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Advertising on Television Rockets, as Super PACs Pour in the Dough: Total Spending $5 Billion

Are owners' profits conflicting with newsrooms' public interest obligations?

After the votes are counted in November, there will be a big winner in the 2012 election who is not Mitt Romney, Barack Obama nor their top donors. This winner does not want to change anything about how America’s latest national election was run.

The unadvertised victors are media businesses that are seeing political advertising profits reach into the billions. There is no one estimate that combines all of 2012’s campaign advertising across all media, but one of the biggest winners clearly will be local TV stations and regional TV networks in 10 presidential swing states—and in California because of its costly statewide ballot measures.

These TV stations alone will earn $2.8 billion in the 2011-12 election cycle, according to a forecast by Moody’s Investors Service, with a big slice of profits coming from shadowy political groups that sprouted like mushrooms after the Supreme Court’s Citizens United decision in early 2010. They are part of media landscape that last month surpassed the 2008 presidential campaign’s spending record. 

“Based on the new environment of virtually unlimited political advertising, we have long expected that political ad sales would set records in 2012,” Moody’s said. “This year the surge in political spending could translate to as much as $2.8 billion in ad revenue for local broadcast and cable television—more than half of the estimated $5 billion total outlay on 2012 political advertising in all media, in line with our initial high-case forecast for a 19% to 27% increase for the broadcasters.” 

The way this mix of money, politics and media is reshaping and distorting the electoral process is one of the biggest news stories of 2012. As Media Matters reported, “The sheer volume is hard to comprehend. This year, more than 97,000 political ads have aired in the state of Iowa alone; nearly 115,000 have been broadcast in Ohio. That's two and a half times the number that aired in Ohio four years ago."

This story has many dimensions, but one that particularly stands out concerns a conflict of interest at the heart of being a media business. The local television stations that are reaping this advertising bonanza are largely not covering the biggest sponsors of the political ads on their airwaves.

“While many TV stations are covering local and national races, they are ignoring the ever-expanding role money and the media are playing in these contests,” a new report by the progressive media reform group, FreePress.org, found. “It’s clear that the election’s biggest winners are the conglomerates that own local TV stations in battleground states. And the biggest loser? Democracy.”

New Political Money Trail Emerges

One of the central features of the post- Citizens United world is that many political groups were created by known partisans—like Karl Rove and the Koch brothers—and structured in a way that they could collect unlimited donations, not identify donors, and run political ads whose message was clear but did not require them to file reports with the Federal Election Commission. The Democrats quickly copied the tactic.

The emergence of super PACS with no contribution limits and politicized non-profits that are pushing the boundaries of federal tax law—to the point of inviting  lawsuits—have been well covered in the media. But the media criticism part of the Free Press analysis concerning local television news in swing states has not.

What’s especially frustrating to the Free Press and other progressive reformers is that there are new tools that investigative reporters and citizens can use to trace the very groups that have figured out how to evade disclosure to the FEC. Since August, anyone buying a political ad on a TV network affiliate in the 50 biggest media markets—including many swing state cities—must fill out a Federal Communications Commission form and post it online. In other words, what the FEC doesn’t see, the FCC does and is making available.