Big Bird Debate: How Much Does Federal Funding Matter to Public Broadcasting?

by Suevon Lee ProPublica, Oct. 11, 2012, 12:36 p.m.

Are Big Bird's 15 minutes up yet? Last week, Mitt Romney pulled public broadcasting into the presidential campaign when he said he would "stop the subsidy" to PBS, despite his love for the furry yellow Muppet.

The remark launched endless Internet memes, fueled late night television jokes and spawned a satirical Obama campaign ad (which the Sesame Workshop, a private, non-partisan charitable organization, has requested the campaign pull). Given the recent flurry of attention, we thought it would be helpful to examine how much federal funding actually affects public broadcasting.

How large is the federal subsidy to public broadcasting?

It's not exactly breaking the bank. The Corporation for Public Broadcasting, the entity created by Congress in 1967 to disperse funds to nonprofit broadcast outlets like PBS and NPR, is set to receive $445 million over the next two years. Per a statutory formula, public television gets about 75 percent of this appropriation while public radio receives 25 percent.

This amounts to roughly .012 percent of the $3.8 trillion federal budget u2013 or about $1.35 per person per year. (Some global perspective: elsewhere in the world, Canada spends $22.48 per citizen, Japan $58.86 per citizen, the United Kingdom $80.36 per citizen, and Denmark, $101 per citizen.)

This sounds like a drop in the bucket. Why would Romney focus on such a small figure?

Because Romney's approach is to target every government program he thinks is "not essential." The candidate's current spending plan not only calls for eliminating Obamacare and privatizing Amtrak, but deep reductions in subsidies to CPB and cultural agencies such as the National Endowments for the Arts and Humanities u2013 expenditures he says are "things the American people can't afford."

Public broadcasting also happens to be a popular target among conservatives, who've long portrayed it as an example of wasteful government spending (in the mid-90s, former House Speaker Newt Gingrich proposed pulling federal funding from the CPB altogether).

Romney's no exception on the campaign trail. As ABC News' The Note reports, last week's debate wasn't the first time Romney has suggested Sesame Street seek outside advertisers to earn its keep. At a campaign stop last December, Romney told voters, "we're not going to kill Big Bird, but Big Bird's going to have to have advertisements, all right?"

How crucial is federal funding to public broadcasting?

Sesame Workshop's executive vice president told CNN last week that the company receives "very, very little funding from PBS." Indeed, the nonprofit generated nearly two-thirds of its $133 million revenue in 2010 from royalties and product licensing alone, according to its website. Its executives are also handsomely compensated: former CEO and president Gary Knell (who now runs NPR) earned $718,456 in executive pay plus $270,000 in bonuses in 2010. So, as the Washington Post points out, Big Bird doesn't exactly depend on the federal government for survival.

PBS draws roughly 15 percent of its revenue from the CPB. NPR's revenue mostly comes from member station dues and fees, with 2 percent coming from CPB-issued grants. Member stations, in turn, receive about 11 percent in federal grants. According to this CPB report, most revenue to both public radio and television (about 59 percent) consists of donations from individuals, corporate underwriters and private grants, followed by state and local support (roughly 20 percent).

But from a leverage standpoint, PBS says it's pretty important. Each federal dollar local stations receive generates roughly six dollars from local sources as a type of bargaining chip, according to a coalition of public broadcasting stations, producers and viewers.

Are there downsides to scaling back federal funding?

Yes. While shows like "Sesame Street" may remain safe under Romney's plan, its viewers in remote areas wouldn't fare as well. Public television and radio stations in poor, rural areas depend the most on federal support to survive. So while large public television markets producing more than $10 million in annual revenue require just 10 percent of federal funds to get by, its counterparts in small towns like Bethel, Ala., or Odessa, Texas, may very well need up to four times that much to operate.

How many markets could be at risk today?

A CPB-commissioned study released earlier this year estimated 54 public television stations (31 in rural areas) in 19 states at "high risk" of going dark if stripped of federal funding. The study also found 76 public radio stations (47 in rural areas) in 38 states at "high risk" of going silent without federal funding.

Aren't there other sources of news, culture and entertainment over the airwaves?

Yes, but public broadcasting has a specific mission of bringing a distinct brand of educational and cultural programming u2013 free of commercial trappings u2013 to a broad swath of the American public.

In establishing the CPB 45 years ago, Congress envisioned a broadcasting service that would encourage development of programming to address "the needs of unserved and underserved audiences, particularly children and minorities," and which could be made "available to all citizens of the United States."

In some areas of the country, public broadcasting still remains the only option, commercial or otherwise: at least 10 public radio stations around the country offer the only broadcast service, radio or television included, to their community.

Have there been prior attempts to defund public broadcasting?

Yes. In 2010, a flap over the firing of former NPR contributor Juan Williams (now a Fox News contributor) for comments he made about Muslims heightened the cries to cut NPR off from federal grants. Last year, Republican lawmakers introduced legislation to block NPR from receiving such grants.

Today, conservatives also argue that the smorgasbord of media offerings renders the form of public television obsolete. As the National Review recently put it, "If PBS doesn't do it, 10 million others will." Others, like Time's Michael Grunwald, arguethat the right to watch commercial-free TV "does not strike me as a basic human right" and that if "private funders feel it's important for South Dakotans to watch Big Bird, they can make that happen with their own tax-deductible contributions."

Can public broadcasting turn to alternate forms of funding?

Yes, but with varying degrees of success. In recent years, budget cuts have forced states to decrease funding for public broadcasting, the New York Times reported early this year. CPB also notes that revenue from individual donations went from $373 million in 1999 to $349 million in 2005.

CPB claims private advertising isn't a solution u2014 and at least one independent analysis estimated it could even lead to net losses by raising operating costs and diminishing support from corporate underwriters or private foundations. According to the report, "a shift to a commercial advertising model would lead to a chase for ratings and move public broadcasters off their fundamental role in lifting the educational and informational boat for all Americans."

What's the Obama administration's stance?

In 2010, the president's bipartisan deficit budget commission proposed cutting funding to CPB to reduce the federal deficit. But the campaign was quick to seize on the issue with its Big Bird ad. First lady Michelle Obama followed suit, telling Virginia voters this week, "We all know good and well that cutting Sesame Street is no way to balance a budget."

The candidates aside, what does the public think?

A March 2011 poll shows that more than two-thirds of the public opposes eliminating government funding for public broadcasting. A more recent poll indicates that 55 percent of voters oppose such cuts to public television.