would cover the basic pass-through 
transmission, allowing local stations to pass through a network 
signal, master control equipment to incorporate local content, 
production equipment, digital television operations and radio 
conversion as well.
    The money authorized for PTFP will be used for competitive 
grants for basic pass-through transmission facilities. While 
they are a good start, the amount of money in the PTFP 
authorization simply will not be sufficient to cover 45 percent 
of the pass-through costs of these facilities. Again, these 
pass-through facilities will not allow local stations to 
provide the local public services so critical to their 
communities.
    So the additional digital funds authorized to CPB are 
critical to enable stations to both construct digital 
facilities that will allow for local insertion of multiple 
program streams and then make full use of this capacity by 
providing multiple programming streams and enhanced television 
services. At WGBH, for example, in addition to general audience 
programming, we are planning to provide enhanced interactive 
educational program services for children, educational and 
instructional programming for use in area classrooms, which 
will be complete with teacher guides and supplementary study 
guides for students, formal and informal adult learning 
opportunities and expanded coverage of the activities of the 
State legislature and Massachusetts public affairs.
    So this will provide not only for the pass-through 
capability, but also the capability to develop, to produce and 
to distribute local content as well.
    I will be happy to address any questions that you may have 
particularly on the digital facilities needed and their cost.
    Thank you.
    Mr. Tauzin. Thank you, Mr. Liroff.
    And finally, Mr. Jeffrey Chester, Executive Director of the 
Center for Media Education in Washington, DC. Mr. Chester.

STATEMENT OF JEFFREY A. CHESTER, EXECUTIVE DIRECTOR, CENTER FOR 
                        MEDIA EDUCATION

    Mr. Chester. Thank you, Mr. Chairman, Representative 
Markey, other members of the committee. We are delighted to be 
here today.
    We strongly support and praise your bill which would 
reauthorize the Corporation for Public Broadcasting, ensure 
that public television and public radio make the transition to 
the digital age, and increase the funding for the digital 
transition. We have been pleased to be able to work with the 
committee over the last few years on a number of issues 
critical to children's programming, including educational 
programming for children's television, the V-chip guidelines 
and more recently, the Children's On-Line Privacy Act, which 
was passed last year.
    We do hope that you will consider some of the many sage 
proposals you had in the previous bill for public broadcasting, 
particularly exploring the need for a trust fund and also to 
ensure meaningful underwriter reform. There is no question that 
commercialism, as Congressman Markey said this morning, 
creeping commercialism, is having an impact on the quality 
production of information on public radio and public 
television. I would like to include in my testimony an article 
recently co-authored by Dr. Alvin Poussaint of Harvard, who 
offers a very biting critique of the influence of commercialism 
on the children's programming block.
    Mr. Tauzin. Without objection, that will be included.
    Mr. Chester. I think it is something that everyone really 
should read.
    Today, I am afraid we were not able to get a VCR here, but 
I could show you, I am also the father of a 6-year old, I want 
to make it very clear, my child loves public broadcasting, it's 
one of the few things I allow her to watch. We live with it 
every day. I also appreciate the programming on public 
television and public radio.
    But increasingly, much of what we see in terms of 
underwriting on public television programming for children is 
more like advertising. Indeed, there are practices going on in 
public television and in public radio that more are akin to 
what we see selling commercial time, in the commercial 
entertainment media. I don't know if any of you have young 
children, and I wish I could show you the Chuck E. Cheese, I 
can't act it out here because you would drag me out, but these 
are underwriter spots that are clearly designed as ads. There 
is a way to design these spots so they appeal to the adults. 
But when your child, when the little Juicy Juice squiggles 
around and all of a sudden your 5 year old turns to you when 
you're in the grocery juice, I want Juicy Juice, I want Chuck 
E. Cheese, clearly there is a better way to do this.
    In addition, a lot of stations are also running, in 
addition to the national underwriting spots, they are running 
local spots. So increasingly the children's block is filled 
with these underwriting promotions. There are all kinds of tie-
ins for licensed products. I don't know if any of you have 
watched the pledge breaks where they say, oh, go get your 
parent, and all of a sudden they hold up the Barney doll you 
can get for $40. Well, the Barney show just ended, or the 
Arthur doll, there is a lot of marketing going on that we think 
is inappropriate to the children's block.
    I think we also have to be concerned about commercialism as 
we move into the digital era. It is not too soon for public 
radio and public television to address to the Congress how they 
are going to ensure that they are going to be non-commercial 
with this interactive media system. Now, if you go on the 
pbs.org web site, this is the PBS kids Arthur page, you go and 
click on the underwriter logo, let's do Juicy Juice. If you go 
to pbs.org/kids, and then you go to Arthur, which is a very 
popular program on public broadcasting, you will see this. This 
is the Arthur home page, you can play with Arthur's pals.
    But you can also end up with, there are hot links on the 
web page directly to the underwriters that appear more like 
advertising to me. Let's say you click on Juicy Juice, and that 
says you are now leaving PBS. This is supposed to be a 
separator, but it is not effective. It does not really tell the 
child that they are about to go into an ad. All of a sudden, if 
the child hits Juicy Juice, they are told, well, gee, if you 
drink about 50 gallons of juice, we'll send you some free 
books. You earn points and as many points as you get, you can 
get books. Then, and this is not clear, this could violate the 
intention of the On-Line Privacy Act, all of a sudden there is 
a form that pops up asking for all kinds of personal 
information.
    Then if you click on another underwriter, all of a sudden, 
and you don't really even see any screen shots, it's really 
just an ad for Frosted Alphabets and marshmallow, and it tells 
the kid in kids language, this is really good to eat.
    It is not too soon, as I said, for public broadcasting and 
public radio to enact safeguards and policies to ensure that 
not only do they restrict the kinds of commercialism going on 
on the broadcast platform but also the new digital platforms 
emerging.
    Thank you.
    [The prepared statement of Jeffrey A. Chester follows:]
 Prepared Statement of Jeffrey A. Chester, Executive Director, Center 
      for Media Education on behalf of Center for Media Education
                              introduction
    Mr. Chairman, Rep. Markey, and other Members of the Subcommittee, 
thank you for inviting me to testify before you today. I am Jeffrey A. 
Chester, Executive Director of the Center for Media Education, a 
national nonprofit and nonpartisan organization. The Center's mission 
is to ensure that the electronic media effectively serve the interests 
of children, youth and their communities.
    We have been privileged to work with this Subcommittee in the past, 
on such issues as children's educational programming on commercial 
broadcast television, effective Parental Guidelines for the V-Chip, and 
protecting children's privacy on the Internet.
    I am particularly pleased, Mr. Chairman, with your proposed 
Reauthorization of the Corporation for Public Broadcasting (CPB). Under 
the bill, CPB will be given a substantial increase in general funding, 
as well as special support to help ensure public broadcasting make an 
effective transition to digital communications. Noncommercial 
television and radio programming continues to play a critical role in 
ensuring that the public receives quality and often in-depth news and 
information. Most notably, public broadcasting has provided children 
(as well as their parents, teachers, and caregivers) with thousands of 
hours of well-made and effective educational programming. The mission 
of CPB--and the local and national noncommercial programming it 
supports--is as vital in the digital age as it has been over the last 
thirty years.
    As the Members of the Subcommittee well know, public broadcasting 
is available to almost everyone in the U.S. with a television. 
Regardless of income or geography, noncommercial TV and radio provides 
its services to the public. Unlike cable, satellite television, or the 
Internet, access to public broadcasting is free. As the system moves 
into digital communications, we expect that it will expand its free 
services to the public, providing Americans with bountiful, interactive 
access to news, public affairs, education, arts and culture. But in 
order to ensure CPB and the system fulfill their potential in the 
digital age, it is important that they incorporate a number of new 
policies.
    That's why, Mr. Chairman, we hope that as the bill moves forward 
you will consider incorporating many of the thoughtful reform proposals 
you and Rep. Markey made jointly last year. One of the key areas 
concerns underwriting. As has been noted, ``creeping commercialism'' 
has had a demonstrable impact on the public TV and radio system. Many 
experts have observed that commercial considerations appear to have 
influenced programming decisions, raising serious concerns about the 
system's editorial integrity. An extraordinary, well-produced three-
part series on the program ``Marketplace'' recently examined the role 
underwriting plays in public radio (http://www.marketplace.org/
features/underwriting/). A recent article in American Prospect (http://
epn.org/prospect/44/44linn.html) by Susan E. Linn and Alvin F. 
Poussaint effectively documented how commercial considerations appear 
to have contributed to a decline in the standards public television has 
traditionally used when airing educational children's programming. 
Additional background on the issue of commercialization can also be 
found on the website of the newspaper Current (see, for example, http:/
/www.current.org/cm/cm1.html).
    CME strongly urges you to include the underwriting reform proposal 
you made last year. Specifically, under that proposal, underwriting 
messages would be limited to simple aural and visual acknowledgements 
of the sponsor of funding, and each underwriting message would be 
limited to 10 seconds in duration. Sponsorship announcements on public 
broadcasting, after all, were conceived originally as a public-
accountability mechanism, a means of disclosing to the public any 
potential conflicts of interest involved in programming. It evolved 
over time as an expression of philanthropic support and community 
public service. Increasingly, however, many underwriting practices are 
more akin to the dealmaking one witnesses in the commercial media. As a 
taxpayer-supported entity, public broadcasting should not be competing 
in the marketplace for advertising support.
    We understand that public broadcasting, in its quest for additional 
support, must respond both to the challenges of today's programming 
marketplace as well as to Congressional directive. Clearly, the message 
sent by Congress in the recent past was for public broadcasting to 
become more entrepreneurially minded and to make better business 
decisions. Ever-increasing programming costs and the additional burden 
of adequately addressing the transition to digital broadcast have 
undeniably placed an economic burden on the system. Such financial 
pressures should not be allowed, however, to divert the system from its 
core mission of providing a vital alternative to commercial 
broadcasting.
    An increase in federal support, as envisioned by your legislation, 
would help relieve some of these financial pressures. But regardless of 
increased federal support, we remain convinced that public broadcasting 
must engage in underwriter reform. There are two areas in particular 
where safeguards are needed to insulate program production from the 
impact of commercial considerations: in news and public affairs, and in 
children's educational programming. Effective safeguards become even 
more important in the digital era, as public broadcasting begins to 
explore a variety of new distribution platforms in what will surely be 
a more competitive broadcast marketplace.
    In the area of news and public affairs programming, the public must 
be able to rely on public broadcasting for a range of editorial 
functions, including unbiased, objective, and in-depth reporting, along 
with commentary and analysis reflecting divergent points of view. Even 
in this era of multiple sources of information, including new digital 
services, there is still a scarcity of journalistically sound long-form 
documentaries and investigative reports. In order to have a vibrant and 
healthy democracy, the public needs free access to the quality news and 
public affairs programming that only public broadcasting can provide. 
The system also has a special role to ensure that independent 
producers, and the diversity of interests they represent, find 
meaningful support for the production and distribution of their work.
    As for children's educational programming, we find some of the 
trends within public television disturbing. As mentioned above, Harvard 
professor and child psychiatrist Alvin F. Poussaint, in an article co-
written by Susan E. Linn, shares many of our concerns. (We have 
included the article as an attachment to this testimony.) Public 
broadcasting has earned its reputation with the public--and with 
parents in particular--by creating educational programs based on 
research designed both to educate and to entertain. Its role has been--
and should continue to be--one of providing children with quality 
educational programming of a range and depth that is simply unavailable 
on commercial television. PBS and the stations must work diligently to 
create programming that serves the interests of children, not the needs 
of marketers, toy companies, and production entities seeking to reap 
profits from what are essentially public resources.
    In response to criticism from CME and other children's health and 
education groups, PBS crafted underwriter rules two years ago that were 
designed to implement some safeguards in the area of underwriting and 
children's programming. Unfortunately, many of the national 
underwriting messages often look and sound more like commercials. They 
usually run both before and after a program. Local stations also add 
their own ``spots,'' which further contributes to the commercial 
clutter. In our opinion, these underwriting messages should be designed 
to be a straightforward acknowledgement of a company's support for the 
program and for public broadcasting's mission. They should be designed 
for adults, and not as a means of promoting products and brands to 
children.
    As you know, Mr. Chairman, children have become a ``hot'' target 
market, and they are bombarded every day, in a variety of settings, 
with all manner of advertising messages. Public broadcasting's 
children's programming, on the other hand, was intended to serve the 
educational and informational needs of a child, and it should remain 
free of the interference and distraction of product pitches and 
appeals. Unfortunately, as you can see from the videotape clip, there 
are now times when something more than learning one's ABCs is being 
sold to children.
    We are pleased to note, however, that PBS appears to have been 
working to ensure that several of the new national underwriting 
announcements are more carefully crafted. But your proposal last year, 
Mr. Chairman, for a ten-second limit, remains the most effective 
safeguard in the area of underwriting.
    As public broadcasting moves into digital communications, it is 
important that CPB, the stations, and other public broadcasting 
entities protect children from new forms of advertising, marketing, and 
electronic data collection. For example, we already find on the PBS 
Kids website ``hot'' links that will transport a child from cuddling an 
e-version of Arthur and his friends, into the web pages of the 
underwriters selling juice and cereal. Let me show you some examples 
(http://www.scholastic.com/juice/index.htm, http://www.kraftfoods.com/
cgi-bin/product.cgi?
PRODUCT--ID=2). On Kraft Foods' Juicy-Juice site, there is a form in 
which children are potentially encouraged to provide personal 
information. PBS's Kids website has a ``bridge page'' that, in our 
opinion, fails to act as an effective separator between program content 
and the underwriters' advertising.
    Thus we call on the public broadcasting system to craft new rules 
for its websites and for whatever new interactive digital television 
and radio programming it develops, that will protect children from 
these new, more subtle and invasive forms of advertising. With the 
ability of digital media to collect personal information and engage in 
personalized ``one-to-one'' communications, and with other new forms of 
advertising that effectively mix ``commerce'' and ``content,'' it is 
especially important that public broadcasting enact policies that 
safeguard the interests of children. CPB must also ensure that public 
broadcasting entities protect the privacy of their audiences and engage 
in exemplary data collection and promotion practices.
    We also call on Congress to consider asking CPB to provide an 
annual report to the American public concerning the system's 
underwriting practices, including the business arrangements made by 
individual production entities with underwriters, sponsors, and product 
licensees.
    Finally, Mr. Chairman, we hope that you will support the creation 
of a effectively endowed trust fund for public broadcasting. Once a 
meaningful system is put in place to support both production and 
distribution, many concerns about underwriting and the impact of 
commercialization will begin to fade. Congress can help ensure that 
public broadcasting designs a system that will effectively fulfill its 
democratic potential in the digital age. The emerging digital 
technologies will allow public broadcasters to serve their communities 
in many new ways, but this expanded capacity should not be seen as a 
license for these broadcasters to engage in activities beyond their 
original educational and informational mission.
    As we enter the digital age, it is critical that we provide our 
children and their children with a rich electronic legacy, one that is 
designed both to inform our communities and to serve our democracy. A 
thriving and vibrant system of noncommercial and public 
telecommunications, I believe, should be a part of that legacy, too.
    Thank you.

    Mr. Tauzin. Thank you very much, Mr. Chester.
    Mr. Engel. Mr. Chairman, I wonder if I could just 
interrupt, and I apologize, before questions, to ask unanimous 
consent to submit an opening statement. I want to in doing so 
thank you and Mr. Markey for holding this hearing.
    My colleague from New York, Mr. Lazio, and I had written a 
letter asking for this hearing, and we are very appreciate that 
you are holding it. I have been a long-time supporter of public 
broadcasting, in those dark days of 1994. We are glad we were 
all able to prevail. I thank you very much, and I would like to 
ask unanimous consent to submit an opening statement.
    Mr. Tauzin. The Chair has already ordered unanimous consent 
for that purpose, but the gentleman is also, his letter has 
also been referenced in the chairman's opening statement.
    Let me make unanimous consent that the letter, which is co-
signed by Mr. Lazio and the entire New York delegation, I 
think, will be made a part of our record. Without objection, it 
is so ordered.
    [The letter referred to follows:]

                      Congress of the United States
                                       Washington, DC 20515
                                                       May 28, 1999
The Honorable W.J. Tauzin
Chairman
Subcommittee on Telecommunications, Trade, and Consumer Protection
2183 Rayburn House Office Building
Washington, DC 20510

The Honorable Edward J. Markey
Ranking Member
Subcommittee on Telecommunications, Trade, and Consumer Protection
2133 Rayburn House Office Building
Washington, DC 20510
    Dear Mr. Tauzin and Mr. Markey: As the leadership of both parties 
work towards reauthorizing the Corporation for Public Broadcasting 
(CPB), we urge you to include language which would permit CPB to make 
grants to public television stations to develop, produce and distribute 
digital television programs.
    Congress has already expressed its commitment to supporting public 
broadcasting's conversion to digital television with last year's 
inclusion of an additional $15 million for CPB's digital transition and 
$21 million for grants through the Public Telecommunications Facilities 
Program (PTFP). The funds appropriated to CPB, however, are contingent 
upon passage of reauthorization legislation by September 30, 1999.
    Public broadcasting's conversion to digital television is mandated 
by the Federal Communications Commission (FCC). In fact, public 
stations across the country are facing a 2003 deadline, by which time 
they must transmit on a new digital channel while continuing to operate 
and transmit their existing analog signals. In order for public 
broadcasters to meet this mandate, they face an investment in new 
equipment estimated to be at least $1.7 billion. For many licensees 
across the country, the costs of the digital transition exceed their 
annual revenues. These stations face losing their licenses and going 
off the air without public support.
    In New York State alone, public broadcasting's conversion to 
digital television will cost more than $65 million for our state's nine 
public broadcasting stations. Fortunately, New York's Commissioner of 
Education and the New York State Board of Regents have already 
recommended state capital funding to leverage the federal investment. 
This proposal, however, has been put on hold awaiting federal action.
    We, therefore, urge the Commerce Committee to take up legislation 
reauthorizing the Corporation for Public Broadcasting as soon as 
possible. Such legislation should authorize CPB to fund development of 
local digital programming in the critical years of transition by making 
digital grants to public stations based on criteria that are 
established in consultation with the stations. Furthermore, we urge the 
Committee to take up legislation reauthorizing PTFP funding through FY 
2004 at levels sufficient to assure that universal access to digital 
broadcasting is achieved throughout New York State and across the 
country.
    Congress has a longstanding commitment to public broadcasting. 
Providing federal funding to help public stations meet the mandated 
deadline for conversion to digital transmission is an investment well 
worth making, one that will ensure that our constituents will continue 
to have the educational programs and services on which they have come 
to depend.
            Sincerely,
                                 Eliot L. Engel, Member of Congress
                                     Rick Lazio, Member of Congress
                              Anthony D. Weiner, Member of Congress
                                  Peter T. King, Member of Congress
                              Michael P. Forbes, Member of Congress
                             Michael R. McNulty, Member of Congress
                               Gary L. Ackerman, Member of Congress
                                 Edolphus Towns, Member of Congress
                             Carolyn B. Maloney, Member of Congress
                             Maurice D. Hinchey, Member of Congress
                                  Nita M. Lowey, Member of Congress
                            Benjamin A. Gillman, Member of Congress
                              Charles B. Rangel, Member of Congress
                            Louise M. Slaughter, Member of Congress
                                 Major R. Owens, Member of Congress
                                 Jerrold Nadler, Member of Congress
                             Nydia M. Velasquez, Member of Congress
                           Sherwood L. Boehlert, Member of Congress
                                John J. LaFalce, Member of Congress
                             and Joseph Crowley, Member of Congress

