Bruce Murphy
Murphy’s Law

Why Are Homeowners Subsidizing Cable TV?

By - Jul 16th, 2001 03:35 pm
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Republican and Democrats can’t agree on much, as they squabble over the state budget, but both parties seem to think that AOL Time Warner needs a tax break. That’s an interesting choice for charity: the corporation is the world’s largest media and internet company, and posted a nice fat profit of $2.1 billion for the first quarter of 2001.

The exemption for Time Warner would take some $12 million in property off the tax rolls. Will our cable fees go down?

The budget amendment in question would exempt digital equipment owned by cable TV stations from property taxes, which will primarily benefit Time Warner and Charter Communications, who together own nearly 80 percent of the cable business in Wisconsin. The City of Milwaukee estimates that some $12 million in property would be taken off its rolls, generating an annual $125,000 property tax deduction for Time Warner. Does this mean Time Warner will be lowering our cable fees?

The budget provision was added to the Assembly Republican version of the budget by Rep. Tim Hoven (R-Port Washington). Hoven has been treated generously by cable companies, who donated $1,300 to him in 1999 and 2000. For the Senate Democratic version of the budget, the provision was added by state Sen. Rod Moen (D-Whitehall), who also received $1,200 from cable companies in 1999 and 2000, and another $3,090 during the six years prior to that. Records for 2001 were not available on-line, but we’re guessing the two legislators will see more cable money coming their way.

Neither Hoven nor Moen responded to interview requests, but lobbyist Tom Hanson was happy to talk about the budget provision. Hanson, whose accounts range from the Wine Institute to the Wisconsin Bear Hunters Association, also serves as president and chief arm twister for the Wisconsin Cable Communications Association. Hanson says that Moen “used to be a cable operator,” so he was a natural to introduce the budget change.

Hanson notes that broadcast TV and radio stations already enjoyed this tax exemption, so it was time for cable stations to get theirs. “We’d always be looking for equity,” adds Bev Greenberg, government relations specialist for Time Warner. “If it’s there for broadcasters, why would cable companies be excluded?”

Why indeed? Hanson and the cable association were apparently asleep during the budget deliberations of two years ago, when the exemption for broadcasters was passed. “The broadcasters wanted it done and we didn’t know about it,” Hanson admits. “They just put it in the budget without telling us about it.”

In the process, broadcasters were able to exempt about $165 million in equipment, cutting their property taxes by $4.2 million, the Legislative Fiscal Bureau estimates. “The argument that companies made then was that they were forced to use a lot of resources to make the conversion to digital and that the tax exemption would help them make the conversion,” says LFB analyst Fred Ammerman.

The London Times’ article on Milwaukee is filled with exaggerations, unproven assertions and outright howlers.

The Federal Communications Commission has required that TV stations make the transition to digital by 2006. Little did the FCC suspect that property taxpayers would end up footing much of the bill in Wisconsin. The end result of the exemption for broadcasters and cable companies is to shift more of the tax burden on to homeowners, who also have to pay those cable fees.

THE LONDON TIMES LIKES US! Yes, a recent story in the London Sunday Times rhapsodized about the Milwaukee school choice program, while chastising England for not adopting such a system. The story led with an adulatory portrait of the Marva Collins Academy, one of this city’s choice schools, and even managed to include a quote from Mayor John Norquist without mentioning Marilyn Figueroa. Apparently the scandal hasn’t made it across the Atlantic.

Writer Melanie Phillips‘ description of Milwaukee and America, however, offered a number of exaggerations, unproven assertions and outright howlers.

America, according to Phillips, is country where “the black urban poor… whenever they are given the chance, turn their backs in droves on America’s publicly funded schools.” In droves? Or how about this casual libel: teachers unions are “a rich source of corruption in American civic life.” Or this unproven assertion: “wherever vouchers are threatened, the failing state schools suddenly improve.” If only it were that easy.

Phillips sees Milwaukee as a virtual paradise where the various systems of choice have created “a soup of creativity,” as Norquist not so felicitously puts it. “In 1990, graduation rates from the city’s public sector schools were less than 35%. Now they are up to 51% and test scores are rising fast. The reason is Milwaukee’s extensive programme of school choice.”

Let’s ignore the fact that the British don’t know how to spell the word program and zero in on the statistics. Tim McElhatton, senior evaluator for the Milwaukee Public Schools research and assessment office, says he can find no data showing such a phenomenal increase in high school completion. MPS would surely jump on any such positive statistic it could find.

As for test score increases, the last round of state proficiency tests shows that Milwaukee students declined in 10 of 15 categories. The only time Milwaukee scores rose “fast” was when every other district in the state saw an increase. The year after the state tests were instituted, in 1998-99, every district saw big increases as students and teachers adjusted to the tests. Since then Milwaukee’s scores have been flat or declining.

Phillips also claims that “under the pressure created by parents choosing to leave [for choice schools], the school board was forced to allow schools to experiment and innovate. The result was an explosion of Montessori schools.” Explosion? In the 13 years before choice, a Montessori approach was adopted by two MPS schools for nearly a thousand students; in the 11 years since choice, Montessori education was added for two more schools and 700 students. If anything, the rate of this innovation has slowed down.

Finally, there is Phillips’ choice of model schools – Marva Collins. At this school, “four-year-olds get an hour-and-a-half of solid phonics a day… By age 11, these children from the wrong side of the Milwaukee tracks are reading Shakespeare, Chaucer, Kipling, Emerson and W.B. Yeats.”

I don’t know about you, but I wouldn’t have subjected my child to a “solid” 90 minutes of phonics at age four. I’d rather my son learn to enjoy reading, instead of having it drilled into him. And I think the average 11-year-old would get more excited about reading a children’s adventure story than an excerpt from Shakespeare or Chaucer. Marva Collins may be a fine school, but the idea that school choice will turn our nation’s youth into avid readers of Emerson and Yeats is the kind of simplistic nonsense that too often passes for serious education commentary.

This article was originally published by Milwaukee World.

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