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Table 12 shows the number of hours of network time per week.
If we subtract the network hours on the air from the total time on the air, we find that the local hours on the air were as follows:
Local hours Radio:
on air Large
85 : 51 Television.
56:40 As far as radio stations are concerned, there does not appear to be sufficient difference in local hours on the air to be a prime factor in any rate variation.
In table 13 are shown the number of stations interested in the group-insurance plan.
Summarizing table 13 we find that 71.5 percent of the 608 stations answered “Yes” indicating interest in a group insurance plan, 9 percent said “Perhaps," 13.8 percent said “No," and 5.7 did not answer.
On the basis of table 13, 80 percent of the respondents indicated interest in the development of a group-insurance plan if such group insurance should lead to savings in insurance costs.
A representative of Employers Reinsurance Corp., of Kansas City, said that they base their rates on the rate cards of stations. As far as analysis of the replies gives us information on costs, there would seem to be no consistent relationship to rates (as we had the station call letters, we could check the rates in Standard Rate and Data Service, and could find no consistent relationship). In some instances there appears to be some agreement-per $25,000 of insurance to the hour rates and sometimes to the half-hour rates, but no consistent relationship and in no case an exact correspondence to the hour or half-hour rates.
It would seem reasonable to expect that hours of exposure or hours on the air and coverage would be important factors in insurance-rate charges. Inasmuch as station time charges to a large degree reflect coverage, Employers Reinsurance Corp.—now insuring the bulk of the stations reporting—would seem to have a reasonable way of making up their own rate schedule when
it bases it upon a station's rates; but as reported above, there seems to be no consistency between the charges made and the station rates. This matter would bear further investigation.
Furthermore, of the 120 stations reporting that they carried insurance, all but 11 reported both the amount of the policies and the cost per thousand dollars of insurance per annum. The 109 stations giving complete data paid a total of $16,612.50 per annum for their insurance in 1953. The loss of $100 against a premium rate of this amount is a phenomenally low loss ratio.
It should be borne in mind that insurance of this kind is primarily to protect stations, particularly smaller ones, against a catastrophic loss. From the insurance companies' viewpoint, one large judgment could wipe out several years' premium return.
On the other hand, experience reported upon in this survey would seem to indicate that this kind of insurance has been fairly profitable to insurance companies in the last 5 years.
Unfortunately, we do not have at hand any benchmark data upon which to judge what this kind of insurance should cost as a protection to stations against the possibility of one large judgment. We do know that there are now pending several large claims, one of them a $50,000 case on the coast, and several of $500,000 each in Nashville, Tenn.
NATIONAL ASSOCIATION OF RADIO AND TELEVISION BROADCASTERS
STATION LIBEL AND SLANDER SURVEY 1. Have you had any claims or suits in respect to libel, slander, etc. (as listed below) during the past 6 years, 1949 through 1954 to date? Yes o No O
If "Yes,” please write in number of claims or suits below: Kind of claim or suit:
Number in each year 19 49
1954 Libel, slander, or defama
tion. Infringement of copyrightInfringement of property
right or piracy-Violation of rights of pri
vacy 2. Are you insured against such claims? Yes O No 3. (a) If insured, what are the limits of your policy? $_ (6) What is your yearly cost per $1,000 of coverage?? $. (c) In what company are you insured?
4. (a) Have you or your insurance company settled any claims in the past 5 years? Yes O No O
(b) If "Yes,” in what year(s)?
5. Have you had any suits or claims based upon political broadcasts? Yes No O (a) If “Yes," how many ?-- This year---
Last year ----1952_---6. How many hours per week are you on the air?
hours. 7. How many hours per week of your programing are network time? ---hours.
8. Bearing in mind the normal low costs of a group-insurance plan (as compared with an individual insurer), would you be interested in a group_plan providing this kind of insurance for radio and television? Yes I No Station call letters.---
City-Mr. HARRIS. You passed around the information a moment ago with reference to the approach the 36 States have made to this problem. Can you tell us whether or not the broadcasting stations in each of those States are satisfied with their respective laws ?
Mr. HEALD. No, sir. In some cases they are not because the statute as finally enacted did not contain all of the proposals in the model
1 Because policies may cover more than 1 year, won't you please be sure to give yearly costs here.
statute. In every case where it was enacted it was an improvement. In some cases they are satisfied with the model statute. So I would have to say it depends upon the exact wording of the statute.
In several cases they are not satisfied with it.
Mr. HARRIS. Could you name 1 or 2 or 3 of the States that have the model statute ?
Mr. HEALD. I have them listed in that group I submitted. I can point out some of the names to you.
Arizona, in 1935, enacted one, in which specifically section 2, if you would care to have me read how the model statute reads as to this particular point:
In no event, however, shall any owner licensee or operator or the agents or employees of any such owner licensee or operator of such a station or network of stations be held liable for any damages for any defamatory statement uttered over the facilities of such station or network by or on behalf of any candidate for public office.
May I point out there that goes even further than the model statute because it says even“on behalf of a candidate.”
Arkansas also has the provision pertaining to this one which we have under discussion, relieving the licensee of liability for political broadcasting. Mr. HARRIS. Does Arkansas have what you call a model statute !
? Mr. HEALD. No, sir. There were several other features of the model statute which we recommended was not enacted by Arkansas, but this one provision was.
Mr. HARRIS. I was going to say: I looked over that hurriedly; I can't see where any station would be held liable at all in our State with the language in the section there.
Let me ask you this. How many of those 36 States have adopted these provisions in the last year or 2?
Mr. HEALD. Very few in the last year. It has been over a longer period of time than that.
Mr. HARRIS. How many since the McFarland bill in 1952?