    Mr. Tauzin. Let me also, in preference to our dialog now, 
make an announcement for all the members. Tomorrow, the 
chairman will have a press conference with Mr. Dingell to 
announce the introduction of the Broad Band Data Relief Bill 
referencing the deployment of full broad band services as 
rapidly as possible for many of these types of media to enjoy. 
We encourage members who have an interest to attend that press 
conference at 1:30 in room 2322 in the Rayburn Building.
    Also, Ms. Courtney, I want to announce particularly for 
your purposes, the high-tech conference schedule for LSU on 
October 11, in which we will invite public television and radio 
to present some of the elements of high-tech educational 
development at that conference. The demonstration you showed 
today would be excellent for that conference.
    The Chair recognizes himself for 5 minutes and members in 
order.
    Let me first point out indeed that what Mr. Markey has 
described as creeping commercialism, Mr. Chester, and which you 
have demonstrated for us in the digital space, continues to be 
a strong concern of ours. But I want to put it all in 
perspective. We can't, I don't think, tell public broadcasters 
that we want them to be as non-commercial as we really want 
them to be and at the same time, fail to provide public funding 
for them to be as public as we want them to be.
    And so the purpose of this bill is indeed to make our 
public contribution, in the hopes that you can continue to make 
progress to eliminate more and more of the commercialism we see 
in analog public broadcasting, and certainly, to prevent it 
from creeping into digital broadcasting of the public broadcast 
systems.
    We are particularly concerned, what you showed us about the 
potential of violating the privacy provisions is of serious 
concern. I would hope that you would take this concern 
seriously and address those. We would hate to read 1 day that 
public broadcasting is part and parcel of advertisers gathering 
information from children inappropriately, when we have tried 
to do our part here in Washington to prevent that from 
happening without parental consent. So perhaps you might want 
to look into that, the legitimate criticism we've seen this 
morning.
    Finally, I wanted to say in advance of any questions that 
we are not giving up on our reform proposals. Again, please 
continue to engage us on them. I don't know when legislatively 
we can ever engage Congress in that effort. But at some point, 
we have to.
    I will say it again for the record, I think it is wrong for 
us to continue to require of commercial stations that they do 
more and more public things when we don't provide the financial 
resources to public stations to do those public things. We have 
it backwards. We are turning commercial stations into public 
stations, and we are turning public stations into commercial 
stations. I think we ought to get our heads back on straight 
and do it right 1 day. I would again encourage your support for 
my efforts and Mr. Markey's efforts to continue to focus on the 
need for public broadcasting to be truly as public and as 
generous in its public content as many of you have dedicated 
yourselves to doing.
    Mr. Burton, I want to turn to you first, sir. I was very 
impressed with the passion of your statement. You have 
performed and worked in both commercial roles, of course, as 
Kunta Kinte, in the very popular, extraordinarily educational 
and popular presentation on commercial television. And now you 
have dedicated an awful lot of your life in the public 
broadcast sector. You have focused, I know, on work in teaching 
children to read, I know you have connected with the work Beth 
Courtney has described in educating children.
    Give us, if you will, a perspective of what it is to work 
in both of these contexts, in the commercial world and in the 
public world. You have done good work in both. What is the 
difference? What is the value, if you will, of working in the 
public broadcasting world?
    Mr. Burton. That's a great question, Mr. Chairman. For me, 
the issue is an issue of balance. I have been, as you pointed 
out, very fortunate to have been involved in what I believe are 
some of the best examples of how to use this medium properly, 
in Roots, Star Trek: The Next Generation, and Reading Rainbow. 
The difference between the first two that I mentioned being 
entertainment vehicles, created and broadcast in a commercial 
arena, and the third in the public television arena, the link 
is the same. They contained that thread throughout them of the 
desire to do more than just entertain the audience.
    Mr. Tauzin. That is not always true in the commercial 
world.
    Mr. Burton. No, it's not always true.
    Mr. Tauzin. How is it that you were able to work in the 
commercial world with that same purpose in mind, when of course 
we are seeing so much criticism today of movies and television, 
because the desire to attract an audience with a dollar has 
sort of, Mr. Markey called it a wasteland, it has sort of 
deepened that wasteland for all of us. We see some of its ugly 
effects.
    Were you not drawn to that as well in the commercial world? 
How is it that you were able to focus instead on projects that 
could have done very well on public television? I mean, Roots 
could have been a tremendous public television venture.
    Mr. Burton. Could have been. I guess the real answer is 
that I've been very fortunate. I also believe that I recognized 
very early the power of this medium, and made a conscious 
choice to align myself with programming that was of a very 
specific nature, intent and energetic imprint. I believe this 
conversation, this national conversation that we are currently 
engaged in in terms of the impact of images in the media and 
how they affect all of us that absorb them, that imbibe them, 
is ultimately going to come down to an issue of personal 
responsibility.
    Mr. Tauzin. Thank you very much, Mr. Burton. The Chair's 
time has expired.
    The gentleman from Massachusetts, Mr. Markey.
    Mr. Markey. Mr. Coonrod, the CPB funds the Independent 
Television Service and the Minority Consortia.
    Mr. Coonrod. Yes, sir.
    Mr. Markey. It is obviously the goal of public broadcasting 
to have a rich diversity of programming, different voices that 
oftentimes are not heard on commercial broadcasting.
    Can you bring us up to speed a little bit on what you are 
doing to encourage independent programming, the minority 
programming, in the public broadcasting system?
    Mr. Coonrod. Mr. Markey, this is one of the top priorities 
for the Corporation for Public Broadcasting. But I would also 
add that it is a priority for many in public broadcasting, not 
just of the Corporation.
    Specifically as concerns the Independent Television 
Service, we are working with them to develop a multi-year 
program. As of now, we have a year by year contract. What we 
are trying to work out with them is a multi-year contract so 
they can have a more predictable funding source.
    Mr. Markey. What is the funding for the existing contract?
    Mr. Coonrod. The program portion is about $6.8 million, I 
believe, and the administrative portion is somewhere in the 
neighborhood of $300,000.
    Mr. Markey. Per year?
    Mr. Coonrod. Per year. What we would like to do is be able 
to provide a long term agreement so they could have a better 
opportunity to plan their activities.
    We are also working with them much more closely on the 
development of digital media. Part of what we would want to 
encourage is the opportunities for all sectors of the 
independent world, minority producers as well, to have 
opportunities to learn how to use the digital media and then to 
produce in the digital media. The ITBS and the Minority 
Consortia are groups that we are working with to try and 
develop those opportunities.
    Mr. Markey. What is the funding for the Minority program?
    Mr. Coonrod. The funding is about $1 million per year per 
consortium. There are five consortia.
    Mr. Markey. So $5 million total for all of the Minority 
Consortia?
    Mr. Coonrod. For the five individual consortia. In 
addition, there is a program fund at CPB at about, on an annual 
basis, somewhere between 30 and 35 percent of those funds, are 
directed toward that.
    Mr. Markey. I appreciate that. I would just urge you to try 
and find ways to increase that if possible. I think that is an 
important role to play.
    Mr. Coonrod. That is part of our intent. We are prepared to 
make a major commitment with the increased funding we are going 
to get in fiscal year 2000.
    Mr. Markey. And if I could, Mr. Duggan, how are we going to 
safeguard the non-commercial nature of public broadcasting? 
First, in the over-the-air, and then in the new media. There 
are limitations that Mr. Tauzin and I suggested in last year's 
legislation that would limit it to 10 seconds. We know there 
are stations around the country that are now up to 30 seconds, 
turning them into commercials, in effect.
    What kinds of safeguards are you looking at to ensure that 
we just don't have the ultimate oxymoron, a commercial public 
broadcasting station?
    Mr. Duggan. Let me say a couple of things about that, 
Congressman. First of all, I think diverse and generous sources 
of funding from all sources that would keep public broadcasting 
from being dependent on any one sources is the finest safeguard 
of our independence from that over-dependence. I think the bill 
that you are supporting and introducing today goes toward that.
    I think your advocacy on the side of the non-commercial 
angels is very effective. And I think that my experience on the 
FCC sometimes taught me that the stick of advocacy in the 
closet was often more effective than the actual legislative or 
regulatory action itself. But I do think your advocacy on this 
has been very effective.
    Mr. Markey. It's a big stick. It's a very big stick.
    Mr. Duggan. Yes, sir.
    Let me say, however, somebody told me once of a sign in the 
Paris zoo on a cage that said, this animal is so vicious that 
when attacked, it defends itself. And I would like simply to 
say that we are non-commercial broadcasters. What we have on 
our air are underwriting messages and not commercials.
    I would like to enter into the record if I may, for the 
enlightenment of Mr. Chester and all who are interested, the 23 
pages of small print of underwriting guidelines that are 
designed as a bulwark against commercialism. I could just tick 
off nine differences between our underwriting guidelines and 
commercials.
    We have no appeals to buy, no product comparisons, no 
superlatives, no interruption of programs, no calls to action, 
no price or value information, no endorsements of any sort, no 
editorial involvement or influence by corporate underwriters, 
no messages over 15 seconds in our national underwriting 
guidelines. There are, as you point out, some local exceptions. 
But all of those are claimed by the local users, and I think 
there are a minority, to be within the FCC guidelines as to 
content. The length may be 30 seconds, but they do not violate 
these guidelines.
    In our children's underwriting, we are even more emphatic. 
We confine the content of any underwriting message to either an 
educational message of a message of support for public 
broadcasting and its mission. There are no commercial 
promotions. There are no mascots or spokescharacters, and we 
allow now product descriptions beyond just the showing of a 
logo.
    We are non-commercial broadcasters. We have chosen careers 
to be non-commercial. So we are your advocates, Mr. Markey, and 
we are in agreement with Mr. Chester about the content.
    Mr. Markey. Well, let me interrupt right there, because you 
remind me of another zoo story, which is the story of the 
mother who has her child with her, and they're walking through 
the zoo. The child looks at the lion and the lamb in the same 
cage. The mother runs over to the zookeeper and says, that is 
so remarkable, the fulfillment of the Biblical prophecy of the 
lion and the lamb lying together. It's so beautiful.
    And the zookeeper says, hey, lady, don't get too excited. 
We've got to put a new lamb in every day. Behold the lamb, as 
the commercial forces in our country focus in on you, asking 
for 30 seconds, commercial, with flexibility as a condition of 
your receiving the grants from these entities. It's that 
condition that puts the lamb in jeopardy.
    That's why we have to build safeguards around public 
broadcasting, to ensure that they're not developed.
    Mr. Chester, just 30 seconds, please.
    Mr. Tauzin. The gentleman's time has expired. Mr. Chester, 
you may respond.
    Mr. Chester. No, I would just say that I hope, Mr. Duggan, 
you go back and you look at some of the underwriting spots, as 
I mentioned, Chuck E. Cheese's, clearly designed to appeal to 
kids. I hope PBS would provide to this committee some 
independent research to find out whether these spots have been 
designed for children or for adults.
    Mr. Duggan. Well, we certainly would like to work with Mr. 
Chester and with members of this subcommittee to ensure the 
non-commercial nature of our service. Because we believe in 
that.
    Let me just say one word, Mr. Markey, about the internet 
site. We have the most elaborate safeguards, we believe, of any 
internet site, any popular internet site, on the internet, to 
protect children. We buffer, and I think Mr. Chester blew 
rather quickly past that buffer page. We buffer before there is 
any transfer to an underwriting message. We have that warning 
page that says you are leaving PBS, you are leaving our web 
site.
    We have 2 million children and parents every month coming 
to that kids' site. We have never had one complaint, not one 
complaint about our regard for the non-commercial nature of 
that site and the buffering. Today's complaint from Mr. 
Chester, which we are grateful for, is the first complaint we 
have ever had. But we do want to work with him to ensure that 
we do not do anything to put at risk the esteem and trust of 
parents in our service.
    Mr. Tauzin. The gentleman's time has expired.
    Does the gentleman from Massachusetts know the difference 
between a Massachusetts zoo and a Cajun zoo?
    Mr. Markey. What is the difference between a Massachusetts 
zoo and a Cajun zoo?
    Mr. Tauzin. In Massachusetts, under the animal's name there 
is the Latin genus and species. In a Cajun zoo, under the 
animal's name, there is a recipe.
    The gentlelady from New Mexico is recognized.
    Mrs. Wilson. Thank you, Mr. Chairman.
    Mr. Chairman, I come from New Mexico, and in New Mexico, we 
need 300 translators to cover the State of New Mexico. It is 
very different. I wonder, for Boston, for WGBH, do you even 
have a translator?
    Mr. Liroff. Yes.
    Mrs. Wilson. That surprises me somewhat. I know that these 
issues are often very different, east versus west. If there is 
one thing, Mr. Markey, that we definitely need more of in New 
Mexico, it is the car guys. I really think we need more car 
guys.
    I have really two questions here. One is for Mr. Coonrod. 
It has to do with the station grant criteria and reform of the 
station grant criteria. I wondered if you and CPB anticipate 
any modification of the station grant criteria, particularly 
with respect to conversion to digital broadcasting by the 2003 
deadline, and whether the difference between rural States and 
urban States, and our heavy dependence on translators is going 
to be taken into account in the change of the grant criteria.
    Mr. Coonrod. We are very aware of the challenge that the 
translators present. We are very aware of the fact that they 
have not been included in the conversion tables that were set 
up.
    In terms of the grant criteria themselves, we have regular 
consultations with the stations to reconsider the grant 
criteria. We will have another regular consultation along those 
lines in the coming months. That is that specifically, the 
challenges faced by the rural stations is one of the issues we 
will consider.
    Whether we will then modify the criteria or not will depend 
on the result of the consultation. But it is a subject we will 
address.
    Mrs. Wilson. Thank you. I have another question that really 
goes to the way television is used. I guess, Mr. Burton, I have 
a particular interest in literacy. There is some irony that I 
am on this committee, since from the age of 17 to the age of 
31, I did not own a television. I do not have cable in my home 
and I do not allow my children to watch television, other than 
some public television programs.
    It seems to me to be a paradox to use television to 
encourage children to read books. I do not understand how that 
works in the mind of a child. And particularly when the love of 
books and the reading has more to do with the person whose lap 
you are sitting on than with the story that is being projected.
    How do you, who I think share this passion for storytelling 
and for books, deal with that paradox?
    Mr. Burton. It's a good question. The show Reading Rainbow 
was created by a teacher, a woman who recognized and wanted to 
address what teachers refer to as the summer loss phenomenon. 
Simply put, a child who is at that early and nascent stage of 
literacy, in that 3 month summer vacation, their reading and 
comprehension skills invariably suffer.
    Also knowing that it is no secret where our Nation's 
children spend an inordinate amount of time, this recent report 
released by the Annenberg Public Policy Center indicates that 
our children in this country spend at least, on average, 3 
hours a day sitting in front of a television. If you add time 
at the computer, they are sitting on average in America, in 
front of some screen or another, about 4 hours a day.
    So our intention was to go where they are, sitting in front 
of the tube, and then draw them back toward literature and the 
written word.
    Mrs. Wilson. But aren't you encouraging them to watch more 
and more in order to persuade them to do it? I don't understand 
that.
    Mr. Burton. I just think it's a matter of being smart and 
acknowledging the truth and going from there. Acknowledging and 
accepting what is and then trying to create a semblance of 
balance in the equation. If we can use the medium of television 
to create a child who is passionate about literature, the more 
the better.
    Mr. Coonrod. If I may interrupt, it may be 
counterintuitive, but I would support exactly what LeVar has 
been saying. A recent study that PBS commissioned through the 
University of Alabama shows precisely that, that families who 
have gone through the exercises, the seminars that are provided 
as part of the Ready To Learn program, the children of those 
families actually watch television less and read more. They 
were brought to those programs through the Ready To Learn 
service on PBS. The data supports those conclusions.
    Mrs. Wilson. Thank you.
    Mr. Duggan. Mr. Chairman, if I could add to what Mr. 
Coonrod said, on the adult side, also, we find that PBS 
watching encourages people to read. Many of our documentaries, 
Ken Burns, for example, the Civil War, made Shelby Foote's 
histories of the Civil War bestsellers again, in paperback and 
hard cover. When we have companion books, we find that they 
rise to the best seller list, because of the power of this 
medium.
    We are television that loves reading and encourages people 
to read. The way we do television is in a rational, linear, 
sequential, chronological way that is not unlike reading. We do 
not have the kind of fast cutting and fragmentary editing that 
you see elsewhere. We have a coherent way of presenting 
information, storytelling, as Mr. Burton said.
    We do find in our research, both on the children's side and 
the adult side, that library use, visits to bookstores, books 
going onto the bestseller list, are a consequence of the kinds 
of programs that we have.
    Mr. Tauzin. The gentlelady's time has expired, but she 
stirred you up real good, and I would like to give you all a 
chance to respond.
    Mr. Chester. I would like to answer that, not only because 
we are an organization that works with children and educational 
media, but because I am also the parent of a 6-year old. One of 
the things that is so important about public broadcasting and 
its children's programming is that it is based on research and 
encourages young children to be literate. If you have ever 
watched Sesame Street, for example, it is very clear. I see the 
benefits with my own daughter now, who has just completed 
kindergarten and is now reading on her own and very proud of 
it. Clearly, she learned a great deal about the ABCs and about 
words and concepts from the public broadcasting educational 
programs.
    So it has a role to play. Clearly, then the parent has to 
play a very key role. But it is a very powerful aid. It is 
better that they watch this kind of programming, because 
oftentimes television, unfortunately, is a babysitter, than if 
they watch something that is going to teach them something 
else.
    So public broadcasting programming can work, which is why 
we have to retain its special mission.
    Ms. Courtney. You see, many of us, I began as a teacher, 
that's my background as well. The whole Ready To Learn project 
that we are doing, I hope that we end up putting more money out 
into the communities. Because we go out with day care providers 
and train them, we give out first books, we give them books, we 
train them how to have that television experience with some of 
the children's programs be interactive. And we actually say, 
turn off the television. It is an interesting thing that we are 
encouraging you, in many instances, not to watch as much 
television.
    But we have to do a lot of outreach into the community. And 
see some of these children, of course, do not have that lap to 
sit in. That's why we are trying to help those.
    But I find my friends obviously use this as well with their 
children and grandchildren. So as somebody indicated, that's 
where the children are. We are trying to make a difference in 
their lives. But we actually have that big outreach component 
that makes a difference.
    One other thing we try and do is we try to bring literature 
to adults. We just did a documentary on Kate Chopin, who is in 
Louisiana, her fine stories and books. We did this, and then 
we're encoding it with enhanced digital material to use for 
English teachers.
    So every time we do a project, we think, how might this 
help in an educational manner. But it does seem odd, we are 
encouraging people sometimes to turn off the television. But we 
do that.
    Mr. Klose. If I may, Mr. Chairman, to the member from New 
Mexico, I should say that National Public Radio has become a 
major source of turning people to literature. The American 
Association of Publishers recently acknowledged that with a 
special award to NPR for its bringing people to literary 
values. Our view is that reading is very important in 
childhood, but it does not end in childhood. The oral 
traditions that radio has made so strong and that NPR's kind of 
radio has made so strong has brought access to literature in 
new ways. We do literary reviews and discussions about 
contemporary books, new books and what authors' views are, and 
do that with an intensity that brings something very special to 
our programming.
    We have found that member stations across the country value 
this, and that there are many linkages at the level where 
stations are building for themselves the kind of institutional 
presence in the community which is so important to the future 
of our stations.
    Mr. Tauzin. The gentlelady's time has expired.
    The gentlelady from California, Ms. Eshoo, is recognized.
    Ms. Eshoo. Thank you, Mr. Chairman, and thank you once 
again to all the panelists for answering a lot of my questions.
    Let me just ask Mr. Duggan, though, I know that you 
touched, in your written testimony, on this issue. I was hoping 
you could expand on what your plans are for making use of 
digital program, especially on how the programming would be 
directed toward children. What do you see as the potential for 
this programming, and maybe give us a sneak preview of what you 
think you will be offering relative to a more interactive 
learning experience.
    Mr. Duggan. Let me mention three uses that we have in mind 
for the digital media and then come back to the special mission 
that we have to children, Ms. Eshoo. And I appreciate the 
question.
    We see high definition television as a marvelous way of 
intensifying the educational and cultural mission of public 
television. Imagine opera, imagine ballet accessible to every 
American, every citizen in his or her home, with the special CD 
quality sound, the intense visual experience of HDTV. Imagine 
our nature programming intensified.
    We think it is made to order for our mission. We do believe 
that particularly in our signature prime time programming, much 
of it produced by WGBH and WNET, our New York flagship station, 
we believe that high definition television is a marvelous way 
of heightening and intensifying the experience, and 
intensifying our mission.
    During the day, we plan to do what we call digital 
multicasting. The wonderful increase in capacity that is 
afforded by digital compression makes it possible for us to 
deliver at least four channels in the space that normally was 
taken up by one. We can deliver the main national PBS feed on 
one of those channels. And using a remote control, the viewer 
can switch to PBS Kids, a full time educational kids channel, 
which we are introducing in September, first on DBS then in 
digital multicasting for our member stations.
    Imagine also a news and public affairs special channel in 
multicasting that will enable civil discourse and serious 
address to issues. Many of our commercial media are driven by 
ratings competition to desert serious discourse about serious 
issues. But we believe that we can find a niche and perhaps 
have a full time public affairs channel that will go beneath 
the surface.
    A lifelong learning channel that would be both 
instructional and life enhancing for our viewers that would 
have not only more academic programming, that would enable 
people to continue their education, but informal learning, the 
kind of pioneering that we have done with how-to. So we believe 
that multicasting during the day is a wonderful opportunity for 
us, and we plan to exploit this technology that way.
    The third way is what you saw, the packaged digital feed 
that can be downloaded along with the program, and that can 
deepen the experience of the viewer who wants to learn more.
    Ms. Eshoo. What are the timeframes around this one? I can 
hardly wait.
    Mr. Duggan. We are already doing this. If you buy a digital 
set at your local California or Washington equipment store, 
WETA, one of our flagship pioneers here in Washington, is 
already broadcasting a schedule in digital, both multicasting 
and HDTV. We are already putting up a full time HDTV feed with 
at least one new HDTV program made available each month.
    Zoboomafoo, one of our children's programs, is already 
being presented with the enhanced packaging. So this is not a 
technology of the future for us. It is here, it is now. And we 
are very enthusiastic about it.
    Ms. Eshoo. That's marvelous. I think that is wonderful news 
for the committee. I appreciate your description.
    Let me just say to Mr. Burton, it isn't very often, we have 
in this hearing room the opportunity to listen to many of the 
geniuses of America. But I have to tell you that with your 
testimony and how you put your thoughts together today, that 
you really feed the soul of America. I thank you for that. We 
all pay tribute to you for it.
    I think for the part of America that we are struggling to 
comprehend, to understand, we keep saying, why, why are these 
things happening, we really have the answer. Because if we 
respond to the greatness of what is in the human spirit, that 
will be healing and that can touch an awful lot of people. The 
medium that you are all here, that you work in, that you have 
support from the Congress, thank goodness, and certainly the 
American people, that we can address and really resolve a lot 
of the things that we don't like about America and want to make 
better. So thank you to you, and your artistry and to all of 
you.
    Thank you, Mr. Chairman.
    Mr. Tauzin. I thank the gentlelady.
    The gentleman from Florida, Mr. Stearns, is recognized.
    Mr. Stearns. Thank you, Mr. Chairman. I regret that I was 
not here earlier, I was chairing a subcommittee on veterans 
health. I appreciate the opportunity that the committee is 
still here and that I could help in some small way with two 
questions I have. And also to welcome my friend, Mr. Coonrod, 
who I've had the opportunity to have dinner with and to see the 
MacArthur tapes and say what a spectacular job public 
broadcasting has done with that American experience.
    I think this goes in line with my colleague from 
California, what she has said, that these kinds and types of 
programming are going to not only the history of America, but 
also presenting information which is part and parcel of our 
soul, of the American experience.
    I have two questions, Mr. Chairman. One is dealing with how 
the estimate of $1.7 billion as developed. I guess earlier 
testimony indicates that the public broadcasting industry 
estimates the total cost of conversion to digital to be about 
$1.7 billion. This I guess would be for Mr. Coonrod. How and 
when was that number derived, and what exactly does it include 
in its total?
    Mr. Coonrod. Mr. Stearns, I can give you a broad answer. 
But there is also a member of the panel who could give you a 
more specific answer. But let me give you the broad answer 
first.
    We put together a group called the digital steering 
committee, which included representatives from public radio and 
public television. We did a thorough review of what would be 
required to provide digital television. And by that we mean not 
just the pass-through capability to deliver a public television 
signal, but also the ability for local stations to provide the 
enhanced services that you have just been hearing about, high 
definition but also enhanced services, enhanced television and 
the multicasting capability.
    So the surveys, which were done largely by engineers and 
other technical people, were based on a services model that 
would enable public television stations to provide the broad 
range of public television services, educational services, 
especially. Those services were then costed out, and that is 
the result of how the specific numbers were arrived at.
    Mr. Liroff, who is at the other end of the panel, is expert 
in the details of those specific numbers. But they were worked 
out through this process with stations around the country.
    Mr. Stearns. Mr. Liroff, you are the Vice President and 
Chief Technology Officer, WGBH Educational Foundation.
    Mr. Liroff. Correct, sir.
    Mr. Stearns. So you are better prepared to give some of the 
details?
    Mr. Liroff. We can drill down at the various layers. At the 
first layer, there are five components in that $1.7 billion. 
The first is for basic transmission, which would allow each of 
the current stations to put a digital television transmitter on 
the air and begin broadcasting a digital signal. The second 
layer is master control capability for each of the stations, so 
they can then integrate local content and local services in 
with a signal coming through from the network.
    The third is for production equipment, so they can produce 
local programming with digital equipment, so they can continue 
their community and local programming services. The fourth is 
for DTV operations. The current expectation is that the analog 
and the digital stations together will be on the air well past 
2006, probably for the next 10 years. Because the analog 
stations can't go off the air until 85 percent of the homes in 
any given market are capable of receiving and displaying the 
digital signal.
    So these stations, as will commercial stations, will then 
have the obligation to be operating two transmitters at every 
local site rather than the one analog station that they now 
operate.
    The last component is for radio's conversion to digital, 
which we believe is imminent within the next year or two. It is 
certainly happening internationally and the U.S. system is very 
close to a resolution of how to accommodate digital radio 
broadcasting within the current band.
    Mr. Stearns. How did you come up with the 85 percent? What 
was that formula?
    Mr. Liroff. That's the U.S. Congress, that was stipulated.
    Mr. Stearns. Okay, that's ours. All right.
    Mr. Coonrod. Mr. Stearns, those figures were developed 
originally in 1998 and have been updated since then. So those 
figures are current.
    Mr. Stearns. Okay, thank you. Thank you, Mr. Chairman.
    Mr. Klose. Mr. Chairman, Mr. Stearns, I'd like to add if I 
could, as Mr. Liroff mentioned, at present there is no radio 
deadline to go to digital transmission. There has not been yet 
a full concurrence as to what that format ought to be, how that 
transmission format ought to be.
    However, we do know some costs going forward right now. 
They are identified inside this larger figure. We have 
identified about an $11 million cost going forward to shift 
antennas. When current antennas get digitized, it's going to 
cause interference to some of our broadcast antennas, and we 
will probably have to find new antennas. We have identified 
that number at about $11 million.
    In addition, the additional funding or continued funding or 
authorization of funding for PTFP is very important to our 
members, because they are using the PTFP money to move 
internally from analog production to digitized production 
basis, which will further enhance their ability to move to 
digital transmission when that comes forward.
    So both these factors are in play there. And continued 
authorization for PTFP is very important to our member 
stations.
    Mr. Stearns. I thank the chairman.
    Mr. Tauzin. Ms. Courtney wanted to respond.
    Mr. Stearns. Oh, I'm sorry. Anybody on the panel, I think 
the chairman would allow me forbearance to answer this question 
in more detail.
    Ms. Courtney. Mr. Stearns, I was looking at Florida's 
numbers, and what they were looking at is a cost of $101 
million to totally do that transition for both just 
transmission and production. But to just stay on the air, $60 
million is going to be the cost. So you can see, it sort of 
breaks out, $60 million just to stay on the air and convert 
their transmitters and antennas and towers. Of that, they have 
now gotten $5 million from the State with a commitment for 
another $15 million. So they're looking at sort of a third, a 
third and a third in terms of support. Maybe Federal a third, 
private fund raising a third, and State money a third.
    I know it's difficult to get a handle on this. Because in 
every community, it is slightly different. I thought everybody 
had 2,000 foot towers, but we're in a swamp, so I have tall 
towers, and my towers are more expensive. Once we go and change 
things out, and that's true in Florida as well, we have to 
strengthen them, because they're not up to the old code to put 
new antennas on them. So that is a tremendous expense, just to 
go and strengthen those towers, put the antennas up and in some 
places, the might be on a mountain. So it varies.
    We are doing detailed examination of each site in public 
broadcasting across this country. The first call is to make 
sure, as you are saying out west, a lot of my colleagues in 
State networks, that we first have universal service, that we 
don't lose the licenses, that people can actually receive the 
service. After that, then you get production equipment. I am 
not even worrying about production equipment until I get my 
transmitters and towers up.
    Mr. Tauzin. Thank you. The gentleman's time has expired.
    Mrs. Wilson. Would the chairman yield for a question?
    Mr. Tauzin. Yes.
    Mrs. Wilson. Was it the English that pushed you out of that 
cold country and down into that swamp? Is that it? And this is 
better?
    Mr. Tauzin. Yes, much better. The truth of the matter is, I 
guess Okeefenokee has a lot in common with Louisiana swamps. 
But our problem is that we build our towers 2000 feet, but they 
sink.
    The gentleman from Ohio, Mr. Sawyer.
    Mr. Sawyer. Thank you, Mr. Chairman.
    Just an observation, quickly. I think it is enormously 
important when it comes to questions like literacy to 
understand that television is simply a vehicle, and that it is 
one of the most effective vehicles for dealing with the 
changing target that literacy in America has become. I just 
want to take a moment to thank all of you for the enormous, 
demonstrable effort to use public broadcasting not simply in 
those programs that we would identify as educational, but 
rather, across the spectrum of programs, to elevate the 
literacy of the Nation.
    For the last decade, you all have been walking a terrible 
tightrope in terms of the solicitation of what Mr. Burton 
refers to as the 5 million Americans who are the real 
contributors. The messages have had to change. It's been a 
difficult message. Now that the target has been taken off, or 
at least we hope that target has been taken off your backs, 
that dilemma of trying to argue first that, although there is 
public funding for public television, the majority of the funds 
come from our listeners, to the period of time in which we 
really, it was difficult for me to go on the air and to argue 
for contributions. Not that I didn't do it, but because the 
argument was so difficult.
    As we emerge into this new era, can you comment about how 
the new formula will affect your ability to sustain the 
contribution, the constituency that you have, and expand it 
more broadly across your listenership?
    Mr. Duggan. Mr. Sawyer, I would say to start out that we 
believe that if we are providing good service to the American 
people, that if our mission is visibly different, and if we are 
fulfilling our educational and cultural mission in a way that 
inspires trust and support, that the support we need, both 
public and private, will be there. We are really quite 
optimistic about that support.
    We care a great deal about every source of support. And 
while we are proudly non-commercial, we value those corporate 
citizens who step up and are corporate supporters. They are not 
allowed to do commercial messages. So one might say they could 
get more commercial value by placing their funds somewhere 
else. But they are doing this as a philanthropic contribution 
to our mission. We value those corporate supporters.
    But as I said to Mr. Markey, we believe that all the five 
principal sources, or what we call viewers like you, our 
individual subscribers, corporations, foundations, State and 
local governments, including publicly supported universities, 
and the Federal Government, a strong and vibrant and generous 
level of support from all five of those is the best guarantee 
of our independence and our ability to fulfill our mission 
without veering in any direction toward one of those.
    Mr. Coonrod. There is a specific way in which increased 
Federal appropriations do help stations leverage their 
additional funds locally. Most of the money that we provide to 
stations for the community service grant is on an incentive 
basis, based on the amount of non-Federal financial support 
they can reach in their community. So when the Federal 
appropriation is increasing, it adds to the incentive that 
stations have to raise more money in their community, because 
it gets matched, not one for one, but it gets matched 
proportionally by increased funds through CPB.
    So your support not only is support directly to the 
stations, but it also helps them raise additional money in 
their communities.
    Mr. Sawyer. It seems to me that is a great opportunity 
again to alter the message and to begin to have the kind of 
positive reinforcement that I think all of us want to see.
    Mr. Klose. Mr. Sawyer, at NPR, I would support exactly what 
Ervin and Bob Coonrod have said here. Let me add, we are very 
sensitive to listener sensitivity on this issue. We know there 
is dialog within our membership organization and also broadly 
across public broadcasting in general about listener 
sensitivity to these issues. We will be studying and watching 
this very, very closely as we go forward.
    We are also looking to substantially build alternative 
sources of revenue that would help stabilize our financial 
issues. We just received, for example, from the MacArthur 
Foundation, the largest single donation or commitment that was 
ever made to a public broadcasting organization, $4 million, 
because it wants to help us build and endowment that would help 
us stabilize our revenue sources.
    Mr. Brugger. Also, Mr. Sawyer, the stations are working 
very hard now to look at collaborations with institutional 
organizations, whether it is universities, community groups, to 
get some of them to help not only with the programming, but 
with the funding of the programming as we build new programming 
streams. Matter of fact, there is a project in Connecticut 
called Mapping the Assets, where they are going around to all 
of the non-profit governmental, and even some of the business 
community, to say what are the needs that public media can 
meet. How can we join partnership with you, a true partnership 
where you are a contributing member, not only in terms of 
dollars, but in decisionmaking about how we program for the 
public media in the future using this great technology that we 
are going to have.
    Mr. Sawyer. Mr. Chairman, I am not sure that my light ever 
was turned on, but that does not make any difference.
    Mr. Tauzin. I apologize, but if you want to ask some more 
questions, please proceed.
    Mr. Sawyer. I just wanted to make an observation. About a 
year and a half ago, one of the public broadcasters in my area 
called up, very distressed because of a pirate radio station. 
It came at a particularly awkward time. I said, did you have 
some special program that you were doing? He said, no, it's our 
fund drive. So we got them off the air as quickly as we 
possibly could, simply because it meant so much for the rest of 
the year's programming.
    Mr. Tauzin. If the gentleman would yield, one of the 
reasons this gentleman has been so concerned about the 
proposals at the FCC, the licensees, thousands of 
microstations, without ever consulting with the public 
broadcast community, whose base might be terribly eroded by the 
addition of all these microstations, I would hope the gentleman 
pays some real attention to that concern.
    Mr. Sawyer. We have discussed that, as you know. I 
appreciate the chairman's position on that.
    Mr. Tauzin. I thank the gentleman.
    The Chair now yields to the gentleman from Illinois, Mr. 
Shimkus.
    Mr. Shimkus. Thank you, Mr. Chairman.
    I am going to end my question with Mr. Chester, but I am 
going to go to Mr. Duggan and Mr. Burton to get there.
    Mr. Duggan, I would rather have my children, who are four 
and 6 years old, watching Juicy Juice at the end of the show, 
and may need to get to a link for that advertisement, versus 
halfway in a show getting an ad for Beast Wars action toys. I 
guess the question I have is, is there a way of screening the 
people who request to be the underwriters, based upon actually 
what they are trying to do? It is still an advertisement, I'm 
not going to parse a word, it is still an advertisement when 
you watch Barney and Huggies comes up as a sponsor. I'm not 
used to being really fine in the vocabulary legally.
    Is there a way of screening appropriate types of 
sponsorship for shows, so that under the public broadcasting, 
Beast War action toys may not see its way to underwriting a 
show?
    Mr. Duggan. I don't believe we have any action figures or 
highly commercial exploitative products of that sort as 
underwriters. In the case where a product is mentioned in 
underwriting, as I said earlier, Mr. Shimkus, we require that 
no promotional message be delivered, that there be an 
educational message. For instance, I think there is a Kellogg's 
underwriting message that says, Kellogg's encourages you to 
read books. It is not a product promotion.
    When a product is an underwriter, we require either that 
education message or a message suggesting the value of the 
mission of public television. So we would vigorously assert 
that though there may be corporate good citizens who support 
our programs, including our children's programs, this is so 
radically different from what we see in real commercials. But 
even to use the term commercialism is misleading, unless you 
acknowledge those tremendous differences.
    But we take very seriously your concerns. I would simply 
say, as Ms. Courtney comes from a background as a teacher, most 
of us have chosen careers in non-commercial, public service 
television. We care deeply about the trust of parents, the 
trust of teachers, and the credibility of what we do. We would 
not want to do anything that would undermine that trust.
    So we take very seriously your concern, and we will try to 
live up to the concern that you express.
    Mr. Shimkus. And I am not sure what the concern is, I am 
really kind of applauding, because I am observer of both, 
public broadcasting and commercial entities. I too have also 
been in public service my entire life in different shapes, as a 
teacher.
    Mr. Duggan. You have also been the subject of a PBS 
documentary, sir.
    Mr. Shimkus. Not as highly acclaimed as Mr. Burton.
    Mr. Duggan. I would not let the moment go past without 
thanking you for your role in that.
    Mr. Shimkus. I'm not going there.
    But I do want to say, I guess a lot of us who were raised 
in the Star Trek era, if we are trekkies, we just appreciate 
your being here and having the chance to talk. You mentioned 
the Motorola phone, and the flip phone. The problem with, when 
you open yourself to public scrutiny in this world, people 
start learning more and more about yourself. I am a trekkie who 
really got my first inclination of further education through 
Starfleet Academy versus the old Star Trek. I attended West 
Point, and Mrs. Wilson, who just left, is an Air Force Academy 
graduate.
    I do give that some of the credit for my desire based upon 
a higher education, leadership skills, how to treat people, all 
of those aspects. And I applaud you, you have invested yourself 
into this issue. And I applaud that. That is what we define as 
leadership by example.
    I am going to throw out another challenge, and then it will 
come back to Mr. Chester's argument. We are talking about a 
really specific period of time here in which funds are needed 
to get to the new era of broadcast. But the fundamental issue 
of funding for PBS and the Corporation for Public Broadcasting, 
there are still some concerns there.
    I think a lot of folks in your profession benefit greatly. 
I would encourage you to use not just leadership by example, 
but help motivate some of your colleagues, not just to think 
they have done their role based upon one appearance as a guest 
star on Sesame Street, but that they give back in a forum that 
is a positive benefit to our society. Because there are many of 
us here on the Hill who are just angry, insulted, confused and 
perplexed, based upon what we have seen over the public airways 
for corporate benefit. I know everybody is like us, probably 
even more, are trying to grab for pieces of your time. But if I 
could just give you any encouragement and any help that we can 
give.
    Because the question follows up now to Mr. Chester and his 
final part of his statement, and I need to quote it, he 
mentions, finally, Mr. Chairman, we hope that you will support 
the creation of an effectively endowed trust fund for public 
broadcasting. I would ask you, what do you mean, how do we get 
there, that's my charge also to Mr. Burton, to help effectively 
endow a trust fund. This addresses the issue post-digital era. 
And I hope that the chairman will allow me to move in that 
direction, because I am looking at the next generation, than 
just the current problem.
    Mr. Tauzin. You want to take us to places we've never been?
    Mr. Shimkus. Well, we've tried to get there before, and we 
have not made it yet.
    Mr. Chester. Certainly, going back to the children's area, 
there is clearly a tremendous difference between what we see on 
commercial television and what we see on public broadcasting. 
Commercial television, particularly for children, has helped 
create a toxic culture, which is why this committee has worked 
so diligently on issues like the V-chip and the parental 
guidelines. It is because we value that programming so much 
that want to ensure that in this highly competitive and 
expensive world of television that we don't take away public 
broadcasting from its original educational mission, and ensure 
that these programs are really non-commercial.
    Just in response to Mr. Duggan, the brands are mentioned, 
it's Juicy Juice. The brands are mentioned, and they are highly 
attractive to children. In fact, one other thing is, we have a 
good article which I did not include with the testimony, but 
hope you read, co-authored by Dr. Alvin Poussaint of Harvard, 
who criticizes what has been going on with public broadcasting. 
One of the questions he has is about the deals that individual 
production companies, copyright holders, are having with 
underwriters.
    Mr. Shimkus. I don't mean to cut you off. I think we 
understand that problem. I guess the question is, how do we 
develop the trust fund now to deal with, and I apologize, but I 
will also say that I would rather have them look at Juicy Juice 
versus Beast Wars. So I'm not trying to get in the middle of 
that.
    Mr. Chester. But it is a question of a slippery slope. I 
think there is an opportunity for a trust fund. Clearly, it 
would take the leadership of this committee and the chairman.
    But certainly, commercial broadcasters have been able to 
benefit tremendously from the spectrum allocation they were 
given in the 1996 Telecommunications Act.
    Mr. Tauzin. Would the gentleman yield on that point? The 
Telecommunications Act of 1996 made it very clear that if 
commercial broadcasters used the new 6 mHz of spectrum for 
purposes other than broadcasting, which they may, they may want 
to get into some other commercial ventures with it, broad band 
data stream ventures, in competition with others in our society 
who have paid for the spectrum to do those things, the Act says 
that the FCC is obliged to require contribution from the 
commercial broadcaster equivalent to what would have been 
obtained in an auction of that spectrum for that commercial 
purpose.
    Now, that's general language. What we have not done is said 
what happens to those moneys. I would suggest to the gentleman, 
and I have suggested to the entire committee, one thing we 
ought to consider is a dedication of those funds, when they are 
identified and when they arrive, that those funds properly 
ought to go into the creation of a trust fund for public 
broadcasting, so that public broadcasting can rely less on the 
attributions and commercialization of its programming and more 
on some sort of public funding.
    But I thank the gentleman for his interest here, and we 
will continue to dialog with him.
    Mr. Shimkus. Mr. Chairman, if I may, I guess the important 
thing too is, as we now in our business, when people are, and 
you all do it through your pledge drives, when people are 
empowered to invest, no matter how small an amount, they are 
better advertisers of the industry, they are better promoters. 
They are our best supporters, those who have given even as 
little as a dollar to our campaign, because they are now 
vested.
    I want to make sure that there is a system formed that we 
can continue to invest the public in this and invest, obviously 
the industries are benefiting. But I also want the major 
recipients, because of their talent, Mr. Burton, to also 
invest. I am going to keep encouraging you. But I want them to 
be part of this trust fund look that we can encourage big 
dollars, small dollars, government dollars and how we can make 
this so. Again, we are not here all the time looking for a 
handout but we have a system and a revenue stream that is safe, 
sound and secure.
    Mr. Tauzin. I thank the gentleman.
    I want to recognize my friend from California, Mr. Rogan, 
if you have any questions, sir.
    Mr. Rogan. Mr. Chairman, I thank you for calling this 
hearing. I also want to thank all of the panelists for their 
testimony. I did not have the privilege, obviously, to hear all 
of the testimony, as a result of competing and conflicting 
hearings and other obligations. I have had the opportunity to 
read all of the testimony. I think the chairman has gone out of 
his way, during my time in Congress, to try to ensure that 
hearings such as this educate members such as me as to the 
importance of these issues.
    I thank you, Mr. Chairman, and I yield back my time.
    Mr. Tauzin. Thank you, Mr. Rogan.
    Let me wrap up by doing something that one of the members 
suggested we had not done today. Let me be the devil's advocate 
for a second. There are no Klingons on the panel. But if there 
were a good Klingon on the panel, he would ask the following 
question. With the advent of 500 channel television, beamed 
down to us from satellites, and with the advent of incredibly 
new cable programming like the Learning Channel, History 
Channel, Discovery Channel, Lifetime, Animal Planet, USA 
Network, many other channels now that are doing much of what we 
would consider better television, teaching us the history of 
our life, the life of the planet, its environmental resources, 
its teaching us in many cases, presenting cultural programming 
and presenting historical perspectives and educating us, as the 
Learning Channel constantly does on so many issues.
    With 1700 radio broadcasters now on the internet, 
broadcasting incredible new and very specific audio streams, 
not just music, but incredible new avenues to teach us and to 
broaden our experience, with the capacity of broad band 
arriving soon, which will similarly introduce thousands of 
television channel broadcasters to the internet, and the 
merging of the computers and the television, so that the 
television itself will become the modem by which internet broad 
band streams deliver video programming and audio programming to 
us in integrated packages. With the capacity of your stations 
themselves to multiplex, so that one station can powerfully do 
the work that four stations previously perhaps did in a given 
community, here's a Klingon question. What the heck do we need 
all of the public broadcasting for? What is so necessary about 
it?
    Mr. Chester. Mr. Chairman, this is an area that we at the 
Center for Media Education study, the future of a digital 
marketplace, not only the children's marketplace. We are taking 
a very, very good look at it, including our broad band policy. 
I can say to you that we will need public broadcasting more 
than ever in this emerging world. Because even though there 
will be more diverse and perhaps countless sources of 
information out there, they will be highly commercial. And the 
model for the new media system really merges advertising, 
marketing, data collection and the content.
    So if you want to have a space where there can be just this 
pure civic discourse, obviously C-SPAN plays a role that is 
very unique. And you hopefully will see more C-SPANs.
    But if you want to have those spaces where it is really 
about engaging in citizenship and in the healthy development of 
children----
    Mr. Tauzin. Mr. Chester, cable says it is doing that. Cable 
tells us that this is local programming, in fact, the law 
requires them and they must carry local coverage, as public 
access channels.
    Mr. Chester. Those are also non-commercial.
    Mr. Tauzin. There is the Learning Channel, History Channel, 
which may be commercial cable channels, but you don't see a lot 
of commercials on them. They are basically doing some pretty 
good stuff. Come on.
    Mr. Chester. I guess we differ. What you will see on those 
channels, even though there are good things, I've heard a joke 
that Hitler should have kept the TV rights, because it's 
endless reporting on World War II. You won't have the 
diversity, you won't have the insight. Only public 
broadcasting, disconnected from the commercial forces that will 
be really shaping this new media, does that.
    Mr. Tauzin. Good point. Somebody else try it.
    Mr. Duggan. Yes, sir. I'd like to give six reasons.
    Mr. Tauzin. Summarize, please.
    Mr. Duggan. Very quickly. We are non-profit and 
educational, and they are not. None of the ones that you 
mentioned can make that claim.
    What that means is our adult learning service broadcasts to 
two-thirds of the college and university campuses in America, 
distance learning telecourses. No for-profit cable channel or 
other television service does that. We are non-profit and 
educational, they are not.
    We reach every home. They do not. Cable reaches between 60 
and 70 percent of the country, and you have to pay $300 to $600 
to get it. It is wonderful. They do lots of good things. We 
deliver to the retired school teacher in Louisiana who loves 
opera, we go free to all of those homes.
    The third point, I just touched on it, but we are free and 
they are not. And that is very important, Mr. Markey touched on 
it earlier. We have unparalleled creativity and innovative 
power and quality, and with no disrespect to them, they do not. 
We invent genres like educational programming for children, and 
they copy them. We invent genres like the historical 
documentary, and they copy them for commercial purposes. We are 
the wellspring of creativity.
    Fifth, we define our audience as citizens, they define 
their audience as consumers. There is a tremendous difference 
there, Mr. Chairman. Finally, we are local and grassroots, 
owned at the local level, they are global combines, owned by 
remote people, delivered bloodlessly from the sky. We exist in 
the bayous of Louisiana and the local communities. We are owned 
and governed locally. And we proudly underscore all of those 
differences.
    Mr. Tauzin. But you missed one of the things I threw at 
you, now. It is not an easy ball to bat back. You are now going 
to multiplex. Why do we need so many of you?
    Mr. Duggan. Because we have so much content and not enough 
shelf space. We have so many wonderful things that we want to 
do for the American people. Kids' programming, more of it over 
more time. How-to and educational lifelong learning, more of 
it, instructional public affairs. We are like a library with so 
many books and not enough shelves to put them on. We have so 
many great things we want to do for the American people, we 
need those extra channels.
    Mr. Tauzin. Ms. Courtney?
    Ms. Courtney. I don't know, I'm exhausted.
    As Ervin indicates, there is so much opportunity to do so 
much. But I have to tell you, I am Chairman of the Board of 
America's Public Television Stations. We in our local 
communities are doing things directly in communities that will 
not be done by a remote site out of some remote cable head end. 
And quite clearly, no one is going to be doing the documentary 
that we are doing this year on the expulsion of the Acadians 
from Nova Scotia.
    Mr. Tauzin. I think we should end the hearing right here.
    Ms. Courtney. But to very specifically say that as we look 
into your community and we say, what are your particular needs, 
clearly in Louisiana we have some very specific needs that are 
unique to our community, and we are addressing them. This is 
true in Florida, in each State. And those local stations.
    Mr. Tauzin. I think we all need to focus on something, 
though, and really think about this. When broad band does in 
fact allow for the distribution of hundreds, perhaps thousands, 
of television broadcast channels on the internet, and the 
internet is intricately connected to the television set, I was 
at the cable convention in Chicago and saw technology that is 
doing that today in buckets. Not just web TV, but other 
technology that is beginning to be introduced.
    When all that happens, the question is, what is going to be 
the value of a local television commercial station in that kind 
of a marketplace, if it does not become extraordinarily local? 
So my guess is that the local television stations are going to 
become much more competitive for covering local events and 
being more local. The question will rise again, what is the 
value of a public television station in that world?
    Ms. Courtney. Clearly they are advertiser driven. You know, 
you and I, my husband was in commercial television for some 20 
years.
    Ms. Tauzin. I want you all to focus on that, what a 
volatile household. She has a commercial anchor living with 
her.
    Ms. Courtney. And the interesting thing is, truly when you 
begin with what your mission is, and Ervin said that so well, I 
think of us as being part of a citizen democracy where we are 
mission driven. Frankly, the shareholders then are the American 
public that we have to report back to, not the investors. It is 
a big difference. I have done commercial television, and I have 
done most of my life public television. There just is a 
difference.
    Mr. Tauzin. By the way, LeVar, Bob Courtney does look like 
a Klingon. I want to put that on the record.
    Mr. Klose. Mr. Chairman, we are a little bit out numbered 
here, we in radio, at this table. But I would like to say that 
our member stations, more than 50 percent of their clock right 
now, their broadcast clock, is local programming. They bring 
civil values and civic discourse in a way that is local in its 
nature, local in its focus and local in its contact. It cannot 
be duplicated, even by national services as, let's say, 
National Public Radio itself, as a programming entity, is.
    When you add that to the kind of national and international 
voices that NPR as a programming entity can bring to those 
local stations and those local listeners, you have an amalgam 
that is without parallel in the country. The multiplication of 
many channels and many sources of information is not going to 
necessarily break that up.
    Mr. Tauzin. I want to give you three challenges as we 
leave. One is obviously, we have a lot of support in the 
committee. I think the co-sponsorship is going to grow on the 
bill and we will have a chance to move it rapidly. Chairman 
Bliley has given us the green light on this, and we hope to get 
a bill done as rapidly as we can.
    But obviously, it is very important that you fan out, make 
sure that we have great support when we get to the Rules 
Committee and the floor with this legislation. This is a time 
problem, if we are going to get you on a track to make the 
digital conversion, well and expertly, and in fairness to the 
State legislators who are in fact investing on a local level 
into this venture. And to the public, who is equally 
contributing their moneys to it.
    Second, please do not assume that because we are moving a 
straight authorization bill that we are not seriously concerned 
about some of the reforms that we have put before you. Continue 
please to dialog with us, and seriously work, Mr. Duggan, on 
not only making sure that there are standards at the national 
level, but at the local level, for the kind of 
commercialization we have seen. If digital sites are going to 
link up to commercial sites that are not subject to that code, 
then perhaps some changes need to be made. Perhaps they ought 
to not be linked, or they ought to be linked only on the 
condition that they are subject to the same kind of codal 
restrictions on over-commercialization of public broadcast 
sites on the digital web.
    And third, I realize that you had not at least early been 
consulted on this microbroadcasting issue. But I would ask you 
please to get engaged with it. My particular concern, I have 
expressed it to the Chairman of the FCC in private meetings and 
have expressed it publicly, is that if we ever get to the point 
where we are making legal all these illegal broadcasters, that 
if everybody can own a station, God knows who would be licensed 
and how those stations would be controlled or regulated, but if 
everybody in the world could own a station, broadcast whatever 
they want, and we fracture the audience out there so badly, do 
we do real damage to the image and the work that public 
broadcasters do in a community.
    If for example a microstation, five microstations in a 
community end up broadcasting to very specific segments of that 
community, does that destroy the work you have done in ethnic 
and multiracial type communities and outreach that public 
broadcasters have been so very successful in doing. I want you 
to think about that, please, and interact with us on that 
issue, as it may come up again. I think it has been put off for 
a while, but it may just pop up ever now and then. I urge you 
to pay some attention to it.
    Finally, let me thank you all for the contributions you 
have made today. As I have said many times, I consider our work 
here in Congress is part of an educational process that 
probably ought to at some point earn some sort of degree. This 
is the best college in America. We have the best resources to 
come and educate us, and you constantly come and give us your 
time and the benefit of your knowledge. Shame us if we do not 
learn, we learn every time and we thank you for that.
    LeVar, thank you particularly, sir. Hollywood and 
Washington always have this strange mutual admiration society 
if something goes on. I don't know what it's all about, except 
we do admire the work you guys do. We particularly admire 
people like you whose work has more than just commercial value 
and commercial stardom connected to it. We appreciate the 
givers in your field, and you are one of those givers, and we 
want to thank you.
    Mr. Burton. Thank you, Mr. Chairman. I just would like to 
say that we have a fine champion in your leadership and the 
leadership of this committee in our common cause here. We 
certainly appreciate you.
    Mr. Tauzin. I want you to do me one other favor. I want you 
to critique that work done on the Acadian expulsion and make 
sure it's almost as good as Roots.
    Mr. Burton. I can almost guarantee there will be a fine 
program produced.
    Mr. Tauzin. Any other questions? Any other final comments? 
Mr. Klose.
    Mr. Klose. Mr. Chairman, if I may, on the issue of the 
microradios, the position of the NPR board of directors is 
that, and I think it applies specifically to us, we of course 
embrace the principles of many voices and multiple sources of 
information. However, there are many technical issues with 
regard to the micros. We, in cooperation with CPB, are doing a 
series of engineering studies to find out what the nature of 
that interference might be. Until those issues are resolved, 
and they are very unclear right now, we need the most thorough 
engineering studies we can get to determine whether or not our 
current broadcast members, with their stations and their 
audiences, what the situation would be going forward with that.
    Mr. Tauzin. As a matter of fact, whereas we have given 
commercial television broadcasters new space, we are asking 
radio broadcasters to convert to digital in the current space, 
which I understand, I am no engineer, but my understanding is 
that is a much more complex sort of operation. The problems of 
interference are much more real. I would encourage you to keep 
us informed as to what you discover in that area.
    Thank you again very much for your contributions today. The 
hearing stands adjourned.
    [Whereupon, at 12:30 p.m., the subcommittee was adjourned, 
to reconvene at the call of the Chair.]


     CORPORATION FOR PUBLIC BROADCASTING AUTHORIZATION ACT OF 1999

                              ----------                              


                         TUESDAY, JULY 20, 1999

              House of Representatives,    
                         Committee on Commerce,    
                    Subcommittee on Telecommunications,    
                            Trade, and Consumer Protection,
                                                    Washington, DC.
    The subcommittee met, pursuant to notice, at 10:15 a.m., in 
room 2123, Rayburn House Office Building, Hon. W.J. ``Billy'' 
Tauzin (chairman) presiding.
    Members present: Representatives Tauzin, Oxley, Stearns, 
Gillmor, Cox, Deal, Largent, Cubin, Shimkus, Wilson, Pickering, 
Fossella, Blunt, Ehrlich, Markey, Rush, Eshoo, Wynn, Luther, 
Sawyer, Green, and Dingell (ex officio).
    Also present: Representative Norwood.
    Staff present: Cliff Riccio, legislative clerk; Justin 
Lilley, majority counsel; Michael O'Rielly, professional staff 
member; and Andy Levin, minority counsel.
    Mr. Tauzin. The subcommittee will please come to order. We 
ask that all our guests take seats and that someone catch the 
door right behind you.
    Good morning. Today we meet with a deep sense of 
disappointment. This subcommittee meets again today to discuss 
the Corporation for Public Broadcasting Authorization Act of 
1999. What began as an attempt to fund Public Broadcasting 
while continuing debate on its reform has now broadened into an 
inquiry about the practices of certain recipients of CPB funds. 
This committee is deeply disappointed about the stories that 
have surfaced in the press about public broadcast stations 
sharing the names of their membership, personal information 
about their members, with third parties, in some cases with 
political parties.
    Let me at the start disabuse hopefully this meeting of 
three, I think, misconceptions. The first is that as we begin 
this process on reauthorizing Public Broadcasting, the 
legislation was somehow set in stone. As you know, this member 
and together with the ranking minority member and I, we have 
worked very diligently on legislation designed to thoroughly 
reform the issue of Public Broadcasting, to bring Public 
Broadcasting not only into the digital age, but to reform it in 
many ways. We end some of the overlapping of functions, the 
duality of operations in certain communities to more properly 
fund it into the future, to end practices that have led to the 
commercialization of Public Broadcasting, and to diminish the 
need for Public Broadcasting to compete with commercial 
stations both for commercially viable programming and 
advertising dollars. We scaled back that effort at the request 
of many of the members of this committee, including the 
chairman, to do a straight authorization.
    Let me assure all the members of this committee that that 
was an open process, and remains an open process. Anybody has 
any problems with the original draft, the numbers contained in 
the original draft, were invited to the first hearing and are 
invited again to discuss those concerns with us that we might 
have a consensus package when and if this legislation moves. I 
would urge members to take advantage of that invitation and to 
work with the Chair that we might have such a good consensus 
package when, in fact, this legislation is brought forward for 
markup.
    Second, the news we get from the newspapers about the 
activities of public broadcast stations in trading the names of 
their subscribers and other personal information about their 
subscribers with third parties is disturbing in not one, but 
two major aspects. The first is that a publicly supported 
entity should think for a moment that it has the right to trade 
private information about citizens of this country who deign to 
support it with any third party for commercial benefit is 
outrageous, should be outlawed if it is not yet, and will be 
outlawed if we have the chance to do so in legislation this 
year.
    Second, trading that information with a political party, 
with a public broadcast station cozying up to any political 
party, any of the political parties in America, is outrageous. 
The idea that public funds spent at a public broadcast station 
should ensure the benefit of any one of the political parties 
of our country is outrageous. It threatens the integrity of 
Public Broadcasting. It further deepens the suspicion that many 
people have had about Public Broadcasting, and it damages the 
efforts being made in Washington, DC, and across America to 
build public support for this adventure.
    Let me as a third point disabuse, I hope, our public 
broadcast stations of a third notion. The notion that 
insulating the cooperation with political parties through so-
called brokers somehow means that the station did nothing wrong 
is a false, erroneous notion. The fact that public broadcast 
stations may have chosen to sell or trade the list of their 
personal information about their subscribers through a broker 
to any political party or any third party is equally egregious, 
equally wrong, and I hope this committee will join me in 
outlawing it.
    Finally let me say we have asked our witnesses and the 
Corporation to help us do an assessment of the activities of 
public broadcast stations across America before this hearing 
today. I am disappointed that in many cases the public 
broadcast stations have responded that, well, we don't know. We 
had somebody doing our--third parties doing our work. Third 
parties have handled the distribution of our lists. Third 
parties have handled--somebody did it, and they are gone now, 
and we don't know whether or not our station engaged in these 
practices.
    Let me assure you if the information we derive this morning 
is not accurate and complete, the Chair will call for a GAO 
investigation.
    Our first job as a committee is to get the facts. We will 
get the facts about these activities. We will learn them 
thoroughly. We will understand the motives and the rationale 
behind these acts before we proceed with any legislation. And 
if we cannot obtain that information directly from our 
witnesses or from the Corporation, we will ask the GAO to do so 
for us.
    And finally, let me return to the word I used at the 
beginning of this session. I start this hearing with 
disappointment. Many of us who look upon Public Broadcasting as 
a real national asset. To have it tarnished in this way, to 
have any station, executive, agent, or employee tarnish it in 
this way is a crime, a sin, and a shame. We are going to deal 
with this. We are going to make these practices, I think, 
illegal before we are through, and we are going to put this 
behind us. But the damage done to Public Broadcasting is real, 
and those responsible for it ought to be ashamed.
    The Chair yields now to the gentleman from Massachusetts, 
Mr. Markey, for an opening statement.
    Mr. Markey. Thank you, Mr. Chairman, very much. I want to 
commend you for calling this additional hearing on legislation 
to reauthorize the Corporation for Public Broadcasting. I am, 
along with you, Mr. Chairman, an original cosponsor of the 
Corporation for Public Broadcasting Reauthorization Act of 
1999.
    The backdrop for this morning's hearing is the disclosure 
by a number of public broadcasting stations that its donor 
lists have been exchanged with political organizations. We know 
that portions of some lists have gone to Democratic National 
Committee organizations, and we also know that some lists have 
gone to conservative political organizations. If an entity 
doesn't keep an eagle eye on its list broker, that broker will 
go anywhere with the donor lists that the law allows. I think 
that we can all quickly reach a consensus here on the 
subcommittee that such donor lists sharing either with 
Democrats or Republicans, conservative or liberal political 
organizations is inappropriate and should be prohibited in the 
future.
    We can join together in making sure that such conduct is 
prohibited by law, and after having readily agreed on a 
bipartisan basis to prohibit the prospective sharing of lists 
with political parties, candidates, or organizations, the 
question then arises as to whether or not we are going to 
starve the system as well. Will we cut the funding? Will we 
punish the system?
    It seems to me that cutting the funding would result in 
these stations continuing to look for additional, more 
commercial sources of revenue such as sales or swaps of donor 
lists or pushing the line even further on underwriting 
acknowledgments on the air. The legislation Chairman Tauzin and 
I have introduced was designed to get the system away from 
these commercial pressures by giving it the funding needed to 
insulate it sufficiently from the creeping commercialism we 
have seen in recent years. If we cut the funding, we fuel the 
proclivity in some stations to experiment and depart at times 
from public broadcast's noncommercial mission.
    I believe the legislation introduced by Chairman Tauzin and 
myself underscores the bipartisan support that Public 
Broadcasting enjoys throughout America. I believe that the 
funding levels in the legislation reinforces the firm 
commitment in Congress to providing an electronic oasis for 
learning and information in what has been called the vast 
wasteland of commercial television. Free over-the-air 
noncommercial television and radio are indispensable media 
outlets in our communities today by millions of Americans, and 
especially millions of children and their parents. We must 
remember that telecommunications technology can only empower 
those who can obtain it or those who can afford to get it. Not 
every American family can afford cable.
    And let's just check it on the TV listings for the upwards 
of 35 percent of America's children who live in families who do 
not subscribe to cable. What's been on free over-the-air 
commercial TV for them in the last few days? Well, on Jenny 
Jones today is a show called controlling husbands. Also on 
Leeza is sexuality in the U.S.A. On Jerry Springer, we have 
tales of infidelity. Yesterday, Jerry had secret sex lives, 
while on Maury there was a show entitled wild teens visit 
prison. Ricki Lake had lie detector tests gauge mates' 
fidelity. Jenny Jones had on nubile fans, while Sally Jessy 
Raphael had women caught in love triangles. Last week noncable 
families could have sat in the living room and watched women 
flaunt buxomness on Jenny Jones, or they could have seen 
gender-bending situations on Jerry Springer.
    Compare that with Public Broadcasting today. Here in 
Washington examples of what is on WETA and on just about every 
other public television station in America include starting the 
morning with Arthur. Then we have Barney and Friends, Whimsy'S 
House, Sesame Street, Big Comfy Couch, Health Week, Travel 
Magazine, Antiques Road Show, Mr. Rogers, Puzzle Place, 
Wishbone, Zoom, all kid-friendly shows all the way up to the 
point at which the News Hour with Jim Lehrer begins at 6 or 
6:30 or 7 on public broadcasting stations. This lineup is then 
followed in the evening with quality programming dramas, 
science shows or history shows.
    At a cost of just over $1 per year per person, what parents 
and kids get from free over-the-air public TV and public radio 
is an incredible bargain. As I said at the first hearing, to me 
the question is not can we afford it, but rather can we afford 
to lose it at $1 per person per year?
    Again, I want to thank Chairman Tauzin for the hard work 
and attention he has brought to this issue, and I look forward 
to working with him as we further explore important public 
policy issues related to Public Broadcasting. Again, I look 
forward to hearing from our expert panel without question, 
though I agree with the chairman that the activities which have 
been identified in the last couple of weeks have to be 
prohibited. We have to ensure that on a bipartisan basis we say 
no to those kinds of activities that have been identified that 
blur the distinction between the public broadcasting system and 
the partisan political network in our country.
    I thank the chairman for holding this hearing. I yield back 
the balance of my time.
    [The prepared statement of Hon. Edward J. Markey follows:]
   Prepared Statement of Hon. Edward J. Markey, a Representative in 
                Congress from the State of Massachusetts
    Good Morning. I want to commend Chairman Tauzin for calling this 
additional hearing today on legislation to re-authorize the Corporation 
for Public Broadcasting. I am an original cosponsor of the 
``Corporation for Public Broadcasting Reauthorization Act of 1999,'' 
introduced by Chairman Tauzin.
    The backdrop for this morning's hearing is the disclosure by a 
number of public broadcasting stations that its donor lists have been 
exchanged with political organizations. We know that portions of some 
lists have gone to the Democratic National Committee and we also know 
that some lists have gone to conservative political organizations. If 
an entity doesn't keep an eagle eye on its list broker, that broker 
will go anywhere with the donor list that the law allows.
    I think that we can all quickly reach a consensus here on the 
Committee that such donor list sharing--either with Democrats or 
Republicans, conservative or liberal political organizations--is 
inappropriate and should be prohibited in the future. We can join 
together in making sure that such conduct is prohibited by law.
    After having readily agreed on a bipartisan basis to prohibit the 
prospective sharing of lists with political parties, candidates or 
organizations, the question then arrives as to whether or not we are 
going to starve the system as well. Will we cut the funding? Will we 
punish the system? It seems to me that cutting the funding would result 
in these stations continuing to look for additional, more commercial 
sources of revenue--such as sales or swaps of donor lists, or pushing 
the line even further on underwriting acknowledgments on the air.
    The legislation Chairman Tauzin and I have introduced was designed 
to get the system away from these commercial pressures by giving it the 
funding needed to insulate it sufficiently from the ``creeping 
commercialism'' we have seen in recent years. If we cut the funding, we 
fuel the proclivity in some stations to experiment and depart at times 
from public broadcasting's non-commercial mission.
    I believe the legislation introduced by Chairman Tauzin underscores 
the bipartisan support that public broadcasting enjoys throughout 
America. I believe that the funding levels in the legislation 
reinforces the firm commitment in Congress to providing an electronic 
oasis for learning and information in what has been called the vast 
wasteland of commercial television. Free, over-the-air non-commercial 
television and radio are indispensable media outlets in our communities 
today for millions of Americans and especially millions of children and 
their parents.
    We must remember that telecommunications technology can only 
empower those who can obtain it or those who can afford to get it. Not 
every American family can afford cable. And let's just check in on the 
TV listings for the upwards of 35 percent of America's children who 
live in families that do not subscribe to cable. What's been on free 
over-the-air commercial TV for them over the last few days?
    Well, on Jenny Jones today is a show called ``Controlling 
Husbands''; also today on Leeza is ``Sexuality in the USA'', on Jerry 
Springer we have ``Tales of Infidelity''. Yesterday Jerry had ``Secret 
Sex Lives'' while on Maury there was a show entitled ``Wild teens visit 
prison.'' Ricki Lake had ``Lie detector tests gauge mates' fidelity''. 
Jenny Jones had on ``Nubile Thangs'' while Sally Jessy Raphael had on 
``Women caught in Love Triangles''. Last week, non-cable families could 
have sat in the living room and watched ``Women Flaunt Buxomness'' on 
Jenny Jones or they could have seen ``Gender bending situations'' on 
Jerry Springer.
    Compare that with public broadcasting today. Here in Washington, 
examples of what's on WETA include starting the morning with 
``Arthur,'' then we have ``Barney and Friends,'' ``Wimzie's House,'' 
``Sesame Street,'' ``Big Comfy Couch,'' ``Healthweek,'' ``Travel 
Magazine,'' ``Antiques Roadshow,'' ``Mr. Rogers,'' ``Puzzle Place,'' 
``Wishbone,'' ``Zoom''--all kid-friendly shows all the way up to the 
Jim Lehrer Newshour. This lineup is then followed in the evening with 
quality programming dramas, science shows, or history shows.
    At a cost of just over $1 per year per person what parents and kids 
get from free over-the-air public TV and public radio is an incredible 
bargain. As I said at our first hearing, to me, the question is not, 
``Can we afford it?,'' but rather, ``Can we afford to lose it?''
    Again, I want to thank Chairman Tauzin for the hard work and 
attention he has brought to this issue and I look forward to working 
with him as we further explore important public policy issues related 
to public broadcasting. And again I want to thank our expert panel of 
witnesses for being with us this morning and look forward to their 
testimony.

