Corporate Media: 1920s/1980s
From Chapter Two: U.S. Mass Media Beginnings
“Without some knowledge of the developmental and historical factors, one cannot understand the present or predict the future.” (Bensman, 2000)
Part One
The Corporate Self
“The following account covering the emergence of mass media in the Untied States from the end of the First World War to the end of the 1930s is best framed within an initial understanding of certain legal definitions that touch on the standing of the corporation in American public life. As we will note, this is particularly significant when associated with vital issues of free speech and political accountability. In this context, the following account has direct bearing on contemporary issues and debates in America today that touch on issues of citizenship (Schiller, 1996; Buckingham, 1997), political accountability (Schultz, 2000) and freedoms of speech (Schudson, 1997a; Schudson, 1997b; Boggs, 2000).
To begin our critical consideration of the corporate culture, a useful condensed insight is offered by legal commentator Perlitz (1996) who reminds us that,
“As far back as the mid-nineteenth century, corporate law was the site for mediating between, on the one hand, individualism and its associated visions of the corporation as a “person” or an entity and, on the other hand, the material reality of corporations as associations of people joined as groups, as aggregations for commercial purposes. For most of the century, policy makers have imagined the corporation as having a separate existence, at least in the sense that corporations are distinct “persons” or “firms” or “groups functioning in commercial markets”. (Perlitz, 1996, p. 284-285)
The acceptance of a corporation as an ‘entity’ is based on the definition as laid down by Chief Justice Marshall (Dartmouth College vs Woodward) who deemed in 1819, that the “creation” of a business corporation was based on certain principles, the most important of which were,
“…immortality, and, if the expression may be allowed, individuality, properties by which a perpetual succession of many persons are considered the same, so that they may act as a single individual.” (Leete, 1982, p. 778)
Marshall’s precedent was later tested in 1886 (Santa Clara vs Southern Pacific) when the Supreme Court under Chief Justice Waite confirmed without argument or opinion that the Fourteenth Amendment that guaranteed equal protection of citizens did apply to the railroad monopolies as representatives of their shareholders. As a direct result,
“Corporations were now armed with constitutional prerogatives. And so armed, they proceeded to the development and exploitation of a continent in a manner never equaled before or since…these unexplained decisions are now so implicit in the financial and industrial undertaking of the nation.” (Corley, Black and Reed, 1981, p. 21)
The framing of a corporation as an individual is, of course, fundamental to the operations of all media organisations since, a fact felt most strongly by writers who at the point of financial success must, according to copyright laws, cede their ownership of their work to the corporate producer. As Streeter (1994) underlines persuasively,
“…giving the corporations the status of persons under law grants them the ability to stand in for ‘authors’ in the framework of copyright, thus transferring the bulk of control over media ‘works’ from individual creators to large bureaucratic institutions. Programs are thus created, produced, owned and exchanged by corporate bureaucracies…(which) have taken the place of individuals in the eyes of the law and in the process of cultural production.” (Streeter, 1994, p. 102)
From Nace (2003), however, we are reminded that the existence of the corporation was, from the very beginning of the Republic, viewed with wary suspicion as its potential threat to the common good was acknowledged and then curtailed within strictly defined charter law. The lists below provides a useful summative guide that contrasts the tightly constrained nature of the corporation before 1860 and its more Liberal descendent of the 20th Century (Nace, 2003).
ATTRIBUTES
CLASSIC FORM OF CORPORATISM – before 1860.
Birth: Difficult, required a custom charter issued by a state legislature; Lifespan: Limited terms ’Shape shifting’ Corporations not allowed to own stock in other companies and restricted to activities specified in the charter; Mobility: Usually restricted to home state; Adaptability: Restricted to activities specified in the charter; Conscience: Actions constrained by shareholder liability and a threat of charter revocation; Will: Managerial action hampered by legal status of minority shareholders and corporate agents; Size: Limited by charter restrictions Constitutional rights: Functional only.
MODERN FORM OF CORPORATISM – since 1900.
