Is National Public Radio Actually National Private Radio?

Public broadcasting is extremely common in the world. Wikipedia’s incomplete list of public broadcasters by country lists over 300 public broadcasting outlets across nearly every country in the world, including “major broadcasters” in the United Kingdom (BBC), Australia (ABC), Canada (CBC/SRC), and the United States (PBS/NPR).

Despite the prevalence of public broadcasting in the world, various discourses that mostly seem to be rooted in anti-communism frequently use the phrase “state media” as an epithet. This “state media” label is selectively applied to public broadcasters that someone disapproves of, generally public broadcasters in foreign countries that are not aligned with the West.

I’ve always found this to be a very annoying practice. If you want to say a certain media outlet is bad, then say that it is bad. Calling it state media is not the way to do that as most state media is pretty good and some non-state media is quite bad.

Over the last few years, YouTube and Twitter have begun labeling certain accounts as “state media” in one form or another as part of some kind of effort to combat misinformation. This is a convenient label for them because, on its face at least, it provides a neutral way to flag outlets as unreliable without actually having to dig into the substance of their content. They could create a “misleading media” label and apply it equally to private and public broadcasters with a sufficient track record of bad and motivated reporting, but this would require a heavier editorial burden than they want to take on.

Using “state media” as a shortcut in this way runs into an obvious problem, which is that most state media is good. So if you label all state media as “state media,” then the label doesn’t really serve its purpose of signaling that the media account in question is disapproved of by Twitter and YouTube. To solve this problem, Twitter and YouTube only label a small fraction of state media as “state media” and these decisions basically just track the sentiments of the Western foreign policy establishment at any given time.

In this context, it was hilarious to me when Elon Musk began having Twitter label all public broadcasters as state media a short time ago, including public broadcasters in Western countries like the BBC in the UK and NPR in the US. If you are going to have a state media label, then it really should be applied to all state media. If you want instead to have a label indicating that an outlet is misleading, then have a label for that and apply that label to all kinds of misleading media. But using “state media” to mean “misleading media” and applying it in the way Twitter and YouTube have is really stupid.

Over the last week, it’s been revealed that the leadership of National Public Radio is furiously pissed at being labeled as state media. This of course makes the whole thing even funnier, but it also raises an interesting question that is rarely discussed in the political discourse, which is: what makes something public rather than private? What exactly is a state-owned enterprise and how do we distinguish it from a non-state-owned enterprise? And how do we understand enterprises with hybridized corporate structures that seem to have both public and private characteristics?

Public Subsidies

The debate around NPR’s status has so far focused primarily on the question of NPR’s revenue sources. In the article announcing that NPR is quitting Twitter, the publication emphasizes that “it receives less than 1 percent of its $300 million annual budget from the federally funded Corporation for Public Broadcasting.” Though it later clarifies that NPR “also receives significant programming fees from member stations, [which] receive about 13 percent of their funds from the CPB and other state and federal government sources.” Put it all together, and it looks like they are claiming that around 5 percent of their revenue comes from public subsidies.

In the context of this debate, they are downplaying these public subsidies as fairly insignificant, but in other contexts they obviously play them up as very important because they want to keep the public subsidies flowing:

These station programming fees comprise a significant portion of NPR’s largest source of revenue. The loss of federal funding would undermine the stations’ ability to pay NPR for programming, thereby weakening the institution.

Elimination of federal funding would result in fewer programs, less journalism—especially local journalism—and eventually the loss of public radio stations, particularly in rural and economically distressed communities.

Whether these public subsidies are “significant” is an interesting question and it’s funny to see NPR talk out both of sides of its mouth on the question. But, under common ways of defining what is and isn’t a state-owned enterprise, it is not actually relevant to the question of whether NPR is public or private.

Many, possibly most, state-owned enterprises receive no public subsidies, meaning that they fund themselves via revenue from their customers. The United States Postal Service is perhaps the biggest and most well-known state-owned enterprise in the US and it funds its services using customer fees called postage. The Tennessee Valley Authority is another US state-owned enterprise and it funds its services using customer fees called electricity rates. In fact, there are around 2,000 public power companies in the US that work this way.

Also, some non-state-owned enterprises receive public subsidies. Private sports teams receive subsidies to build stadiums. The federal government is giving huge sums of money to chipmakers to locate factories in the US. And so on. Few if any people contend that these subsidies make the entities public or state-owned.

Corporate Governance

Typically, state ownership is defined by the way an entity is governed, not by how much public subsidy it receives. Specifically, the key questions are who is the beneficial owner of the entity (i.e. who owns the entity’s stock if it is the kind of entity that has stock) and who appoints the top management of the entity, typically its board.

NPR does not have shareholders and so the only real question is how the appointment process for corporate leadership works.

In the various defensive articles I’ve read, NPR has so far not discussed the question of how its board and CEO are selected.

As far as I can tell, the corporate governance of NPR works as follows:

  1. The over 1,000 NPR member stations elect 12 board members. These board members must be managers of an NPR member station.

  2. The 12 board members from (1) select 9 additional board members from the public. These board members must be separately confirmed by the over 1,000 NPR member stations.

  3. The board members select an NPR president and CEO who also sits on the board.

  4. The chair of the NPR Foundation also sits on the board. I am not sure how they are appointed.

When you sum it all up, basically the board has 23 members and the member stations select all but possibly one of them, with 12 of the 23 members (a slight majority) being actual managers of member stations.

Now that we know that member stations control the board, the question turns to who controls the member stations? Wikipedia has a list of the stations. NPR itself explains that:

About two-thirds of stations are licensed to, or are affiliated with, colleges or universities. The remaining third are governed by community-based boards. Some stations are operated jointly with public TV stations.

So it appears that a large majority of the voting weight for board appointments comes from radio stations at public universities and colleges. Amusingly, people don’t seem to find the phrase “state university” to be the kind of epithet “state media” is, but here we have a media entity with a corporate governance structure ultimately dominated by decision-makers at state universities.

This is certainly an unusual governance structure. It looks almost like a producer cooperative except that the members of the producer cooperative are mostly state-owned educational institutions. Nonetheless, if forced to choose, I would say that it is, as its name suggests, a public broadcaster, i.e. a state-owned enterprise. At minimum, it seems to be more SOE than not.