    Mr. Tauzin. I thank the gentleman.
    I yield now to the vice chairman of the Telecommunications 
Subcommittee, the gentleman from Ohio, Mr. Oxley, for an 
opening statement.
    Mr. Oxley. Thank you very much, Mr. Chairman.
    Mr. Chairman, in 1984 when Ronald Reagan was in his first 
term in the White House and I was in my second term in the 
House, my first on the Energy and Commerce Committee, I offered 
four amendments to two CPB authorization bills. The measures I 
sought to amend would have authorized three times the Reagan 
administration's budget request for Public Broadcasting. The 
first amendment was designed to cut the authorization back to a 
mere 25 percent increase. The second would have reduced CPB 
funding to the administration's request. Republicans were deep 
in the minority in those days, and both of my amendments failed 
miserably. However, both measures were vetoed by President 
Reagan, who, in his first veto message said that he would have 
supported the more reasonable funding levels of my amendment.
    Well, the more things change, the more they stay the same. 
Mr. Chairman, when we consider authorization levels for Public 
Broadcasting, I believe we have to ask ourselves the following 
threshold question: Should the viewing habits of those who 
watch Masterpiece Theater really be subsidized by those who 
prefer the World Wrestling Federation?
    In all seriousness, Mr. Chairman, I appreciate the 
importance of reauthorizing the CPB, and I understand the need 
to do so in a timely fashion. I support reauthorizing the CPB, 
and I support helping fund the transition to digital 
broadcasting, but not without reform and not at the levels 
contemplated under the legislation before us.
    Of course, the chairman has acknowledged these concerns, 
and I appreciate his willingness to work with us to put 
together a package that we can all support.
    I believe there is consensus on the committee that Public 
Broadcasting needs reform. In my opinion, one of the major 
goals of such reform should be to point Public Broadcasting in 
the direction of self-sufficiency and move away from the cycle 
of annual appropriations. In the past, the Corporation for 
Public Broadcasting has been challenged to come up with 
innovative new sources of funding to replace tax dollars, 
whether it be enhanced underwriting or enhanced advertising, 
something that I proposed about 10 years ago. We had some 
support at that time from the public broadcasting stations, 
including the gentleman who headed up the Public Broadcasting 
System in Chicago, who was very much in favor of what we tried 
to do in regard to enhanced underwriting and advertising. But 
unfortunately the powers that be at Public Broadcasting 
prevailed, and we continue to increase public funding.
    We have talked about increased royalties from the marketing 
of licensed merchandise, consolidation of facilities or some 
other marketplace solution. After all, if CPB funding makes up 
only 14 percent of public broadcasting's total budget, self-
sufficiency seems like a reasonable goal. Yet here we are in 
1999 with business as usual and no reforms in place. The only 
real change is the CPB's budget requests have gotten a lot 
higher.
    And then this list-swapping scandal comes along. When WGBH 
first got caught, they said it was a one-time mistake by a low-
level employee. Now we are learning drip by drip it is a 
widespread practice going back years and years. Worse, it makes 
WGBH's initial public statement look like a failed attempt at 
some type of cover-up. Even as a Public Broadcasting watchdog, 
I never would have guessed that a public broadcasting station 
would engage in anything so stupid and so nakedly partisan. 
What's more, the stations engaged in these inappropriate 
arrangements with the DNC are the very stations responsible for 
the bulk of the programming produced by public broadcasters. 
This is not the place you want to uncover proof of partisan 
bias.
    Mr. Chairman, I thank you for calling today's hearing. I 
look forward to getting some answers out of the first panel. I 
look forward to moving a reform reauthorization bill in the 
very near future, and I yield back.
    Mr. Tauzin. I thank the gentleman.
    The Chair now yields to the ranking minority of the full 
committee, the gentleman from Michigan, Mr. Dingell.
    Mr. Dingell, again, the Chair appreciates the cooperation 
of the gentleman from Michigan in the waiver required for us to 
have this hearing today.
    I now yield to the member from Michigan.
    Mr. Dingell. Thank you. We are delighted to talk to the 
Chair on these matters, and I commend you for holding this 
hearing.
    First of all, Mr. Chairman, I ask unanimous consent to 
revise and extend my remarks. Second of all, Mr. Chairman, I 
wish to make just a few brief comments.
    Mr. Tauzin. Without objection.
    Mr. Dingell. Thank you, Mr. Chairman.
    I certainly hope that the recent controversy over the fact 
that some public stations have shared their donor lists with 
political groups doesn't overshadow the importance of 
maintaining a strong and vibrant Public Broadcasting Service 
for the people of Massachusetts, California, and every 
community in between. I would like to say that I regard this as 
a valuable, important and useful service to all Americans, and 
I am, of course, pleased to support it.
    I hope that we will get to the bottom of the questions 
associated with the rental of lists, et cetera. I note that is 
about to be a matter of some discussion here, and I hope that 
this would indicate on the part of my Republican colleagues 
that their outrage over this matter would indicate that they 
intend to move forward toward some kind of campaign finance 
reform. I think it augurs well.
    Thank you, Mr. Chairman.
    [The prepared statement of Hon. John D. Dingell follows:]
    Prepared Statement of Hon. John D. Dingell, a Representative in 
                  Congress from the State of Michigan
    Thank you, Mr. Chairman, for recognizing me. Just a few weeks ago, 
Members of this Subcommittee heard testimony from a large panel of 
distinguished witnesses on the bill to reauthorize the Corporation for 
Public Broadcasting, H.R. 2384. They were unanimous in strong support 
of this legislation, Mr. Chairman, and for good reason. It is a fine 
bill; one which I was proud to be an original cosponsor with you and 
the Ranking Member of the Subcommittee, Mr. Markey.
    Mr. Chairman, you are to be congratulated on your effort to pass 
the first reauthorization of public broadcasting since 1992. But, more 
importantly, you are to be congratulated for drafting a bill that is 
truly supportive of the valuable public service that non-commercial 
broadcasting provides.
    Today, more than ever, the American people are yearning for an 
alternative to what many see as a decay in the quality of programming 
on commercial radio and television. During the last hearing, we 
discussed a recent report by the Annenberg Public Policy Center on the 
current state of children's television. It came as no surprise that the 
trends were disturbing. There is more violence, more sex, and more 
suggestive language in programs aimed at our children today than at any 
time in the history of television.
    These results come despite commitments by commercial broadcasters 
to air more children's educational programming, and despite the 
introduction of a new television ratings system. As well meaning as 
these efforts may have been, they are no replacement for the 
development of more and better programming by non-commercial 
broadcasters whose motives and mindset are fixed on values other than 
the bottom line.
    Mr. Chairman, I certainly hope that the recent controversy over the 
fact that some public stations have shared their donor lists with 
political groups doesn't overshadow the importance of maintaining a 
strong and vibrant public broadcasting service for the people of 
Massachusetts, California, and every community in between.
    I know you share the view of most Americans that the efforts of 
public broadcasters pay dividends far greater than the amount we invest 
as a nation. The public doesn't want Congress to censor the programs 
they don't like; rather, they want us to encourage the creation of 
shows that they do. That is precisely the mission of public 
broadcasting, and I hope the Committee will stand firm in its 
commitment to authorize funding that pays more than lip service to the 
needs of our nation and its children.
    I yield back the balance of my time.

    Mr. Tauzin. I thank the gentleman.
    I recognize the gentleman from Florida Mr. Stearns for an 
opening statement.
    Mr. Stearns. Thank you, Mr. Chairman. Let me compliment you 
for calling this hearing and in a timely manner. As my 
colleagues know, we are here also to talk about--to address the 
issue of authorization levels, and this controversy, I have 
great empathy for our witnesses today. I think every Member of 
Congress has been in a position where he or she has had to 
explain something where something has happened in their 
campaign or congressional career which they couldn't quite 
fathom. So I think we are all a little sympathetic with you, 
and we are here to help you, but we also have to get to the 
bottom of this.
    One of the things, before I go on to this controversy, I 
might talk about is the authorization levels in H.R. 2384 I 
don't think are going to happen. It does not equate to these 
appropriations, so I think it is unlikely that this committee 
will receive or appropriate those kind of levels. So then that 
leaves us with the question as how are we going to go about and 
fund CPB and the American public television networks. I think 
some of the questions that we are going to ask you are going to 
have to provide answers on how you think we should go forward 
the next 5, 10 years, and I will associate my comments with my 
colleague from Ohio that sometime down the road we should 
privatize public television so that you don't have to go 
through these tortuous hearings and explanations.
    And perhaps one thing you might comment on is perhaps how 
generous underwriting rules might be changed to allow you to 
move to digital conversion, because remember, Congress itself 
has mandated that you move to digital conversion. And so with 
that in mind, I think Congress has to understand we must 
provide some means and help so that you can do that.
    That being said, let me just take the latter part to 
address the sharing of donor lists between public television 
stations and political or social organizations.
    I think the chairman's quote that was in the New York Times 
editorial today in which he said, quote, it undermines the 
faith in broadcasting, I think sums it up how all of us feel, 
but I would point out in today's Washington Times, they say 
that public television and radio stations have swapped their 
membership lists with groups that support, support, abortion, 
gun control, and other very politically charged issues.
    Now, this is very difficult for, I think, people to 
understand. When you are swapping your donor lists with Handgun 
Control, Incorporated, Planned Parenthood, and Zero Population 
Growth is just a few of the groups the public stations have 
swapped with, and I think many of us find that this undermines 
our faith in Public Broadcasting. And even how it was handled 
with the Boston station, WGBH, you know, at one time they had 
reported that this is a one-time mistake is what they said, and 
lo and behold, they later revealed, in fact, that that was not 
true, and they had been sharing their donor lists with the 
Democrat National Committee beginning in the 1980's. And so, I 
mean, the story starts to unravel, and then we find it is 
across the country that they are doing this.
    I think, Mr. Chairman, I would suggest that Public 
Broadcasting come up with a solution in which they have an 
outside commission or an outside board investigate this and not 
come forward and say, our inspector general said such and such. 
I think your credibility has been undermined. I think you have 
an opportunity to restore yourself, and I think it can only be 
done by someone outside Public Broadcasting. And so I call on 
you today to put into your game plan an outside group of 
individuals respected by both sides, by all people in America, 
to investigate this so that we can get to the bottom of this, 
and obviously on a legislative side, we intend to make sure 
this doesn't happen again.
    So I feel some compassion for you folks on the witness 
stand today, and I think as members, we have to come up with a 
solution here so that we can get to the next 5 to 10 years 
where they are privatized, as my colleague from Ohio has said, 
and I think if we do that, then Public Broadcasting can make 
the move to digital, and then in the end we will have a more 
competitive organization. And I thank the chairman.
    Mr. Tauzin. The Chair thanks the gentleman.
    The gentlelady from California, Ms. Eshoo is recognized.
    Ms. Eshoo. Thank you, Mr. Chairman, for holding this 
hearing today. I, along with, I think, everyone that is here, 
is disappointed that we have to be here today to discuss the 
sharing of donor lists by PBS stations with political 
organizations. Everyone knows it is wrong. Everyone senses the 
sting of the embarrassment, and I hope that what is necessary 
to come out in a hearing will be separated out from some of the 
comments that Mr. Markey made about what a great value Public 
Broadcasting is to the people of our Nation. While I still 
believe the funding we will provide for CPB presents one of the 
very best investments Congress can make, this episode has left 
me feeling really let down and, most frankly, over the weekend 
sometimes angry, but we have to move on.
    I understand that the affiliates involved have begun to 
implement internal procedures to end this. I am sure that there 
is a scramble to do so, and I think that that is important. In 
light of the current situation, perhaps these internal policies 
really won't be enough. I think that whatever emerges has to 
give the American people the confidence that this simply cannot 
penetrate any station anymore, and I think that good policy can 
assure that.
    Obviously, there isn't any excuse for the mistakes that 
have been made. The Washington Post today, I think, used the 
word ``stupidity,'' and it stands in such stark contrast to the 
extraordinary intelligence that has been applied artistically 
and otherwise to PBS.
    It is my hope that my colleagues won't use this episode as 
a return really to what we experienced here in the Chambers 4 
years ago when my Republican colleagues were putting the 
entirety of Public Broadcasting squarely on the chopping block. 
If we do that, we are really going to be punishing the American 
people. That is not a solution.
    Today we are going to hear during our second panel 
witnesses testifying that the Federal Government has no 
business in funding Public Broadcasting. Fortunately, we are 
also going to hear testimony from famous filmmaker Ken Burns, 
whose films have added so much to the understanding of the 
American people of their own American history.
    Mr. Burns points out in his written testimony that were it 
not for the grant that he received from CPB, his brilliant 
series on the Civil War would have never been made. I am 
certain that all of us, each of us, can think of many, many 
fine examples of similar excellent programming that Public 
Broadcasting has produced.
    So it is my great hope, Mr. Chairman, that the mistakes 
that have been made by a number of stations do not poison the 
well and that, once again, if the Congress punishes the 
stations, they will indeed be punishing the American people.
    So I can't say that I am looking forward to the painful 
testimony today. It is necessary. The American system is one 
that brings things out into the public and that we move on from 
what we learn so that we make sure that these mistakes are not 
made again. I would support language in the reauthorization 
that would essentially outlaw any exchanging or selling of 
lists. As a Democrat and as a great supporter of KWED and 
public broadcasting, I really don't need to have my party 
involved in it. It is enough, I think, as a contributor to my 
party that I raise my voice in support of Public Broadcasting. 
So I don't need the lists sold or exchanged or shared.
    Again, I don't look forward to all of this. I wasn't 
looking forward to walking into the hearing room today, but we 
can do this. We will get through it, and let's just make sure 
that we leave this intact and whole, because I really think it 
is a gift to the American people, and separate all of this out, 
make it illegal, set good policies and move on. Thank you.
    Mr. Tauzin. The Chair thanks the gentlelady.
    The Chair yields to the gentleman from California, Mr. Cox, 
and at the same time the chairman would like to commend the 
gentleman for his interest in this matter and for the attention 
he has paid to it, and also to reassure the member that we 
intend a second hearing so we can hear a number of the 
witnesses whom he wanted to hear who could not be here today.
    The Chair now yields to Mr. Cox.
    Mr. Cox. I appreciate the chairman. As you know, I also 
paid a special interest in the oversight investigation 
subcommittee hearing going on upstairs, so I will try also to 
pay attention to its simultaneously occurring.
    Government-funded mass media is a dangerous admixture. It 
requires an exception to our general rule that free expression 
in a free society will be hindered if it is influenced by the 
government. It requires a presumption that the marketplace of 
ideas will be devoid of some very important commodity unless 
government steps in to fill the void. In the information age 
that presumption is increasingly subject to question, but if we 
accept that presumption, and if we make an exception to the 
rule against government involvement in the content of mass 
media America, then very sturdy firewalls are needed to prevent 
politics from infecting programming content. The fact that 
taxpayer-financed public television and radio is sharing its 
donor lists with the Democratic National Committee, Zero 
Population Growth, and other political organizations makes it 
clear that those firewalls are not in place.
    Today's Washington Post editorial page appropriately calls 
this stupidity. The New York Times calls it an extraordinary 
display of carelessness. The Boston Globe notes, it appears to 
violate public television's tax-exempt status.
    Mr. Chairman, I would like to second your request for the 
General Accounting Office to fully examine these matters. This 
will help us get to the bottom of it. It is ironic that today's 
hearing comes on the heels of our hearing just last week on how 
best to protect consumer privacy in the information age. At 
that hearing members on both sides of the aisle, Republican and 
Democrat, talked about how important it is for enterprises that 
collect personal information to accurately inform consumers 
about whether and with whom they will share this information. 
We heard testimony from the members of the Federal Trade 
Commission that there should be consequences for enterprises 
that fail to live up to sound privacy policies. WGBH, the well-
known PBS affiliate in Boston, actually assured its consumers 
that it had an official station policy against sharing its 
members' names, addresses, and other information with partisan 
political groups, but this policy, as was recently discovered, 
was apparently just lip service.
    A 4-year-old boy, Sam Black, is a fan of the Barney 
television show, which airs in his hometown of Wellesley, 
Massachusetts. Sam's mother, Jody Black, sent WGBH a $40 check 
for their children's program. She included Sam's name with a 
donation. Later 4-year-old Sam Black received a fund-raising 
letter from the Democratic National Committee seeking his 
financial help in getting Democrats elected to office. 
Initially WGBH attempted to suggest this was an inadvertent 
violation, a misunderstanding. The station's vice president for 
communications blamed it on a new employee, but once the Boston 
papers began to dig deeper, it became clear that this practice 
of selling names, addresses and other personal information was 
officially sanctioned by the executives at the station.
    So the question before us today is what did the Corporation 
for Public Broadcasting do when it learned of these reports in 
early May 1999? To quote from an editorial in today's New York 
Times, ``amazingly the Corporation for Public Broadcasting, 
which distributes Federal money to stations, did nothing.''
    Since then, the media, not the Corporation for Public 
Broadcasting, not taxpayer-supported media, but first-
amendment-supported media, have discovered that this practice 
of selling or swapping names and addresses and other personal 
information with Democrat fund-raisers is far more widespread. 
In San Francisco, KQED admitted sharing its membership lists 
with the campaign to reelect Senator Barbara Boxer. They also 
shared it with the Democrat National Committee. Senator Boxer's 
office has, in fact, confirmed using the list for fund-raising 
purposes.
    The New York Times said today organizations that depend 
partly on public money to survive should not play politics. 
That was their editorial. And the Times added, this ought to be 
a simple and self-evident rule. We should hold public 
broadcasters accountable to this simple and self-evident rule, 
and we should insist that PBS hold its own employees and its 
member stations fully accountable.
    I thank the chairman.
    [The prepared statement of Hon. Christopher Cox follows:]
    Prepared Statement of Hon. Christopher Cox, a Representative in 
                 Congress from the State of California
    Government-funded mass media is a dangerous admixture. It requires 
an exception to our general rule that free expression in a free society 
will be hindered if it is influenced by government. It requires a 
presumption that the marketplace of ideas will be devoid of some very 
important commodity unless government steps in to fill the void. In the 
Information Age, that presumption is increasingly subject to question.
    But if one accepts it, and if we make an exception to the rule 
against government involvement in the content of mass media in America, 
then very sturdy firewalls are needed to prevent politics from 
infecting programming content. The fact that taxpayer-funded public 
television and radio are sharing their donor lists with the Democratic 
National Committee, Zero Population Growth, and other political 
organizations shows those firewalls don't exist.
    Today's Washington Post editorial page appropriately calls this 
list-sharing ``stupidity.'' The New York Times calls it ``an 
extraordinary display of carelessness.'' The Boston Globe notes it 
appears to violate public television's tax-exempt status.
    Mr. Chairman, I'd also like to second your request for the General 
Accounting Office to fully examine these matters. This will help us get 
to the bottom of these matters.
    It is ironic that today's hearing comes on the heels of our hearing 
just last week on how best to protect consumer privacy in the 
information age. At that hearing, members on both sides of the aisle--
Republican and Democrat--talked about how important it is for 
enterprises that collect personal information to accurately inform 
consumers about whether, and with whom, they will share this 
information. We heard testimony from the members of the Federal Trade 
Commission that there should be consequences for enterprises that fail 
to live up to sound privacy policies.
    WGBH, the well-known PBS affiliate in Boston, actually assured its 
consumers that it had an official station policy against sharing its 
members' names, addresses, and other information with partisan 
political groups. But this policy, as was recently discovered, was 
apparently just lip-service. We learned this in the case of Sam Black, 
a 4-year old boy.
    Sam is a fan of the ``Barney and Friends'' television show, which 
airs in his hometown of Wellesley on WGBH. Sam's mother, Jody Black, 
sent WGBH a $40 check to thank them for their children's programming. 
She included Sam's name with the donation. Later, 4-year-old Sam Black 
received a fundraising letter from the Democratic National Committee, 
seeking his financial help in getting Democrats elected to office.
    Initially, WGBH attempted to suggest this was an inadvertent 
violation, a ``misunderstanding.'' The station's vice president for 
communications blamed it on a new employee. But once the Boston papers 
began to dig deeper, it became clear that this practice--selling names, 
addresses, and other personal information--was in fact sanctioned by 
the executives at the station.
    What did the Corporation for Public Broadcasting do when it learned 
of these reports in early May? To quote from an editorial in today's 
New York Times: ``Amazingly, the Corporation for Public Broadcasting, 
which distributes Federal money to stations, did nothing.''
    Since then, the media--not CPB, not taxpayer-supported media, but 
First Amendment-supported media--have discovered that this practice of 
selling or swapping names, addresses, and other personal information 
with Democrat fundraisers is far more widespread.
    In San Francisco, KQED admitted to sharing its membership lists 
with the campaign to re-elect Senator Barbara Boxer. They also shared 
it with the Democrat National Committee. Senator Boxer's office has in 
fact confirmed using the list for fundraising purposes.
    ``Organizations that depend partly on public money to survive 
should not play politics,'' the New York Times rightly states. And, the 
Times add, this ought to be a ``simple and self-evident rule.'' We 
should hold public broadcasters accountable to this rule. And we should 
insist that CPB hold its own member stations fully accountable.

    Mr. Tauzin. The Chair thanks the gentleman.
    The gentleman from Ohio Mr. Luther is recognized.
    Mr. Luther is not here. The gentleman Mr. Sawyer is 
recognized.
    Mr. Sawyer.  Thank you, Mr. Chairman, for having this 
hearing. I think we all come here with a measure of discomfort 
over the specifics that bring us here today. I simply want to 
say that I hope that the committee will not substantially 
revise its approach, which was developed in a quieter 
environment, in terms of the way we expect to support public 
television and Public Broadcasting in general over the next few 
years. We certainly should not penalize public broadcasters 
because of the mistakes of a few stations or, frankly, the deep 
misjudgments of the few individuals within them. Public 
television, Public Broadcasting, public radio hold this Nation 
together in ways that very few other institutions do.
    It is in the face of this that I suppose that I really 
appreciate what the gentleman, Mr. Cox, had to say about the 
perspective that this places on privacy to begin with. The 
notion that broadcasters would sell donor lists to any third 
party brings deep dismay at the fact that my donation would be 
available as a matter of what I would never have suspected to 
be public record. But having said that, it puts into real 
perspective the rage that many of us feel in the selling of 
vastly more sensitive information about ourselves and our 
families, our finances, and our health issues for commercial 
gains in other settings in the way we talked about just last 
week. That is a far deeper violation of personal trust, and, 
frankly, it is not merely enough simply to inform me that you 
are selling this information about me. It seems to me we need 
deeper prohibitions there, perhaps even more importantly than 
we do on the subject that brings us here today.
    Having said that, I do share that disappointment, but let 
me suggest that the role that CPB and all of its affiliates 
bring to the Nation is really much more than we get anywhere 
else. I know that we hear a great deal about the Discovery 
Channel and the History Channel, and that is wonderful, but the 
fact is that when we talk about privatizing Public 
Broadcasting, it seems to me that we lose the heart and soul 
that has made it what it is. Public broadcasting has been a 
pioneer in identifying and nurturing an audience for the kind 
of innovations and program content that today provides 
substantial commercial benefit in the cable environment. And 
that freedom to take risks in pursuit of quality is the 
hallmark of Public Broadcasting and is almost entirely absent 
from commercial television, not that quality programing is, but 
the ability to take that risk on a regular basis is, broadcast 
or cable, where even the very best programming often replicates 
innovations that were first proven in the public setting.
    I am glad we have the Discovery Channel, and I am even more 
glad that they had public broadcasters who had the vision and 
the courage and the freedom to experiment beyond the realm of 
commercial programming. I hope we don't lose that, Mr. 
Chairman. I hope we don't lose that in the concern that brings 
us here together today. And I am grateful that we have the 
candid participation of so many leaders within the industry to 
share their perspective on this.
    Thank you, Mr. Chairman.
    [The prepared statement of Hon. Thomas C. Sawyer follows:]
  Prepared Statement of Hon. Tom Sawyer, a Representative in Congress 
                         from the State of Ohio
    Thank you Mr. Chairman for holding this second reauthorization 
hearing for the Corporation for Public Broadcasting. I want to also 
thank our witnesses for coming to testify before us.
    Recent discoveries in the past week have posed serious questions on 
how this Subcommittee should proceed with respect to providing a multi-
year reauthorization for public broadcasting. We started out with 
legislation that would have provided a straight reauthorization--no 
reform or station matching requirements were included in the bill. I 
supported that effort. However, I have read reports that because of the 
recent list sharing discoveries that the Corporation's authorization 
level will be substantially reduced. I hope this Subcommittee 
reconsiders that approach. We should not penalize all public 
broadcasters because of the mistakes of a few stations--or, more 
precisely, the misjudgement of a few individuals within those stations.
    As I have said before, public broadcasting not only brings the full 
range of entertainment, radio, and arts to the American people every 
day, it ties this Nation together. Without it many Americans would be 
deprived of the educational and cultural programs that these public 
broadcast stations provide.
    I do not agree with the notion that the time has come for public 
broadcasting to stop receiving federal funding. Currently, federal 
funding for public broadcasting comprises only a small portion of the 
budgets for public broadcast stations. The remainder come from sources 
like private corporations, universities, and individual donors. Federal 
dollars help public broadcast stations to leverage their existing 
resources to meet the demands of their constituencies as well as to 
make necessary improvements to the stations.
    I recognize that there are several other programs on cable 
networks, and occasionally on broadcast networks, that provide similar 
programming to that of the CPB's affiliates. For instance, the 
Discovery Channel has quality and educationally enhancing programming, 
but it is not readily available to everyone. Not everyone has the 
ability to subscribe to cable. However, public broadcasting's mission 
is to provide programming for everyone, including those who cannot 
afford cable to those who live in rural areas. That is one big 
distinction between the two. The other is that cable oriented programs 
can be susceptible to heavy commercialization. Therefore, who ever 
covers the cost of the program being aired can actually dictate what is 
being shown. To a large extent, that does not happen with programming 
aired by public broadcast stations.
    Even more important, the CPB has been a pioneer in identifying and 
nurturing the audience for the kind of innovations in program content 
that today promises substantial commercial benefit in the cable 
environment. That freedom to take risks in pursuit of quality is the 
hallmark of public broadcasting and is almost entirely absent from 
commercial television, broadcast or cable, where even the very best 
programming often replicates innovations first proven in the public 
setting. I'm glad we have the Discovery Channel, and I'm glad they had 
public broadcasters who had the vision and courage and freedom to 
experiment beyond the realm of the commercially proven.
    Mr. Chairman, these are just a few of my observations. Maybe in 
light of the recent developments we should consider requiring public 
broadcasters to make concerted efforts to reform some of their 
practices. However, I don't believe substantially cutting their funding 
level because there are other channels providing similar programming is 
the right approach. Public broadcasting serves as a primary resource 
for all of our constituents, and they deserve to continue receiving the 
quality programming they have become accustomed to receiving in the 
past.
    Thank you Mr. Chairman.