Birth: Easy, general incorporation allows automatic chartery; Lifespan: No limits Corporations free to pursue acquisitions and spin-offs; Mobility: No restrictions; Adaptability: Allowed to pursue multiple lines of business and initiate or aquire new ones at the company discretion; Conscience: Fewer constraints due to limited liability, disuse of charter revocation; Will: Legal revisions enable consolidation of management powers; Asset limits removed, antitrust laws generally not effective Constitutional Rights: Steady acquisition of constitutional rights
The comparison provides a useful oversight of how the persona of the corporation became increasingly legitimised through Supreme Court interpretations of the U.S. Constitution from the 19th to the 20th centuries. For Nace (2003), such legitimisation ran counter to the wishes of the original Constitution framers whose faith was in the assumed strength of charter law to constrain corporate development.
The strength in corporate economic status and political power which soon emerged after the Civil War was vividly marked into the American consciousness at 12 noon on 18th November 1883 when the nation’s clocks were standardised across the new four time zones. It was made possible by synchronising all the clocks in all the railroad stations which were linked by telegraph. However, national time zones emerged, “…neither from an act of Congress nor from an executive order by the President, but rather from a joint decision of the country’s railroad corporations.” (Nace, 2003, p. 69).
The telegraph, like the new media that would soon follow, was a clear challenge to those static inhibitions of mountains, valleys, and imposed state boundaries that the framers of the Constitution thought sufficient enough to curtail the dangerous potential of the corporation. The assertion of the corporate symbolic strength came about, as Burke (1966) might have it therefore, by creating things from words.
From Railroads to Airwaves
“…an imperishable corporation with its own territory, an empire within a republic, more powerful than a Sovereign state, and absolutely inconsistent with the purity of republican institutions, or with the safety of any government…with the prodigious development of corporate wealth, resistance must be vain.” (Henry Adams, in Schlessinger, 2003)
Henry Adam’s diatribe from the July 1870 edition of the North American Review was directed against the-then rapidly developing strength of the New Pacific Railway corporation but could very easily be set within contemporary concerns that focus on another form of invasive tentacle – the power of those few media corporations that would soon dominate the United States ether landscape beginning in the 1920s.
The rapid development of mass media technologies in the hands of a few corporations in the 1920s rested on equating corporate identity with the rights usually conferred to individual citizenship and from that emerged an interpretation of free speech principles that impacted on the nature and function of broadcasting content first on radio and later television in the 1980s. In concrete terms, equating television product – including advertising – with free speech ensured that corporations could evade government restrictions since, according to the Constitution itself, “…congress shall make no law…abridging the freedom of speech, or of the press…”.
It was – and remains – assumed that free speech existed ‘naturally’ when not constrained by government edict only. Looking to how this inflects on issues of media power in the 21st century, Foerstel (2001) underlines how the media oligopolies, or,
“…new private information power centers have successfully persuaded the public that their corporate control of the media is an exercise in individual free expression. The effective use of the First Amendment for a shield of corporate power relies in large part on a century-old Supreme Court ruling that a corporation is an individual and on the subsequent corporate presumption that abridgement of expression can only come from the state.” (Foerstel, 2001, p. 12, italics added)
Precisely how that persuasion takes place is the focus of our later analysis.
In such a condensed media environment, the prevailing definitions of free speech emerge principally from the media corporations themselves and so serve clearly defined corporate aims and objectives. This debate runs as a constant surface motif throughout the developing histories of 20th century U.S. media – from The Radio Act of 1927 to the Telecommunications Act of 1996 – and exists, further, as subtextual narrative feature across and within media products themselves, particularly news reporting and website features - “We Report, You Decide”, for example, is the principle operating rhetoric of Fox News.
This creates a webbed rhetoric of cross-referential accounts and narratives that informs all media output – from television ‘chat’ shows, news broadcasting, to radio phone-ins and commercial advertising (wherein we can ‘choose’ or ‘elect’ our preferred television commercial). It could also be an important driver in the high profile of rap music – proving on-going evidence of free speech rights to the younger generation. Writing, then, in the light of more recent court deliberations in the 1980s and 1990s McChesney (1999) underlines how, in the hands of the wealthy
“…the advertisers, and the corporate media, the new-fangled First Amendment takes on an almost Orwellian cast…these semi monopolistic corporations that brandish the Constitution as their personal property eschew any public service obligations and claim that public efforts to demand them violate their First Amendment rights… Indeed, the media giants use their First Amendment protection not to battle for open information but to battle to protect their corporate privileges and subsidies.” (Mc Chesney, 1999, p. 279).
