[Congressional Record Volume 140, Number 145 (Friday, October 7, 1994)]
[Senate]
[Page S]
From the Congressional Record Online through the Government Printing Office [www.gpo.gov]


[Congressional Record: October 7, 1994]
From the Congressional Record Online via GPO Access [wais.access.gpo.gov]

 
                   ``PORK'' FOR THE WASHINGTON POST?

  Mr. BYRD. On another matter, Mr. President, I have been the object of 
some very derogatory editorial writing on the part of the Washington 
Post recently. On September 21, 1994, the editorial page of the 
Washington Post labeled as mere ``pork'' certain provisions in the 
fiscal year 1995 Transportation appropriations bill. In trying to 
create a mountain out of a molehill, the Post's editors called me ``the 
King of Pork.'' Now, the shoe is on the other foot, and dirt of another 
molehill is creating muddy going for the editors of the Post.
  The Washington Post is now, apparently, guilty of using the same 
editorial page to urge the speedy passage of the GATT world trade 
agreement, although time for further inspection of this lengthy piece 
of legislation reveals a $900 million loophole that favors--whom? The 
Post's parent company, a fact that the Washington Post editorials 
failed to acknowledge. A provision inserted into the GATT implementing 
legislation--which is not subject to amendment or changes in 
conference, as are provisions in the appropriations bills--requires 
companies to pay only 85 percent of the average price of wireless 
telephone licenses in upcoming auctions, and no less than $400 million. 
But this is a far cry from the estimated $1.3 billion than those 
licenses might fetch in a free market. And the Washington Post was not 
even happy with that compromise. They had argued that those licenses 
should be given away, with no payment at all to the Government. Is 
this, then, ``Pork'' for the Post?
  Mr. President, I ask unanimous consent that two articles from the 
Washington Post dated October 5 and October 7, 1994, be printed in the 
Record.
  There being no objection, the articles were ordered to be printed in 
the Record, as follows:

                [From the Washington Post, Oct. 5, 1994]

                   The Trade Bill * * * and the Post

       The House remains scheduled to take up the trade bill 
     today, and vote on it possibly tonight. That's what it ought 
     to do. Some members have urged that the vote be put off until 
     after the election, as was done in the Senate. They ask why 
     the House should have to cast in advance a hard vote that the 
     Senate won't cast until afterward. But the vote won't be any 
     easier then. Nor will it be any less necessary.
       The bill incorporates into U.S. law the terms of the new 
     world trade agreement. Through worldwide tariff cuts--the 
     largest tax cut in history--and various other means, the 
     agreement is expected to generate a strong expansion of the 
     U.S. and world economies. The fear among some is that it will 
     cost the United States jobs; in fact it will have the 
     opposite effect. Nor will it lead to the erosion of U.S. 
     sovereignty they profess to foresee, a weakening of health 
     and safety, labor or environmental standards or a higher 
     deficit. In the long run, the growth will likely reduce the 
     deficit.
       This newspaper has been attacked in recent days from 
     several quarters on grounds that our editorial support for 
     the trade bill masks and is the result of a provision that 
     would benefit The Washington Post Co. That's just plain 
     false, as some of those making the charge best know. The 
     paper has been a strong and tireless, if not actually 
     tiresome, supporter through three administrations and eight 
     years of the international negotiations that have now given 
     rise to this bill. More than 400 editorials have been 
     published in that period on the subject of trade. Virtually 
     every one has been tilted in the direction of freer trade; 
     many have endorsed provisions now part of the trade 
     agreement; all but a few of these several hundred appeared 
     before the bill and the revenue provision in question were 
     even drafted.
       We on the editorial page try to keep abreast of provisions 
     in which The Post Co. has a commercial interest so that we 
     can acknowledge them when they arise. Usually we do so and we 
     failed to do so here; it was a mistake. What we should have 
     known and said about the trade bill provision is as follows:
       It involves the price that will have to be paid for a 
     license to provide advanced cellular telephone service by a 
     company in which The Post is a major investor and 70 percent 
     limited partner. The critics describe the price as a deep 
     discount; The Post Co. looks at it as anything but. The 
     license was originally supposed to be free. It was one of 
     three awarded by the Federal Communications Commission in a 
     national competition meant to encourage companies to invest 
     in new wireless technology. After the company in which The 
     Post has its interest won the competition, the FCC changed 
     its mind and said it would charge for the license. The 
     possible proceeds were then seized upon by the administration 
     and others looking for future revenues to offset the tariff 
     losses under the trade bill. The license fee in the bill will 
     be less than the fee would have been as proposed by the FCC. 
     But the provision that officials of rival companies are 
     calling a gift, Post company officials regard instead as a 
     breaking of the government's word and a dunning.
       But break or dunning, the revenue provision was not a basis 
     for the editorial. Nor does it seem to us to be a basis for 
     voting either way on the bill. We continue to think, as we 
     have all along and for the same reasons, that the trade bill 
     ought to pass.