    Mr. Tauzin. The Chair thanks the gentleman.
    The Chair will now recognize the gentleman from Oklahoma. 
In doing so, the Chair would like to preface the recognition 
with an announcement. The Chair has asked for guidance from the 
staff on the question of members showing videos in their 
opening statements, and the Chair is prepared to interpret the 
rules to indicate that so long as members stay within the time 
allotted for opening statements, that members of the committee 
will be permitted to display video in connection with their 
opening statement.
    The gentleman from Oklahoma, Mr. Largent, is now recognized 
for an opening statement.
    Mr. Largent. Mr. Chairman, thank you for holding this 
timely hearing on the Corporation for Public Broadcasting, 1999 
reauthorization. Needless to say, a great deal of information 
has come to light regarding the fund-raising methods of some of 
PBS's largest stations over the past week. What was first 
reported to be an isolated incident of donors list-swapping 
between the Boston PBS affiliate and the Democratic National 
Committee is in reality a widespread practice among PBS 
stations throughout the country.
    Last week articles on the Corporation for Public 
Broadcasting chronicled the fact that PBS stations in New York, 
Washington, and San Francisco have entered into similar 
membership list-swapping, selling or renting arrangements with 
the Democratic National Committee. To be fair, it has also been 
reported that some of these stations have entered into 
membership list-swapping deals with Republican groups. 
Regardless of whether the list-swapping occurred with the 
Democratic National Committee or the Republican-leaning groups, 
this practice should not be condoned and should cease 
immediately.
    If this story was not disheartening enough, I learned 
yesterday from an article in the Weekly Standard entitled, 
PBS's Massage Parlor, that all 500 employees at the Public 
Broadcasting Service's headquarters are eligible for federally 
subsidized massages during office hours. Apparently, according 
to the article, there is a massage signup sheet outside the 
sixth floor human resources offices. Those employees that don't 
have an opportunity to go to the sixth floor are notified by e-
mail.
    I don't think I am going too far out on a limb when I say 
that even the most ardent PBS supporter would find this to be 
an extravagant perk, especially considering that PBS is a not-
for-profit corporation.
    Mr. Chairman, at this point, with the subcommittee's 
indulgence, I would like to show a brief excerpt from a 
documentary that aired last month on a Nebraska public 
television station entitled, Its Elementary: Talking About Gay 
Issues in School.
    [Videotape played.]
    Mr. Tauzin. The gentleman may proceed.
    Mr. Largent. I have to believe, Mr. Chairman, that most 
parents in America would object to their 6- or 7-year-old being 
exposed to such mature subject matter at school at such a young 
age, being homosexual or heterosexual. I would venture to guess 
that most of the children in the video don't have the slightest 
idea of what a gay or lesbian lifestyle means, and furthermore, 
they are learning about it from a complete stranger. 
Nevertheless, according to the Nebraska's public broadcasting 
magazine, Nebraska ETV believes it is important to increase 
awareness and provide information about this divisive topic.
    I know some are thinking that I am taking a few isolated 
incidents and blowing them out of proportion in an effort to 
defund the Corporation for Public Broadcasting. That is not my 
intent. Rather I am using these examples to highlight the need 
for reform at CPB. After 32 years it is time for CPB to become 
more self-sufficient. Simply put, Big Bird is nearly 30 years 
old, and it is time to leave the Federal nest.
    It should not be as difficult as some might think. Federal 
funding accounts for only 14 percent of PBS's total operating 
budget. Notwithstanding the It's Elementary documentary, public 
broadcasting offers a great deal of quality programming such as 
the civil war and baseball anthology series produced by one of 
our witnesses today, Mr. Ken Burns. The PBS community has 
determined that it will need $1.7 billion to convert to digital 
television by 2003. They are requesting $700 million from 
Congress for this purpose. I am confident that this 
subcommittee, with the assistance of CPB and other interested 
parties, can work together to enhance Public Broadcasting's 
underwriting abilities and increase its licensing revenues from 
the sale of toys, books and videos associated with PBS 
programming to decrease the Federal share of the digital 
conversion cost.
    As I stated earlier, Mr. Chairman, this should not be 
viewed as a partisan attempt to defund PBS. Rather it is a 
sincere effort to make CPB more efficient while saving several 
millions of American taxpayer dollars.
    Mr. Chairman, I look forward to working with you and other 
members of the subcommittee on this issue, and I look forward 
to hearing from our witnesses.
    Mr. Tauzin. The Chair thanks the gentleman.
    The Chair would advise members that we have been now called 
to a 15-minute vote on suspending the rules and passage 
followed by four 5-minute votes. The Chair will take an 
additional statement or two, and we will recess. I suspect it 
would be best to recess until the hour of noon so that everyone 
can--if you can catch a quick lunch before we come back. We 
will take a few more statements and recess until noon.
    The gentleman, Mr. Green from Texas, is recognized.
    Mr. Green. Thank you, Mr. Chairman, and I appreciate your 
calling this additional hearing. Let me say first that Public 
Broadcasting provides high-quality and educational programming 
for children. Such shows as Barney and Friends and Sesame 
Street have often been cited by parents as the best shows for 
children, and I know that, even though my children are now 
college graduates, they enjoyed that when they were that age.
    I am a cosponsor of this legislation, and it goes a long 
way in assisting and providing for PBS stations to continue to 
provide these quality programs.
    Let me address the recent controversy broken out on whether 
or not a PBS station has the legal right to trade, sell, or 
lease their donor lists to a political party. Let me say I am 
glad that KHOU TV in Houston has said they don't do that, and I 
think the concern I have is that the donor lists trading is 
wrong, and it should not happen, and we should stop it, if 
necessary, to do this reauthorization.
    But let me go a step further in following up on Mr. Cox, 
using the same information that we did on the H.R. 10. Maybe we 
should require if there is a way to--that they want to earn 
money from those lists, it should be with the permission of 
that donor only, and if approved by the donors. And let's 
realize that these exchanges and lists were made to raise the 
85 percent of the funding that the Federal Government can't 
provide. So in some cases maybe those local stations were much 
more aggressive than they should have been, but again, to raise 
85 percent when we provide less than 15 percent, less than 14, 
according to my colleague from Oklahoma.
    This, however, should not be the issue. We should look at 
how can Congress assist in providing the high-quality 
educational television and refocus on authorizing the 
Corporation for Public Broadcasting to make sure they have the 
necessary funds to continue to provide that broadcasting and 
also funds that they can convert to digital television.
    And thank you, Mr. Chairman. I yield back my time.
    Mr. Tauzin. I thank the gentleman.
    The Chair recognizes the gentlelady Mrs. Cubin for an 
opening statement.
    Mrs. Cubin. Thank you, Mr. Chairman. Thank you for holding 
this hearing. I can't help but wonder whether or not if you 
would ask those young children, babies really, after they had 
the presentation what is a gay person, if they might not have 
said it is somebody that jumps up and down on one foot and 
plays soccer. So I really feel that it is a violation of all 
parental guidance to have something like that be shown to 
children.
    It was approximately 2 weeks ago when this subcommittee 
began to learn of the situation in Boston where WGBH, a tax-
exempt public television station, shared the names of its 
donors with the campaign arm of the Democratic Party. Since 
that time the number of stations who engage in the same type of 
practice has grown considerably. In fact, over the last 48 
hours I have learned of at least four or five other public 
broadcasting stations that have been sharing their list of 
donors with the DNC as well.
    This hearing is going to be important in finding out how 
widespread this practice has become and what steps this 
subcommittee must take to end this illegal activity. From the 
press accounts I have read, there seems to be an inaccurate 
depiction by CPB and Public Broadcasting executives as to how 
serious this matter is. In several accounts I have seen the 
public television executives who have referred to this matter 
as a violation of station rules or a mistake made by 
inexperienced office personnel and the common practice by these 
types of organizations. Let there be no doubt this is illegal 
activity. As a nonprofit organization, the Federal law 
prohibits CPB from sharing donor lists with any political 
organization or any political candidate. That is very clear. 
The sooner CPB admits to this illegal activity, the better.I am 
sure we all want to put this behind us, but unless there is 
some acknowledgment of wrongdoing, it will linger on with this 
committee or until this committee takes further action.
    I join with the chairman in calling for a study by the GAO, 
and I also call on the Internal Revenue Service to investigate 
how widespread this problem is and to take action to stations 
that engage in political activities. If the IRS finds that this 
practice is engaged in by a majority of CPB-funded stations, it 
is my feeling that the CPB's tax-exempt status should be 
revoked and that Congress should begin a process of phasing out 
funding for CPB.
    The conclusion has already been drawn that PBS and NPR 
programming can stand on its own without taxpayers footing the 
bill. The Federal Government's contribution to PBS is 
approximately 14 percent. It is my belief that the profit 
derived from the program-related merchandise and other 
commercial activities engaged in by CPB-sponsored stations will 
more than make up the difference.
    Competitive, educational programming has taken root since 
the advent of CPB in 1967. The legislation that created public 
educational television was certainly important and necessary at 
the time. I think we in Congress do need to reevaluate as time 
passes, however. Today the educational void is being filled by 
private, commercial television stations that have proven 
successful in bringing intelligent and responsible programming 
to our Nation's children and their parents. At the very 
minimum, this committee must take a second look at the funding 
levels that are put forth in H.R. 2384. I commend Chairman 
Tauzin for his willingness to do that, and I applaud his 
leadership in addressing the subcommittee's concern.
    I look forward to hearing from the panelists and thank you, 
Mr. Chairman. I yield back the balance of my time,.
    The Chair thanks the gentlelady as usual for excellent 
comments and would now recess the committee until 12 noon. The 
committee stands in recess.
    [Brief recess.]
    Mr. Tauzin. The committee will please come to order. The 
Chair recognizes the gentleman from Maryland, Mr. Ehrlich, for 
an opening statement.
    Mr. Ehrlich. Thank you, Mr. Chairman. I do not have a 
written statement, but I understand the panelists are anxious 
to get going. I feel compelled to make a number of points, Mr. 
Chairman. One, I do want to associate myself first with remarks 
from my colleague from Ohio, Mr. Oxley.
    Second, I want to acknowledge and thank the chairman for 
this hearing today and the scheduled hearing to follow. Third, 
I want to commend Congressman Largent for what he did today. 
Mr. Chairman, I, in response to the earlier hearing we had an 
opportunity to draft a letter dated July 6 to Mr. Duggan in 
follow-up to his testimony. And my first question in follow-up 
to his testimony was in relation to, pertaining to the phrase 
he used in his submission to the committee when he mentioned 
the public broadcasting services' cultural mission. I asked him 
to define for me PBS's cultural mission and its collective 
efforts to successfully fulfill this mission. Obviously it is 
an issue important to members of this committee. It has already 
been said, and I would like to restate to the panel, we have 
sympathy for your position here. We have all been in this 
position, usually with reporters on the other side. Quite 
frankly I am less concerned with the distance faux pas. We can 
certainly correct it. I think we will do it through 
legislation. I am at least equally interested in the cultural 
mission of public broadcasting and the philosophical 
orientation that follows from that sort of phrase.
    I really enjoy the member from Massachusetts not only in 
the gym but also his intellect, his sense of humor. We disagree 
a lot, but we have a lot of fun and I certainly respect him. I 
feel at least compelled to at least take 30 seconds to respond 
to his well stated remarks with respect to the trash that is on 
TV today. I do feel compelled as somewhat of a rejoinder to, 
and, I just pulled the listings today--mention the fact that on 
A&E and the Family Channel and Disney and the History Channel 
and Nickelodeon, we have America's Castles, we have 
investigative reports, biography, we have Walt Disney Presents, 
we have Amazing Animals. We have Firefighting. We have the Real 
West. We have the 20th Century. We have History Undercover. We 
have Tales of the FBI, we have Civil War Journal, we have Life 
in the ER, et cetera. There is quality, clearly, on cable 
television today. There is trash as well.
    The bottom line, Mr. Chairman, is that we need to look at 
whether this public investment, and I think that is probably 
the appropriate term, will remain appropriate in the new 
millennium given what we have with respect to competition in 
that new millennium.
    Again, I look forward to working with the ranking member 
and the chairman in regard to this very important issue, and I 
yield back.
    Mr. Tauzin. I thank the gentleman. The Chair now recognizes 
the gentleman from Maryland, Mr. Wynn, for an opening 
statement.
    Mr. Wynn. Thank you very much, Mr. Chairman. I won't make 
any lengthy comments. I would like to say a couple of words, 
however. I think at our earlier hearing, we had an emerging 
bipartisan appreciation for the importance of public television 
in American life, and I was very encouraged by that. It is 
unfortunate that some recent events have apparently undermined 
that, and I would just say that I would hope that as a 
committee that we would not respond inappropriately to an 
isolated incident in such a way as to overturn the progress 
that has been made in this very important area. It seems to me 
that there is some individuals who are responsible and 
appropriate sanctions ought to be applied to those individuals 
for admittedly very poor judgment. But on the other hand, the 
overall mission of public television in this country is so 
important, and my colleague from Maryland alluded to the nature 
and quality of a program that is being provided that it would 
be, I think, a grave mistake if we were to take action in the 
heat of passion, as we sometimes say, that would undermine the 
overall accomplishments that have been made by public 
television.
    So I would just say let us not let the baby out with the 
bath water. Let us exercise some restraint, apply sanctions 
where appropriate, but overall I think we were on the right 
track supporting public television. Perhaps with greater 
support these kinds of problems would not occur. I hope we 
would continue on the path that we started, which was to 
support enthusiastically public television.
    I yield the balance of my time.
    Mr. Tauzin. I thank the gentleman. The chairman recognizes 
the gentleman from New York, Mr. Fossella, for an opening 
statement.
    Mr. Fossella. Thank you, Mr. Chairman. I guess the question 
I have is whether Elmo is a Democrat or Republican. The point 
is, is that we shouldn't have to ask such questions. And again 
I associate my comments with everyone who thanks the chairman 
and be given the opportunity to air this issue out. But 
frankly, in my view public broadcasting is a public trust. I 
think what has happened is that trust has been breached and my 
colleague Mr. Stearns said earlier I don't necessarily 
empathize with what you have to do now to answer for some of 
your affiliates but nevertheless the buck has to stop 
somewhere. And it begs the question if Mr. Chairman Tauzin had 
not delayed the markup last week to reauthorize the CPB and not 
called for this hearing when we would have discovered this 
information.
    I think that begs the question as to who is doing the 
oversight. Is there adequate oversight by the CPB, among 
others? Does Congress have additional responsibility to 
conduct, I think, the oversight which we are doing today? Who 
knew about these practices and for how long? And whether there 
were guidelines at these affiliates, whether in Boston or 
California, and if there were such guidelines the people who 
violated those guidelines, did the superiors know about them? 
And are those people who violated those guidelines going to pay 
the price in some way?
    We can have the philosophical debate and I think it is 
reasonable. I think there are those who say anybody who 
criticizes public broadcasting is a puritan. In fact, it is in 
someone's testimony here today. I disagree. I think you can 
have reasonable people disagree on the future of public 
broadcasting, the Corporation for Public Broadcasting, and its 
relationship to what Congressman Erhlich just pointed out, the 
plethora of options that the American consumer has when it 
comes to television. So I wouldn't advise anybody to get roped 
into that ideological sighting because folks here have genuine 
and I think real concerns and beliefs as to public money to 
subsidize entities that now we learn have gone to subsidize 
political activities.
    So, Mr. Chairman, again I thank you for calling this and I 
sincerely appreciate your desire to work with Mr. Markey and 
the minority so that we can forge some kind of compromise but 
at the same time highlight that this type of stuff when 
taxpayer money is used can't and should not be tolerated.
    I yield back. Thank you.
    Mr. Tauzin. I thank the gentleman. The Chair now recognizes 
the gentlelady, Mrs. Wilson, for an opening statement.
    Mrs. Wilson. Thank you, Mr. Chairman. I will be brief. As I 
noted in our previous hearing on this subject, there is a 
certain irony in my addressing this issue since for 17 years of 
my adult life, I did not own a television and I still don't 
have cable television nor do I allow my children to watch much 
television. But there are quality programs on public 
broadcasting as well as on commercial channels. There is no 
question in my mind about that. But I think we are dealing with 
a situation now where a handful of people have broken a public 
trust or behaved inappropriately and there are consequences 
both for those individuals or organizations who engage in 
inappropriate behavior, but I think those supporters of public 
broadcasting are also experiencing the fact it is a broader 
consequence, and a sad one.
    Mr. Chairman, what I would like to say specifically or what 
I would like to address specifically is the challenge for the 
West. I represent the State of New Mexico, part of New Mexico, 
Albuquerque, and I am from New Mexico and many of these things 
that are available on the East Coast or in America's urban 
areas through satellite and cable and over the Internet are not 
realities in rural New Mexico. What is a reality is that you 
can get PBS because we have 300 translators serving rural New 
Mexico. For those of you who have never had the privilege of 
coming to the American West or to New Mexico, you have to 
understand that 40 percent of Indian country, only 40 percent 
of Indian country has basic telephone service.
    This is a very rural State and when we talk about all of 
the things that are available on cable and by satellite and all 
of the emerging technologies, I want to make sure that rural 
America is not left behind and I think at this point that is 
one of the things that public broadcasting still offers within 
the network of translators that are available.
    Thank you, Mr. Chairman.
    Mr. Tauzin. I thank the gentlelady. Are there further 
members who would like to make opening statements.
    [Additional statements submitted for the record follow:]
 Prepared Statement of Hon. Tom Bliley, Chairman, Committee on Commerce
    Thank you, Mr. Chairman for your hard work on this important issue 
and for holding this hearing this morning.
    Today, the Subcommittee meets once again to discuss the structure 
and funding of public broadcasting. As the Committee considers 
legislation to authorize the Corporation for Public Broadcasting, I 
think it's important to provide a historical back-drop to this 
dialogue.
    Congress established the Corporation in 1967 to answer pleas for 
better, and more family friendly informative video programming. At that 
time, the three commercial television networks dominated the airwaves, 
and the near universal conclusion at that time was that the networks 
were building ``a vast wasteland of bland programming.''
    Congress stepped in, and created CPB. The idea was that CPB would 
provide ``seed money'' to those programmers who had a better vision for 
American television.
    It worked. In fact, it worked so well that it spawned a competitive 
marketplace for similar programming. Hence, the development of 
``Noggin' '' . . . and ``the History Channel'' . . . and ``Odyssey'' . 
. . and countless other networks that are dedicated to the principle 
that video programming can enrich the lives of American families.
    Needless to say, times have certainly changed. Let me say that I 
remain concerned about the coarseness of programming on broadcast 
networks. However, I take solace in the fact that consumers today--
compared to 1967--have a wealth of additional options.
    All of this suggests that, compared to 1967, the video programming 
marketplace today is helping to fulfill the needs of American 
consumers. The Subcommittee must not lose sight of this critical fact 
as we move forward. We should be very frugal with American taxpayer 
dollars in light of the fact that the marketplace is helping to serve 
the needs of American consumers.
    This is not to say that there is no role for federal funding here. 
The marketplace still has yet to fill some critical gaps . . . 
including those areas where consumers have no access to cable or 
satellite. In those homes, public broadcasting is a critical link to 
valuable information and entertainment. And Congress needs to ensure 
that it will remain so.
    But Congress also needs to be careful as it balances the interests 
of taxpayers with the needs of unserved markets. Moreover, we should 
have a plan in place for reducing over time the American taxpayers' 
share of the burden.
    Finally, with regard to recent evidence that particular public 
broadcasters exchanged fund-raising lists with political parties. I 
have sent letters to the Corporation for Public Broadcasting, the 
Public Broadcasting Service and the Association of America's Public 
Television Stations requesting all such records and information 
relating to these alleged practices. I have asked these organizations 
to report back to me by July 26 with this material. I look forward to 
learning more about these practices before this Committee considers the 
final authorization of additional funds for CPB in the years to come.
    I once again thank the Subcommittee Chairman for his hard work in 
this area, and I look forward to working with him as the process moves 
forward.
                                 ______
                                 
Prepared Statement of Hon. Bobby L. Rush, a Representative in Congress 
                       from the State of Illinois
    Thank you, Mr. Chairman. It is truly an honor to come before you 
today to stress the importance of Reauthorizing the Corporation for 
Public Broadcasting (CPB).
    CPB provides funding to public broadcasting services that we dear 
the most such as Public Broadcasting Station (PBS) and the National 
Public Radio (NPR). PBS and NPR provide Americans with quality 
programs.
    Although, there has been some information regarding some individual 
public television stations exchanging donor list with political 
parties, we should not hold reauthorization of CPB hostage to isolated 
incidents.
    It is my understanding that officials from the CPB have condemned 
this practice. I hope that in today's hearing we can get assurances 
from Mr. Conrad that this activity of swapping donor list will end and 
will not occur ever again in the future.
    As we approach the new millennium, public television stations are 
facing the challenge of making the transition to digital broadcasting 
by the year 2003. This conversion is expected to cost $1.7 billion and 
creates obstacles for non-profit public television stations who are in 
dire need of funding.
    The Corporation for Public Broadcasting Reauthorization Act of 1999 
allocates $15 million for fiscal year 1999 and $100 million for each 
fiscal year from 2000 until 2003 to aid in the transition. I strongly 
support this legislation and I believe that any reduction in this 
allocation will hinder public broadcasting stations from meeting its 
deadline.
    We must ensure that CPB is reauthorized at a level where it can 
continue to survive in a commercially driven arena. Thank you, Mr. 
Chairman.

    Mr. Tauzin. The Chair would now recognize our first panel. 
The first panel consists of Mr. Robert Coonrod, President and 
CEO of Corporation for Public Broadcasting, CPB; Mr. Ervin 
Duggan, President and CEO, Public Broadcasting Service, PBS; 
and Mr. Kevin Klose, President and CEO, National Public Radio, 
NPR. Your written statements are part of your record. We would 
ask that you not recite them for us but rather engage us as 
usual in a conversational way with the main points of your 
discussion.
    We will begin with Mr. Coonrod of the CPB. Mr. Coonrod, as 
I introduced you, I would hope that you would immediately and 
quickly address the question raised in the ``New York Times'' 
editorial this morning as to when did the Corporation for 
Public Broadcasting find out about this incident in Boston or, 
this incident, these incidents across America and why, if you 
did not take any action, why didn't you.
    Mr. Coonrod.

      STATEMENTS OF ROBERT T. COONROD, PRESIDENT AND CEO, 
CORPORATION FOR PUBLIC BROADCASTING; ERVIN S. DUGGAN, PRESIDENT 
    AND CEO, PUBLIC BROADCASTING SERVICE; AND KEVIN KLOSE, 
            PRESIDENT AND CEO, NATIONAL PUBLIC RADIO

    Mr. Coonrod. Thank you, Mr. Chairman. I will address that 
momentarily. But first I would like to thank you, Mr. Chairman, 
for holding this hearing, for giving us an opportunity to 
address this issue today. This is a difficult issue for all of 
us and we share the sentiment that we have heard from the 
committee members about the inappropriateness of some of the 
activity that has been described here.
    Over the decades, my predecessors and I have come here 
several times to say, please help us in certain ways and we 
have also had an opportunity from time to time to come back and 
say thank you for the support that you have lent us. 
Occasionally we have had to come here and say sorry, we blew it 
and, well, Mr. Chairman, here is a case where clearly that is 
what we have to do today. We have to say to you that we blew 
it.
    Now, my colleagues and I, when we learned of this last 
week, issued a joint statement which I believe you have seen, 
which said several things. It said that we do not condone this 
kind of activity, that we will work as appropriate with the 
Congress to see to it that it doesn't continue.
    I would like to do two things this afternoon, Mr. Chairman. 
I would like to address the point that you raised when you 
introduced me and then I would like to provide some detail 
about what we know as of today about the direct mail 
activities.
    The situation that was--that you addressed and was 
addressed in the ``New York Times'' this morning has to do with 
WGBH in Boston. In May, we learned from the ``Boston Globe'' 
that WGBH had made its mailing list available to the Democratic 
National Committee. As we have heard several times during the 
course of this hearing, making member or donor names available 
to political parties is manifestly a bad practice. It is 
something that public television and radio stations should--in 
which they should not engage, and WGBH immediately recognized 
that what it had done was wrong. It acknowledged that publicly. 
It recognized--it stated that it was a violation of established 
policies of WGBH, policies that had been in place since 1994. 
It went beyond that. It wrote a letter of apology to its 
members. It went on the air and said to its viewers and 
listeners that they had done something that was wrong. They 
informed the IRS of what they had done and they informed their 
independent auditors. Those are all of the actions that WGBH 
took at the time and all of those actions seemed entirely 
appropriate.
    As late as July 13, as late as last week, WGBH reaffirmed 
that the situation was as it had described it in May. It was 
only on Thursday morning that we learned that there was more to 
the situation than what was in the--what had been publicly 
disclosed at that point. But based on the information that was 
available and based on the prompt, unequivocal action that WGBH 
took, it seemed to us clear that they had dealt with the 
situation appropriately.
    That is my statement on that particular situation. I could 
say in hindsight there are other things we might have looked at 
but at the time it looked like the prompt, swift action, 
unequivocal action that was taken was the appropriate action.
    I would also like, Mr. Chairman, to talk a little bit about 
some of the broader practices that we have been learning since 
we have learned about this last Thursday.
    The use of direct mail campaigns to raise money is a common 
practice throughout the nonprofit world. In fact, Standard Rate 
and Data Service, one of the country's leading sources of media 
data, profiles 24,000 not-for-profit organizations that make 
their lists available for trade or rental. During the past 
week, CPB conducted phone and e-mail surveys of more than 75 
stations. These are public television stations who indicated 
that they have used direct mail or direct mail brokers to 
solicit funds. This group represents less than 10 percent of 
the radio and television stations in public broadcasting. But 
this does represent the largest stations, the largest public 
television stations.
    To a point you made earlier this morning, Mr. Chairman, the 
information that I am about to give you is not comprehensive 
but it is accurate. It will take us some time to develop 
comprehensive information and our inspector general will be 
assisting in that process and we will be able to provide a 
comprehensive report on the practices in the near future. But 
based on what we know today, approximately 50 public television 
stations, 50 of the 353 public television stations, that is 
about 15 percent, exchange lists with other nonprofit 
organizations. Almost all of them do that by the use of list 
brokers or intermediaries. Now, 30 stations have rented lists 
from political organizations. Fewer than 30 also appear to have 
exchanged member lists with political entities of either or 
both parties. By exchange we mean they have made their donor 
names available in return. Of the four major list brokers who 
do business with public broadcasting stations, three also do 
business with political organizations, and all three do 
business with both sides of the aisle. Two of the four have 
policies which specifically prohibit the transfer, rental, or 
exchange with political parties or candidates. So while they do 
business with political parties, they prohibit exchange with 
individual candidates.
    As we have looked at this, Mr. Chairman, fund-raiser 
effectiveness rather than partisan political purpose appears to 
have been the primary motivation for stations renting or 
exchanging lists because in addition to dealings with the 
Democratic National Committee, which had been mentioned in the 
past week's media coverage, our preliminary review indicates 
that a number of Republican organizations, such as the 1996 
Dole Campaign, the Conservative Republican Super File, the 
Country Club Republicans, Golden Age Republicans, Republican 
Party Builders, and Great American Donors have also exchanged 
lists with public television stations.
    But the bipartisan nature of this transaction begs the 
larger ethical question that we have been discussing this 
morning. Should public stations that receive Federal financial 
support deal in this way with any political entity? And I think 
the answer to that is unequivocal. I think that is the point 
that my colleagues and I tried to make last week. We do not 
condone this activity. We do not condone the buying, selling, 
or trading of lists with partisan political campaigns or 
committees.
    Under the CPB procedures, the inspector general will--has 
been informed of these reports, reports that we have and we 
will cooperate fully with whatever factual review the inspector 
general undertakes and we will cooperate with whatever 
recommendations he makes.
    Also last week, Mr. Chairman, I notified all station 
licensees that in addition to existing certifications of 
compliance that they have in order to get CPB funds, they will 
now be required to certify that they are in compliance with all 
applicable Federal laws and regulations specifically relating 
to nonprofit organizations and partisan political activity. So 
that will be a condition of funding from CPB in the future.
    Going forward, Mr. Chairman, we would very much like to 
work with this committee and with the Congress and as we have 
identified it from the statements this morning, there seem to 
be three broad areas where we have sort of common goals and 
goals--and we would like to work in cooperation with you on 
that. First is in the implementation of strict privacy 
guidelines which would prevent unauthorized disclosure of names 
of members of public radio and television stations. Second is a 
prohibition on exchange of lists with political committees or 
parties or institutions. And finally, support for some sort of 
an independent review so that we can judge the full extent of 
this and make specific recommendations as to reforms should 
they be necessary.
    Thank you, Mr. Chairman. I would be happy to answer any 
questions.
    [The prepared statement of Robert T. Coonrod follows:]
Prepared Statement of Robert T. Coonrod, President and Chief Executive 
            Officer, The Corporation for Public Broadcasting
    I welcome this opportunity to appear again before the Subcommittee 
and to participate in today's discussion. I understand that Members of 
the Subcommittee are concerned about recent press accounts of the 
trading or renting of several public broadcasting station membership 
lists with political organizations. With the Subcommittee's permission, 
I would like to use my oral statement to address that issue in detail. 
However, because I know the Subcommittee is asking questions as well 
about the continuing relevance of public broadcasting in a cable and 
direct broadcast satellite environment, I would like to use my brief 
written statement to highlight, in particular, why the services and 
programs public television provides are more important today than ever. 
I could just as easily focus these comments on the great strides being 
made by public radio, but will today address the issue of the relevance 
of public television in relation to programming being produced for 
distribution by cable and by commercial television networks.
    American public broadcasting is not, and never has been, government 
broadcasting. It is a quintessential grassroots enterprise, made up of 
353 television and 694 radio stations, each of which is governed by its 
own local board of directors. The federal appropriation accounts for 
13.5 percent of public broadcasting's annual revenues. This translates 
into an annual federal grant to public radio stations, television 
stations, and a diverse variety of television and radio producers. The 
federal grant is not only essential for their operations, it is a 
crucial element of their identity and mission. Public broadcasting is, 
in fact, one of the most successful public/private partnerships in 
operation today. Each of our partners is important to the continued 
health of this system, but the federal government is perhaps the most 
important. The loss of any one partner jeopardizes the enterprise.
    Recognizing your key role in making this enterprise possible, let 
me address the variety of Americans for whom public broadcasting 
remains relevant.
    Public broadcasting is relevant to minorities. At a time when the 
NAACP is threatening to sue commercial broadcasters about the lack of 
African-American faces on commercial television, public broadcasters 
are celebrating award winning programming by and about African-
Americans. I Must Keep Fighting: The Art of Paul Robeson; NPR coverage 
of Africa; African's in America: America's Journey Through Slavery, and 
When Good Men Do Nothing are just a few recent examples. Latinos, Asian 
Americans, Native Americans and Pacific Islanders are also seeing and 
hearing their faces and voices on public radio and television.
    Public broadcasting is relevant to young people who are 
increasingly confronted by violent images in a variety of media. Public 
broadcasting is not only a safe haven from violent programming, it 
promotes safe havens in a literal sense. On June 5, 1999, over 2,000 
communities held ``safe night'' events. ``Safe night'' is an ongoing 
annual national event designed to teach youth ways to avoid violence. 
Public broadcasters are helping organize and promote the events. PBS 
aired a live one-hour special, also shown on the Black Entertainment 
Network (BET), that connected safe night events around the country.
    Public broadcasting is relevant to individuals who cannot access 
the many available cable or satellite channels, either for financial 
reasons, due to remote location, or because not all channels or 
services are available to them. More than 30 million homes, or an 
estimated 90 million people, do not receive cable, either by choice or 
because they cannot afford it. Essentially all Americans have access to 
public broadcasting, delivered for free over the air.
    Public broadcasting is also relevant to high school dropouts. More 
than 2 million Americans have earned their high school diplomas through 
GED programs offered by public television stations.
    It is relevant to American teachers. In a survey conducted by Cable 
in the Classroom last summer, PBS materials topped the field of 
classroom choices, with 70 percent of teachers reporting they use video 
materials from PBS in the classroom. The PBS Adult Learning Service 
delivers distance-learning telecourses by satellite to two-thirds of 
the nation's college campuses, where 360,000 students are enrolled in 
these courses for college credit. The Annenberg/CPB Channel provides 
free, detailed teacher training in math and science to anyone in the 
country, free of charge. We are expanding this service to include 
teacher training in English, History and Literature.
    Finally, public broadcasting continues to be very relevant to the 
youngest among us. Most of us already know that from observing the 
viewing habits of our own children and grandchildren, nieces and 
nephews, friends and neighbors.
    Our programming consistently earns the respect of our professional 
peers. Our educational contribution to children's viewing has been 
validated over and over, and public opinion research repeatedly shows 
that the American people appreciate the service we provide and consider 
it a good use of taxpayers' money.
    As I mentioned to this Subcommittee on June 30, programs airing on 
PBS and NPR recently received 12 of 33 George Foster Peabody Awards for 
Broadcast and Cable Excellence, out of nearly 1,300 entries. A few days 
later, Fred Rogers, Sesame Street, Bill Nye the Science Guy, and Arthur 
all won daytime Emmys. Earlier this year, a CPB/National Asian American 
Telecommunications Association-funded documentary Regret to Inform was 
nominated for an Oscar.
    Our children's programming is consistently singled out for its 
excellence. Last month, in its 1999 State of Children's Television 
Report, the Annenberg Public Policy Center of the University of 
Pennsylvania noted that the number of programs airing for children has 
risen (up 12 percent over the previous year), with the largest increase 
on basic cable venues. Yet the report adds, ``Programs with clear and 
salient lessons tend to appear most frequently on PBS' High-quality 
programs are still most likely to appear on PBS stations and least 
likely to air on broadcast weblet and independent stations.'' This is 
simply further evidence of why American families regard public 
broadcasting as a safe haven for children and a wise investment for 
taxpayers. You will hear from Amy Jordan of the Annenberg Public Policy 
Center later today about this study.
    Taxpayers, too, value our programming and services. In a 1997 poll 
by Roper Starch Worldwide, Inc., Americans rated public radio and 
public television as the second and third best values in return for tax 
dollars spent. Only national defense rated higher.
    This outstanding record of programming and service will improve 
exponentially when digital broadcasting becomes the new standard. By 
2003, digital broadcasting will permit us to deliver more content in 
exciting new ways that expand our educational depth and reach. Digital 
will provide not only expanded capacity, but also the means to make a 
television set function more like a computer. As I've said before, we 
are extremely excited about this because the technology has finally 
caught up with our mission. Eventually, digital technology and the new 
media it will spawn are going to be an important and powerful new tool 
for learning among all age levels, and at all economic levels.
    We know that the American people value this institution. It is the 
support and participation of the Congress that makes public 
broadcasting ``public,'' and we look forward to continuing the 
partnership for many decades to come. We believe public broadcasting is 
poised to enter an era in which we will offer new services even more 
effectively to more and more Americans.
    I will be pleased to answer your questions.

    Mr. Tauzin. Thank you, Mr. Coonrod. There will be lots of 
questions, I am sure. Mr. Ervin Duggan, President and CEO of 
PBS. Mr. Duggan.

                  STATEMENT OF ERVIN S. DUGGAN

    Mr. Duggan. Thank you, Mr. Chairman, Mr. Markey, members of 
the subcommittee. Good afternoon. Nothing is more 
disheartening, Mr. Chairman, for people who try to be people of 
integrity, who try to act prudently than to find that we have 
been involved in something inappropriate, embarrassing, and 
downright stupid. We at PBS care deeply about maintaining the 
trust of the American people. Like you, therefore, we are 
deeply concerned about the events that have given rise to this 
hearing. We believe emphatically that any conduct having even 
the appearance of partisan political activity by a public 
broadcast station or public broadcaster cannot be condoned.
    The stations involved have underscored that these list 
exchanges that took place are standard among nonprofits, that 
this activity occurred mostly by third party list brokers, that 
their conduct was focused on fund raising and not on partisan 
politics. No matter about that. It is inappropriate and wrong 
for it to happen and so that is why PBS together with CPB, the 
National Public Radio, and America's public television stations 
issued a statement last week underscoring our position that 
such practices simply cannot be condoned.
    Many stations do have policies against such practices. 
Clearly, however, these policies need better auditing. They 
need strong enforcement, and they need to be universal. We need 
to have a universal ethic throughout our system. Fortunately, 
our stations are now acutely aware of this issue and they are 
taking steps even as we meet to address it quickly and 
forthrightly.
    In light of these recent developments, PBS' development 
office and our development advisory committee made up of 
station leaders in the development field are issuing an 
advisory this week strongly urging our member stations to 
establish policies strictly prohibiting the exchange or rental 
of lists to partisan political campaigns, committees, or 
groups.
    I would like to echo what my colleague Bob Coonrod has just 
said, that we are very much in favor, as members of the 
committee are in favor, of strict privacy policies that prevent 
unauthorized use of member or donor names, of an absolute 
prohibition against the partisan use of lists or names, and I 
personally am very much attracted to Congressman Stearns' 
suggestion of a distinguished group who could do a review of 
current practices and make strong recommendations about what 
the ethics should be. We of course will be leading an effort of 
that sort within our enterprise, but I think it would help 
restore trust to have the kind of independent review that 
Congressman Stearns spoke of.
    As you know from my hearing in June, Mr. Chairman, we in 
public broadcasting have many ideas for using the new digital 
technology for education, for culture, for citizenship, and we 
believe we can do things that our brothers and sisters in the 
commercial world simply cannot do because they are necessarily 
driven by the need to return--to serve advertisers and to give 
returns to shareholders and that creates certain obligations 
for them that we are free of and we can innovate and do things 
for nonprofit educational and cultural purposes that they 
cannot do.
    As the subcommittee moves forward, therefore, we hope that 
you will find ways to address this unfortunate situation 
without damaging the constructive contributions to American 
life that public broadcasting makes. As Mr. Markey pointed out 
earlier, the forced commercialization of this enterprise would 
deepen the problems that we are talking about here today. It 
would not solve them.
    Public broadcasting can be seen as a kind of electronic 
analogue of the public library, and I think most of us would 
accept it as a terrible suggestion to turn the public libraries 
of the Nation into book stores and to say people can buy books 
and so we don't need public libraries. We are the electronic 
public library of the air. We serve that same educational 
purpose and I hope we can prove to the American people day in 
and day out that we deserve their support and that we deserve 
your support. We welcome the opportunity to work with you and 
members of the committee in any way to address this latest 
issue appropriately, effectively, and constructively.
    [The prepared statement of Ervin S. Duggan follows:]
 Prepared Statement of Ervin S. Duggan, President and Chief Executive 
                  Officer, Public Broadcasting Service
    Good Morning, Mr. Chairman and Members of the Subcommittee. I am 
Ervin Duggan, President and Chief Executive Officer of Public 
Broadcasting Service. We appreciate the opportunity to participate in 
this hearing.
    Because PBS cares about maintaining the trust of the American 
people, we are deeply concerned about the events that occasion this 
hearing. We believe emphatically that any conduct having even the 
appearance of partisan political activity by a public broadcaster 
cannot be condoned.
     The stations involved have underscored that list exchanges are 
standard among nonprofits and that their conduct was focused on 
fundraising, not politics. Nevertheless, PBS, together with CPB, NPR 
and American's Public Television Stations, issued a joint statement 
last week underscoring our position that such practices are not to be 
condoned.
    Many stations do have policies against such practices. Clearly, 
however, these policies need better auditing and enforcement 
mechanisms--and they need to be universal. Fortunately, our stations 
are now acutely aware of this issue and are taking steps to address it 
quickly and forthrightly.
     In light of these recent developments, PBS's development office 
and our Development Advisory Committee are issuing an advisory this 
week strongly urging our member stations to establish policies strictly 
prohibiting the exchange or rental of lists to partisan political 
campaigns, committees or groups.
     As you know from our hearing in June, we have many ideas for using 
digital technology for education, culture and citizenship. As the 
subcommittee moves forward, therefore, we hope that you will find ways 
to address this issue without damaging the essential and constructive 
contributions that public broadcasting makes to American life. We 
welcome the opportunity to work with you in any way to address this 
issue appropriately, effectively and constructively.

    Mr. Tauzin. Thank you, Mr. Duggan. The Chair now recognizes 
Mr. Kevin Klose, President and CEO of NPR.

                    STATEMENT OF KEVIN KLOSE

    Mr. Klose. Mr. Chairman and members of the committee, thank 
you for giving me the opportunity to address you this 
afternoon. I have been President of NPR since December 1998 and 
to echo one of honorable members earlier today, I would also 
never have guessed that this was going on with regard to what 
has occurred with the lists.
    Distinctly NPR is a coalition of autonomous local stations, 
each with its own community of listeners. They are licensed to 
a variety of nonprofit organizations, community foundations, 
colleges, universities and other community institutions. The 
majority are licensed to universities. Our board of directors 
is drawn principally from managers of those stations. Ten of 
our 17 board members are elected by the membership, which 
includes almost 300 individual stations. Ten of the board 
members are station managers. They run for election and the 
bylaws are subject to the vote of our membership.
    With regard to our policy and practice regarding donor 
lists since 1983, there has been a prohibition at NPR 
prohibiting NPR from soliciting the public directly. This 
direct solicitation prerogative is left to member stations.
    Over the years NPR has shared names with member stations, 
chiefly listeners who have requested tapes or transcripts from 
us from member stations' broadcast areas. Recently we have 
proposed to member stations that we would provide them names of 
listeners in their communities who request tapes and 
transcripts only with prior permission of the listeners. It is 
our intention to establish very careful guidelines for this 
service to local stations that would bar the sharing of such 
information with any partisan organization.
    The NPR Board of Directors will meet this week in its 
previously scheduled July meeting and this issue and related 
issues obviously will be a topic of discussion and deliberation 
by the board and we will review the efficacy of our own 
guidelines and procedures and we hope to be able through that 
discussion and through working with our member stations to be 
sure that we are a model for our member stations and for these 
kinds of issues with regard to both the privacy of our citizens 
and the privacy of those who make donations and support NPR and 
our programs.
    Further, as you know, I have signed a statement, joined 
with my colleagues in the national organizations, stating very 
clearly I do not condone what happened and as the President and 
CEO of NPR, my management will work as appropriate with the 
committee and in the membership framework and the framework of 
our board of directors to achieve both clarity on this issue 
and assurances in the future that the issues of privacy and of 
great fire walls that have supported the integrity and 
credibility of NPR, its member stations and our programming 
together stays in place and the strength and in the future. 
Thank you very much, Mr. Chairman.
    [The prepared statement of Kevin Klos follows:]
   Prepared Statement of Kevin Klose, President and Chief Executive 
                     Officer, National Public Radio
    Chairman Tauzin, members of the Subcommittee, thank you for 
inviting me to speak before you today and providing me with the 
opportunity to talk about National Public Radio, and its relationship 
with its member stations as well as the public.
    NPR is a private, non-profit company, which serves two primary 
roles. One, NPR produces and distributes high quality noncommercial, 
educational, informational and cultural programming to its member 
stations, who in turn broadcast that programming to listeners in local 
communities across the country.
    Two, NPR is also a membership organization, representing just over 
600 noncommercial educational radio stations throughout the United 
States. In this capacity, we offer member stations such services as 
legislative and regulatory representation, program promotion and 
training. NPR is not a radio station nor does it own radio stations.
    NPR stations are independent and autonomous, reflective of their 
local communities. They are licensed to a variety of non-profit 
organizations, communities, colleges, universities and other 
institutions. The majority of NPR member stations are licensed to 
educational institutions.
    Member station dues and program purchases account for two thirds of 
NPR's annual budget ($75 million in FY 1999). On average, NPR receives 
2 to 4% of its total budget from federal sources, including competitive 
grants awarded by the Corporation for Public Broadcasting (CPB), the 
National Science Foundation, and the National Endowments for the Arts 
and Humanities.
    Let me explain what NPR's policy and practice is regarding donor 
lists and exchanges. Since 1983 NPR has had a board policy prohibiting 
NPR from soliciting the public directly--on-air fund-raising, direct 
mail and telephone solicitations remain an exclusive prerogative of 
local stations.
    Over the years NPR has shared names with member stations--chiefly 
listeners who have requested tapes or transcripts. Recently NPR 
informed its member stations only that we would provide them the names 
of listeners in their communities who request tapes and transcripts. 
Before the names are provided there will be provisions in place to 
assure that no such information will be shared with any partisan 
political campaign or organization.
    We are guided in this and other interactions with stations by the 
knowledge that our NPR stations are rooted in local communities and 
responsive to the needs of those who live there. The most recent 
information indicates listener contributions account for 29 percent of 
public radio stations' revenue, the largest single category of funding. 
The trust and commitment to our listeners that have developed over the 
past 25 years are the foundation of this remarkable broadcasting 
endeavor. Therefore, maintaining that trust is crucial to allowing 
public radio to continue to provide the programming and services upon 
which listeners have come to depend. We will continue to work together 
with our members to ensure that we are worthy of the public's trust.
    Public radio is most grateful for your continuing support. I look 
forward to working with you in the future.