It is a debate to which we will return in our last chapter, but one that drives our account of how a few corporations were able to secure the dominance over the American media landscape. For an understanding of how this dominance was established in the first instance, preliminary coverage will now focus on how the U.S. broadcast system initially developed at the turn of the 20th century.
Part Two
Broadcast Beginnings: Wires, War and Washington, D.C.
Acting in his capacity of Secretary of Commerce, Herbert Hoover’s request on 3rd March 1922 for a supplemental appropriation for his Department’s ‘Bureau of Navigation’ provides a detailed and loaded insight into the burgeoning explosion of radio development across the United States at the time:
“ …within the past 60 days there has been a tremendous development in the radio field throughout the United States of the system known as “radio broadcasting” and the employment of radio telephones in connection with the distribution to the public of government reports, including weather forecasts, crop and market estimates, etc; and in addition to these, concerts, news, lectures on educational, health and other subjects of public interest, religious services and general broadcasting by amateurs. This service is extending with great rapidity to every part of the country and it is estimated that there are at least 600,000 listening in stations now in operation…this number is still increasing so rapidly that the manufacturers of instruments are unable to meet the demand.” (Bensman, 2000, p. 25)
From the partial evidence of this letter alone, it is clear that radio “amateurs” across America, still free of government regulation and corporate commercial interests, were already driving and determining the scope and content of the wireless superhighway of the 1920s. This sudden profusion of private and community use was the result of numerous but related social, scientific and political circumstances that had coloured the development of radio transmissions in the decade before and as staged by the three International Wireless and Telegraph Conferences (1903, 1906, 1912) that had set agreed protocols for standardised use of wireless bands on the coastal highways.
The Radio Act of 1912
The Radio Act of 1912 provided for the licensing of radio operators and station transmission, though, despite appearances, it did not, according to a ruling by the Attorney General, accord any effective regulatory power to the Department of Commerce which was the official government body overseeing the new media. Designating particular frequencies for particular uses applied the property metaphor of the wilderness to the airwaves, thereby creating, “…the beginnings of major territorial divisions in the spectrum that continue to this day.” (Streeter, 1994, p. 97).
In a way that foreshadowed future prejudices in frequency allocations, the Act gave the frequency spectrum to two significant bodies – the Marconi Corporation won virtual monopoly in the commercial designation leaving the remaining availability for the U.S. Navy. The criteria of judgment came down to technical competency and public safety, criteria established and determined by these same institutions. As Streeter (1994) neatly puts it,
“…beginning in 1912, therefore, the State action wrested control over a new communications medium from a mixed group of small entrepreneurs and hobbyists and turned it over to large corporations and the military…furthermore, private individuals – the amateurs – were forcibly ejected from their place in the spectrum without compensation, while others, notably the Marconi Company, were granted a place of privilege by what amounted to government bequest. Similar actions were taken in Europe; what was unique about the U.S. was that this seizure was undertaken in the name of ‘free enterprise’.” (Streeter, 1994, p. 97)
So, as with the prairies and mountains of the 19th century, so with the opening wilderness of public airwaves of the 20th century. In addition, in an act of acute prescience, the Senate Committee made clear, that,
“…the term “radio communication” instead of “Radio telegraphy” is used throughout the bill so that its provisions will cover the possibility of the commercial development of radio telephony.” (Bensman, 2000, p. 9).
The development towards a system that could actually carry the human voice instead of Morse code was something lawmakers were therefore already legislating for and that “possibility” was largely assured given the current stages of research. Reginald Fessenden at the University of Pittsburgh had already impressed sound onto a electromagnetic carrier wave in 1906 and, more importantly, Lee de Forest had invented the audion tube which would become a crucial component in transmitting and receiving equipment since it made it possible to amplify radio waves without distortion and, significantly, generate the high-frequency radio wave needed to carry speech – and music. Despite his more noble intentions for his invention, however, McChesney (1999) informs us that De Forest’s later hatred of radio advertising was such that in the 1930s he tried to perfect a scrambling device that would automatically mute the radio commercials and then return the volume to audible levels when the programme returned (McChesney, 1999, p. 237).