              [From the Washington Post, October 7, 1994]

  Post Taken to the Pillory--Paper Criticized on Trade Pact Provision

                           (By Howard Kurtz)

       The Washington Post, which delights in exposing secret 
     deals on Capitol Hill, suddenly finds itself accused of 
     participating in one.
       A media furor has developed over a provision involving the 
     GATT world trade agreement that would provide what critics 
     call a windfall for three firms, including a Post Co. 
     subsidiary, that are seeking wireless telephone licenses from 
     the government. The Post became the primary target of 
     criticism after running editorials backing the trade pact 
     without mentioning the company's financial interest.
       ``We did make a mistake and we really feel awful about 
     it,'' Meg Greenfield, the paper's editorial page editor, said 
     yesterday. ``Of course we should have known. We wished we'd 
     known. There's a system for information on these things, and 
     it just broke down.''
       Opponents of the General Agreement on Tariffs and Trade 
     have gleefully seized on the disclosure that The Post and the 
     corporate parent of the Atlanta Constitution would benefit 
     from the provision, which was inserted by the Clinton White 
     House and House Energy and Commerce Chairman John Dingell (D-
     Mich.) into legislation implementing GATT. The ensuing 
     controversy has helped temporarily derail a U.S. vote on 
     GATT.
       Former presidential candidate Ross Perot charged on ``Larry 
     King Live'' that ``the White House cut a deal with The 
     Washington Post and the Atlanta Constitution that is going to 
     cost the taxpayers $2 billion.
       * * * It is the ultimate corruption of our system * * * the 
     biggest piece of pork ever. * * * I mean this makes 
     Whitewater look small.''
       Conservative commentator Pat Buchanan, also a former 
     presidential contender, said on CNN's ``Crossfire'': 
     ``Somebody snuck that thing in there, and it is an outrage. . 
     . .Let me give you a little sound bite: The Washington Post 
     got a $200 million bailout in the GATT treaty. Did your 
     congressman vote for it?
       Executives at The Post Co. and American Personal 
     Communications (APC), which is 70 percent owned by The Post, 
     say the provision actually saves the taxpayers money and was 
     hardly a back-room deal. In fact, they say, The Post 
     disclosed the first legislative move in this direction last 
     July, before it became part of the GATT bill.
       ``The idea that these terms would be put in GATT was 
     emphatically not APC's idea,'' said Donald Graham, The Post's 
     publisher and chief executive officer. ``It was Chairman 
     Dingell's idea.''
       Scott Schelle, APC vice president, said GATT opponents are 
     using The Post's involvement as the ``excuse dujour'' to help 
     sink the treaty. ``There is no aspect of a give-away here at 
     all,'' he said.
       One man who helped broker the deal is former Democratic 
     congressman Thomas Downey, now a lobbyist for APC. ``My role 
     has been useful but marginal,'' Downey said. ``APC made their 
     case both to Mr. Dingell and the White House. So did The 
     Post. Both sides had big interests in explaining their 
     side.''
       GOP critics take a more jaundiced view. ``The Washington 
     Post had no business editorializing and saying this was a 
     good deal for the free world, and all of a sudden you see in 
     the bowels of this legislation there's a little item they 
     overlooked.'' said Rep. Robert Livingston (R-La). ``That to 
     me is appalling.''
       How a provision affecting The Post came to be added to the 
     controversial GATT measure in the waning days of a 
     congressional session is a tangled tale. In 1992, APC and two 
     other firms won a federal competition to develop ``pioneer'' 
     technology for wireless telephones. The licenses were awarded 
     for free, which was standard practice at the time. The three 
     companies spent tens of millions of dollars developing the 
     technology, which is to compete with cellular phones.
       Last year, however, Congress ordered the Federal 
     Communications Commission to start auctioning off such 
     licenses in the future. The chief rivals of the ``pioneer'' 
     firms, Bell Atlantic and Pacific Telesis, argued vociferously 
     that the newcomers should pay for their lucrative franchises.