    Mr. Tauzin. The Chair thanks the witnesses and will 
recognize himself for a round of questions and other members as 
appropriately.
    Mr. Coonrod, when this news broke to this subcommittee, we 
were in the middle of a discussion, as Mr. Cox pointed out, of 
privacy on the Internet. And this committee and members of the 
public who were testifying were decrying those bad players out 
there who were still sharing private information about citizens 
to others for commercial purpose or otherwise without their 
permission. We learned in the middle of that hearing, someone 
brought us that report from Boston, that one of our public 
television stations had done the same thing and even worse, had 
shared that information with one of the national political 
parties.
    The ``Washington Post'' today tells us that it looks like 
about three dozen stations may have used these list brokers. 
You tell us today the number is now 50.
    Mr. Coonrod. As of last night 53 stations.
    Mr. Tauzin. How many, sir?
    Mr. Coonrod. 53. We surveyed 75 stations and of those top 
75 stations, 53 have used list brokers.
    Mr. Tauzin. When will we have a final report indicating how 
many total stations have engaged in this practice?
    Mr. Coonrod. We are working now to come up with a 
questionnaire that we can in some organized way solicit this 
information from all the grantees, but it will take a couple of 
weeks before we can compile all the information to be sure that 
it is accurate and comprehensive.
    Mr. Tauzin. Is that number likely to grow?
    Mr. Coonrod. The number is likely to grow, Mr. Chairman, 
but from what we have determined, only stations of a certain 
size tend to use list brokers so the smaller stations are 
unlikely to have been exchanging lists with other 
organizations.
    Mr. Tauzin. Directly with organizations. Let's talk about 
that for a second. We know in Boston that a public broadcast 
station traded names directly with the National Democratic 
Party. Is that correct?
    Mr. Coonrod. That is what has been reported----
    Mr. Tauzin. No list brokers. This activity lasted since 
1994.
    Mr. Coonrod. The Boston station, WGBH, asserted that it was 
done through a list broker.
    Mr. Tauzin. They say it was a list broker as well.
    Mr. Coonrod. That is what they say. WGBH asserts that it 
had no direct contact with the Democratic National Committee.
    Mr. Tauzin. We will be happy to learn what is correct 
because the reports we have is that it was direct contact.
    Mr. Coonrod. I understand that. I am just being clear, Mr. 
Chairman.
    Mr. Tauzin. Do we have any other reports of direct contact 
between any public broadcast radio television station and one 
of the political parties in this country?
    Mr. Coonrod. No, sir.
    Mr. Tauzin. As far as you know it was all done through list 
brokers as of this moment?
    Mr. Coonrod. As of today.
    Mr. Tauzin. But we don't know. Here is one of the problems 
I have with your testimony today, Mr. Coonrod. You acknowledge 
that in May the station issued a public apology after the story 
came out in which the station said it was just new employees 
doing this and it was just a single mistake. The station 
obviously issued a public apology to the citizens in that 
community which was a lie, which basically said we are sorry 
for doing one thing when in fact we did something quite 
different. They engaged in a practice that lasted over a long 
period of time and apparently with the consent of the 
management of the station; is that correct?
    Mr. Coonrod. I can't speak to the consent of the management 
of the station but apparently it lasted over a long period of 
time, yes.
    Mr. Tauzin. In any event the Corporation for Public 
Broadcasting made no inquiries? Did not call the managers in 
and talk with them? Did not visit the station and find out what 
was really going on? Did not ask the hard questions that the 
newspapers eventually asked that produced the correct answers?
    Mr. Coonrod. Mr. Chairman, we spoke with the station and 
both--the rapidness of the response and the definiteness of the 
response caused us to believe, incorrectly, but caused us to 
believe that the information that WGBH was providing publicly 
was in fact the truth.
    Mr. Tauzin. Mr. Coonrod, if you believed it was the truth, 
did you not feel an obligation to contact every public 
broadcast station immediately and advise them that you had 
found out this had happened in Boston and then determine 
whether or not any such practice was being engaged in anywhere 
else in America?
    Mr. Coonrod. Mr. Chairman, exchanging membership lists with 
political parties is such a manifestly stupid thing to do, it 
never occurred to me that people would be doing it.
    Mr. Tauzin. But you found out they were in Boston. You saw 
no need to check whether other public stations were doing it.
    Mr. Coonrod. We found out, Mr. Chairman, they had done it 
and as soon as it was made public, they publicly disavowed it. 
They themselves admitted it was a stupid thing to do. They said 
it was a violation of their own internal policies. They 
informed the IRS. In hindsight, I wish we had done something 
different but at the time, it seemed like they were--they had 
come entirely clean.
    Mr. Tauzin. My time has expired. I want to lay one thing on 
you before I pass it on to all of you. If any broadcast station 
in America has announced publicly to the citizens of this 
country that our policy is to take your names and the names of 
your children and your private information and trade it off 
with other individuals in this country either for profit or for 
whatever other reason and specifically to trade it off with 
political parties in this country for their use in soliciting 
you for money. If any station had announced that that was going 
to be its policy, do you think for a second there wouldn't have 
been a public outcry against it? Do you think that station 
could have done it in the face of public opinion had they 
announced they were doing it? And do you think for a second 
that that activity ought ever have to occur in this country 
with public broadcasting?
    Mr. Coonrod. It ought not to occur.
    Mr. Tauzin. And finally, do you agree with me because it 
has occurred and because we don't even know the extent to which 
it has occurred yet, that the damage done to the integrity of 
the relationship between the American public and what they came 
to--come to expect from public broadcasting is severe, it is 
going to take some real time to heal?
    Mr. Coonrod. We believe it is severe, Mr. Chairman. Our 
relationship, our effectiveness is built on the trust that we 
built up with the American people over the years and events 
like this erode that trust. That is true and we have to work in 
every way we can to dig ourselves out of this hole.
    Mr. Tauzin. Mr. Markey.
    Mr. Markey. Thank you, Mr. Chairman, very much.
    Again, I want to begin by restating that 35 percent of the 
children in the United States live in homes without cable. We 
are talking about broadcast here. We are talking about free. 
And that is why it is so important. We have to remember that 
this is part of our commitment to universal service of all 
Americans. People wouldn't have to pay in order to gain access 
to quality programming.
    I agree with what the gentleman from Louisiana was just 
saying about how offended people justifiably are when they 
discover that their names, which they felt were going to be 
kept confidential, are sold for corporate gain, even if it is 
the Corporation for Public Broadcasting or the public 
broadcasting stations. But you could substitute banks, HMOs, 
insurance companies, in terms of how offended every American 
would be if they found out that their names were being sold as 
they were conducting business with their local bank, with their 
local HMO. The exact same reaction.
    I only say this because at least at WGBH they had an opt 
out provision. Of the 200,000 contributors, 40,000 had opted 
out. Now, I can understand where many others would probably 
feel there should be an opt in, that you should be--unless they 
get your explicit permission but generally speaking, this is 
part of a larger discussion we are starting to have in America 
this year about privacy in this modern era. And I do believe 
that every subscriber should be entitled to that ability.
    Let me also say that WGBH yesterday sent a letter to the 
chairman and to the ranking member and all the members of the 
committee in which it said this in one paragraph in a longer 
letter. First I want to report to you--this letter comes from 
Henry Beckton, the President of WGBH--first I want to report to 
you that the actions taken by WGBH staff were errors in 
business judgment and not partisan political acts. We are aware 
of no contact between WGBH and the Democratic National 
Committee. All of our mailing list activity is handled by 
commercial list brokers. These are separate companies. We have 
a policy prohibiting the exchange of WGBH donor lists with 
political organizations which we put in place in 1994. I 
officially believe that such activity should not occur and 
deeply regret that the policy was not adequately enforced by 
our staff.
    So there is no evidence of direct connection, although 
these list brokers run their own world out there and they try 
to make money doing it. There wasn't proper supervision. We are 
going to have to, I think, just prohibit the practice, but I 
don't think that there is any real indication that the PBS 
stations were out there trying to engage in direct contact with 
any partisan organization.
    Now, everyone agrees that sharing these lists is 
inappropriate. The question is where do we go from here? That 
is, to go further and to punish the system with funding cuts 
would put pressure on the system to become more commercial in 
its operation and in its personality. Commercial public 
broadcasting is an oxymoron, like jumbo shrimp. Carnivorous 
vegetarian. There is no such thing as commercial public 
broadcasting. The key here is to ensure that we maintain the 
integrity, the special identity which the Public Broadcasting 
System has been able to establish over the last generation.
    I think that preserving public TV by enhancing its 
commercial character is like trying to save a church by renting 
billboard space on the steeple. You just can't do it and retain 
that which is essential in terms of its character. So I ask 
then whether or not at the end of the day--again I am just 
going to ask you to restate briefly if you could, Mr. Duggan, 
the impact that additional pressure on you to go out to find 
more money from commercial sources would have upon the identity 
of the Public Broadcasting System.
    Mr. Tauzin. The gentleman's time has expired. The witnesses 
will be allowed to respond.
    Mr. Duggan. Thank you, Mr. Markey. I think we need deep 
understanding of this buzzword ``privatization'' because it has 
no other meaning that I can discern except commercialization. 
The world is filled with commercial channels. They have no 
mission to schools as we have a special instructional mission 
to schools. They have no satellite broadcast of distance 
learning to two-thirds of the campuses in the United States 
which we do as a nonprofit public service. They have none of 
these nonprofit cultural obligations as missions that we 
perform so we could probably succeed as a commercial network. 
That would be an option that would be open to us. But we would 
then be making our program choices to serve advertisers and to 
generate ratings, and the Metropolitan Opera would go. 
Educational programming for children that is driven by the 
curriculum by teaching letters and numbers would go out the 
window, I think, for action adventure, things that would drive 
ratings up and serve advertisers.
    As you say, the entire character, the entire personality, 
the entire mission would change. We would have to shut down 
those nonprofitable things like the satellite service, 
instructional service to schools and universities. It simply 
wouldn't exist. So the forced commercialization of public 
television would be like the forced commercialization of the 
public library, turning it into a bookstore. Yes, people would 
come and buy books but you wouldn't have the public library 
anymore. And a 30-year effort to build a noncommercial, 
nonprofit, culturally oriented public service to the American 
people would be lost forever.
    Mr. Markey. Thank you, Mr. Chairman.
    Mr. Tauzin. Mr. Oxley is recognized for 5 minutes.
    Mr. Oxley. Thank you, Mr. Chairman. My friend from 
Massachusetts indicated apparently there was no evidence of 
direct connection between the public station in Boston and the 
Democratic National Committee. Let me quote from a recent 
article, ``There are some people who want to exploit this for 
their own political agenda. That to me is a scandal, said Alan 
D. Solomon, a former finance chairman of the Democratic 
Committee and a board member of WGBH TV.'' Going on to quote 
Mr. Solomon, ``This is not about politics. This is not about 
scandal, Solomon said last night. It is about direct mail fund-
raising. People in the direct mail business buy and sell lists 
every day. That is what they do. So they go out and they ask 
people if they want to contribute. Museums do it, hospitals do 
it, and public television stations do it. Barbara Boxer does 
direct mail, too.''
    That doesn't sound particularly apologetic, given the 
statements from the witness table. Mr. Coonrod, the CPB is 
receiving $250 million in appropriations for this fiscal year; 
is that correct?
    Mr. Coonrod. That is correct, sir.
    Mr. Oxley. Yet the authorization for fiscal year 2002 for 
CPB, not including the additional funding for digital 
conversion, comes to $475 million under H.R. 2384 which, 
according to my figures, would represent 190 percent increase; 
is that correct?
    Mr. Coonrod. Well, we are comparing appropriation and 
authorization. The most recent authorization bill which was--
which expired in 1996 authorized the Corporation for Public 
Broadcasting at $460 million, I believe. I am speaking from 
memory but I think that is the correct number. So what we are 
talking about in authorization terms is an increase of $15 
million over the 1996 authorization level. I am sorry, 425, so 
we are talking $50 million.
    Mr. Oxley. I am talking authorization. We are after all the 
authorizing committee. So basically it does represent 190 
percent increase in your request. Why did the CPB----
    Mr. Coonrod. No, excuse me, sir. It--the authorization--the 
most recent authorization for the Corporation for Public 
Broadcasting was in 1996. That is when the authorization 
expired. That authorization was $425 million. So it represents 
a $50 million increase in authorization over the last--the most 
recently authorized level, which was in 1996.
    Mr. Oxley. Why was that increase asked for?
    Mr. Coonrod. The current increase?
    Mr. Oxley. Yes.
    Mr. Coonrod. The current increase was asked for for several 
reasons. First of all, we are what you might describe as the 
trough, the bottom of the trough for funding of public 
broadcasting. We are $250 million. It was $250 million 
previously and there had been a decline. We are looking to 
restore our funding to a level that was consonant to the level 
of funding for public broadcasting that it enjoyed in the early 
1990's and so that is--I could describe to you the elements in 
the request.
    The station operations, there are two parts to that 
primarily but one is the preparation for the transition to 
digital, the additional cost the station will have to incur for 
dual operations. During the transition period, Mr. Oxley, 
stations will have to maintain both their analog transmitters 
and their digital transmitters so they will be incurring 
significant additional costs.
    In addition, we are encouraging stations and PBS and others 
to begin to take advantage of the digital technology and the 
primary way to take advantage of that digital technology is to 
produce programs for both the multicast and the enhanced 
television capabilities that digital allows. At the hearing on 
June 28, we saw a brilliant demonstration of a Ken Burns 
documentary and the enhancements that were possible through 
digital television. So the increased, the increase request was 
so that we could provide additional programming in addition to 
the operational funding, so that we could provide additional 
program funding so programs of that quality could be made 
available once digital became a reality.
    Mr. Oxley. One final question. The request for $100 million 
for the transition to digital was five times what the 
administration requested; is that correct?
    Mr. Coonrod. I believe that is correct. I believe that is--
yes.
    Mr. Oxley. So we are faced with a situation of looking at 
$100 million authorization for the transition as opposed to $20 
million as requested by----
    Mr. Coonrod. But there is an important distinction between 
what the administration requested and what was in the 
authorization bill. What the administration requested was the 
ability for money sufficient so that a station could pass 
through a signal that was essentially delivered. In other 
words, a signal from PBS, what we are trying to achieve here, 
Mr. Oxley, is the ability of local stations to provide local 
service in their communities. That requires local stations to 
have a greater capability than simply the pass-through 
capability and that additional money was earmarked primarily 
for that purpose and also for the ability to purchase 
production equipment as well which was not in the 
administration's request.
    Mr. Oxley. Yield back.
    Mr. Tauzin. The Chair recognizes the gentlelady from 
California, Ms. Eshoo, for 5 minutes.
    Ms. Eshoo. Thank you, Mr. Chairman. In light of our 
colleague Mr. Cox's comments on privacy, I would like to ask 
Mr. Duggan about the privacy policies of the affiliates. What I 
would like to point out to members is the case of KQED, which 
is the public station in the Bay Area located in San Francisco, 
and how they have a policy, because I asked them what their 
policy was and they sent this. In fact, I may just ask for 
unanimous consent to place this in the record because it does 
demonstrate, Mr. Chairman, what goes out to members of KQED and 
they can check off no exchange, no appeals, no telemarketing. 
So this is an opting out as it were provision and I think that 
that might be important for members to know.
    Is this national policy for all PBS affiliates and if not, 
do you think that it should be?
    Mr. Duggan. Ms. Eshoo, I think it is important for members 
of the committee and the public to understand the local 
ownership and control of PBS and its member stations. Other 
television networks are governed and run from New York and 
California. They are owned by global conglomerates. That is not 
the case in public television. Each station is locally owned 
and governed by a local board. It is a local community 
institution. They in turn own PBS. We don't even call ourselves 
a network because we are so radically different. The stations 
tell me what to do. I don't tell them what to do. They pay my 
salary. I don't pay their salary.
    Ms. Eshoo. At this juncture because of what has happened, I 
would think you are all in it together.
    Mr. Duggan. We are and while I am sure that local stations 
have a widely differing patch work, policies having to do with 
privacy and with lists, we have, as I said in my opening 
statement, issued an advisory to our stations today or this 
week saying that we believe they should institute strong 
privacy policies and that they should have an absolute 
prohibition on the partisan use and that we need to explore the 
standards that we all have in fund-raising. That may have to do 
with fund-raising programming as well as direct mail practices.
    Mr. Tauzin. Would the gentlelady yield for a moment.
    Ms. Eshoo. I wanted to raise the point about our hearing. I 
would be glad to yield.
    Mr. Tauzin. There is no need. The gentlelady will proceed.
    Ms. Eshoo. Were we thinking of the same thing? No? The 
point that I want to make here is that just a week or 10 days 
ago this committee had a hearing that the chairman had called 
on electronic commerce and how consumers, business to consumers 
and business to business, that is conducted over the net is 
handled and while the chairman of the FTC and others said that 
the best policy would be for companies to step forward and 
adopt a policy that was based on volunteerism, I think in this 
case that we are beyond the volunteerism.
    You described something that is not even--you don't call it 
a network but they are community boards. They come up with 
their own decisions. This has now become a national case so I 
don't think we can afford to have a patchwork quilt of where 
one community board says one thing and another community board 
says another. In Federal Government, I think if that were what 
came out of public broadcasting nationally, the Congress is 
going to step in and say, no, can't do this anymore.
    There are, as my dear friend and colleague seated to my 
right here, Tom Sawyer, said to me some time ago, and I have 
quoted him many, many times, that there are few words in our 
Constitution that has saved more bloodshed in this country and 
that is the separation of church and state. And I think that we 
sometimes seem to take that for granted. As my father said to 
me 1 day, what's wrong with starting the day out with a little 
our Father and hail Mary. For my dad, that was all right. For 
the next person, it is not going to be. And I want to draw the 
parallel to political organizations, politics and nonprofits 
and public broadcasting. There has to be a very bright line 
drawn between them. It is not all right. It is not okay. In 
fact, it blurs the vision and it diminishes the confidence that 
the American people really should have in the system that is so 
brilliant otherwise.
    So I hope that what I am hearing you say--well, I think the 
Congress is going to step in. I don't think you are going to 
have the opportunity to say, well, board by board, community by 
community because this really flies in the face of what we 
should be doing. So do any of you have any idea how much money 
was actually raised by the respective stations, income from the 
lists?
    Mr. Tauzin. The gentlelady's time has expired. The 
gentleman will be allowed to respond.
    Mr. Duggan. Ms. Eshoo, on the first part you suggested, I 
think you are very likely to see a quickly developed response 
on the part of all public television stations to deal with this 
issue and that a national response will be forthcoming. I think 
this issue has galvanized our system. I think the embarrassment 
of the behavior that has come to light of a few stations has 
been embarrassing to the entire system and I think you will see 
the response that you call for. With respect to the amount of 
money raised in this list sharing, I don't know that any 
estimate has been made or whether anyone has an answer. I do 
not.
    Mr. Coonrod. We have not been able at this point to come up 
with a reliable estimate. We know the number is not large. I 
wouldn't want to speculate at this point.
    Ms. Eshoo. Thank you. Can we ask that that be made 
available to the committee when you have it.
    Mr. Coonrod. Yes, ma'am.
    Ms. Eshoo. Thank you, Mr. Chairman.
    Mr. Tauzin. Without objection. The Chair will recognize one 
more of our members for a round of questions. Then we will have 
a recess for this 15-minute vote I think and come back right 
after the vote. Before I do, for the record the Chair wants to 
acknowledge that the authorization bill that was considered and 
would be considered in this committee started with a 12 percent 
increase in the level of authorization over the 1996 level, not 
190 percent as someone had said.
    The Chair now recognizes Mr. Stearns for his 5 minutes.
    Mr. Stearns. Thank you, Mr. Chairman. Mr. Duggan, my 
questions are pretty much directed to you. In your opening 
statement which we heard, I think the staff and members are 
trying to understand that you have issued letters but are you 
going to perform a conductive, retroactive search so to speak 
to uncover all paths, lists, exchanges by stations with 
partisan groups? More specifically, do you plan to discover all 
past incidents of list swapping?
    Mr. Duggan. Mr. Stearns, I believe that the Corporation for 
Public Broadcasting, which has public interest oversight 
through its inspector general, is engaging in a search of that 
sort and we are cooperating fully in providing information to 
CPB, but if the purpose is to do that kind of inventory and for 
you to hear me express my support for such a search, yes, 
indeed, we want to do everything possible to uncover all 
activity of this sort.
    Mr. Stearns. When do you think that information would be 
completed? Is this a question for Mr. Coonrod or yourself? It 
seems like since you are, so to speak, at the top here, 
shouldn't you be the pile driver here?
    Mr. Duggan. Well, I am more of a pile driven by my member 
stations, Congressman. I am the employee of the member stations 
and I do not generally crack the whip as a network president 
would do. We are a membership association. But I believe that 
the result you seek is going to be forthcoming and I do want to 
invite Mr. Coonrod to speak on this because we are working 
together to get that information.
    Mr. Coonrod. Mr. Stearns, we are working to get that 
information. Our inspector general, the CPB inspector general, 
is conducting an independent survey. He will survey all of the 
stations and will attempt to assert some basic information so 
we can have a kind of data base of practices at all stations, 
all 700 or so licensees that receive CPB grants. But as we have 
learned, given the nature of list swapping through--or list 
exchanges through list brokers, it may be very difficult to 
track down all of the transactions that took place in the past. 
Certainly going forward we can guarantee that we could be--make 
available reports that indicate all of the transactions that 
take place going forward, all of the trades or rentals that 
take place but I cannot give you absolute assurance that we can 
reconstruct----
    Mr. Stearns. So you don't keep track of the list swapping 
in the past?
    Mr. Coonrod. Individual stations have kept track of that. 
Station records may not be complete. Now, if they are complete, 
then we can provide that information. If they are not----
    Mr. Stearns. When these lists were swapped, did you receive 
payment for this and what did you receive in return?
    Mr. Coonrod. I guess--let me take a step back. We--the 
Corporation for Public Broadcasting has not itself engaged in 
any of these activities.
    Mr. Stearns. I know. But each station, when each station 
did it, did they get money or what did they get in return?
    Mr. Coonrod. When a station rents a list, it gets money.
    Mr. Stearns. Cash? Does it get actually cash that you 
deposit in your station's account? That is the question.
    Mr. Coonrod. When it rents a list, it pays money, but when 
it receives--when it makes its list available, it gets cash.
    Mr. Stearns. When it gives the list from the station to the 
political party to Handgun Controls, Zero Population, or 
Planned Parenthood, does Planned Parenthood give you money and 
you deposit it in the station's account?
    Mr. Coonrod. Yes. If what happens is the list is--the names 
of the station donors, the station members are provided to the 
other organization, then it can either be cash or it can be an 
in kind. Often, almost always it is an in kind.
    Mr. Stearns. Wouldn't you keep track of all that? For 
example, with WGBH, there was a refinancial payment. I am just 
saying when you say you can't go back it seems to me you can 
because there has got to be some written, at least some 
annotation that you got something for something, particularly 
if it is money, it is a deposit, and isn't this reportable?
    Mr. Coonrod. To be clear we can go back. What I am saying 
to you, given the fact that there are over 700 licensees who 
are involved here, I cannot guarantee at this point that each 
of them has records that are complete and verifiable. That is--
those that have engaged in--used the benefits, the services of 
a list broker, the brokers keep a record of this and that is--
--
    Mr. Stearns. Mr. Chairman, I would urge the committee to 
have an outside source look at this because I think in all 
deference to the organization, if they look at it, you know how 
these things go. So I think we need somebody outside because 
once this quid pro quo is made, it is reportable if it is cash, 
even in kind.
    So, I mean, for them to say that they can't go back, it is 
difficult and I think begs the question and I urge the 
committee to try and find some way to get an outside source to 
do this.
    Mr. Tauzin. The gentleman's time has expired. The gentleman 
can respond.
    Mr. Duggan. Mr. Stearns, I believe you were out of the room 
when I spoke earlier, but I said we are very much attracted to 
the idea that you expressed for an independent review. We are 
going to do everything we can internally to get to the bottom 
of this and to effect the kind of change that needs to be 
effected. But we care so much about the trust of the American 
people that we also think an independent review perhaps by a 
distinguished citizen or citizens who could look into this and 
advise what went on and make recommendations would add to the 
credibility of our efforts and so we would invite a process 
where we could explore that with you.
    Mr. Tauzin. I thank the gentleman.
    I would point out in the Boston situation, Boston's 
information was corrected only because the National Democratic 
Party issued information indicating that they had engaged in 
using these names at an earlier date. Absent that, perhaps no 
one would have known. An independent review may well be called 
for.
    The Chair would declare a recess until after this vote.
    [Brief recess.]
    Mr. Tauzin. How does that translate to your statement? In 
other words, the statement that you have made is that that is a 
practice which we do not condone.
    Mr. Coonrod. That was Mr. Duggan's statement.
    Mr. Duggan. I would be happy to answer. And I do not imply 
that we are powerless here, because I see my role as a leader 
of the system. Even though I am an employee of the stations, I 
am quite candid with them about what I believe to be right and 
wrong.
    I simply wanted to explain to Mrs. Eshoo that we did not 
work like other networks. We are not powerless to market. We 
have already said in no uncertain terms that we thought this 
was a terrible practice.
    Mrs. Cubin. And if you do it?
    Mr. Duggan. I think we should use the sunlight of scrutiny 
and the power of our leadership to convince this system that a 
reform is necessary in these practices, where it exists. And I 
believe that sunlight of scrutiny has already been effective.
    Congressman Cox asked a minute ago about the sanctions that 
could be put in place. I don't think there are any sanctions 
that could be more serious than the scrutiny and embarrassment 
that has already occurred from these behaviors. And I will do 
anything in my power to ensure that these practices end and 
that we restore the trust of the American people.
    Mrs. Cubin. There is a law that does apply, law and rules 
and reg that does apply to all of the stations, and that is the 
Internal Revenue Service Code and their status as a tax-exempt 
organization. And according to the Democrat National Committee 
counsel, Joe Sandler, this is a quote: The IRS rules are clear 
that a nonprofit organization can rent or exchange its list 
with a political organization as long as it treats all 
political organizations equally.
    Now, I wonder, this is about WETA here in Washington, that 
they have traded names with the DNC, and the Patriotic 
Veterans, and the Great American Republicans. Now, I have been 
a Republican all my life. I have been involved in political 
activities all my life. I have never heard of the Patriotic 
Americans and the Great American Republicans, and I have no 
idea if they are Republicans, conservative, libertarians, 
Democrats. I have no idea what they are. I wonder if the 
station knows what they are, and if there shouldn't be some 
requirement that they found out. And, of course, this is in the 
purview of the Internal Revenue Service. But would you think 
exchanging the list with the Democrat National Committee and 
the Patriotic Veterans and the Great American Republicans would 
be treating all political organizations equally?
    Mr. Duggan. Ms. Cubin, even if exchanging that list is 
legal, it is stupid. It is imprudent. It is wrong.
    Mrs. Cubin. I agree.
    Mr. Duggan. We are different from other nonprofit 
organizations. And I emphatically disagree with that spokesman 
from the Democratic Committee who would imply that just because 
it is legal for nonprofits to do this, it was all right for a 
public television station to do it. We have a special 
relationship that is based on trust and credibility. And just 
doing what is legal--I wouldn't want my children to do 
everything they were legally permitted to do.
    Mrs. Cubin. Then would you think it was appropriate for the 
Internal Revenue Service to look further into whether or not 
violations based on the impartiality of the treatment of 
political organizations comes to play?
    Mr. Duggan. Well, I don't give advice to the Internal 
Revenue Service. I think if the Internal Revenue Service has a 
serious issue and feels that the law may have been broken, then 
if they feel an obligation to look into it, they would. But I 
don't want to be in a position of commenting on that because I 
don't know the law. I am not a lawyer.
    My concern is that no station should do something, just as 
no individual should do something, just because they have a 
right to do it. There are all sorts of things that we as 
Americans have rights to do that are not right to do. I would 
rather have my children pledge allegiance to the flag in school 
than burn the flag in school, though they may have a right to 
do it. And I think falling back on what is legal and what we 
have some sort of legal right to do misses the whole point of 
restoring trust and maintaining trust and deserving trust with 
the American people. And that means being prudent and showing 
good judgment and staying within the ambit of what is legal.
    Mr. Tauzin. The gentlewoman's time has expired.
    Mrs. Cubin. Just one quick question, yes or no?
    Mr. Tauzin. Without objection.
    Mrs. Cubin. The CPB is certainly exempt from the Freedom of 
Information Act. Would any of you oppose an amendment being 
added to the authorization bill that would subject CPB to the 
Freedom of Information Act?
    Mr. Coonrod. Currently, we use policies that are consistent 
with the Freedom of Information Act, so if we were required to 
do that, we wouldn't change our policies in any way.
    Mr. Tauzin. The gentleman from New York.
    Mr. Fossella. I apologize if the question has been asked 
and answered already, but we sort of run all over the place 
around here. But it was raised earlier regarding the policies, 
the auditing, I think Mr. Duggan focused on this, the auditing 
and the enforcement and the universality of the policies. But I 
don't know if I have heard what that specific policy is and 
what the consequences of violating that policy is. I have heard 
you are going to look at it. I don't question the faith in 
which you make that statement. And I am just curious as to if 
you decide today that someone or some group of people have 
violated a policy established in one of the affiliates, what is 
the consequence?
    Mr. Coonrod. Let me try that. Stations have a grant 
relationship with the Corporation for Public Broadcasting. In 
order to qualify for a grant, they must certify that they are 
doing certain things. Up until Thursday there was no 
requirement, we had no requirement that involved fund-raising 
and the brokering of lists and that sort of thing. On Thursday 
we put in a requirement that they must certify that they are 
operating in full accordance with applicable IRS regulations. 
That means, going forward, should they certify that they are 
and then they aren't, they would lose--not risk losing, they 
would lose funding from the Corporation for Public 
Broadcasting.
    However, that does not--we have not found a way to apply 
such regulations retrospectively.
    Mr. Fossella. So if I may, what I hear you saying is that 
even if you find out that a number of affiliates have violated 
what you say is a new policy, there is nothing you can do about 
it?
    Mr. Coonrod. Because it is a new policy.
    Mr. Fossella. There was no such policy up until Thursday?
    Mr. Coonrod. Right.
    Mr. Fossella. In terms of the funding level, I think 
Congressman Oxley focused on this earlier, do you think that 
the funding request made by the administration is adequate?
    Mr. Coonrod. I think--let me answer that in two parts, the 
request for the operations of the Corporation for Public 
Broadcasting and then the piece for digital. Taking the second 
one first, the administration's request does not take into 
account a very important part of something that we consider 
quite important; that is, the ability of local stations to take 
full advantage of the digital technology. The administration's 
request would be sufficient if we were just to have stations 
pass through a signal. By that I mean they would have to take a 
signal from PBS and simply pass it through to viewers. They 
would not be able to provide any kind of local educational 
services that are an important part of what we do. And on the 
digital front that is a big difference between what the 
administration has suggested and what we are suggesting.
    In terms of the operational funding where we think a larger 
number is called for, there are really two parts to that as 
well. We are moving into the digital era, and stations for the 
foreseeable future will have to be doing both analog and 
digital broadcasts because that is what the law will require; 
until 85 percent of the population has a digital set, we will 
also have to continue broadcasting in analog. So that is an 
additional operating expense.
    In addition, we are appropriating that we will be able to 
multicast and that we will be able to produce programs--
enhanced television programs. Those would be additional program 
expenses.
    So the increase in funding would not go--the increase in 
funding that we are looking for would not go to--would go for 
new activities is the way I would describe it. It wouldn't go 
for simply sustaining ongoing operations.
    Mr. Fossella. Let me make one observation and particularly 
to Mr. Duggan. You know in terms of accountability, and it 
appears that you want to accept the accountability and 
responsibility for making the best out of this bad situation, 
but listening, I don't know to what extent you actually can 
enforce any of these things, given the almost cooperative 
nature of the way you are affiliated with the local stations 
around the country. So I guess this is for another day and 
another time. But clearly it goes to the heart of the matter if 
once you establish this policy, how do you as president intent 
to follow through?
    So I will yield back. I see my time has expired. Take it up 
another day.
    Mr. Tauzin. The gentleman will be allowed to respond.
    Mr. Duggan. We have not been in the business at PBS of 
sanctioning or punishing our member stations in the past, and 
we generally find the level of integrity and conduct among our 
member stations to be very high. We do have a membership 
relationship with our member stations, and they make certain 
certifications every year, one of which is that they are, in 
fact, noncommercial and nonprofit.
    And I can envision the PBS board perhaps--and here I am 
speculating, because I don't know of any plan to do this, but I 
can envision a reporting requirement that would be a part of 
the certification for membership that would ask member stations 
to certify that they engage in no partisan political activity, 
they do not do any of these questionable things. So there are 
available within the membership relationship being able to 
deliver the national programming from Sesame Street to the news 
hours to Ken Burns' great documentaries is a very important 
thing for our stations, and that comes along with their 
membership. So there are certainly mechanisms if the board of 
directors of this nonprofit corporation decides to use those 
mechanisms that can be put in place.
    Mr. Tauzin. The Chair thanks the gentleman.
    The Chair yields to the gentleman from Michigan Mr. 
Dingell.
    Mr. Dingell. Thank you, Mr. Chairman.
    Gentlemen, welcome. I want to test now whether this 
absolutely magnificent display of outrage on the part of my 
colleagues is directed at public broadcasting exchanging lists, 
or exchanging lists with Democrats.
    So we will begin by asking this question: You noted that 
there have been exchanges of lists with at least seven entities 
involved with the Republican Party, including the 1996 Dole 
Victory fund-raising superfile, Conservative Republican 
superfile, Country Club Republicans, Golden Age Republicans, 
Republican Party Builders, and Great American Donors.
    Have you exchanged lists also or have public broadcasters 
either at the stations or CPB level or any other level 
exchanged lists with the Republican National Congressional 
Campaign Committee?
    Mr. Coonrod. As far as we can determine, no.
    Mr. Dingell. No. Have you done it with the Republican 
Senatorial Campaign Committee?
    Mr. Coonrod. As far as we can determine, no.
    Mr. Dingell. Do the other two gentlemen at the table so 
indicate also?
    Mr. Duggan. I have no knowledge of any such exchanges, Mr. 
Dingell.
    Mr. Dingell. Has CPB ever exchanged lists with candidates 
for public office other than the Dole campaign?
    Mr. Coonrod. There is one instance that we are familiar 
with in San Francisco.
    Mr. Dingell. What is that?
    Mr. Coonrod. KQED bartered a list with the Barbara Boxer 
campaign.
    Mr. Dingell. Okay. Now, tell me this, these lists are 
turned over by the local stations, I gather, to brokers?
    Mr. Coonrod. All of the activity that we have identified is 
through a broker. That is right.
    Mr. Dingell. Through a broker, not at station level?
    Mr. Coonrod. We have not found--we have not interviewed a 
station that engaged in direct list exchange. It was all 
through a broker.
    Mr. Dingell. Now, what does a broker do when he gets a 
list? The broker has got a list, what does he do with this 
list?
    Mr. Coonrod. I mean, I am not a broker, but brokers broker 
lists.
    Mr. Dingell. Let's reason together. The broker gets a list. 
He has got to do something with it. Obviously he then contacts 
somebody else who then wants the list; is that right? Or 
somebody else has already contacted him who wants the list; is 
that right?
    Mr. Coonrod. That is logical, Congressman, but my sense of 
how it works is that they maintain lists, they actually have 
lists, and it is a more fluid situation. That is my sense of 
it.
    Mr. Dingell. Was any taxpayers' money involved in the 
purchasing of lists?
    Mr. Coonrod. There was no--as far as we can tell, there was 
no direct taxpayer money. In other words, there was no money 
that went from--well, certainly I can say that no direct CPB 
dollars were used.
    Mr. Dingell. Were any indirect CPB dollars--or was there 
any indirect applications of public moneys?
    Mr. Coonrod. Possibly. Because the funds are fungible at 
the station level, you could--you could speculate that it is 
entirely possible that they were used in some way.
    Mr. Dingell. Now, what costs are involved in this? Let's 
take a unit of 10,000 names, just for the purposes, how much 
would be involved? About $900, I understand; is that right?
    Mr. Coonrod. It is in that neighborhood. Different lists 
have different prices, but it is about a dime a name or 
something like that.
    Mr. Dingell. About what? A dime a name?
    Mr. Coonrod. Or maybe less in some cases.
    Mr. Dingell. Who pays the money, and who gets the money?
    Mr. Coonrod. There are various ways that this happens. A 
common practice is to exchange names where there is no exchange 
of money. There is an exchange of information.
    Mr. Dingell. That is one example where you just trade 
names.
    Mr. Coonrod. Then there is the renting of a list where 
someone will, on a one-time basis, for a fee, for some small 
amount of money per name, rent a list from a list broker or 
through a list broker. Public television stations engage in 
that practice with some frequency as far as we can determine.
    Mr. Dingell. They do this as a regular business practice, 
or do these brokers subsist entirely upon the revenue that they 
derive from public broadcasting?
    Mr. Coonrod. As far as we can determine, there are about 
24,000 not-for-profit organizations that engage in some sort of 
list sharing.
    Mr. Dingell. 24,000?
    Mr. Coonrod. That is on a data base that we were able to 
search.
    Mr. Dingell. Would that include church groups?
    Mr. Coonrod. Yes, it would include not-for-profit 
organizations.
    Mr. Dingell. You don't mean to say that a church group 
would exchange names with the Democratic Party, do you?
    Mr. Coonrod. I am not an expert.
    Mr. Dingell. How about hospitals?
    Mr. Coonrod. Hospitals would be on the list, not-for-profit 
hospitals.
    Mr. Dingell. Religious orders?
    Mr. Coonrod. I don't know about religious orders.
    Mr. Dingell. I find this a fascinating subject. Obviously 
if we have a corrupt practice here, it must be engaged in by 
churchmen, too, and women.
    Mr. Tauzin. The gentleman's time has expired. The gentleman 
will be allowed to respond.
    Mr. Dingell. I was just getting down to a very fascinating 
subject here.
    Mr. Tauzin. I realize that, sir, but the gentleman's time 
has expired.
    Mr. Coonrod. I can't speculate on what others do, but I 
think the point that we come back to is that public 
broadcasters ought to refrain from practices that have the 
appearance of partisanship.
    Mr. Tauzin. The Chair will now recognize the gentleman from 
Illinois Mr. Rush for a round of questions.
    Mr. Rush. Thank you very much, Mr. Chairman. My first 
question before--first question I have is we have a public 
broadcasting channel or station in Chicago, WTTW. Are they a 
part of the infamous 53?
    Mr. Coonrod. I believe we contacted WTTW, and I believe 
that they have engaged the service of a list broker. So I am 
not exactly sure how you phrased your question, but they are 
one of the 53 we have identified. We can be more specific when 
we check the data by station.
    Mr. Rush. All right. How long has the sharing either, by 
selling or otherwise, of donor lists by your affiliates been 
going on?
    Mr. Coonrod. I can't answer that with any precision, but we 
have identified practices dating back to 1981. But I don't know 
how long----
    Mr. Rush. Does sharing always involve brokers?
    Mr. Coonrod. It doesn't always involve brokers, but in the 
stations that we have surveyed, and we have started from the 
top, those most likely to engage in the exchange of lists, the 
activity almost exclusively involves brokers among the stations 
that we have surveyed.
    Mr. Rush. Okay. In response to a question Mr. Dingell had 
earlier, you mentioned bartering. What is the characteristics 
of a bartering of lists, what is that? Money is not involved in 
that?
    Mr. Coonrod. One of the practices is that lists are traded. 
So you--you in effect barter a certain number of names for a 
certain number of names in return.
    Mr. Rush. And brokers are not involved in that at all?
    Mr. Coonrod. No brokers are involved in that. I don't know 
the exact mechanism, but there is a brokerage fee, I would 
assume, because of the way they manage the lists. And these are 
all computerized, so somebody has to manage the computer 
program and that sort of thing.
    Mr. Rush. If I can recall from previous testimony, you 
indicated that 85 percent of your revenues for your affiliate 
stations come through individual fund-raising efforts; is that 
right?
    Mr. Coonrod. No, sir, I think what you are referring to is 
roughly 15 percent comes from the Federal Government or through 
the CPB, and there are other sources. Subscribers, and the 
fund-raising. Subscribers account for about 23 percent of the 
total revenue for public broadcasters. The most current year 
that we have complete data available was 1997, and it was $472 
million from all membership sources, not just through the list, 
but on-air pledges and everything else.
    Mr. Rush. Public dollars account for approximately 15 
percent?
    Mr. Coonrod. That is right.
    Mr. Rush. Fund-raisers or affiliate stations have to engage 
in pretty aggressive fund-raising; is that right?
    Mr. Coonrod. Indeed.
    Mr. Rush. Was there ever a time when the exchanging or 
sharing of lists, exclusively a function of not-for-profit 
organizations sharing lists with each other for fund-raising, 
that did not involve political parties?
    Mr. Coonrod. I am not sure I----
    Mr. Rush. Was there ever a time that you know of where 
political parties were not engaged with your affiliate stations 
in terms of sharing of lists?
    Mr. Coonrod. I don't know the answer to that. We don't have 
the information.
    Mr. Rush. Okay. Did either Republican Party candidates or 
office holders of the Republican Party or the Democratic Party 
share lists with your member stations any of your member 
stations?
    Mr. Coonrod. Yes, well, let's be clear. They have gone 
through brokers, and those brokers have had lists available. So 
the way it has been described to us is that it is probable that 
names from the candidates' list were provided to the public 
television station. It would take some work to fully go back 
and track the specific name.
    Mr. Rush. So you are saying----
    Mr. Tauzin. The gentleman may proceed for 1 minute without 
objection.
    Mr. Rush. So you are saying that it is not unheard of that 
political parties would share their donor lists with your 
affiliate networks; is that right?
    Mr. Coonrod. I have become an instant expert in this 
subject, and I don't know what the practices of political 
parties are. But I do know from looking at it from the public 
broadcasting point of view, that the same brokers who broker 
lists for public broadcasting stations also broker lists for 
political parties.
    Mr. Rush. Thank you.
    Mr. Tauzin. I thank the gentleman.
    The Chair would, before dismissing this panel, would like 
to give you, Mr. Coonrod, a chance to correct or perhaps 
elaborate on the testimony that you gave in writing as opposed 
to the testimony you have given orally today.
    In your written testimony on page 5, I quote, based on what 
we know today, approximately 50 of the public television's 353 
stations, or about 15 percent, exchange lists with other 
nonprofit organizations, almost all using list brokers as 
intermediaries. It is unclear from your oral testimony as to 
whether or not there were, in fact, some of the stations who 
provided or exchanged lists with other nonprofit organizations 
without going through a broker or an intermediary. At one point 
you said no. You answered my question there were none. Your 
testimony implies there were some. In your testimony with Mr. 
Rush, you again implied that there may have been some. What is 
the correct answer?
    Mr. Coonrod. Based on what I know right now, I guess that 
is the way I would have to put it, we have not found any 
station that has exchanged a mailing list with a political 
party directly. That is all--any time that has happened, it has 
been through a broker. But given the way the facts change from 
time to time, it is possible that there is information out 
there that we haven't collected.
    Mr. Tauzin. Well, you understand why, when you give us a 
written statement that says almost all use brokers, it leaves 
the impression that you did have knowledge that someone did 
not. You are telling us you do not have knowledge?
    Mr. Coonrod. I do not have knowledge--let me be clear. What 
we have tried to do, Congressman, is corroborate whatever 
information that we have so that we could be sure that the 
information we were providing was accurate. And so we tried to 
get at least, if I may use that, two sources. And when there 
was conflicting information, we would go down to a deeper 
level. And so I wanted to make sure that we were not providing 
information that in any way could be incorrect.
    Mr. Tauzin. Now, again, before we dismiss you, you indicate 
that you have surveyed a group that represents less than 10 
percent of the radio and television stations in public 
broadcasting.
    Mr. Coonrod. That is right.
    Mr. Tauzin. So we have information coming from only a 10 
percent sample.
    Mr. Coonrod. That is right.
    Mr. Tauzin.  You also indicate that the CPB's inspector 
general is conducting an independent review, and he would make 
it available to us as soon as it is completed. Can you tell us 
when that would be?
    Mr. Coonrod. I can tell you what I believe his schedule is, 
and that he would have it done within 30 days, but I can 
confirm that for you to be sure.
    Mr. Tauzin. Does the CPB inspector general have sufficient 
staff to do this in an appropriate amount of time for this 
committee to be satisfied with the results?
    Mr. Coonrod. Well, once again, he could answer that better, 
but if he needs additional staff, I would certainly do 
everything I can to make sure it was available to him.
    Mr. Tauzin. It would be extremely helpful, and the chairman 
would so request of you, Mr. Coonrod, that perhaps periodic 
reports be made to this committee, perhaps on a weekly basis, 
as information is discovered that we can track this survey and 
identify whether or not progress is being made in conducting an 
inquiry as to the other 90 percent of the stations that have 
not yet, apparently, been investigated.
    Mr. Coonrod. We could report to the committee weekly.
    Mr. Tauzin. The committee will so request that we get a 
weekly report, and the committee would like to realize we 
cannot set a deadline for your inspector general, but we would 
like if at all possible to have that final report within those 
30 days that we might be able to act accordingly.
    Mr. Coonrod. I will work with the inspector general to make 
sure that he has sufficient resources to do it as quickly as is 
possible.
    Mr. Tauzin. Are there any questions by any of the other 
members?
    Gentlemen, you have my thanks for your participation today, 
and we will now call the second panel forward.
    The second panel will consist of Mr. Ken Burns, president, 
Florentine Films, Maple Grove Road, of Walpole, New Hampshire; 
and Mr. Kent Lassman, deputy director of technology and 
communications for Citizen for a Sound Economy Foundation in 
DC; Dr. Amy Jordan, senior research investigator of the 
Annenberg Public Policy Center in Philadelphia; and Mr. Timothy 
Graham, director of media analysis, Media Research Center, in 
Alexandria, Virginia.
    Mr. Tauzin. Ladies and gentlemen, thank you for being here. 
We will begin with someone I know everyone recognizes, Mr. Ken 
Burns.
    Mr. Burns.