More notably for our focus, the American Telephone and Telegraph (AT&T) company and the General Electric company were both researching into the de Forest vacuum tube by 1913. In 1915, General Electric had perfected the Alexander alternator, capable of generating powerful high frequency currents and over the next few years would secure key patents crucial to the development of radio broadcasting. It would be on the basis of these patents and others that followed that General Electric would become America’s most dominant company.
By 1917, however, the patent logjam in the courts that had stifled technological research was ended. With America at war, the patent impasse was broken on 7th April 1917 by a Presidential proclamation that all commercial stations serving maritime commerce came within the operational management of the Naval Department and that all others were effectively closed down. Amongst those stations taken over by the Navy was its own major competitor in the field – the Marconi Company. Now that the government assumed all liability for patent infringement, the three main competitors, namely Westinghouse, Western Electric, and General Electric, all served successfully as the principle benefactors of the war economy and became major providers in the Defense Department‘s drive for greater technology and equipment capabilities in radio transmission.
The demands of the new warfare generated rapid technological advances and, based on the vacuum tube capabilities, a range of breakthroughs were effected, namely, long distance telephony and ground to air speech communication – all developments driven by the exigencies of war. Such alignments would be repeated in 2003 as the invasion of Iraq helpfully generated a needed upswing in the wider use of broadband technologies.
From Defense Departments to Worthy Citizens
With the end of war in 1918 and the return to limited government deregulation, however, interested parties such as the Naval Department and the commercial companies naturally wanted to secure the benefits of their successes for both national and corporate security – and long-term profit initiatives.
Returning the (foreign) Marconi company to its rightful and prominent place within the competitive market, for example, was clearly detrimental to this aim. Director of Naval Communications Admiral Bullard (he came from Media, Pennsylvania) was instrumental in warding off this clear and tangible threat to national Homeland security. So, towards this singular aim,
“Unable to convince Congress to keep control within the government, but still concerned about the deployment of its radio system, the Navy urged General Electric, largest of the radio manufacturers, to buy out the British backed Marconi company… General Electric’s acceptance of the Navy’s suggestion resulted in the formation in October 1919 of the Radio Corporation of America. In this country, RCA became owner of practically all the commercial high-power wireless telegraph facilities.” (Bensman, 2000, p. 13-14).
A fruitful synergy of mutual interests, then, between a department of the government (Defense) and a private corporation (General Electric) led to the deliberate creation of a private monopoly, the Radio Corporation of America (RCA) based on the significant transfer of that government body’s many important and lucrative patents. This, in Cook’s (1998, p. 52) understated terms, would be “initial government assistance”.
We can register, then, from this fact alone, how the corporate mergers and media synergies that were deemed a unique and sudden feature of the 1980s media landscape had their antecedents even in the 1920s and involved the same handful of usual and familiar corporate and government institutions”.
And Farnsworth?
END OF EXTRACT FROM CHAPTER 3, “We,the media…”
And from the Internet Archives: TelevisionTomorrow, a classic from the late 1930s:
http://www.archive.org/details/tomorrow_television
END OF CHAPTER 2
2008 Update: On Broadway,The Farnworth Invention.
From NPR: “Aaron Sorkin is best known as a television writer and producer — most notably as the creator of the Emmy Award-winning series The West Wing. But he got his start on Broadway 19 years ago, with the play A Few Good Men. He’s back now with a new play, The Farnsworth Invention, which happens to be all about television. About the television, that is — as in the box itself. And why not? It’s hard to think of a more ubiquitous device. They’re in our living rooms, our dens, our bedrooms, even in our kitchens and baths sometimes. Some houses have more TVs than people. “I make my living in television, I love television, I’m a TV addict,” says actor Hank Azaria, who stars in The Farnsworth Invention. “I was raised on television — and I didn’t know about this story until I read this play.”
Where To Now?
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For historical continuities, why not try Chapter 5 on the 1980s: http://wethemedia.edublogs.org/1920s-us-media-beginnings/1980s-wars-white-house-and-media-mergers/
Or maybe corporate film on corporate media from 1999?:-
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