America, Donald Trump is what deregulation looks like. Step by step, over the past four decades, we’ve loosened government’s protective hold on us, and now here we are. We thought everything was becoming cheaper or free, but only because the real costs were being hidden from us.
Trump is the presidential candidate that Rush Limbaugh and other conservative talk-radio entertainers have been begging listeners and goading leaders to provide. Trump traffics in the same simple solutions and dubious conclusions that have made Limbaugh and others into millionaires. It’s worth understanding better how their business model succeeded.
Before 1987, broadcasters were governed by the Fairness Doctrine. In return for access to the public airwaves, radio and television operators were required to provide equal time for opposing political viewpoints. President Reagan vetoed legislation that would have affirmed the public policy enforced by the Federal Communications Commission since 1949.
“This type of content-based regulation by the federal government is, in my judgment, antagonistic to the freedom of expression guaranteed by the First Amendment,” Reagan said in his veto message. “In any other medium besides broadcasting, such federal policing of the editorial judgment of journalists would be unthinkable.”
Within months, Rush Limbaugh moved from a local radio show in Sacramento to become a national broadcaster out of New York City. Two years later, The New York Times wrote that Limbaugh had “more listeners than any other talk show host.” Freed to broadcast editorial commentary without having to present opposing views, radio station owners lined up to air Limbaugh and those who followed him.
The Rush Limbaugh Show soon had 650 affiliates. Most of those radio stations paid zero dollars for the program, thanks to another deregulation or two. In a brilliant business move that couldn’t have been possible only a few years earlier, Limbaugh’s company allowed radio stations to air the show in return for commercial time that it could then resell to advertisers seeking a nationwide audience.
A 1982 consent decree paved the way for the breakup of the Bell telephone system. The Bell monopoly ended in 1984, making way for dozens of smaller companies competing fiercely for customers, who for the first time had a choice between telephone companies. One especially lucrative aspect of the business was long-distance calls.
Reaching a nationwide audience was suddenly easy. Any company with a toll-free 800 number and “operators standing by” could get an immediate response for their advertising dollars. The final piece of the puzzle was finding businesses who sell what talk radio’s listeners would want to buy.
In a word, ointments. Locally applied for immediate comfort, wonder drugs of various sorts learned that these listeners would make a free call to get a free sample that could then be followed by regular and lucrative reorders.
Those businesses could operate freely only because government again loosened restrictions on who can advertise what and to whom. Direct-to-consumer advertising was frowned upon by the Food and Drug Administration before the 1980s.
The FDA and the Federal Trade Commission took a laissez-faire approach to advertising in the 1980s, allowing advertising of therapeutic agents for “recognized non-serious conditions,” such as arthritis. Vitamin supplements and other similar products were not far behind.
Companies syndicating these programs often gave advertisers a deal they couldn’t refuse: “If we don’t make your phones ring, you won’t have to pay us.”
Let’s review the deal. Radio stations get top-flight entertainment programming with no cash payments by ceding some advertising time to the syndicator. The syndicator signs up advertisers who pay nothing if they don’t get a response. Those ads promise consumers a free trial of their product, if they’ll only call a toll-free number.
It all seems too good to be true because that’s exactly what it is. Everything is free, until the bill comes due. Why buy the snake oil, when you can vote for the snake?
Americans are free to act when they won’t think, buy what they don’t need, evaluate what they can’t understand. They can pay later for an immediate promise of relief. Why should government be allowed to intercede?
Don Kahle (email@example.com) blogs at www.dksez.com.