  STATEMENTS OF KEN BURNS, PRESIDENT, FLORENTINE FILMS; KENT 
   LASSMAN, DEPUTY DIRECTOR, TECHNOLOGY AND COMMUNICATIONS, 
CITIZENS FOR A SOUND ECONOMY FOUNDATION; AMY B. JORDAN, SENIOR 
    RESEARCH INVESTIGATOR, ANNENBERG PUBLIC POLICY CENTER, 
  UNIVERSITY OF PENNSYLVANIA; AND TIMOTHY GRAHAM, DIRECTOR OF 
             MEDIA ANALYSIS, MEDIA RESEARCH CENTER

    Mr. Burns. Thank you, Mr. Chairman. It is an honor for me 
to appear today, and I am grateful you have given me this 
opportunity to express my thoughts. Let me say at the outset as 
the father of two daughters and a film producer increasingly 
concerned with violence on television that I am a passionate, 
lifelong supporter of public television as well as someone 
engaged in it. Few institutions provide such a direct grass-
roots way for our citizens to participate in the shared glories 
of their common past, in the power of the priceless ideals that 
have animated our remarkable Republic for the last 200 years, 
and in the inspirational life of the mind and the heart that an 
engagement with the arts always provides. It is my wholehearted 
belief that anything that threatens this institution weakens 
this country.
    I have been producing documentary films for almost 25 
years, celebrating the special messages the American past 
continually directs our way. And these include films on the 
Brooklyn Bridge and the Statue of Liberty, the turbulent 
Louisiana politician Huey Long, and on the--I think--the 
sublime pleasures and unexpected lessons of our national 
pastime, and, of course, the searing transcendent experience of 
our Civil War. I even made a film on the history of this 
magnificent Capitol Building and the much maligned institution 
that is charged with conducting the people's business. But in 
every instance, Mr. Chairman, I have consciously produced these 
films for national public television broadcast, not the 
lucrative commercial networks or cable.
    As an educational filmmaker I am grateful to play even a 
small part in an underfunded broadcasting entity which, among 
dozens of fabulously wealthy networks, just happens to produce 
on shoestring budgets the best news and public affairs 
programming on television, the best science on television, the 
best arts on television, the best children's shows on 
television, and some say the best history on television.
    With Congress' great insight, public television was born 
and grew to its startlingly effective maturity echoing the same 
time-honored sense that our government has an interest in 
helping to sponsor communication, art and education just as it 
sponsors commerce. We are not talking about a 100 percent 
sponsorship, a free ride, but a priming of the pump, a way to 
get the juices flowing in the spirit of President Reagan's 
notion of a partnership between the government and the private 
sector.
    The CPB grant I got for my Civil War series attracted even 
more funds from General Motors and several private foundations, 
money that would not have been there had not the Corporation 
for public broadcasting blessed the project with its rigorously 
earned imprimatur. But there are those who are sure that 
without public television, the so-called marketplace would take 
care of everything, that what will not survive in the 
marketplace does not deserve to survive, and nothing could be 
further from the truth, because we are not just talking about 
the commerce of a Nation. We are not just economic beings, but 
spiritual and intellectual beings as well. And so we are 
talking about the creativity of a Nation.
    Some forms of creativity thrive in the marketplace, and 
that is a wonderful thing reflected in our Hollywood movies and 
our globally popular music. But let me say the marketplace 
could not make, and to this day could not have made, the Civil 
War series or any of the films I have been working on. The 
marketplace will not, indeed cannot, produce the good works of 
PBS, just as the marketplace does not and will not pay for our 
fire department or our Defense Department, things essential to 
the safety, the defense, and well-being of our country. It 
takes government involvement, eleemosynary institutions, 
individual altruism, extramarketplace effort to get these 
things made and done. I also know, Mr. Chairman, that PBS has 
nothing to do with the actual defense of our country. I know 
that. PBS just makes our country worth defending.
    The former Speaker of the House of Representatives, Newt 
Gingrich, spoke eloquently and often of an American people 
poised for the 21st century, endowed with a shared heritage of 
sacrifice and honor, the highest ideals mankind has yet 
advanced, but also armed with new technologies that would 
enable us to go forward as one people. I say to all of those 
who would listen that we have in public television exactly what 
he had envisioned.
    Many have recently criticized public television for certain 
controversial actions and projects with possibly too political 
a bent. I share the outrage of those who have condemned these 
lapses, but that is all they are. Let us not be so foolish, as 
Congressman Wynn suggested, to throw the baby out with the bath 
water. To paraphrase the historian David McCullough, to 
diminish the effectiveness of this institution for these 
transgressions would be like getting rid of the Navy for the 
Tailhook scandal. Let us respond reasonably.
    The historian Arthur Schlesinger, Jr., has said that we 
suffer from too much ``pluribus'' and not enough ``unum.'' few 
things survive in these cynical days to remind us of the Union 
from which so many of our collective and personal blessings 
flow, and it is hard to wonder in an age when the present 
moment overshadows all else what finally does endure, what 
encodes and stores the genetic material, the DNA of our 
civilization passing down to the next generation the best of 
us, what we hope at least will mutate into betterness for our 
children and for our posterity.
    Mr. Chairman, I think PBS offers one clear answer. It is 
the best thing that we have in our television environment that 
reminds us why we agreed to cohere as a people, and that is a 
very good thing. Thank you, Mr. Chairman.
    [The prepared statement of Ken Burns follows:]
      Prepared Statement of Ken Burns, President, Florentine Films
    Mr. Chairman and Members of the Committee: It is an honor for me to 
appear before you today and I am grateful that you have given me this 
opportunity to express my thoughts. Let me say from the outset--as a 
father of two daughters and a film producer, increasingly concerned 
about violence on television--that I am a passionate life-long 
supporter of public television and its unique role in helping to stitch 
our exquisite, diverse, and often fragile culture together.
    Few institutions provide such a direct, grassroots way for our 
citizens to participate in the shared glories of their common past, in 
the power of the priceless ideals that have animated our remarkable 
republic and our national life for more than two hundred years, and in 
the inspirational life of the mind and the heart that an engagement 
with the arts always provides. It is my wholehearted belief that 
anything which threatens this institution weakens our country. It is as 
simple as that.
    For almost 25 years I have been producing historical documentary 
films, celebrating the special messages American history continually 
directs our way. The subjects of these films range from the 
construction of the Brooklyn Bridge and the Statue of Liberty to the 
life of the turbulent demagogue Huey Long; from the graceful 
architecture of the Shakers to the early founders of radio; from the 
sublime pleasures and unexpected lessons of our national pastime to the 
searing transcendent experience of our Civil War; from Thomas Jefferson 
and Lewis and Clark to Frank Lloyd Wright, Elizabeth Cady Stanton and 
Mark Twain. I even made a film on the history of this magnificent 
Capitol building and the much maligned institution that is charged with 
conducting the people's business.
    In every instance, I consciously produced these films for national 
public television broadcast, not the lucrative commercial networks or 
cable.
    As an educational filmmaker I am grateful to play even a small part 
in an underfunded, broadcasting entity, with one foot tenuously in the 
marketplace and the other decidedly and proudly out, which, among 
dozens of fabulously wealthy networks, just happens to produce--on 
shoestring budgets--the best news and public affairs programming on 
television, the best science on television, the best arts on 
television, the best children's shows on television, and some say the 
best history on television.
    When I was working more than 15 years ago on my film about the 
Statue of Liberty, its history and powerful symbolism, I had the great 
good fortune to meet and interview Vartan Gregorian, who was then the 
president of the New York Public Library. After an extremely 
interesting and passionate interview on the meaning behind the statue 
for an immigrant like him--from Tabriz, Iran--Vartan took me on a long 
and fascinating tour of the miles of stacks of the Library. Finally, 
after galloping down one claustrophobic corridor after another, he 
stopped and gestured expansively. ``This,'' he said, surveying his 
library from its guts, ``this is the DNA of our civilization.''
    I think he was saying that that library, indeed, all libraries, 
archives, and historical societies are the DNA of our society, leaving 
an imprint of excellence and intention for generations to come. It 
occurs to me, as we consider the rich history of education and service 
of PBS, (and as we are forced again and again and again to justify our 
very existence,) that we must certainly include this great institution 
in that list of the DNA of our civilization. That we are part of the 
great genetic legacy of our nation. And that cannot, should not, be 
denied us or our posterity.
    We have consistently provided, with our modest resources, and over 
more than three tumultuous decades, quite simply an antidote to the 
vast wasteland of television my friend Newt Minnow so accurately 
described. We do things differently. We are hardly a ``disappearing 
niche,'' as some suggest, but a vibrant, galvanic force capable of 
sustaining this experiment well into our uncertain future.
    But now, and sadly not for the first time, I hear critics saying 
yet again that PBS must be scrapped, that our government has no 
business in television or the arts and humanities, that we must let the 
marketplace alone determine everything in our cultural life, that this 
huge broad based institution is essentially elitist, that a few 
controversial projects and actions prove the leftist political bias of 
the public television community. I feel strongly that I must respond to 
these charges.
    Since the beginning of this country, our government has been 
involved in supporting the arts and the diffusion of knowledge, which 
was deemed as critical to our future as roads and dams and bridges. 
Early on, Thomas Jefferson and the other founding fathers knew that the 
pursuit of happiness did not mean a hedonistic search for pleasure in 
the marketplace but an active involvement of the mind in the higher 
aspects of human endeavor--namely education, music, the arts, and 
history. Congress supported the journey of Lewis and Clark as much to 
explore the natural, biological, ethnographic, and cultural landscape 
of our expanding nation as to open up a new trading route to the 
Pacific. Congress supported numerous geographical, artistic, 
photographic, and biological expeditions to nearly every corner of the 
developing West. Congress funded, through the Farm Securities 
Administration, the work of Walker Evans and Dorothea Lange and other 
great photographers who captured for posterity the terrible human cost 
of the Depression. At the same time, Congress funded some of the most 
enduring writing ever produced about this country's people, its 
monuments, buildings, and backroads in the still much used and admired 
WPA guides. Some of our greatest symphonic work, our most treasured 
dramatic plays, and early documentary film classics came from an 
earlier Congress' support.
    With Congress' great insight Public Television was born and grew to 
its startlingly effective maturity echoing the same time-honored sense 
that our Government has an interest in helping to sponsor 
Communication, Art and Education just as it sponsors Commerce. We are 
not talking about a 100% sponsorship, a free ride, but a priming of the 
pump, a way to get the juices flowing, in the spirit of President 
Reagan's notion of a partnership between the government and the private 
sector. The CPB grant I got for the Civil War series attracted even 
more funds from General Motors and several private foundations; money 
that would not have been there had not the Corporation for Public 
Broadcasting blessed this project with their rigorously earned 
imprimatur.
    But there are those who are sure that without the Endowments, the 
so-called ``marketplace'' would take care of everything; that what 
won't survive in the marketplace, doesn't deserve to survive. Nothing 
could be further from the truth, because we are not just talking about 
the commerce of a nation, we are not just economic beings, but 
spiritual and intellectual beings as well, and so we are talking about 
the creativity of a nation. Now, some forms of creativity thrive in the 
marketplace and that is a wonderful thing, reflected in our Hollywood 
movies and our universally popular music. But let me say that the 
marketplace could not have made and to this day could not make my Civil 
War series, indeed any of the films I have made.
    That series was shown on public television, outside the 
marketplace, without commercial interruption, by far the single most 
important factor for our insuring PBS's continuing existence and for 
understanding the Civil War series' overwhelming success. All real 
meaning in our world accrues in duration; that is to say, that which we 
value the most--our families, our work, the things we build, our art-- 
has the stamp of our focused attention. Without that attention, we do 
not learn, we do not remember, we do not care. We are not responsible 
citizens. The programming on PBS in all its splendid variety, offers 
the rarest treat amidst the outrageous cacophony of our television 
marketplace--it gives us back our attention. And by so doing, insures 
that we have a future.
    The marketplace will not, indeed cannot, produce the good works of 
PBS. Just as the marketplace does not and will not pay for our fire 
department or more important our Defense Department, things essential 
to the safety, defense and well-being of our country. It takes 
government involvement, eleemosynary institutions, individual altruism, 
extra-marketplace effort to get these things made and done. I also 
know, Mr. Chairman, that PBS has nothing to do with the actual defense 
of our country, I know that--PBS just makes our country worth 
defending.
    Do not be persuaded by the argument that this is all elitist, that 
we are funding the superfluous; ``opera for the rich.'' The meat and 
potatoes of public television reaches out to every corner of the 
country and touches people in positive ways the Federal Government 
rarely does. Indeed, it would be elitist itself to abolish the 
Endowments, to trust to the marketplace and the ``natural aristocracy'' 
that many have promised over the last two hundred years would rise up 
to protect us all--and hasn't.
    With regard to my own films, I have been quite lucky. The Civil War 
series was public television's highest rated program and has been 
described as one of the best programs in the history of the medium. But 
that show, indeed all of my films produced over the last quarter of a 
century, are only a small part, a tiny fraction, of the legacy of PBS. 
If public television's mission is severely hampered or curtailed, I 
suppose I will find work, but not the kind that insures good television 
or speaks to the overarching theme of all my films--that which we 
Americans all hold in common. But more to the point, where will the 
next generation of filmmakers be trained? By the difficult rigorous 
process of CPB and PBS or by the ``Hard Copy's'' of the world? I hope 
it will be the former.
    The former Speaker of the House of Representatives Newt Gingrich 
spoke eloquently and often of an American people poised for the twenty-
first century, endowed with a shared heritage of sacrifice and honor 
and the highest ideals mankind has yet advanced, but also armed with 
new technologies that would enable us to go forward as one people. I 
say to all who would listen that we have in public television exactly 
what he envisions.
    Many have recently criticized public television for certain 
controversial actions and projects with possibly too political a bent. 
I share the outrage of those who have condemned these lapses. But 
that's all they are: mistakes made by institutions forced continually 
to find sources of revenue from ever more disparate sources. Let us not 
be so foolish as to throw the baby out with the bath water. As 
historian David McCullough said, to abolish this institution for these 
transgressions, ``would be like getting rid of the Navy after the 
Tailhook scandal.'' Let us respond reasonably.
    Unfortunately, some continue to believe that public television is a 
hot-bed of radical thinking. I wonder, though, have they ever been to a 
PBS station? I doubt it. PBS is the largest network in the world, 
reaching into the most remote corners of every state in the Union and 
enriching the lives of people of all backgrounds. These are essentially 
conservative institutions, filled with people who share the concerns of 
most Americans. Indeed, PBS is supported by 70% of Republicans, 80% of 
Independents, and 90% of Democrats across the country. And Mr. 
Chairman, I know many people who criticize us as too conservative, to 
middle of the road, too safe.
    And in a free society, the rare examples of controversy that may 
run counter to our accepted cannon, or one group's accepted cannon, 
need not be the occasion for a new reactionary Puritanism, but ought to 
be seen as a healthy sign that we are a nation tolerant of ideas, 
confident--as the recent tide of geo-political history has shown--that 
the best ideas will always prevail.
    One hundred and fifty seven years ago, in 1838, well before the 
Civil War, Abraham Lincoln challenged us to consider the real threat to 
the country, to consider forever the real cost of our inattention: 
``Whence shall we expect the approach of danger?'' he wrote. ``Shall 
some transatlantic giant step the earth and crush us at a blow? Never. 
All the armies of Europe and Asia could not by force take a drink from 
the Ohio River or make a track in the Blue Ridge in the trial of a 
thousand years. No, if destruction be our lot, we must ourselves be its 
author and finisher.'' As usual, Mr. Lincoln speaks to us today with 
the same force he spoke to his own times.
    Mr. Chairman, clearly we in public television must not take 
ourselves too seriously. Sometimes our greatest strength, our 
earnestness metastasizes into our greatest weakness. I know it's true 
for me. Usually a faithful and true companion, our earnestness and 
seriousness is sometimes worked to death. And Lord how we like to see 
our mission as the cure. I remember once, after giving an impassioned 
defense of what we do at PBS, a man came up to me and said simply, 
``It's not brain surgery, you know.'' (Perhaps.)
    But a few weeks ago, on a perfect spring day, I was walking with my 
oldest daughter through a park in a large American city on the way to a 
college interview. We were taking our time, enjoying the first warm day 
of the year, when a man of about thirty, dressed in a three piece suit, 
approached me.
    ``You're Ken Burns.'' he asked.
    I nodded.
    ``I need to talk to you about Baseball,'' he said under his breath.
    ``Okay.'' I hesitated.
    Then, he blurted out: ``My brother's daughter died.'' I took a step 
backward.
    ``I'm sorry,'' I said. I didn't know what else to say.
    ``SIDS.'' he said. ``Crib death. She was only one.''
    ``I'm so sorry,'' I said. ``I have daughters.''
    ``I didn't know what to do,'' he said in a halting, utterly sad 
voice. ``My brother and I are very close. Then I thought of your film. 
I went home to our mother's house, got our baseball mitts, and went to 
my brother's. I didn't say a word. I handed him his mitt and we went 
out into the backyard and we played catch wordlessly for an hour. Then 
I went home . . . I just wanted to thank you.''
    Maybe it is brain surgery.
    Mr. Chairman, most of us here, whether we know it or not, are in 
the business of words. And we hope with some reasonable expectations 
that those words will last. But alas, especially today, those words 
often evaporate, their precision blunted by neglect, their insight 
diminished by the shear volume of their ever increasing brethren, their 
force diluted by ancient animosities that seem to set each group 
against the other.
    The historian Arthur Schlesinger, Jr. has said that we suffer today 
from ``too much pluribus, not enough unum.'' Few things survive in 
these cynical days to remind us of the Union from which so many of our 
personal as well as collective blessings flow. And it is hard not to 
wonder, in an age when the present moment overshadows all else--our 
bright past and our unknown future--what finally does endure? What 
encodes and stores that genetic material of our civilization, passing 
down to the next generation--the best of us--what we hope will mutate 
into betterness for our children and our posterity.
    PBS holds one clear answer. Please do not be the author of its 
destruction, the finisher of their important good works. PBS is the 
best thing we have in our television environment that reminds us why we 
agree to cohere as a people. And that is a fundamentally good thing.
    Nothing in our daily life offers more of the comfort of continuity, 
the generational connection of belonging to a vast and complicated 
American family, the powerful sense of home, and the great gift of 
accumulated memory than does this great system which honors me by 
counting me a member.

    Mr. Tauzin. Thank you, Mr. Burns.
    The Chair will now welcome and recognize Mr. Ken Lassman, 
deputy director of technology and communications for the 
Citizens for a Sound Economy Foundation. Mr. Lassman.

                    STATEMENT OF KENT LASSMAN

    Mr. Lassman. The role of authorization within the budget 
process is to review the original mission of every Federal 
agency and program. The dramatic change to the communications 
marketplace in the last 30 years makes Federal subsidy to the 
Corporation for public broadcasting unnecessary. The question 
before us today should be how soon can we allow the CPB to 
break free of these subsidies, and what action will you take to 
allow the CPB to flourish?
    Mr. Chairman and members of the committee, thank you for 
the opportunity to share a free market perspective on the CPB 
authorization. I am the deputy director for technology and 
communications policy at Citizens for a Sound Economy 
Foundation, and I present these views on behalf of our 250,000 
members.
    The CPB is a dinosaur, and I offer to you that if it 
survives, it will be because of change from within, because the 
forces of technology have already transformed the environment 
in which it operates. This morning's statements clarify a few 
ideas. See, some folks like it, and some folks treasure it, and 
some folks would go so far as to say it is an American 
institution. And I for one think that folks should get to keep 
it. You might think I am talking about the CPB and public 
broadcasting, and I am, but I am also talking about American 
taxpayer dollars.
    Today consumers have untold number of choices that did not 
exist when the CPB was created. To continue to subsidize the 
CPB would be like subsidies for the Pony Express in an era 
after the railroad, the telegraph, the telephone, facsimile 
machines and even e-mail has come on the scene. It simply is 
not necessary.
    The traditional story about the funding of the CPB is well-
known. At the time that it was created, three networks 
dominated the television marketplace. Rowan and Martin's Laugh-
In was the top-rated program, and Congress appropriated $5 
million to the CPB in fiscal year 1969. Today 9 of the top 20 
cable networks are devoted to education, public affairs, news, 
or children's programming. A quick search of the Internet turns 
up hundreds if not thousands of Web sites devoted to every 
imaginable local, cultural, artistic and educational topic. 
What began as a modest expenditure is now a monstrosity. 
Adjusted for inflation, $7.4 billion has been taken from 
taxpayers to subsidize the CPB in the last 30 years.
    The legislation that this hearing was called to address 
would increase funding for the CPB at a time when the subsidy 
should be limited and eventually eliminated. H.R. 2384 creates 
a formula so that as alternative sources of funding are 
realized, Federal funding doesn't diminish. Not only does this 
guarantee that more taxpayer dollars are spent on public 
broadcasting, but it makes it impossible for public 
broadcasting to outgrow its history of Federal support.
    Likewise, the $415 million authorized for a single class of 
broadcasters to transition from analog to digital technologies 
is nothing more than a high-tech handout. If public 
broadcasters raised funds for their digital transition through 
private markets, there would be at least three positive 
effects. First, taxpayers and the Congress would have a rough 
proxy of how consumers value the CPB and its affiliates. 
Second, a hybrid format with digital as well as analog 
programming would create value in the economy rather than 
replacement of one set of programming for another. And the 
third positive effect would be to allow public broadcasters to 
continue to reach the poorest Americans, who would be the last 
to purchase new television and radio equipment.
    Digital conversion should be the opportunity to set the CPB 
free of Federal subsidies. As of now I am afraid it is viewed 
as an obligation to spend more money. I want to set the record 
straight. It is a mistake to confuse the CPB with all of public 
broadcasting. CPB is only one source of support for public 
broadcasting. In 1997, only 7 percent of funding for public 
broadcasting, 7 percent, came from the CPB. The same year 
operating revenue shot up a total of $47 million, an increase 
of 23 percent. Over the last 2 years, PBS grew by 30 percent 
while its CPB funding dropped. Evidently, popular, well-
researched and thorough programs like those that Mr. Burns 
creates can succeed in the marketplace.
    Some critics claim that quality programming cannot be 
supported with private support. In essence this argument 
requires one of two assumptions. Its advocates might believe 
that the programming is not good enough. Well, they are wrong. 
Or they might believe that consumers do not know enough for 
themselves about what they need, and that a benevolent, 
federally funded public broadcaster should come in to deliver 
art and education and culture. They are wrong on this point as 
well.
    Mr. Chairman, I have several things to share with you, and 
I will reserve them for your questions. Thank you.
    [The prepared statement of Kent Lassman follows:]
   Prepared Statement of Kent Lassman, Citizens for a Sound Economy 
                               Foundation
    In 1899, Lee de Forest completed doctoral work at Yale studying the 
length and velocity of electromagnetic waves. In the introduction to 
his autobiography, Father of Radio, de Forest wrote, ``I discovered an 
Invisible Empire of the Air, intangible, yet solid as granite.'' 
1 A century after de Forest's experiments, the Corporation 
for Public Broadcasting (CPB) is an empire of the airwaves; its form is 
difficult to grasp and it is solidly entrenched in the federal budget. 
Like de Forest, I believe in progress and progress requires 
alternatives to increased federal funding for the CPB.
---------------------------------------------------------------------------
    \1\ Lewis, Tom, ``Empire of the Air: The Men Who Made Radio,'' 
HarperCollins, 1991, New York, page 364.
---------------------------------------------------------------------------
    The CPB is a dinosaur. If the CPB survives, it will be because of 
change from within, because the forces of technology have transformed 
the communications environment in which it operates.
    Mr. Chairman and members of the committee, thank you for the 
opportunity to share my views on the Corporation for Public 
Broadcasting and its budgetary authorization. As you may know, I am the 
deputy director for technology and communications policy at Citizens 
for a Sound Economy Foundation (CSE Foundation), and I present these 
views on behalf of CSE Foundation's members.2
---------------------------------------------------------------------------
    \2\ CSE Foundation does not receive any funds from the U.S. 
Government.
---------------------------------------------------------------------------
    More than a quarter of a million strong, CSE Foundation's members 
are found in every corner of America. Our members distinguish 
themselves as political activists. They constantly remind us that 
decisions made in Washington, D.C. are felt in places far away from 
here. And that is where CSE Foundation can be found. We fight at the 
grassroots level for lower taxes and less regulation of the economy. 
And let it not be forgotten that political activists are also 
consumers, consumers of the myriad high-quality goods and services 
available in America, including public broadcasting.
Introduction
    This hearing immediately brings to mind a few ideas. Some folks 
like it. Some folks treasure it. Some folks even consider it an 
American institution. I for one think that folks should get to keep it.
    You might think that I am talking about the CPB. I am. And of 
course, I am talking about taxpayer dollars as well. The purpose of 
this hearing is to consider an authorization for the CPB. The role of 
authorization within the budget process is to review the original 
mission of every federal agency. Given the dramatic changes to the 
communications marketplace in the last 30 years, continued federal 
subsidies for the CPB are unnecessary. The question to answer is how 
soon can the CBP break free of federal subsidies.
    Today, consumers have untold number of choices today that did not 
exist when the CPB was created. To continue subsidies for the CPB is 
like subsidizing the Pony Express in an era of railroads, the 
telegraph, facsimile machines, the telephone and email.
    Federal subsidies should end as soon as possible. If the CPB has a 
place in a marketplace filled with satellite, Internet, and cable 
communications, it could become something of a ``United Way'' for the 
airwaves. The next generation of the CPB could raise private dollars to 
help local broadcasters.
    This statement has two basic points.

1. Contrary to what you may hear today, the health of public 
        broadcasting does not depend upon federal funding. Last year, 
        approximately 17.5 percent of PBS' funding came from the 
        federal government. All told, only 7 percent is from the CPB. 
        In fact, evidence suggests that as federal funding decreases 
        public broadcasting becomes stronger.
2. The marketplace today is dramatically different than it was 30 years 
        ago. Direct satellite broadcast, new over-the-air broadcast, 
        video rental, cable and the Internet are competitive sources of 
        education and entertainment. Independent, community-based, and 
        educational programming is available across America.
Funding
    Over the last several years, public broadcasting raised more money 
and operated larger budgets when federal funding decreased, or at best, 
remained stable. It should come as no surprise that federal funding is 
like a poison pill. Economic resources in the private sector are often 
more efficient, produce higher quality goods, and are more innovative 
than the resources in the public sector.
    Federal Authorization and Appropriation. The traditional story told 
about the funding of the CPB is well known by many members of this 
committee. At the time that the CPB was created, three networks 
dominated the television broadcast marketplace. In FY 1969, the 
administration requested $9 million and Congress appropriated $5 
million to the CPB. Over the last 30 years, more than $5.2 billion has 
been taken from taxpayers and used to subsidize the CPB.3
---------------------------------------------------------------------------
    \3\ For three decades, federal funding of the CPB has grown at 
staggering rates. After the initial $5 million outlay, the next 
appropriation was tripled and then the CPB appropriation grew an 
additional 53 percent in FY 1971. By FY 1979, the CPB was taking home 
more than $120 million--24 times more than FY 1969--from the federal 
treasury. According to the President's Budget, (FY 2000, Historical 
Tables, 12.3) in the proceeding ten years the CPB appropriation went to 
$228 million, an increase of 90 percent. The most recent decade has 
seen CPB appropriations balloon to as much as $323 million in a single 
year. McCalip, Bernevia, ``95063: Public Broadcasting: Issus in the 
106th Congress,'' CRS Issue Brief for Congress, page 6.
---------------------------------------------------------------------------
    The most recent authorization for the CPB expired at the end of FY 
1996. This fact alone is cause for pause. H.R. 2384 would authorize the 
CPB for five years. Before consideration is made as to at what level 
the CPB should be funded, an initial and more important question must 
be answered. Should the CPB be dependent upon federal money? If not, is 
a five-year authorization necessary?
    Once the primary question is addressed, it is possible to debate 
the proper level of funding. The proposed legislation not only appears 
to put the cart before the horse with a five-year authorization, but it 
also loads the cart down with excessive baggage.
    The baggage is of course a tremendous amount of money. H.R. 2384 
would increase federal spending on the CPB by more than 60 percent next 
year.4 The legislation would increase funding by an 
additional $40 million in FY 2001--an increase of more than 13 percent. 
A one-year hike of 40 percent, or even 13 percent, is impossible to 
justify especially given that last week the Labor Department released 
data to show that there was no inflation for the second consecutive 
month.
---------------------------------------------------------------------------
    \4\ See also, Lilly, Aaron, M. ``He's Almost 31 Years Old: It's 
Time for Big Bird to Leave the Next,'' TAX Fact #22, Citizens for a 
Sound Economy, 1999.
---------------------------------------------------------------------------
    In addition, H.R. 2384 creates a formula that ensures that federal 
funding does not diminish even as alternative sources of funding for 
public broadcasting are realized. This is a poor approach. Not only 
does this guarantee that more taxpayer dollars are spent on public 
broadcasting, but it makes it impossible for public broadcasting to 
outgrow its history of dependency on federal support.
    Digital Technology Conversion. A transition to digital broadcast is 
cumbersome and expensive. The fact that it may be difficult for public 
broadcasters to invest in new equipment, systems, and training should 
highlight a larger problem. It is a problem faced by all broadcasters 
as the result of statutory deadlines. Authorizing and ultimately 
appropriating federal subsidies to any single class of broadcasters to 
aid in this transition is nothing more than a high-tech handout. 
Taxpayer dollars should not fund improvements to the physical plant of 
broadcasters.
    As recent as the President's FY 1999 Budget, $375 million was 
requested to subsidize this transition. The legislation before you 
today increases this give-away by $40 million.
    Obviously, supporters of H.R. 2384 view a transition to digital 
broadcasting as a problem to be solved with taxpayers' money. The 
contrary might be a healthier and more productive perspective. A 
transition to digital does not have to be a simple substitution for 
traditional analog broadcasting. In fact, the marketplace may support 
analog broadcasting for many years to come. Due to overhead, we might 
expect that every one of the $415 million authorized to the transition 
would not be invested in new equipment and systems. Yet, for a 
downstream share of revenues, it is entirely plausible that hundreds of 
millions of dollars of investment could be financed through private 
markets. It is not prudent to pour federal dollars into the conversion 
of public broadcasting to digital when alternatives have not even been 
entertained.
    If public broadcasters raised funds for their digital conversion 
through private markets, there would be at least three broad positive 
effects: First, taxpayers and the Congress could have a rough proxy of 
how consumers value the CPB and its affiliates.
    In 1995, Representative Jack Fields entertained private sector bids 
for portions of public broadcasting. The fact that at least three firms 
would have bid for all or part of PBS hints at the value of public 
broadcasting properties. Why should federal support continue if there 
are private firms and individual investors willing to pay a market 
value for public broadcasting?
    Second, a hybrid format--digital and analog programming--would 
create value in the economy rather than simply replace one set of 
programming with another. Make no mistake; the effect of this proposal 
would be to grow public broadcasting in America. It would however grow 
as a result of private and not public funds. While this is not the time 
for a lengthy discussion on spectrum management, it is imperative to 
point out that the highest degrees of spectrum flexibility must be 
available in the marketplace to encourage private investment.
    A third positive effect would be to allow public broadcasters to 
continue to reach the poorest Americans who would be the last to 
purchase new television and radio equipment. Digital conversion could 
be an opportunity to set the CPB free of federal subsidies instead of 
an obligation to spend more money.
    Financial Health. The CPB is doing quite well. At the end of last 
year, the CPB had $137,844,824 on hand.5 At the very least, 
past appropriations and other revenue streams should be considered as 
decisions are made about federal funding.
---------------------------------------------------------------------------
    \5\ CPB 1998 Annual Report, http://www.cpb.org/atwork/
annualreports/1998/fin--rep.html.
---------------------------------------------------------------------------
    It is a mistake to confuse the CPB with all of public broadcasting. 
The CPB operates as a funding conduit for PBS, National Public Radio 
(NPR), and their affiliates. The CPB is only one source of support for 
public broadcasting. When the rhetoric heats up, Big Bird, Barney and 
Masterpiece Theater make the headlines. However, it is also a mistake 
to think that the decisions made in this room will decide the future of 
a popular or high-quality program. Popular programs succeed in the 
marketplace.
    The end of funding for the CPB is not the end of public 
broadcasting. Consider that in 1997, only 7 percent of funding for the 
Public Broadcasting Service (PBS) came from the CPB.6 Yet, 
the FY 1997 operating revenues were up a total of $47 million over FY 
1996, an increase of 23 percent.7
---------------------------------------------------------------------------
    \6\ PBS 1997 Annual Report, http://www.pbs.org/insidepbs/
annualreport1997/highlights.html.
    \7\ ibid.
---------------------------------------------------------------------------
    To put this growth in perspective, if I grew 23 percent in the next 
year, I would be 7 feet, 7 inches tall. If the membership of the House 
grew at the same rate, there would be 100 additional members next year 
and this subcommittee would have 33 members.
    The total revenues for PBS in FY 1997 were in excess of $369 
million. The outright elimination of the PBS revenues from the CPB, 
nearly $25,900,000, is more than $11 million less than PBS' new 
operating revenues. There are more new revenues for PBS than the total 
amount of money from the CPB. This is ``due largely to growth in PBS's 
Learning Ventures activities, such as PBS The Business Channel, PBS 
Home Video and the PBS Adult Learning Service.'' 8
---------------------------------------------------------------------------
    \8\ ibid.
---------------------------------------------------------------------------
    PBS is growing. ``Total operating revenues, including program 
underwriting, reached $448 million in fiscal 1998, 30 percent above 
fiscal 1995's $344 million.'' 9 Its operating revenue ``grew 
$37 million in fiscal 1998 and $30 million in fiscal 1997, primarily 
through such non-station sources as video sales, fees for educational 
services, licensing arrangements and cable royalties.'' 10 
The combined $67 million growth in 1997 and 1998 and the 30 percent 
increase in operating revenues occurred while funding for the CPB went 
from $312 million in FY 1996 to $250 million in FY 1999.11 
Federal funding went down and operating revenues went up.
---------------------------------------------------------------------------
    \9\ PBS 1998 Annual Report, http://www.pbs.org/insidepbs/
annualreport/index.html.
    \10\ ibid.
    \11\ Note that the fiscal year for PBS ends on June 30, while the 
last day of the federal budget's fiscal year is September 31.
---------------------------------------------------------------------------
Alternatives and the Marketplace
    There are alternatives to federal support for public broadcasting. 
The realization of these alternatives may require that federal support 
be withdrawn. Why would a potential financial supporter of public 
broadcasting become an actual donor if there were an assurance of 
government aid? A rational person would likely withhold their donation 
and give it to another organization. It is plausible that federal 
support is not so much a crutch toward a healthy public broadcasting 
effort, but it is a handicap.
    This would explain how public broadcasting grows when subsidies are 
reduced. Alternative programming and content is also available. In the 
last decade alone, members of this committee have sponsored legislation 
to address cable television, direct satellite television, the Internet 
and its content, as well as radio licensing and spectrum management.
    Alternative Funding. There are alternatives to federal financing. 
Recent research by George Pieler outlines the far-reaching support that 
public broadcasting has within the giving-foundation community. Pieler 
writes, ``of grants to PBS, CPB and NPR reported by the Foundation 
Center, total 1996 grants ($18.1 million) were almost as large as 
combined grants for 1994 and 1995 ($20.1 million).'' 12
---------------------------------------------------------------------------
    \12\ Pieler, George, ``Big Bird Meets Cash Cows: Foundations, 
Corporations Respond to Fear Tactics,'' Foundation Watch, Volume IV, 
Number 4, April 1999, Capital Research Center.
---------------------------------------------------------------------------
    The CPB is preparing for a time when federal subsidies are reduced, 
if not eliminated. The CPB has dedicated funds to ``assist stations'' 
efforts to develop greater economic self-sufficiency in response to 
slowing industry revenues and potential reductions in federal and other 
sources of financial support.'' 13 These television and 
radio ``future funds'' totaled $10,728,408 in 1998.14 Only 
two years before, the total amount spent on future funds, including 
system support, was just over a half a million dollars.15
---------------------------------------------------------------------------
    \13\ CPB 1998 Annual Report, http://www.cpb.org/atwork/
annualreports/1998/fin--rep.html.
    \14\ ibid.
    \15\ The TV future fund was $218,450, the radio future fund was 
$199,772 and system support for the future funds $99,424. This 
information can be found in the 1996 CPB Annual Report, http://
www.cpb.org/atwork/annualreports/1996/statementactivities.html. It is 
not clear from the data provided what constitutes ``system support.'' 
However, it appears that approximately one fifth of the expenditures on 
the future self-sufficiency of CPB affiliates was spent on overhead.
---------------------------------------------------------------------------
    The future funds raise several questions. First and foremost, why 
are federal funds at the CPB being used to plan for the future of local 
stations? If the goal of this planning is to develop greater economic 
self-sufficiency, what measures are being used? Is the program meeting 
these measures? And if the program is successful with a particular 
station, then the funding that the CPB had previously dedicated to that 
station is no longer necessary. Therefore, the amount of taxpayer 
subsidies to the CPB should be decreased.
    If, on the other hand, there are no measures for success or if 
measures exist and the ``future funds'' program is a failure, federal 
funding should be decreased by at least as much as is being spent on 
the program. By itself, this one commonsense change would have saved 
taxpayers nearly $11 million last year.
    A final note about alternative means of support for public 
broadcasting: As I said before, there is some high-quality programming 
available as a result of public broadcasting and it is evident that the 
market would support this programming. It is ironic and a bit sad that 
the greatest defenders of the value created by public broadcasting are 
not found in the public broadcasting community. With every request for 
federal subsidies, a quiet assertion is made: Public broadcasting is 
not good enough to succeed without a handout. Public broadcasting is 
better than that. Quality programming succeeds every day without 
federal subsidies.
    All too often we fall into a trap and act as if the policymaking 
community knows better than the market how to value a product or 
service. The only way to determine an economic value is to allow 
consumers to choose freely in the marketplace. Consumers vote with 
their dollars and through the market process. The argument that the 
programming available on public broadcasting cannot be supported by 
private investment reveals the thinking of its advocates.
    In essence, this argument requires one of two assumptions. When you 
hear this argument, take note. Its advocates believe that either the 
programming is not good enough or that consumers do not know enough for 
themselves about what they need and that a benevolent, federally-funded 
public broadcaster can bring culture and education to them.
    If the former is the case, it is a sad statement on the programming 
that taxpayers have subsidized for the past 30 years. And if the latter 
is the case, it is a reprehensible, do-gooder, and elitist attitude 
that does not warrant the financial support of a self-respecting 
American government.
    Alternatives in the Marketplace. Nobel Prize winner George J. 
Stigler wrote, ``a monopoly is an enterprise that is the only seller of 
a good or service.'' 16 Whether public broadcasting enjoyed 
a monopoly on programs devoted to education, arts, nature and culture 
30 years ago is an interesting hypothetical question. Today, however, 
the market for programs devoted to education, arts, nature and culture 
is, to say the least, highly competitive. A full complement of 
technologies, programs and alternatives are available. With the 
exception of public broadcasting, most receive no direct subsidies from 
the federal government.
---------------------------------------------------------------------------
    \16\ Henderson, David, R. ed. ``The Fortune Encyclopedia of 
Economics,'' Warner Books, New York, 1993, page 399.
---------------------------------------------------------------------------
    Consider the following chart.17 An analysis by Bryan 
Riley at CSE Foundation found that cable television provides a 
competitive alternative to the programming of public broadcasting. 
Riley's analysis did not account for the hundreds of programs available 
through satellite television and could not have accounted for the 
Internet.
---------------------------------------------------------------------------
    \17\ Riley, Bryan, ``Time for Big Bird To Leave the Nest: 
Privatizing Public Television,'' Budget Impact Statement No. 14, CSE 
Foundation, March 6, 1995.