       PacTel, which tried to win one of the free licenses, is no 
     slouch in the lobbying department. The company has 
     contributed more than $1.3 million to congressional 
     candidates over the past decade.
       ``Yes, we competed. Yes, we lost,'' said PacTel spokesman 
     Robert Stewart. But he said the proposed deal is ``too much 
     of a give-away'' and ``would create a tremendous distortion 
     in the marketplace.''
       In July, the FCC went further and decided to charge the 
     three companies a total of more than $1 billion for their 
     existing licenses. The Post subsidiary cried foul, suing the 
     government for changing the rules in midstream.
       Graham said, ``There is no question whatsoever that the 
     pioneer awards were supposed to be free of licenses. . . The 
     pioneers feel this promise is being broken because of 
     ferocious and successful lobbying'' by corporate rivals. 
     Graham said he too had ``done some lobbying'' with the 
     administration and Congress.
       Dingell, for one, was persuaded. In a letter to colleagues, 
     he said the FCC does not have the legal authority to charge 
     for phone licenses and that its effort could be ``quite 
     possibly overturned in court,'' leaving the government with 
     ``nothing.'' So the White House and Dingell struck a deal 
     with the companies that the congressman defended as ``a good 
     deal for the taxpayers.''
       The compromise requires the companies to pay 85 percent of 
     the average price of licenses in upcoming auctions, and no 
     less than $400 million. While this is far less than the 
     estimated $1.3 billion the licenses might fetch today, Graham 
     said it is ``grossly worse'' than the deal the companies 
     originally struck. Had The Post known the eventual cost, he 
     said, ``we would not have competed.''
       The GATT legislation suddenly loomed as a very attractive 
     vehicle. Not only was it on a ``fast track,'' meaning it 
     could not be amended, but the administration was required to 
     find some money to offset the revenue lost by lowering 
     tariffs. The pot of cash to be raised from the three 
     companies was ideal for this purpose, and the Dingell 
     language was quietly added to the thousands of pages of GATT 
     legislation.
       PacTel officials discovered the move Sept. 21, and in the 
     next two days the Associated Press and Wall Street Journal 
     carried stories on the deal. Still, the issue remained muted.
       That changed on Tuesday, when PacTel bought full-page ads 
     in The Post and Washington Times. ``The Washington Post and 
     two other corporations have slipped in a billion-dollar 
     loophole--and the Post forgot to mention its own special 
     interest in two editorials urging quick passage of the trade 
     pact,'' the ad said.
       ``We ran the ads because we'd had no success getting the 
     attention of the administration,'' Stewart said. Dingell 
     dismissed the ad as ``misleading'' and part of a ``corporate 
     cat fight.''
       Asked why he sold space to a business rival, Graham said: 
     ``The Post tries to give extraordinary freedom to advertisers 
     to say what they wish. We've run many ads criticizing the 
     newspaper and its policies.''
       While acknowledging its mistake in an editorial Wednesday, 
     The Post said it has run more than 400 editorials in favor of 
     free trade. Greenfield said the notion that her editorial 
     page was secretly trying to advance corporate interests was 
     ``a bit nutty.'' But the political damage had been done: 
     House Republicans succeeded that day in delaying a scheduled 
     vote on GATT until after the November elections.
       The disclosure of The Post's role was ``explosive'' and 
     ``dynamited support within the Republican Party,'' Buchanan 
     said. ``It's an insider's deal, and the fact that it's The 
     Washington Post is icing on the cake. The Washington Post is 
     not a beloved institution in the Republican Party.''
       All this has left the paper in the awkward position of 
     reporting on a Capitol Hill struggle in which it has become 
     central player.
       ``It's always hard to make sure you're having the same 
     arm's-length relationship that you have with any other 
     story,'' said Executive Editor Leonard Downie Jr. ``Probably 
     it's difficult to convince readers that we are treating it 
     the same way as any other institution.''

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