Mr. HARRIS. Could you give it to me approximately? Most of them?
Mr. HEALD. I would say quite a few of them, yes.
Mr. HARRIS. The reason I bring that up is that we had the same question up then and we ran right into the old question which has been raised here today as to the Federal Government preempting the State's long-established right or prerogative in this field. Congress was reluctant to do it at that time.
In my humble judgment is is not going to be done this time without very, very careful consideration.
I was wondering if they made progress in 36 of the 48 States, why would it not be better to endeavor to prevail upon the other 12 States to do something about it and therefore not have this encroachment, if it is an encroachment, of the Federal Government on the State's prerogative.
Mr. HEALD. I think that will be considered. There is no question about that, Mr. Chairman. However, the 12 States who have not enacted it and the several States who have enacted only in part, of course, have had this presented to them on many occasions. I cannot
say why it has not been enacted. But at the present time I feel that there will be some difficulty in getting 100 percent.
You will also have the problem, of course, that if you have various laws which differ and a broadcaster who is completely interstate in all his aspects, has then the problem of complying with 4 or 5 laws and not with one in this particular matter, which makes it much more difficult.
Mr. HARRIS. We will be glad to analyze the provisions of those statutes as you submit them.
Were there any further questions on this? If not, you may proceed to the other bill.
Mr. HEALD. Thank you, Mr. Chairman. I will skip the first paragraph, if I may, which is a repetition of the other.
I am appearing on behalf of the National Association of Radio and Television Broadcasters in opposition to H. R. 3789.
H. R. 3789 would amend section 315 (a) of the Communications Act of 1934 by withdrawing the right of equal opportunity for the use of broadcast facilities in political campaigns from persons, who have been convicted of certain crimes, such as treason, or who are members of subversive organizations. This amendment would supplement existing provisions of law which deal with political broadcasts by subversive organizations.
While this association approves and supports the objectives sought to be achieved by H. R. 3789, it feels that the practical difficulty in determining whether or not a person is a member of one of the proscribed organizations will place an undue burden on a licensee of a broadcast station and may result in the purpose of the bill being defeated.
To begin with, it would not always be easy to discover whether or not a person has been convicted of treason, sabotage, espionage, sedition, or subversive activities, especially when the time to investigate is limited. However, it is another and vastly more difficult matter to determine whether a person is a "member of an organization proscribed by section 3 of the Communist Control Act of 1954 or which, under the Subversive Activities Act of 1950, has been held to be a Communist organization of one type or another. The mere identification of an organization and its predecessors by name is often a difficult task. However, the determination of (1) whether or not a person has any connection with one of the subversive organizations, or (2) whether that connection is legally equivalent to membership is something that the average licensee will be unable to accomplish without the aid of a lawyer and a trained investigator. Finally, these difficulties will almost always be compounded by the licensee's lack of time in which to investigate, even if able and willing to do so. The licensee would be asked to assume a judicial role even though he is not equipped for such a task and, in some cases, cannot afford to equip himself for these duties. In addition, despite the utmost precautions that the licensee may take, there would always be a grave danger of liability for defamation as the result of an erroneous determination of membership in a proscribed organization. Moreover, if broadcast time is erroneously denied a candidate, the licensee would have to answer to the Federal Communications Commission for a violation of the provisions of section 315.
These practical difficulties involved in determining whether or not a man is a member of a Communist front organization could well result in many licensees ignoring the provisions of the proposed law and continuing to give equal time to all persons who are legally qualified candidates under local statutes, since such a course is not prohibited by the proposed legislation. The broadcasters of the Nation would like nothing better than a practical method of keeping subversives off the air. It appears, however, that the burden of determining the identities of the individual subversives could better be placed upon somebody better qualified to make these findings.
May I just add, Mr. Chairman, that this is particularly true, of course, of a small station. It would not be applicable to a network which has a large legal staff and trained investigators at hand.
You realize that the majority of our stations are of the smaller station category. Mr. HARRIS. Mr. Williams, any questions? Mr. WILLIAMS. No. Mr. HARRIS. Mr. Hale? Mr. HALE. No. Mr. HARRIS. Mr. Dolliver, any questions? Mr. DOLLIVER. No questions. Mr. HARRIS. Mr. Rogers? Mr. Rogers. I have one question.
Would your objection to this legislation be answered if a provision was put in there that compliance by the filing of an affidavit or the making of a sworn statement by the proposed broadcaster would be sufficient-I do not mean the station but the candidate who is applying for the time--such a statement as might be subject to the false-swearing laws within the State!
I know that many of the so-called people connected with subversive elements and communism, in Texas, always refused to make a sworn statement because we have a pretty stiff false-swearing law down there.
It looks to me like there would be an opportunity under this act to put some people in jail that you could not otherwise.
Mr. HEALD. Congressman Rogers, specifically; yes. That is exactly the type of thing we have in mind that might be done.
Mr. ROGERS. So you would not have to bear the responsibility of it, once he had sworn to that.
Mr. HEALD. Then the licensee would give him the time and he would be subject to any penalty for perjury.
Mr. ROGERS. False swearing.
Mr. HEALD. As I understand your suggestion, it would not be the licensee's responsibility other than to require that a statement be filled in.
Mr. ROGERS. Yes; that would be punishable as a criminal offense if he made a false statement.
Mr. HEALD. And it would be up to the State prosecuting authority. That would meet the question.
Mr. Harris. Mr. Flynt, any questions?
Mr. HEALD. Mr. Chairman, if you have no further questions, may I merely state for the record that this association would like to have recorded its opposition to the House Joint Resolutions 138 and 139, the so-called tall-tower bill.