              Washington, D.C. Viewing Choices: March 5-11
------------------------------------------------------------------------
         Broadcast Time             PBS Programming    Cable Alternative
------------------------------------------------------------------------
2 PM Sunday.....................  ``The Lawrence      ``Brideshead
                                   Welk Show: Then     Revisited''
                                   and Now'' (WMPT).   (Bravo)
10 PM Monday....................  ``A Hard Day's      ``Great Battles of
                                   Night'' (WETA).     the Civil War''
                                                       (TLC)
10 PM Tuesday...................  ``Nightly Business  ``Business
                                   Report'' (WETA).    Tonight'' (CNBC)
10 PM Wednesday.................  ``John Tesh Live    The U.S. Navy's
                                   at Red Rocks''      First Jet Fighter
                                   (WMPT).             (Discovery)
2:30 PM Thursday................  ``Look & Cook''     ``Yan Can Cook''
                                   (WMPT).             (TLC)
10 AM Friday....................  ``Homestretch ''    ``Fitness Pros''
                                   (WHMM).             (ESPN)
6:30 PM Saturday................  ``This is Garth     The Metropolitan
                                   Brooks'' followed   Opera Performs
                                   by the Eagles in    ``Tosca'' (Bravo)
                                   concert (WMPT).
------------------------------------------------------------------------

    Consumers have a wide range of choices for educational material. 
Consider just a few numbers.
 Television. By 1997, televisions were in 98 percent of 
        American households. Thirty years ago there were three networks 
        but the addition of Fox and part-time networks like UPN and the 
        WB to the over-the-air market provide more choices and new 
        programming.18
---------------------------------------------------------------------------
    \18\ World Almanac, p. 188.
---------------------------------------------------------------------------
 Cable. In 1975, there were 3,506 cable systems in America. Ten 
        years later, there were nearly twice as many (6,600) and today 
        there are more than 10,000 cable systems that deliver cable 
        television to more than 67 percent of households.19
---------------------------------------------------------------------------
    \19\ ``The World Almanac and Book of Facts 1999'', World Almanac 
Books, p. 189.
---------------------------------------------------------------------------
 Cable. Two-thirds of households with income between $30,000 
        and $35,000 and three-fifths of households with income between 
        $20,000 and $30,000 have cable television in 
        America.20
---------------------------------------------------------------------------
    \20\ The 1998 Statistical Abstract of the United States, Table No. 
916.
---------------------------------------------------------------------------
 Video. In 1998, nearly 50 million videocassettes were rented, 
        up from 32.3 million in 1990.21
---------------------------------------------------------------------------
    \21\ Found at www.mpaa.org/useconomicreview/1998/sld029.htm.
---------------------------------------------------------------------------
 Internet. The Department of Commerce reports that traffic on 
        the Internet doubles every 100 days and that the World Wide Web 
        is growing at twice the rate of the U.S. economy.
    The wide availability of independent, unique, and community based 
content may be unmatched by the Internet. In just one small sub-set of 
programming--children's educational material--a quick search uncovered 
web sites such as:

 Pitara.com, a site for kids with an Indian perspective that 
        includes poetry, stories and special features on history and 
        culture;
 Exploratorium.edu, a self-identified museum of science, art 
        and human perception; and,
 Funbrain.com, where more than 30 educational games in eight 
        categories are free for kids in four different age groups.
    The Internet is not a substitute for Sesame Street. It is, however, 
a viable alternative that has done as much as any medium to change the 
marketplace for the programming that public broadcasting was created to 
provide.
Recommendations
    Unlike many policy issues that come before this committee, the 
future funding of public broadcasting presents an opportunity for a 
win-win situation. Public broadcasting is stronger without federal 
subsidies. At a minimum, a decrease would change the focus of public 
broadcasters toward the needs and desires of their audience and away 
from the tempestuous swirl of politics. Likewise, taxpayers would win 
with a reduction in the amount of government spending.
    Above all else, a change in the relationship of the federal 
government to public broadcasting should take into account the 
incentives of public broadcasters. Creative and pragmatic ideas to 
reduce federal subsidies should come from public broadcasters. These 
ideas should be solicited. Any proposal should have two key 
characteristics.

1. Move control of the CPB and its affiliates away from the government.
2. Decrease, to the point of elimination, federal subsidies for public 
        broadcasting.
    All proposals consistent with these simple guidelines should be 
considered. For example, if the CPB offered a proposal to make itself 
independent in three years, Congress might waive spectrum fees that 
result from auxiliary use of the spectrum.
    The Socratic adage that the unexamined life is not worth living 
might very well be applied to federal spending and the CPB. An 
authorization made without consideration of CPB's financial situation 
and the dramatic changes in the marketplace is an authorization not 
worth making.
    Thank you.

    Mr. Tauzin. I thank the gentleman.
    The Chair is now pleased to welcome Dr. Amy Jordan, senior 
research investigator for the Annenberg Public Policy Center in 
Philadelphia.

                   STATEMENT OF AMY B. JORDAN

    Ms. Jordan. Mr. Chairman and members of the committee, I 
appreciate the opportunity to testify before you today. My name 
is Amy Jordan, and I am a senior research investigator at 
Annenberg Public Policy Center of the University of 
Pennsylvania, and I direct research on children and television 
there.
    This is a topic that is not only a professional interest to 
me, it has personal relevance as well. I am the mother of three 
children, ages 10, 6, and 4, and over the years my family has 
come to appreciate, in many ways rely on, the PBS programs that 
are offered to my children.
    Since 1996, the Annenberg Public Policy Center has been 
tracking television for children. Each spring we conduct a 
national telephone survey with 1,000 parents and 300 of their 
children. We also conduct yearly consent analyses of the 
children's television available in one large market, 
Philadelphia, to determine whether and how children are being 
served by television. And more recently we have been assessing 
the impact of the FCC's processing guideline known as the 3-
hour rule.
    In my comments today I will summarize the Annenberg Public 
Policy Center's research on the role of television in 
children's lives, the state of children's television in 1999, 
and the unique and important position of PBS in the overall 
landscape of children's television.
    Television is a very important medium in the lives of 
America's children, even in this multimedia era. Children spend 
more than 2.5 hours each day watching television, and almost 
half of America's children have television sets in their 
bedrooms. Research in the academic community supports the 
notion that good television, television that is designed to be 
beneficial, really does make a positive contribution to 
children's lives. Unbiased research out of top universities 
indicates that such programs as Sesame Street, Barney and Mr. 
Rogers' Neighborhood boost children's cognitive processing, 
social skills and creativity. This research supports 
developmental psychologist Dan Anderson's contention that, 
quote, educational television is not an oxymoron, the way, as 
Congressman Markey said, commercial public television is an 
oxymoron.
    Children today certainly have a vast menu of programming 
from which to choose, particularly children who have cable. 
Though the majority of families with children do subscribe to 
cable, it is important to note that one-quarter to one-third of 
America's children do not have access to cable and that 
noncable homes are disproportionately disadvantaged. But having 
cable does not necessarily ensure that children have access to 
programs that are high-quality or educational.
    Our 1999 analysis revealed that approximately a third of 
cable's offerings for children were low-quality, containing 
violence, sexual innuendo, stereotyping and/or harsh language. 
This figure seems rather stark in comparison to PBS's 
programming. Not one of PBS's programs for children fell into 
that low-quality category. In fact, the vast majority of 
programs were of the highest quality, contained significant 
educational value, and free of problematic content child 
experts worry about.
    In our 4 years of research, PBS has consistently ranked No. 
1 as a contributor of the largest percentage of high-quality 
programs for children. No other venue, including Nickelodeon 
and Disney, offer such a large quantity and quality of programs 
for children as PBS.
    Our findings that PBS stations offer high quality 
educational programs resonates with parents who believe and 
have believed since we began our polling in 1996 that public 
broadcasting offers the best programming for their children. 
Not only does the largest proportion of parents feel that the 
best shows for children can be found on public broadcasting, 
when asked to name a good show for children, PBS programs come 
up more often than any others. Parents really like Sesame 
Street and Barney.
    Our research shows that during the last few years, 
children's television in general has begun to slowly improve. 
But the 3-hour rule has not yet produced sufficient broadcast 
programming for children to eliminate the need for the kinds of 
programs offered by PBS. Some of the commercial broadcasters' 
so-called educational shows really can't be considered 
educational by any reasonable benchmark. We found Jumanji 
labeled as educational because characters ``survive in the 
jungle by being creative and athletic.'' that was one 
commercial broadcaster's educational program.
    Our research shows that PBS's lineup of children's programs 
makes an important contribution to the landscape of children's 
television in at least two important ways. First, it serves a 
unique and broad audience, not just those children who are 
attractive to advertisers or who have access to cable. PBS 
strives to reach audiences of all ages with age-specific 
programs. Second, PBS tackles tough but important topics in 
their programming, subjects that might seem too risky for 
commercial broadcast networks: classic literature, science, 
cultural awareness, geography and history.
    In sum, the Annenberg Public Policy Center for Research 
indicates that PBS is consistently dependable as a source of 
quality television for children and widely trusted by parents, 
advocates, and scholars who see it as a safe harbor in an 
otherwise unpredictable environment. Thank you, Mr. Chairman.
    [The prepared statement of Amy B. Jordan follows:]
  Prepared Statement of Amy B. Jordan, Senior Research Investigator, 
       Annenberg Public Policy Center, University of Pennsylvania
                              introduction
    Mr. Chairman and members of the Committee, I appreciate the 
opportunity to testify before you today regarding H.R. 2384, The 
Corporation for Public Broadcasting Authorization Act of 1999. I am a 
Senior Research Investigator at the Annenberg Public Policy Center of 
the University of Pennsylvania, and I direct the research on children 
and television. I received my Ph.D. in Communications from the 
University of Pennsylvania in 1990, and have been with the Annenberg 
Public Policy Center teaching and conducting research on children and 
television since 1995. This is a topic that is not only of professional 
interest to me; it also has some relevance. I am the mother of three 
children--ages ten, six and four. We all appreciate and enjoy PBS.
                about the annenberg public policy center
    The Annenberg Public Policy Center (APPC) was established by 
publisher and philanthropist Walter Annenberg in 1994 to create a 
community of scholars within the University of Pennsylvania that would 
address public policy issues at the local state and federal levels. 
Since 1996, the Center has been tracking the availability and 
viewership of quality, educational television for children. Each 
Spring, we conduct a national telephone survey of over 1,000 parents of 
2- to 17-year-old children and over 300 of their children on their use 
and perception of television and other media. In addition, APPC 
conducts yearly content analyses of the children's television available 
in one large market--Philadelphia--to determine how children are being 
served by public and commercial broadcast television as well as basic 
and premium cable TV. More recently, we have been assessing the 
implementation and impact of the Three-Hour Rule; the FCC processing 
guideline that requires that commercial broadcast stations, seeking 
expedited license renewal, air a minimum of three hours a week of 
educational television for children.
    I will summarize the Annenberg Public Policy Center's research on 
the role of television in children's lives, the state of children's 
television in 1999, and the unique and important position of PBS in the 
overall landscape of children's television.
                  television in the lives of children
    Television is a very important medium in the lives of America's 
children. Even in 1999--in the multi-media context of computers and on-
line access, videogames and VCRs--children spend more time with 
television than they do with any other medium (on average, two and a 
half hours per day). In addition, nearly half of America's children 
have a television set in their bedroom (Stanger and Gridina, 
1999).1
---------------------------------------------------------------------------
    \1\ 29.4 percent of preschoolers; 46 percent of elementary school 
age children and 60.2 percent of adolescents have TVs in their 
bedrooms.
---------------------------------------------------------------------------
    Many child development experts say the average child spends too 
much time with television,2 but the parents we surveyed 
appear to be more concerned with what their children watch (70 percent) 
than how much they watch (18.9 percent). Parents' concern over what 
children can potentially see on television is reflected in the 
generally negative opinion they have of the medium. Only 16.5 percent 
of parents in our 1999 survey feel that there is ``a lot'' of ``good 
television'' for young people. Nevertheless, most feel that television 
can be a positive resource in the home, with the majority saying that 
their child's television viewing does ``more good than harm.'' 
3
---------------------------------------------------------------------------
    \2\ Stanford child expert William Damon, for example, says one and 
a half hours per day should be the upper limit (Damon, 1997).
    \3\ Parents of preschoolers are more likely to say that television 
does more good than harm than parents of older children. 72.3 percent 
of preschoolers' parents felt this way, compared to 63 percent of 
elementary school age and 52.8 percent of teenage viewers' parents.
---------------------------------------------------------------------------
    Research in the academic community supports the notion that ``good 
television''--television that is designed to be beneficial--really does 
make a positive contribution in the life of the developing child. 
Unbiased, carefully controlled studies on such PBS programs as ``Sesame 
Street,'' ``Mister Rogers' Neighborhood'' and ``Barney and Friends'' 
indicate that children's cognitive processing (Collins et al., 1997), 
social skills (Friedrich and Stein, 1973) and creativity (Singer & 
Singer, 1983) receive a boost as a result of children's viewing of 
these programs. This research supports developmental psychologist 
Daniel Anderson's contention that: ``educational television is not an 
oxymoron'' (Anderson, 1998).
    Given the increasing evidence of the benefits of educational 
television, one must consider whether parents have the choices and 
information they need to be able to find enriching, age-appropriate 
programming for their children.
                 the availability of quality television
    Children today have an astonishing number of programs produced and 
aired specifically for them. In the market we study--Philadelphia--
there are 29 channels offering 1,324 children's programs in an average 
week (279 of these programs are unique titles). The explosion of 
children's programming appears to be taking place on the cable front, 
where more than half (55 percent) of programs for children are aired 
(Woodard, 1999).
    Over the last two decades, children's access to cable has been on 
the rise. Our Spring survey indicates that the majority of families 
with children subscribe to cable (77.4 percent). However, it is 
important to note that nearly one-quarter of homes with children ages 
2-17 do not have access to cable television. Differences in cable 
access are predicted by the economic circumstances of families. APPC's 
research and Nielsen data show that homes without cable are 
disproportionately disadvantaged (Stanger, personal communication; 
Nielsen, 1996), probably because cable television is a non-essential 
monthly expense that would strain the resources of America's poorest 
families.
    Having cable doesn't necessarily ensure that children have access 
to programs that are predictably high-quality or educational, though it 
does ensure that children with cable TV have roughly twice the number 
of programs from which to choose. APPC's 1999 analysis of the quality 
and availability of television for children revealed that approximately 
a third of cable's offerings for children were judged to be of low 
quality (30 percent)--containing violence, sexual innuendo, 
stereotyping and/or harsh language. This figure seems rather stark in 
comparison to PBS's programming. Not one of PBS's programs for children 
fell into the low quality category. In fact, the majority of programs 
(80 percent) were evaluated as high quality--containing significant 
educational value and gender and ethnic diversity in the characters and 
devoid of problematic content that child experts worry about (Woodard, 
1999). In the four years during which the Annenberg Public Policy 
Center has tracked the quality and availability of programming for 
children, PBS has consistently ranked #1 as the contributor of the 
largest percentage of high quality programs (Jordan, 1996; Jordan and 
Woodard, 1997; Jordan, 1998; Woodard, 1999). No other venue--including 
Nickelodeon and Disney--offers children such large quantity and quality 
of programs for children as PBS.
   the state of children's television: quality, quantity and public 
                              perceptions
    Our finding that PBS stations offer high quality, educational 
programs for children resonates with the parents who believe--and have 
believed since we began our polling in 1996--that public broadcasting 
offers the best programming for their children (Hart, 1996; Stanger, 
1997; Stanger, 1998; Stanger and Gridina, 1999). Not only do they say 
that the best shows for young people can be found on public 
broadcasting, when parents of children ages 2-17 were asked to ``name a 
show that is best for your child'', two PBS programs--``Sesame Street'' 
and ``Barney and Friends'' have been the most frequently cited programs 
three years in a row (Stanger, 1997, 1998; Stanger and Gridina, 1999).
    Television for children is slowly improving, possibly the result of 
economic and regulatory forces. Annual content analyses have shown that 
over the years there has been a small drop in the proportion of 
programs for children that contain ``a lot'' of violence 4; 
and an increase in the number of shows that contain some enriching 
content. 5 Commercial broadcasters--such as those affiliated 
with Fox, ABC or WB--have begun airing three hours a week of 
educational television in order to receive expedited FCC review of 
their license renewal applications (Schmitt, 1999). We now see ``The 
Magic School Bus,'' ``Popular Mechanics for Kids,'' and ``Pepper Ann'' 
on the nation's free airwaves--a direct result of the Three Hour Rule 
(Jordan, 1999).
---------------------------------------------------------------------------
    \4\ In 1998, 32 percent of programs were judged to have ``a lot'' 
of violence. That number declined to 28 percent in 1999.
    \5\ In 1998, 46 percent were judged to have no educational value 
and in 1999 that number was down to 25 percent.
---------------------------------------------------------------------------
    This is good news for parents who try to minimize their children's 
exposure to violence and encourage their viewing of potentially 
enriching fare. For those who look, high quality, educational 
programming can be found all over the dial and almost any time of the 
day. The challenge is for parents to identify these educational 
programs and direct their children to them.
  guiding children to quality, educational programming: the challenge
    The Three-Hour Rule has not yet produced sufficient broadcast 
programming for children to eliminate the need for such programs on 
PBS. The E/I icon used to identify educational programming is often 
obtuse and unevenly applied. In addition, APPC's analyses revealed that 
one in five programs labeled as E/I by commercial broadcast stations 
could not be considered educational by the Annenberg Public Policy 
Center's benchmarks. This is not a new trend. As far back as the 
Children's Television Act of 1990 we have seen broadcasters creatively 
re-labeling cartoons or old family sitcoms as educational. In 1994, for 
example, The Center for Media Education found ``The Jetsons'' labeled 
as an educational program because it ``taught children about life in 
the 21st Century'' (CME, 1992). In 1999, two years into the 
implementation of the Three-Hour Rule, we found ``Jumanji'' labeled as 
educational because characters ``survive in the jungle by being 
creative and athletic'' (Schmitt, 1999).
    Until there is a market increase in the percent of homes with 
children that have access to cable and until the educational 
programming on broadcast stations is consistently educational, PBS is 
the only place parents can turn with confidence that what their 
children watch will be enriching.
              the disincentives for educational television
    In the absence of regulation, it seems that many commercial 
broadcasters feel that it is in their financial best interest to avoid 
children's educational programming. Research we conducted with 
advocates, producers, advertisers, academics and network executives 
prior to the passage of the Three-Hour Rule revealed an industry-wide 
conventional wisdom that educational programming is perceived as less 
lucrative than entertainment-only programming. The reason: educational 
television must, by definition, target a narrower audience in order to 
ensure that the lessons of the program are age-appropriate (Jordan, 
1996). The producers of ``Captain Planet,'' for example, say the 
audience for this superhero cartoon is all children ages two to twelve 
(Jordan, 1998)--a large enough audience to be attractive to 
advertisers. The producers of ``Bill Nye the Science Guy,'' by 
contrast, say their target audience is fourth graders (Schmitt, 1999).
    The conventional wisdom of the commercial television industry also 
dictates that the best way to capture the largest possible audience for 
advertisers is to program for boys, since, in the words of the 
interviewees, girls will watch boys' programs but boys will not watch 
girls' programs (Jordan, 1996). It is therefore no surprise that 
commercial broadcast and cable channels are populated with male-
dominated action/adventure series such as ``Batman'', ``Spiderman,'' 
``Superman,''--X-Men,'' and ``Beast Wars.''
  the unique contribution of pbs to children's television programming
    Because PBS does not rely on the support of advertisers in the same 
way as commercial broadcasters, it does not appear to abide by the 
dictates of conventional wisdom. Our research shows that PBS's lineup 
of children's programs makes an important contribution to the landscape 
of children's television in at least two important ways: it serves a 
unique and broad audience (not just those children who are attractive 
to advertisers or who can afford cable); and it offers them a diverse 
menu of programming (not only ``prosocial'' but also ``traditionally 
academic'' educational shows).
PBS Serves A Broad Audience of Children
    Content analyses indicate that PBS does not limit itself to serving 
one age group or even the lowest common denominator. Unlike those on 
commercial broadcast stations, PBS's programs reach children of all 
ages with age-specific programs--there are preschool programs such as 
``Sesame Street'' and ``Mister Rogers' Neighborhood;'' elementary 
school age programs such as ``Arthur'' and ``Zoom;'' even programs for 
pre-teens and teens such as ``Wishbone'' and ``In the Mix.'' By 
contrast, commercial broadcasters typically ``brand'' their channel for 
children of a particular age (for example, NBC focuses exclusively on 
programming for the oldest children). Because commercial broadcasters 
must rely on advertisers to support their children's shows (and because 
advertisers prefer the largest possible audience of six-to twelve-year 
olds), there are virtually no educational programs for preschoolers on 
broadcast stations beyond those provided by PBS. As one advertising 
executive put it in 1996: ``Two to five is not a real big target for 
advertising'' (Jordan, 1996:29).
PBS's Educational Programs are Unique and Diverse
    The PBS programs we have examined in our annual content analyses 
typically look novel and creative when compared with the fare offered 
through commercial venues. This is even the case when one compares 
PBS's educational programs with the educational programs offered by 
commercial broadcasters to satisfy the requirements of the Three-Hour 
Rule. Though three-quarters (75 percent) of the commercial 
broadcasters' educational programs are ``prosocial shows''--containing 
content that addresses children's social and emotional needs (Schmitt, 
1999)--PBS's shows are more varied and more likely to be tied to 
traditional academic curricula. One sees PBS programs tackling topics 
that might seem too risky for commercial broadcast networks: classic 
literature, science, cultural awareness, geography, and history. And 
unlike some of the commercial broadcasters' educational programs, these 
shows are carefully researched to ensure that the message is properly 
conveyed to and understood by the target audience (see, for example, 
research by Milton Chen on ``Square One TV''). PBS programs work on the 
development of basic letter and number concepts in preschoolers 
(``Sesame Street''); offer lessons nature, wildlife and the environment 
(``Kratt's Creatures''), address literacy and literature (``Reading 
Rainbow'' and ``Wishbone'') and deal with complex scientific concepts 
(``Bill Nye the Science Guy''). These are the sorts of programs that 
were envisioned by those who crafted the Children's Television Act and 
The Three-Hour Rule but only truly realized by PBS (Jordan, 1999).
                              conclusions
    Research at the Annenberg Public Policy Center over the past four 
years indicates that there are more high quality and educational 
programs as a result of changes in the economic and regulatory 
environment. Our four year program of research on children and 
television shows that parents are most likely to cite PBS stations as 
the best source of good programming for their children. When asked 
about programs they encourage for their children, parents quite 
frequently listed ``PBS'' (as a general station venue) or PBS programs. 
In addition, when asked to name high-quality, educational programs for 
children, we see in our surveys with parents and interviews with 
industry insiders and observers, that PBS shows are listed more often 
than any other venue of programming.
    It is clear from our research that PBS is a unique and important 
educational resource in the lives of our nation's children--
particularly those children who have comparatively few resources 
available in the home. PBS is consistently dependable as a source of 
quality television for children, and widely trusted by parents, 
advocates and scholars who see it as a safe harbor in an otherwise 
unpredictable environment.
    Finally, if you will allow me a personal note, I am a mother who 
relies heavily on PBS. It is a station that I know will offer my three 
children something more than brain candy. Indeed, I am convinced that 
Big Bird and Elmo and the gang at ``Sesame Street'' are responsible for 
not only teaching my children their A-B-Cs and 1-2-3s but also helping 
me convince them that cooperation is a win-win situation. The support 
you give to CPB and PBS translates into support for the parents of 
America--parents who are trying to do their best to help their children 
grow into smart, caring, productive young people.
    Thank you for giving me this opportunity to meet with you today.

                               References

    A.C. Nielsen. (1996) ``Top 100 Cable Television Children's 
Programs.'' Special Report to the Annenberg Public Policy Center.
    Anderson, Daniel. (1998). ``Educational Television is Not An 
Oxymoron.'' The Annals of the American Academy of Political and Social 
Science, Vol. 557, pp. 24-38.
    Center for Media Education (1992). ``A Report on Station Compliance 
with the Children's Television Act.'' Georgetown University Law Center.
    Chen, Milton. (1980). ``Television, Science and Children: Formative 
Evaluation for 3-2-1 Contact.'' Educational Technology Systems, Vol. 9, 
No. 3 261-276.
    Collins, P, J. Wright, D. Anderson, A. Huston, K. Schmitt, E. 
McElroy, and D. Linebarger. (1997). Effects of Early Childhood Media 
Use on Adolescent Achievement.'' Paper presented at the biennial 
meeting of the Society for Research in Child Development, April, 
Washington, DC.
    Damon, William. (1997). Remarks at The APPC Second Annual 
Conference on Children and Television, The National Press Club, 
Washington, DC.
    Fredrich, L.K. and Stein, A. (1973). ``Aggressive and Prosocial 
Television Programs and the Natural Behaviors of Preschool Children. 
Monographs of the Society for Research in Child Development, Vol. 38, 
No. 4.
    Hart Associates. (1996) ``Children/Parents: Television in the 
Home.'' Survey No. 1. Philadelphia, University of Pennsylvania, The 
Annenberg Public Policy Center.
    Jordan, Amy B. (1996). ``The State of Children's Television: An 
Examination of Quantity, Quality, and Industry Beliefs.'' Report No. 2. 
Philadelphia, University of Pennsylvania, The Annenberg Public Policy 
Center.
    Jordan, Amy and Woodard, Emory (1997) ``The 1997 State of 
Children's Television Report: Programming for Children Over Broadcast 
and Cable Television.'' Report No. 14. Philadelphia, University of 
Pennsylvania, The Annenberg Public Policy Center.
    Jordan, Amy B. (1998). ``The 1998 State of Children's Television 
Report: Programming for Children Over Broadcast and Cable Television.'' 
Report No. 23. Philadelphia, University of Pennsylvania, The Annenberg 
Public Policy Center.
    Jordan, Amy B. (1999). ``The Three-Hour Rule: Insiders' 
Perspectives.'' Report No. 29. Philadelphia, University of 
Pennsylvania, The Annenberg Public Policy Center.
    Schmitt, Kelly. (1999). ``The Three-Hour Rule: Is it Living Up to 
Expectations?'' Report No. 30. Philadelphia, University of 
Pennsylvania, The Annenberg Public Policy Center.
    Singer, Jerome and Singer, Dorothy. (1983). ``Implications of 
Childhood Television Viewing for Cognition, Imagination and Emotion.'' 
In Children's Understanding of Television, Anderson and Bryant, Eds., 
New York, Academic Press.
    Stanger, Jeffrey. (1997). ``Television in the Home: The 1997 Survey 
of Parents and Children.'' Philadelphia, University of Pennsylvania, 
The Annenberg Public Policy Center.
    Stanger, Jeffrey. (1998). ``Television in the Home 1998: The Third 
Annual National Survey of Parents and Children.'' Philadelphia, 
University of Pennsylvania, The Annenberg Public Policy Center.
    Stanger, Jeffrey and Gridina, Natalia. (1999) ``Media in the Home 
1999: The Fourth Annual Survey of Parents and Children.'' Survey No. 5. 
Philadelphia, University of Pennsylvania, The Annenberg Public Policy 
Center.
    Woodard, Emory. (1999). ``The 1999 State of Children's Television 
Report: Programming for Children Over Broadcast and Cable Television.'' 
Report No. 29. Philadelphia, University of Pennsylvania, The Annenberg 
Public Policy Center.

    Mr. Tauzin. Thank you, Dr. Jordan.
    Finally, Mr. Graham, director of Media Analysis Research 
Center here in Alexandria, Virginia.
    Mr. Graham.

                   STATEMENT OF TIMOTHY GRAHAM

    Mr. Graham. Thank you, Mr. Chairman, for allowing me to 
testify on short notice. It is nice to testify on behalf of the 
involuntary contributors to PBS as well as a panel of 
beneficiaries.
    For the last 12 years the Media Research Center has studied 
the problem of liberal bias in the national media. We have over 
16,000 tapes of television news programming and provide the 
public with evidence when national networks have failed to live 
up to their promises of objectivity and balance. Part of that 
effort has involved documenting the failure of PBS and NPR news 
and public affairs programming to live up to their promises, 
but unlike the other television networks, PBS is instructed by 
the Public Broadcasting Act of 1967 to provide objectivity and 
balance in all programming of a controversial nature. The other 
networks don't break the spirit of this law when they use their 
own airwaves to favor one political party over another.
    We are not here to debate whether the Democrats could offer 
counterexamples to the hundreds of examples of unfairness to 
conservatives. Has NPR's Nina Totenberg ever done to Democratic 
Supreme Court nominees what she did to Douglas Ginsburg or 
Clarence Thomas? Has WGBH's Frontline series ever suggested 
that a Democratic administration conducted an illegal foreign 
policy worthy of the suggestive title ``High Crimes and 
Misdemeanors''?
    We are not here to debate whether the Democrats could offer 
many Republican names at the top of PBS or NPR, which have 
resembled a revolving door of former Democratic partisans from 
Ervin Duggan and Delano Lewis to Douglas Bennet and Frank 
Mankiewicz. Contrary to the assertions of some congressional 
staff, this left-leaning public image of PBS and NPR is not a 
myth, but an image that is both well-earned and well-
documented.
    The newest revelations about public broadcasting have only 
deepened the public image of a PBS-DNC complex. These direct 
mail deals aren't just an outrage to conservative Americans, 
but to every American who expects public broadcasting to be a 
public trust free of partisan manipulation. These revelations 
expose the systemic failure of congressional and CPB oversight 
of public broadcasting. How else can we explain that PBS 
stations have been swapping direct mail names with Democratic 
fund-raisers back to 1981, almost 20 years, and this is 
suddenly an entirely new topic to the American people.
    This erupting PBS-DNC fund-raising scandal demonstrates 
what can happen when Congress and the CPB don't do enough to 
lift the veil of privacy that supposedly public stations draw 
around their own financial arrangements. Behind our back PBS 
stations have constructed an indirect form of taxpayer finance 
campaigns, at least for the Democrats, like Senator Boxer, but 
the lack of oversight means the taxpayer here has been asked to 
put up and shut up. If it hadn't been for that 4-year-old fan 
of Barney and Friends who was asked to donate to the Democrats, 
this committee would be adding a half billion dollars to the 
CPB budget without a hearing like this.
    This committee's efforts to authorize a substantial 
increase should be halted until this full-scale investigation 
can take place. This year's forward appropriation should be put 
on hold until Congress is satisfied that these list-swapping 
practices with Democrats and other liberal interest groups as 
were reported today, Planned Parenthood and so on, have been 
fully investigated, exposed and halted, and I endorse the idea 
of a GAO investigation, and I hope--I guess that the IRS is 
presently investigating, at least in Boston.
    While CPB should be expected to probe this matter, Congress 
should not count on CPB alone for results. In its confused 
standing as a private corporation that distributes hundreds of 
millions of tax dollars, CBS does not answer--CPB does not 
answer to the Freedom of Information Act, and in its current 
form CPB sees itself as a quote/unquote heat shield protecting 
the public broadcasting system from the scrutiny of Congress 
and the people that it represents.
    Even the most extreme examples of outrageous content have 
drawn only inaction from CPB. When Los Angeles public station 
KFBK a couple of years ago broadcast African Mental Liberation 
Weekend, which viciously attacked Jews, the president of CPB 
Richard Carlson said, I believe the problems that would be 
created by monitoring content--the problems created by doing 
this are limitless, and I would expect despite their words here 
today that their investigation of station fund-raising 
practices would have the same reluctance to jeopardize these 
stations' standing before congressional appropriators.
    In recent days we have heard of the possibility of 
outlawing public station list-swapping, but if Congress employs 
that remedy, what will be the punishment? The public outrage of 
these practices should not be disposed through sterile 
statutory language with no more legal force than the original 
mandate for balance in the 1967 Public Broadcasting Act.
    Clearly these outrageous stands we have heard, these 
practices we have heard of today show no fear of congressional 
or CPB oversight. Boston station WGBH was swapping lists with 
the Democratic National Committee at the same time that House 
Speaker Newt Gingrich had pledged to zero out taxpayer funding. 
Obviously WGBH, when this full story came to light, explicitly 
lied to Congress and the American people. It was not a one-time 
misunderstanding but at least a 5-year practice. This is not 
what we have heard today, errors or stupidity. If it was 
stupidity, it was decades of stupidity.
    Mr. Tauzin. The gentleman's time has expired. Would the 
gentleman kindly wrap?
    Mr. Graham. Thank you.
    I just wanted to say that we hope that Congress would 
explicitly condemn individual stations for these practices and 
seek some way either through Congress or through the CPB to 
punish the individual stations by reducing or eliminating their 
funds. Thank you, sir.
    [The prepared statement of Timothy Graham follows:]
  Prepared Statement of Tim Graham, Director of Media Analysis, Media 
                            Research Center
    For the last twelve years, the Media Research Center has studied 
the problem of liberal bias in the national media. We have over 16,000 
videotapes of television news programming and provide the public with 
evidence when the national networks have failed to live up to their 
promises of objectivity and balance. Part of that effort has involved 
documenting the failure of PBS and NPR news and public-affairs programs 
to live up to their promises. But unlike the other television networks, 
PBS is instructed by the Public Broadcasting Act of 1967 to provide 
objectivity and balance in ``all programming of a controversial 
nature.'' The other networks don't break the spirit of this law when 
they use their own airwaves to favor one political party over another.
    We're not here to debate whether the Democrats could offer counter-
examples to the hundreds of examples of unfairness to conservatives. 
Has NPR's Nina Totenberg ever done to Democratic Supreme Court nominees 
what she did to Douglas Ginsburg and Clarence Thomas? Has WGBH's 
``Frontline'' series ever suggested that a Democratic administration 
conducted an illegal foreign policy worthy of the suggestive title 
`High Crimes and Misdemeanors'? Why did PBS offer live testimony of 
hearings on Watergate and Iran-Contra and not the Senate's 1997 
hearings of the DNC's Chinese-fundraising scandal?
    We're not here to debate whether the Democrats could offer many 
Republican names at the top of PBS or NPR, which have resembled a 
revolving door of former Democratic aides, from Ervin Duggan and Delano 
Lewis to Douglas Bennet and Frank Mankiewicz. Contrary to the 
assertions of congressional staff, this left-leaning image of PBS and 
NPR is not a ``myth,'' but an image that is both well-earned and well-
documented.
    The newest revelations about public broadcasting have only deepened 
the public image of a PBS-DNC complex. These direct-mail deals aren't 
just an outrage to conservative Americans, but to every American who 
expects public broadcasting to be a public trust, free of partisan 
manipulation. These revelations expose the systemic failure of 
congressional and CPB oversight of public broadcasting. How else can we 
explain that PBS stations have been swapping direct-mail names with 
Democratic fundraisers for 20 years and it's an entirely new topic?
    This erupting PBS-DNC fundraising scandal demonstrates what can 
happen when Congress and the Corporation for Public Broadcasting have 
done very little to lift the veil of privacy that supposedly ``public'' 
stations draw around their own financial arrangements. Behind our 
backs, PBS stations have constructed an indirect form of taxpayer-
financed campaigns, at least for the Democrats. But the lack of 
oversight means the taxpayer is asked to put up and shut up.
    If it hadn't been for a four-year-old fan of ``Barney and Friends'' 
who was asked to donate to the Democrats, this committee would be 
adding a half-billion dollars to the CPB budget. This committee's 
efforts to authorize a substantial increase should be immediately 
halted until a full-scale investigation can take place. This year's 
forward appropriation should be put on hold until Congress is satisfied 
that these list-swapping practices with Democrats and other liberal 
interest groups have been fully investigated, exposed, and halted.
    While CPB should be expected to probe this matter, Congress should 
not count on CPB alone for results. In its confused standing as a 
``private corporation'' that distributes billions of tax dollars, CPB 
does not answer to the Freedom of Information Act. In its current form, 
CPB sees itself as a ``heat shield''--protecting the public 
broadcasting system from the scrutiny of Congress or the people it 
represents.
    Even the most extreme cases of outrageous content have drawn only 
inaction from CPB. When Los Angeles public station KPFK for two years 
in a row broadcast an ``Afrikan Mental Liberation Weekend'' which 
viciously attacked Jews, CPB President Richard Carlson declined to 
actually monitor on-air content: ``I believe the problems that would be 
created by doing this are limitless.'' I would expect their 
investigators of station fundraising practices to have the same 
reluctance to jeopardize the stations' standing before congressional 
appropriators.
    In recent days, we've heard of the possibility that public station 
list-swapping with political organizations would be explicitly outlawed 
by Congress. But if Congress employs that remedy, what will be the 
punishment? The public outrage at these practices should not be 
disposed through sterile statutory language with no more legal force 
than the original mandate for balance in the 1967 Public Broadcasting 
Act.
    PBS stations clearly have no fear of Congress. Boston station WGBH 
was swapping lists with the Democratic National Committee at the same 
time that House Speaker Newt Gingrich had pledged to zero out taxpayer 
funding. When this new story first came to light, WGBH officials 
explicitly lied to Congress and the media by citing the list-swapping 
not as a five-year practice, but as a one-time ``misunderstanding.'' 
Congress must explicitly condemn individual stations for these 
practices and punish them by seeking to reduce or eliminate their 
federal funding.
    We believe that public broadcasting showcases the worst traits of a 
public-private enterprise. It mixes billions in public funding with 
private-sector notions of financial privacy. The recent list-swaps 
underline yet another way in which public stations are used for private 
gain. The proper congressional response should be vigorous efforts to 
insure that public broadcasting is not just a partisan tool, being 
secretly used as a tax-funded political organizing base.
    But that's what it's been for 20 years or more. It's awfully hard 
to claim PBS liberalism is a ``myth'' when its supporters are coveted 
as top money prospects for the Democrats. This is the classic PBS way 
of doing business: using a nonpartisan, tax-funded operation to feather 
the Democratic nest, whether it's on-air propaganda or off-air wheeling 
and dealing.
    WGBH, where this expose began, is not just Boston's PBS affiliate. 
It is a massive commercial enterprise, a flagship of the nation's 
public broadcasting system. Conservatives know them best for putting 
out ``Frontline,'' a liberal-tilting documentary series. WGBH is a 
particularly blatant example of a station that doesn't need tax 
dollars. It's rolling in corporate and foundation contributions. In his 
new book, ``Masterpiece Theatre and the Politics of Quality,'' PBS 
critic Laurence Jarvik notes that WGBH is the largest producer of 
programs for the PBS system, gets over $10 million annually from Mobil, 
has a total budget of over $100 million, and gets some 90 percent of 
its funding from someplace other than CPB.
    So why do they need to exchange fundraising lists with the 
Democrats--and why would they lie? When first confronted by the 
practice--when a 4-year-old ``Barney'' fan received a fundraising pitch 
from the DNC when his mom contributed $40 to WGBH--the station's 
spokesmen lied. Jeanne Hopkins told The Washington Times, ``we have a 
policy against exchanging names with political or religious groups. 
This was in violation with our own policy. It was a misunderstanding.'' 
But this was not a one-time mistake. The Boston Globe reported that 
WGBH has been swapping names with the DNC since 1994. Five years of 
misunderstandings? More to the point: It began when the station went to 
the DNC for names, not the other way around.
    The current status of CPB funding is especially sad, considering 
the promises just four years ago that CPB was on a ``glide path'' to 
zero federal funding. This seems to happen over and over again. A March 
2, 1981 Time magazine article noted that the Reagan administration 
aimed to reduce the CPB's roughly $160 million budget by 25 percent. 
While cuts were implemented, the 1995 debate began with the reality 
that the CPB budget was $285.6 million. ``Cuts'' don't last.
    The CPB remains perhaps the federal government's best example of a 
program that can't cry it's needy. In the 1980s, public television's 
total income more than doubled, despite early Reagan budget cuts, from 
$581 million in 1980 to $1.26 billion in 1990. Such an infusion of 
money makes it very difficult for public broadcasters to construct 
doom-laden scenarios of bankruptcy in the face of privatization.
    Much of the current CPB appropriation could be made up simply by 
striking better licensing deals with producers. ``Nonprofiteers'' are 
making a mockery of the ``noncommercial'' nature of PBS. Forbes 
recently reported that Barney the Dinosaur was the third largest 
grossing entertainer in the United States, over a billion dollars, and 
CPB has only raised $1.6 million from the show's producers. The big-
dollar beneficiaries actually thrive on the government seal of 
approval: the Licensing Letter found that in children's TV, PBS shows 
do better in merchandising than private network shows. ``Sesame 
Street'' outmerchandised everything but ``Jurassic Park'' in 1993. 
Ironically, that noncommercial patina means big money.
    Bill Moyers, who jumped ship to NBC News at a time when his profits 
could come under scrutiny, has made a small fortune off PBS Home Video 
royalties, as well as book spinoffs from series like ``Healing and the 
Mind'' and (ironically) ``The Secret Government.'' Asked to divulge his 
profits, Moyers has proclaimed he is an ``independent businessman'' and 
doesn't have to comply. For unintentional laughs, one couldn't top 
Moyers, hosting the show ``Project Censored,'' asking New York Times 
reporter Tim Weiner with a straight face about the Pentagon: ``Did you 
find that the secrecy...actually increased the possibilities for 
profiteering and fraud?''
    PBS is now a lucrative avenue for intellectual product placement, a 
Liberal Home Shopping Club. In the summer of 1992, ``Listening to 
America with Bill Moyers'' focused two programs on liberal Philadelphia 
Inquirer reporters Donald Barlett and James Steele. Their book 
``America: What Went Wrong?'' became an immediate paperback best-
seller. Rolling Stone writer William Greider, who constantly decries 
the corrosive effect of money on politics, hosted a two-hour 
``Frontline'' special based on his book ``Who Will Tell the People,'' 
which also became a best-seller. (His political pull with PBS producers 
and its cash value were not mentioned in the book). Exposure pays: in 
the 18 months before he joined the White House staff, ``MacNeil-Lehrer 
NewsHour'' commentator David Gergen earned $1 million, mostly from 
speaking fees. Time on PBS is money, and PBS ought to be getting a much 
better deal for its valuable national airtime.
    But CPB frowns on the idea of private-sector success in public 
broadcasting, striking savvy deals to offset tax dollars. Minnesota 
Public Radio raised eyebrows a few years ago by plunking down $12 
million for WLOL, a station in the middle of the FM dial. But CPB 
President Richard Carlson complained about MPR's success with its 
``Wireless'' catalogue, telling The Washington Post: ``It's damn hard 
to go up on the Hill and ask for millions of dollars when they're 
making millions of dollars off Beethoven T-shirts.''
    The Republicans' now-forgotten intention to privatize PBS has 
turned a much-needed spotlight on the public broadcasting elite's 
arrogance toward congressional oversight and indifference to public 
complaints. If they refuse to answer the public's demand for answers on 
their questionable practices, that is an excellent reason why they 
should be removed from the federal budget, so they can be accountable 
to no one but themselves, the way they like it.

    Mr. Tauzin. The Chair thanks all of the witnesses.
    Let me first recognize myself for the appropriate 5 
minutes.
    Mr. Graham, I don't disagree with you. I think your 
recommendations are solid. We are going to have to outlaw this 
practice. I think there also needs to be sanctions. I am 
disappointed that the Corporation for Public Broadcasting was 
not prepared to suggest that sanctions were in order when a 
station violates its own publicly disclosed policy and then 
lies about it, or at least discloses only part of the story in 
an effort to dismiss it. I want to correct you, however. This 
committee was not prepared to give another half billion dollars 
to public broadcasting without appropriate review. We were 
beginning a markup process in which there was going to be a 
great deal of discussion as to the appropriate authorization 
levels, not spending levels which are settled at the 
Appropriations Committee, and perhaps it is time to straighten 
that out.
    The bill we offer included a 12--less than 12 percent 
increase in authorization levels from the 1996 authorization, 
and even that number was very much subject to amendment and 
discussion by the committee. The disclosure what happened in 
Boston obviously calls for additional hearings. It is a good 
reason for us to be doing this today, and the gentleman from 
California, Mr. Cox, asked for, and we are happy to help him, 
with additional witnesses on the very subject you, Mr. Lassman, 
and you, Mr. Graham, have brought to us today.
    The question is what is the role of public broadcasting and 
the CPB in a multimedia era where there are, in fact, many 
channels of communications that were not available when public 
broadcasting was first initiated.
    Mr. Burns, let me turn to you and ask you to respond to Mr. 
Lassman. Mr. Lassman has made a strong case that there are, in 
fact, many outlets for the kind of programming that you 
yourself produce. And perhaps you can comment on that. Could 
you have produced the Civil War series for commercial 
television if you had--would it have been different? Why did 
you have to--or why did you go to public broadcasting to do it 
and the other works you have produced for public broadcasting?
    Mr. Burns. That is a very good question, Mr. Chairman. Let 
me just state categorically there is no other place on the dial 
that could have produced the Civil War series or any other 
series. It is true that there are many other outlets now. There 
have been for as long as I have been making films; the last 25 
years there have been other things.
    A couple of things. I am working on a film right now on 
Mark Twain. Mark Twain said, the difference between the right 
word and almost the right word is the difference between 
lightning and a lightning bug. Public television to me is that 
lightning. It is free of commercial interruption. I would 
suggest that every one within the sound of my voice understands 
the basic principle that all meaning in our lives accrues in 
duration. The things that you and I are most proud of, the work 
we have done, the relationships we have come from our sustained 
attention, but where else do we find a completely free 
attention span? For three generations now, more than three 
generations of commercial television, we have insisted of our 
children that they be interrupted--and not just our children, 
but ourselves--that we be interrupted every 8 minutes by 6 or 8 
new messages completely unrelated to the----
    Mr. Tauzin. But public television is doing more than that. 
Public television and radio are doing more and more, advising 
us more and more that they are being underwritten by corporate 
sponsors, and the corporate sponsors give us these fine 
products. They are looking more and more like advertisers; are 
they not?
    I will let you respond, Mr. Lassman.
    Go ahead, Mr. Burns.
    Mr. Burns. I agree there has been corporate sponsorship 
acknowledgments at the beginning and end of programs, but we 
are not going to the symphony or to Shakespeare to be 
interrupted by those messages within the content, and that is 
where PBS has held the line.
    Mr. Tauzin. The big difference is simply that it is an 
uninterrupted programming?
    Mr. Burns. Among many, many other things. I also feel it is 
free of the kind of influences that Mr. Duggan suggested to 
Congressman Largent; that the variety, the patchwork quilt of 
funding, not just government, but private foundations, 
individuals, and corporations, that insulates us from the kind 
of influence and interference that we feel and I have felt 
every time I have moved outside of this oasis.
    Mr. Tauzin. Mr. Graham would argue that there are some 
influences influencing the course of NPR and public 
broadcasting in general, and that they are not necessarily 
always wholesome.
    Mr. Graham. I think Mr. Largent's videotape showed that 
this is what we have in the system. That is not something that 
I think we would all sit our children down to watch. This is 
the sort of thing where Mr. Markey suggests that our--he listed 
all the Jerry Springer programs. If we listed what PBS 
broadcast a couple of weeks ago during Gay Pride Week, Sunday, 
Monday, Tuesday, Wednesday, Point of View, they had a list of 
gay rights liberation celebration programming, and it is funded 
explicitly by the Government of the United States through the 
National Endowment of the Arts and other Federal agencies.
    Mr. Tauzin. Mr. Lassman, you want to respond. You all can 
respond. Go ahead.
    Mr. Lassman. Mr. Chairman, I have two very quick points. I 
think this is a very serious issue that Mr. Burns is raising. I 
will draw your attention to the fact that I got caught, and 
much like many of you several weeks ago, I sat down for the 
entire afternoon and watched the World Cup. I was caught up in 
the hysteria. I was caught up in the excitement. It was 
wonderful. There weren't commercials. It was on broadcast 
television. At the top of the program, occasionally during the 
middle of the program, there were announcements of who the 
underwriters were.
    My second point is much more serious, and I don't want to 
try and outquote Mr. Burns on Thomas Jefferson, but it was 
Jefferson who taught us that the enduring wisdom of America is 
held in its people's hearts. And I for one think that people 
can decide for themself. They know whether they are being 
tricked. And it is not a matter of commercialism. It is other 
sources of funding. Thank you for the time.
    Mr. Tauzin. Ms. Jordan wanted to respond.
    Ms. Jordan. I also want to talk about the commercial 
influence on children's television. The kinds of shows that one 
sees on public broadcasting versus commercial broadcast 
stations are qualitatively very different in part because of 
economic disincentives for educational programming on 
commercial broadcast stations. We have seen through research 
that in the absence of regulations like the Children'S 
Television Act and the 3-hour rule, educational programming for 
children disappears because by definition, educational programs 
for children have smaller audiences. They need to be more 
narrowly targeted, and advertisers don't like that. They also 
don't like to have programs that don't have toys or other 
products associated with them. So we see a much greater 
diversity and a much narrower age targeting of programs on PBS 
for children.
    Mr. Tauzin. Mr. Markey?
    Mr. Markey. Thank you, Mr. Chairman, very much. You know, I 
am just going to make a few observations, Mr. Chairman. First 
of all, Mr. Lassman, in soccer there are no time-outs, you see. 
So if they put on commercials, you would be interrupting the 
game, but at half-time, they made up for it. You got a lot of 
commercials at half-time in the soccer match. So it is just a 
little bit different sport, and as Americans, we are just 
getting used to the fact that soccer just breaks into two 45-
minute halves. And I never knew this either, but we will just 
have to adjust the way we think about commercials, but they 
make up for it before and after and in the middle of the game. 
They do put ads up in the middle of the screen right up there 
in the corner. They were keeping it going right throughout the 
game.
    You know, Mr. Graham, here is the thing. I know you are 
just going down this litany of Democrats, but I would have 
sworn that Richard Carlson, Republican, was the chairman of CPB 
for 7 years. Mr. Coonrod replaced him. He was a good man. I 
know he ran for mayor of San Diego as a Republican, and I know 
his son, Tucker Carlson, is on CNN almost every day, and he is 
a good man. But we were able to work with Mr. Carlson. I 
thought that he was a very good representative of the 
Corporation for Public Broadcasting for all those years.
    And I know that you don't want to mention the fact that 
William F. Buckley has his own show on public broadcasting, or 
Wall Street Week, which I really don't think you could call a 
liberal Democratic program or even--and it probably 
disappointed you a little bit that, you know, Mr. Burns here 
and his baseball series balanced out Mario Cuomo by also having 
George F. Will on as an expert.
    But nonetheless, I think when you look through the totality 
of the programming, especially if you look at the children's 
programming from early in the morning until 6 at night, you are 
hard-pressed really. I am sure there are isolated instances 
that tick people off, by the way, on both sides, not one. But 
on the totality of the programming, I think people just think 
of it as high-quality science, art, news, children's 
programming, with a little bit of stuff once in a while that 
ticks people off. But they don't want this thing cut. They 
don't want it eliminated. They don't want Big Bird put out 
there and fried on a skillet and left to fend for themselves in 
the open market. I don't think that is what this is all about.
    You know, maybe you guys don't remember the history of 
this, but the Federal Communications Commission back in 1983 
took all the rules off the books that said that commercial 
broadcasters had to have children's programming every week, and 
you know what happened once the free market was able to 
determine whether or not they were going to put on any 
educational programming for children? They just dropped it for 
the most part. They said, we just can't make money doing this. 
We can't pull this off. And so in 1990, this committee and the 
Congress, we had to pass another law, the Children'S Television 
Act, that ultimately has been implemented to say that each 
commercial station has to put on 3 hours a week. Remember, PBS 
has on about 12 hours a day, not the 3 hours a week, and they 
do it under a Federal mandate; that is, the commercial 
broadcasters.
    And in addition, again I have to keep coming back to this 
point, we agree there is a lot of great children's programming 
on cable. Nickelodeon's great. Discovery is great. But 35 
percent of the children in America live in homes that do not 
have cable. Moreover, those children tend to skew much younger 
and poorer than the children in middle-class and upper-middle-
class America. As we reach a day when the industrial age is 
ending and the information age, the new economy is unfolding, 
it is clear that as a counterpart to voting for GATT and NAFTA 
and this global trade which quickly erodes the older industrial 
base in our country, that we have a responsibility to ensure 
that we are giving every child, regardless of income, 
regardless of ethnicity, access to the skill set that helps to 
democratize access to information and job skills and jobs 
ultimately in this new economy.
    That is what PBS is all about. It is recognizing that the 
bottom third may not have as much access to this cornucopia of 
programming, excellent as it may be, which is on cable, but 
just not affordable for many Americans.
    So, you know, when you are making your presentation, 
whether it be Democrat/Republican, or liberal/conservative or 
cable versus broadcast, you have to make these distinctions. 
You have to be clear that you are presenting the totality of 
the programming and the access to it, because I love William F. 
Buckley, and I love Ruckheyser, and I love all of that. I have 
watched it since I was a boy, and I have learned from it, but I 
don't believe in any way that my mind was poisoned because I 
heard a different point of view that my mother or father were 
giving me, which were hard-core blue-collar Democrats. It just 
exposed me to other ideas. But my fundamental grounding 
ultimately, the educational basis, the base that my parents had 
given me, allowed me to understand this larger context, this 
larger world that was being created on PBS for free, for the 
children of the blue-collar and the poor in America.
    So I just make that again as a statement, Mr. Chairman, and 
I hate to get up here and keep doing that, but we have got to 
set the right context so that people understand what this 
debate is really all about. Thank you.
    Mr. Tauzin. The gentleman's statement time has expired.
    Mr. Sawyer. What happened to I Love Lucy?
    Mr. Tauzin. The Chair will allow any witness who wishes to 
respond briefly, and then I have to move on.
    Mr. Graham. Mr. Markey, the reason my statement said we 
weren't here to debate this, because if we were here to debate 
this, we would be here for a long time.
    Mr. Markey. But like Cicero, you raise all of the 
complaints and said, of course I will never raise these issues, 
and you leave it out here unanswered.
    Mr. Graham. This is a concern which conservative taxpayers 
do not feel they get the time----
    Mr. Tauzin. The gentleman's time has expired.
    Mr. Markey. Brother Earl told me never allow a Ciceronian 
presentation to go unanswered.
    Mr. Tauzin. The gentleman's time has expired. The Chair has 
been trying to be generous and allow the witnesses to respond 
to him, but we can't get into this, or we can't move on.
    Any other gentleman or the lady wishes to respond to Mr. 
Markey?
    Mr. Graham. I simply disagree with his statement. That is 
the whole issue. It is not just the bias and the content, but 
the bias now that is represented by WGBH trading lists with the 
Democrats. What it shows you naturally here is that the public, 
the audience of PBS, the donors of PBS are a naturally liberal 
audience. As the Congressman from Wyoming pointed out, we have 
no idea who these Republican groups are that supposedly are 
trading lists with WETA, but we know these audiences are 
natural fund-raising targets for liberal organizations. It just 
proves to you that liberal garbage out, liberal garbage in.
    Mr. Tauzin. Mr. Lassman you want to make a final comment? 
Anyone else?
    Mr. Burns for five.
    Mr. Markey. That is a Pat Buchanan characterization that 
Bob Dole is a liberal.
    Mr. Burns. Mr. Chairman, I have been involved in public 
television for 20 years, and for 20 years I have lived in the 
conservative State of New Hampshire. I have not seen the 
evidence of the vast conspiracy that Mr. Graham has described 
today. In fact, I have seen in many instances the opposite, not 
just the many fine programs that Congressman Markey mentioned, 
but a general sense among many of my colleagues in the 
filmmaking community that PBS is a rather conservative 
institution that is afraid of the kind of new ideas that I 
agree completely with Mr. Markey that any public debate, 
particularly in a free country, ought to be not only tolerant 
of but welcoming of.
    Mr. Tauzin. The Chair will recognize the gentleman from 
Oklahoma for questions. Mr. Largent.
    Mr. Largent. I would like to say at the beginning of my 
comments by saying I am a fan and consumer of your product. It 
is a very good one. I appreciate it.
    Mr. Burns. My daughters thank you as well.
    Mr. Largent. But I want to ask you some questions about 
your testimony, because one of the things that you said is 
that, first of all, you said you didn't think that you could 
have produced a Civil War documentary any other way than the 
way you in fact did. And yet also in your testimony, you said 
it was the most widely viewed PBS series in history. That 
doesn't seem to make sense because advertising dollars follow 
the consumers.
    Mr. Burns. I think in some ways they have reacted to the 
success of the Civil War and have now gone to places--not just 
to public television where, of course, history has grown leaps 
and bounds in the last two decades, but they have gone to other 
outlets. I would suggest that many of these fares are thin, and 
because they are interrupted by commercials, less effective 
than the Civil War.
    I think the Civil War was successful for a number of 
reasons not the least of which is that this is the great trauma 
in the childhood of the Nation, and we all stopped for a second 
to consider who we were. But I think it was the public 
television environment. I couldn't get anyone to even listen to 
me for the years it took me to produce that film, or indeed the 
7 or 8 documentaries I made before that. I couldn't even get in 
the door.
    Mr. Largent. But you wouldn't have that same problem today.
    Mr. Burns. No, but I would not be my own master. What 
public television is not is this vast Federal monolithic thing 
imposing a Federal view of how Americans should see themselves 
on TV, but the sum total of all the programming. What public 
television allowed me to be was myself; that is to say 
unfettered by some producer who is going to say make it sexier, 
make it longer, make it shorter, make it less violent, make it 
more violent.
    Mr. Largent. Let me ask you this question. It didn't appear 
that General Motors fettered you at all, and they underwrote 
Civil War, didn't they?
    Mr. Burns. They provided approximately 30 percent of the 
budget.
    Mr. Largent. Did you feel fettered?
    Mr. Burns. Not at all.
    Mr. Largent. Why not?
    Mr. Burns. Because the way public television is set up by 
its business affairs practices prevents General Motors, indeed 
any underwriter, from affecting the content. But that is not 
true once you have entered into the commercial realm where a 
sponsor--as you know, through the long history of television, 
sponsors have exerted tremendous pressure in every way, and we 
have a phrase in film making which we call LCD, lowest common 
denominator. The reason why I am in public television and will 
stay in public television for as long as it is public 
television is because we do not pander to the lowest common 
denominator, and that, at the end of the day, allows me to do 
the kind of work that I think reaches you. If I had gone 
another route, I don't think you would have seen the same 
quality thing. I don't think you would have felt it or been 
obliged to come back or to comment favorably.
    Mr. Largent. Let me follow up with that and say what I am 
trying to do is enhance public television, but not doing it on 
the backs of taxpayers, and I think there is a way to do that. 
There is a middle road, I think, that we can find here that 
doesn't interrupt programming, which is a convenience and is an 
issue, but at the same time takes the attractiveness of 
programs that you do and others and fuses some commercial 
dollars without the LCD factor thrown in there.
    Mr. Lassman, you had a comment?
    Mr. Lassman. Mr. Largent, I would ask you to imagine with 
me a private setting, not a commercial setting, but a private 
setting, just as my home is private. It is not a commercial 
place to go. And public broadcasting in America can become 
something of a United Way, collecting and raising and 
distributing private funds. The difference is that a United Way 
doesn't rely on taxpayer dollars and that Good Housekeeping 
stamp of approval that says to General Motor,s this is a 
quality product, it will meet its deadlines. We have some 
oversight that can still be done in a private way, and that 
middle ground, I encourage you to seek it out.
    Mr. Largent. Well, that is a good analogy, but it is not 
entirely true. Having served with United Way for a number of 
years, that is not an exactly accurate picture of what takes 
place.
    Mr. Chairman, if I could just have a little more time here.
    Mr. Tauzin. Without objection, so ordered.
    Mr. Largent. Mr. Burns, I guess I just wanted to conclude 
by saying that, you know, there is a strong support across the 
aisle, both sides of the aisle, for, Corporation of Public 
Broadcasting, but we are looking to try to find a way to 
enhance the product without just simply increasing taxpayer 
subsidization of that, and I think at the end of the day we 
might be able to find that middle road, and I would encourage 
you to help us through that process.
    With that I would just would yield back my time, Mr. 
Chairman.
    Mr. Burns. Mr. Largent, I would love to be involved and 
feel that I am involved in that conversation, in that working 
out, in that debate, but I really wanted to stress again that 
this is really a unique system, and while 14 percent of the 
public television's budget comes from the Federal Government, a 
great deal more of my budgets do, and I would not be able to 
make the films without that kind of support.
    Mr. Tauzin. The gentleman's time has expired.
    The gentleman from Michigan Mr. Dingell is recognized.
    Mr. Dingell. Thank you, Mr. Chairman.
    Mr. Graham, I enjoyed your comments very much, and I wanted 
to thank you for them. I particularly noted your comments seem 
to indicate a great deal of outrage at the fact that the lists 
were traded or sold. Is that correct?
    Mr. Graham. That would be our understanding.
    Mr. Dingell. And you also expressed a great deal of outrage 
that they were traded with Democratic organizations. Is that 
right?
    Mr. Graham. In this case, the Democratic National 
Committee. The Republican organizations were still waiting to 
figure out if they exist.
    Mr. Dingell. I noted that Mr. Dole, his committee, was one 
which exchanged lists. How do you feel about that?
    Mr. Graham. If I am not mistaken, Mr. Dingell, the Dole 
search happened after the Boston Globe story in May. That is my 
present understanding.
    Mr. Dingell. Let's just understand. You either are outraged 
that Mr. Dole exchanged lists with public broadcasting, or you 
are not. Which is the case?
    Mr. Graham. What I am saying to you is that if this list 
was offered to your average conservative fund-raiser, they 
would not exchange it, because it is not a lucrative list for a 
conservative fund-raiser.
    Mr. Dingell. It just said--I just note that Mr. Dole's 
campaign exchanged lists. Bob Viguerie fund-raiser superfile. 
Are you outraged about them exchanging lists? Conservative 
Republican superfile exchange, golden age Republicans exchanged 
lists, Republican Party builders exchanged lists, and great 
American donors. I assume you are not outraged about them?
    Mr. Graham. I am familiar with Mr. Viguerie. I am not 
familiar with any of the others, so I can't tell you whether 
those organizations, whether they have the Republican in the 
title are actually conservative fund-raisers or not. The point 
being that this is a practice----
    Mr. Dingell. Are you outraged if those groups exchanged 
lists with public broadcasting, or are you not?
    Mr. Graham. I am saying yes.
    Mr. Dingell. You are. Up until now, I got the impression 
that your outrage was the fact that there had been exchanges 
with Democrats.
    Mr. Graham. It is my understanding that the Republican 
National Committee has exchanged no list. You found in your 
questioning earlier there were no major Republican 
organizations keeping----
    Mr. Dingell. Please keep your red herrings at the committee 
table. I am talking about----
    Mr. Tauzin. The gentleman controls the time. Mr. Dingell 
knows how to control the time. The gentleman Mr. Dingell has 
the time.
    Mr. Dingell. Thank you.
    Can you tell us whether you are outraged about these lists 
being exchanged with these groups that I have just mentioned?
    Mr. Graham. I said that I believe it is wrong for public 
broadcasting to switch its lists with any partisan 
organization. What I am also saying is----
    Mr. Dingell. All right. Now let's talk about you. Do you 
exchange your lists with partisan organizations?
    Mr. Graham. I imagine that our organization relying on 
direct mail would do list exchanges, but not with Federal 
agencies or audiences of Federal television.
    Mr. Dingell. You're a 503(-c), are you?
    Mr. Graham. Right.
    Mr. Dingell. That means that you are tax-exempt?
    Mr. Graham. Yes.
    Mr. Dingell. And not only are your activities tax-exempt, 
but your donors' contributions are tax-exempt?
    Mr. Graham. Correct.
    Mr. Dingell. So you are outraged about the fact that CPB 
gets a subsidy from the Federal Government. You get a subsidy 
from the Federal Government, too, by being tax-exempt.
    Mr. Graham. I pay taxes.
    Mr. Dingell. Are you outraged about that?
    Mr. Graham. I am outraged that I pay taxes that goes to 
WGBH, who trades lists with the Democrats. There is a 
difference between conservative groups trading lists with each 
other and federally subsidized stations doing it with the 
Democrats. There is a difference.
    Mr. Dingell. But they traded--I note here that they traded 
with Dole. Now, Mr. Dole, if my memory serves me correctly, was 
a Republican candidate for President. Bob Viguerie is a well-
known conservative Republican, conservative Republican 
superfile. Now, it may perhaps be that you should be outraged 
that the country club Republicans have been exchanged. And the 
golden age Republicans, they obviously are dupes of the liberal 
fronts. But it seems to me that there is a dichotomy in your 
statements that I am having a hard time understanding.
    Now, if I were to make a contribution, a tax-exempt one of 
$75, according to your Web sites, I would receive, amongst 
other things, a bumper stick that declares John Dingell to be, 
and I quote, a proud member of the vast right-wing conspiracy; 
is that correct?
    Mr. Graham. That is correct.
    Mr. Tauzin. The gentleman's time has expired. He asked for 
an additional minute. Without objection so ordered.
    Mr. Graham. And he may join the conspiracy.
    Mr. Dingell. Could you tell me whether that is a political 
statement?
    Mr. Graham. That is a political statement.
    Mr. Dingell. Political statement. And it is subsidized by 
taxpayer dollars by making you tax-exempt.
    Mr. Graham. Yes. I am not exchanging a list with WGBH.
    Mr. Dingell. You have indicated earlier that you objected 
strongly to the fact that CPB should be tax-exempt.
    Mr. Graham. I think what we said--I think what I said in my 
statement was that CPB needs to do a better job of accounting 
for these sorts of activities. I don't think I referred 
necessarily to the tax exemption of CPB. I did complain about 
the Freedom of Information Act exemption that they seem to 
have.
    Mr. Dingell. I see.
    Mr. Chairman, you have been most kind. It has been a most 
enlightening discussion. I want to thank Mr. Graham for 
clarifying his position and for certain continued obfuscations. 
Thank you.
    Mr. Tauzin. I hope you get your bumper sticker. It might 
explain why Bob Dole lost. He bought the wrong list.
    The gentlelady Mrs. Cubin is recognized.
    Mrs. Cubin. Thank you, Mr. Chairman. I find myself in a 
very difficult position on this issue, and I guess it wouldn't 
be an issue if there weren't multiple sides.
    Let me tell you what I think about this and ask for some 
answers and some help. I think most of you probably heard 
Heather Wilson's opening statement about the situation between 
the geographics and the demographics in rural areas, 
particularly in areas where there are a high level of poverty 
in Indian reservations and so on, and the access to television 
through the cable and through satellites, and some places that 
public television is the only thing that is available. My 
district is very much like Mrs. Wilson's, only more rural. And 
so I really accept the need for something like--or for PBS.
    I agree that what's available for arts and culture and 
education for children has changed since 1967, though, and like 
Mr. Largent said, I am not sure that there isn't a better way 
to expand it. But the concern that I have, while we can look at 
the goods of this type--good qualities, I should say, of this 
type of broadcasting when there are abuses, and I absolutely 
believe there have been abuses, then it is bad, and it 
jeopardizes the entire system, just as it has right now, with 
people sitting here wondering what the Congress is going to do 
and you know, some of those abuses.
    With all due respect to Dr. Jordan, her testimony stated 
that her studies or that their studies showed that children's 
educational programs for PBS was age-specific and appropriate, 
and that there was not inappropriate sexual content, but when I 
saw the video that Representative Largent showed us, I have to 
tell you I don't think that it was age-specific for 5- and 6- 
and 7-year-olds to be hearing about the gay lifestyle, and I 
don't think that it is appropriate sexual content when they are 
talking about a soccer ball, and I bet those poor kids had no 
idea what gay even meant.
    So there are abuses. Obviously another abuse is--at least 
in my opinion--is the political trading of these lists. Whether 
it is Republican or whether it is Democrat, I don't care. I 
have trouble viewing the DNC as equivalent to any of the 
organizations that were named that received or that traded 
lists. So I want to preserve the access to areas, especially 
rural and poor areas. I want to preserve the type of 
programming that you, Mr. Burns, talked about, uninterrupted 
and unfettered by someone else in what you do. I think there is 
definitely a role for them and a place for that in this country 
today. I am not sure it is the structure that we currently 
operate under.
    My opinion is we need to smack the heck out of people--not 
out of people, but those stations. We need to smack the heck 
out of the ones who have abused this, whether it is the people 
who put on the programming like the video that we saw, or 
whether it is the stations that traded lists, and I want to ask 
you, Mr. Graham, what kind of punishments should there be for 
those? Because I see that as protecting the system in the first 
place and also respecting the opinions of people who have a 
different opinion than what I agree to be the liberal bias of 
the public broadcasting system.
    Mr. Graham. Sure. And I think it is important to sort of 
address Mr. Markey's idea that conservatives complaining about 
liberal bias are somehow afraid of liberalism. I think really 
what they are saying, if there is going to be a diverse 
channel, that we would see more conservative voices. And they 
always bring up Firing Line at 2 on a Saturday afternoon, which 
really isn't even on the direct feed, and compare it to their 
blockbuster programs like WGBH.
    I think that, as Mr. Oxley pointed out today, these 
stations that we are talking about smacking the heck out of are 
the most successful, largest public television stations in the 
country. WETA in Washington, WGBH in Boston, WNET in New York, 
these are--they produce the majority of the programming that 
people see, and so--and they are the ones that probably are the 
ones that are least needy when it comes to the Federal 
appropriation.
    But it seems to me that the only way we can reach through 
this system is to say CPB awards these people Federal funds 
through community service grants, et cetera? I don't know. We 
have a system right now where there is not a direct 
appropriation from Congress to the station. There is an 
appropriation to CPB. CPB appropriates to the stations, and as 
I said earlier in my testimony, you can have a raving wake of 
antisemitism, and the funding for these specific stations has 
stayed the same because how can Congress--Congress can't do 
anything about that.
    That is what Ken Burns wants. He wants a system where he 
wants to be the master, and the American people who pay for it 
aren't the master. They have no say over what programming goes 
on television, and I think--so there has to be an 
investigation, and there has to be some sort of way we can 
punish the individual stations through the funding mechanism. I 
don't know if there is any way it can be done in the present 
system. That is the problem that we are addressing in 
testimony.
    Mrs. Cubin. I have to say that what I feel, I think, the 
worst about is rather than CPB saying, this is wrong, here's 
what we are going to do about it, and we are going to do 
something, that the supporters seem to say it is okay, or 
because the service is so good, the service that is provided is 
so good, that the tactics are okay. I don't think that is true.
    Mr. Tauzin. The gentlelady's time has expired. Any witness 
that wants to respond to her may do so.
    Mr. Lassman. Thank you, Mr. Chairman.
    Mrs. Cubin, what I have heard today, especially in your 
last comment, is broad consensus on ends. Many of us agree on 
the programing for what it may be, that it should be out there. 
We differ on the means. And we have talked specifically about 
the means through a funding process. I want to challenge you to 
think with me about a means in a different way, and rather than 
proposing public policy to fix it, and rather than going 
forward and making some sort of new policy in this committee 
and in this Congress, it is possible to lift things off and to 
pull back, and I recommend to you to get very involved in the 
work that comes before this committee on data transfer and more 
the telecommunications side of things.
    Broadcast technologies are more than 100 years old. 
Satellite, direct satellite, cable, telephone wires, the 
electrical grid, cable, again these technologies can deliver 
voice. They can deliver video. They can deliver sound, 
everything. And what we are talking about on the other half of 
this committee, subcommittee, is how do we move regulations off 
of the firms that want to come in and provide service. It is 
not just broadcasters.
    Mr. Tauzin. The Chair now is pleased to welcome the 
gentleman from Ohio Mr. Sawyer for a round of questions.
    Mr. Sawyer. Thank you, Mr. Chairman.
    I have to tell you I have enjoyed the exchange. I can't say 
that I agree with you, Mr. Graham, but you bring a vitality to 
this discussion that is healthy, and I think it is good that 
you and Mr. Markey had the opportunity to share with one 
another as you did.
    Let me ask Mr. Burns to comment on one of your concerns 
that you expressed in your last comments, and that was that Ken 
Burns wants to be the master, as though this was a negative 
desire, something that would be damaging to the quality of 
product that the public is exposed to. Would you care to 
comment on that, Mr. Burns?
    Mr. Burns. I was just trying to express as a craftsman, as 
an artist, how one would want to do one's work. But I think you 
also have to realize that we submit to rigorous oversights in 
all of these projects, oversight that is never required in any 
marketplace situation that I know of. That is the oversight of 
historical consultants. I get a good deal of my funding, or 
have until funding was severely cut back, from the National 
Endowment of Humanities, which required rigorous proposals.
    I am currently working on a history of jazz. The proposal 
went to 400 pages, and they have given us for our Civil War 
series 30 percent of our budget. Now it is about 6 percent of 
our budget, but we were willing to submit our entire project to 
those kinds of historical scholarly controls. We work with 
other artists, other writers that influence that. But at the 
end I wanted to be free of those kind of mercantile decisions 
that seem to always leave one with a bad taste, of length, of 
sexiness, of violence, of commercial interruptions, all of 
those sorts of things, and I have stepped out, I have moved and 
explored opportunities in other realms and have come back 
instantly to public television as literally an oasis where I 
can do the work that I want to do.
    And this sort of sense--we are the sum total of all of the 
programs that we have made, not the mistakes of a few people, 
and I agree with everyone here, this is a terrible mistake, but 
the public trust has invested in the quality of those programs.
    Let me just repeat, this is the best children's 
programming. What could be more important? The best children's 
programming among hundreds of channels. This is the best news 
and public affairs, balanced. Everyone would agree, from CEOs 
to farmers in the Midwest. This is the best history, the best 
science. These are the high-rated programs. The program, Mrs. 
Cubin, that you brought up that Representative Largent showed 
is not, in fact, a public-television-sponsored program, from 
what I understand, and I am more worried about my daughters 
being exposed to the much more outrageous issues than that one 
finds daily in the kind of listing of programs that Congressman 
Markey brought up in his opening remarks many hours ago.
    Mr. Sawyer. Let me just make an observation, Mr. Chairman. 
We keep talking about the great asset of public television 
being its quality, and it has produced quality. But it seems to 
me that the greatest asset that it brings over the last 30 
years has been the capacity to experiment, to let people who 
are indeed, to the degree that they can, be their own master, 
bring their product, and let it compete in an environment where 
being free of commercial interruption is nice, but being free 
of commercial pressure is critical. And it is the ability to 
bring to a viewership, that may not have been yet developed and 
proven in the marketplace, a product that will develop that 
audience. It is as much as anything a freedom to fail in that 
environment, to fail in the commercial environment--in a test 
of audience as it is to succeed with it. The freedom to fail 
just does not exist in the commercial environment. You make 
money or die.
    Mr. Burns. If I may respond, this is a system that is very 
much like our Federal and our public political system. I think 
today we have been dealing with the tensions between States 
rights and the Federal, how much control these guys have over 
all of those individual States. But it also reflects us, and so 
it is necessarily going to reflect some of us at different 
extremes, at different times and be abhorrent, perhaps, to some 
of us at different times or turn us off at different times or 
make us angry. But for the most part I have noticed in 25 years 
of being very much involved but utterly independent from this 
system that it is reflecting us in all our diversity.
    Henry Adams said in the middle of the 19th century, there 
are grave doubts at the hugeness of the land and whether one 
government can comprehend the whole. It is a great anxiety that 
has come down to us in this late 20th century, too, and I feel 
that there are very few institutions that are able to if not 
comprehend the whole, that make a good attempt to do that.
    And it sometimes fails. I agree, Congresswoman, and that is 
part of it. I think the ability to fail is built into that 
system, just as it is into our political system, but that is 
our strength.
    This is a system that 80 percent of Americans tune into at 
least once every month. It is supported by 70 percent of 
Republicans and 80 percent of independents and 90 percent of 
Democrats. There is just a few of us, Mr. Graham included, that 
don't find value in this system, and that is a wonderful thing, 
and I love the fact that my public television is a complicated 
and diverse mirror of who we all are.
    And, yeah, we will make mistakes, just as we all do in the 
political process here, but we are out front here. We are 
saying, boy, we made a mistake here, but judge us by the 
quality of those programs and free us, liberate us, from the 
tyranny of this perpetual fund-raising nightmare that leads us 
down these ridiculous alleys and makes the kind of mistakes 
that these people have so clearly made.
    Mr. Sawyer. Thank you, Mr. Chairman.
    Mr. Tauzin. The gentleman's time has expired. The Chair 
will take a little liberty as we wrap up the session today, and 
I will invite any other comments the members want to make. 
First I want to recognize the vice chairman of the full 
committee Mr. Gillmor, who is present, and I want to 
acknowledge his presence with us today.
    First of all, we are dealing in a free-speech society with 
an institution that receives Federal funds to speak to us, 
Federal taxpayer dollars, not dollars surrendered voluntarily, 
surrendered under an extraction system called the IRS and 
brought here to Washington and spent to speak to us. It is 
because public broadcasting has that special role in a free-
speech society that it comes under all these kinds of tensions, 
I think. Is it speaking to us in a way that is objective? Is it 
speaking to us in a way that is unbiased? Is it speaking to us 
in a way that is uncompromised by the political processes that 
might compromise it from the right or the left? And the trust 
that Americans have that public broadcasting does so, Mr. 
Burns, in all the eloquent ways that you have described that it 
ought to and very often does speak to us, the trust that it 
will continue to do so is literally on the table before us 
today, and it has been damaged. It is like a patient who had 
been bleeding for a little while, and I suspect until this 
investigation is over, there will be more blood spilled as we 
find out that not 53 stations, but 60 and 70 and perhaps a heck 
of a lot more have been guilty of trading the names of its 
subscribers away to others to use for political purposes or 
what have you.
    When we began the process of reauthorization, Mr. Markey 
and I had hoped that we could have a full discussion of public 
broadcast reform. We hoped we could really engage the Congress 
into deciding which of the schizophrenic type of approaches we 
have taken to public broadcasting was the correct one, whether 
we ought to fund it more and make it less commercial, or 
whether we ought to free it for more Federal funding and let it 
go its own way, as some of you have suggested.
    In the context of those reforms, we talked about the 
possibility of a trust fund set up somehow that public 
broadcast viewers would not be constantly seeing 
advertisements, that public broadcasters would not constantly 
have to try to imitate commercial broadcasters in their 
programs. It wouldn't be competing against commercial 
broadcasters for advertiser dollars or commercially viable 
products in the marketplace. It quickly became apparent to us 
that the commercial television world nor the public television 
advocates were prepared for that discussion.
    It is important we talk about the commercial television 
world in that discussion. The commercial television world is 
being told by Mr. Markey in his 1990 act to do some public 
things. Educational television. It is as though we don't have 
public broadcasting doing it. We need the commercial world 
doing it, too, under public mandate, determined on a quality 
basis. And so we had hoped to have that discussion, whether it 
was really the role of commercial broadcasters to do that 
business, or really was it the role of public broadcasting; and 
if it was the role of public broadcasting, could we allow 
public broadcasting to become more and more commercialized and 
less and less what it was intended to be. We are not going to 
obviously have that full discussion, but we are going to 
obviously have some discussion as we move this process forward.
    My intention initially was to bring out a simple 
reauthorization bill, to define the maximum limits in the 
reauthorization bill of what Congress could appropriate to 
public broadcasting. Not to appropriate. I make that clear, Mr. 
Graham; define the maximum limits. That was all we were going 
to do, and this committee was going to settle where those 
maximum limits were. We started with the request of Public 
Broadcasting Corporation. We started with their request, and we 
suspected that request would come under some very good and 
useful and productive debate. We would end up passing a 
reauthorization bill, the likes of which we had passed in 1996, 
which would set some limits for the appropriators to go 
forward. We thought it was critical to do it because public 
broadcasting faces the same challenge that commercial 
broadcasters face in migrating into a digital world, and what 
are they going to look like in a digital world? Can they 
multicast? Will they be permitted to multicast or simply pass 
through programming? We thought it important to begin that 
debate.
    And then this scandal erupts of public broadcast stations 
engaged in the process of trading away the confidential names 
and addresses and heaven knows what other personal information 
about their subscribers to anyone, Mr. Graham, anyone and 
several consequences enter into that.
    One, let me suggest to all of you who are here who were 
part of the first panel and may still be representing the first 
panel. I don't think this committee is going to report a bill 
that says you can sell or exchange your lists to anybody other 
than political people. I think it is going to say, stop selling 
or exchanging your lists. So get ready for that. I don't think 
this committee is going to likely say that we are not going to 
punish all the public broadcasting for the sins of a few or of 
the many who may end up being guilty, but we are going to let 
those people go free, too. I think there is going to be some 
sanctions imposed somewhere in here, and think there is going 
to be some very clear language about what public broadcasting 
can and cannot do when it comes to associating with political 
parties, if that isn't clear enough already.
    I suspect Mr. Stearns' idea of some sort of watchdog public 
interest body to make sure that public broadcasting stays 
within the channels of its mandate, that it doesn't, in fact, 
become an arm, a vessel or a microphone for any political party 
or interest in this country is probably going to happen, 
something in the legislation. And I should think we are going 
to have a debate, as Mr. Largent has pointed out, as to whether 
or not we are going to move to more commercialization or less 
commercialization, as to whether or not we let public 
broadcasting depend less on Federal funds and more on 
commercial dollars, and what effect that has on public 
broadcasting.
    So we are in for a series of pretty interesting debates 
now, and maybe that is good. Maybe that is timely. Maybe it is 
about time it happens. In that regard, we are going to have 
another hearing in which we are going to invite people who 
present programming like public broadcasting to come and tell 
us their story about what they are doing in this modern age, 
and how they can reach kids with educational programs, and what 
they are doing to inform and educate and render the kind of 
cultural statements that we ought to be rendering about 
ourselves if we are going to understand the whole of our 
society, as Mr. Burns pointed out.
    So we are going to hear the counterclaims, and then we are 
going to begin a good debate, and this committee will make 
hopefully some good decisions. I don't know how it is going to 
turn out, but I invite you all, I particularly invite the 
commercial broadcast community if you are within my ear range, 
cable interests, all of you to be thinking about your 
particular role in this exercise. If we tell public 
broadcasting you no longer depend upon Federal funds at some 
point, you are on your own, then what will we require of 
commercial broadcasters and cable companies when it comes to 
educational programs, for example? If we tell public 
broadcasting, you no longer rely upon Federal funds, will we 
have any right to tell them to quit trading the names of their 
citizens to anybody or to conduct themselves in a way that is 
bipartisan or not biased? Do we take us down that trip, that 
road, and do we like the result?
    There will be some good discussions, and to the extent that 
you have helped us and started us along that path, I want to 
thank you all today. We appreciate your testimony.
    Any final comments by any other members? The hearing stands 
adjourned.
    [Whereupon, at 3:45 p.m., the subcommittee was adjourned, 
subject to the call of the Chair.]
    [Additional material submitted for the record follows:]



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