LAST MONTH’S DEBATE at the Apollo Theater in Harlem remains one of the more ill-covered campaign events, not least because the press failed to notice that, on a key policy question, Al Gore moved to the left of not only Bill Bradley but also Bill Clinton. The moment came early in the debate after a sharp exchange in which Bradley zinged Gore for supporting, 20 years ago in the House, legislation that protected the tax-exempt status of racially discriminatory private schools. Claiming Bradley had misrepresented his votes, Gore quickly changed the subject.
“Now let me . . . talk about a more recent vote,” the vice president said. “In 1995 you were the only Democratic senator to vote against affirmative action to help expand the number of African American-owned broadcasting outlets — radio stations and TV stations. Why did you . . . vote against that?” Declining to answer, Bradley instead tried to hand Gore copies of the measure he had voted for. But Gore ignored him and again asked Bradley to explain his vote. Bradley never did, but conceded he had voted “against that amendment,” adding that Bill Clinton had signed it into law.
The press failed to analyze this exchange, and instead glossed over the disagreement — and most of the issues for that matter — with superficial sports and entertainment metaphors. With few exceptions, Gore’s vote 20 years ago and Bradley’s vote in 1995 were regarded as old news. No one, so far as I could tell, reported the fact that Gore actually stated an intention to change public policy. “One of the changes that I would seek,” he said, “is to repeal the measure that Senator Bradley supported.” In other words, Gore wants to restore the status quo ante.
This was news — and still is. The measure Bradley supported was House Resolution 831, one of the first bills enacted in 1995 by the new Republican Congress. The law increased and made permanent a health insurance deduction for self-employed individuals that had expired in 1993. This was a popular tax break and enjoyed strong bipartisan support. What was controversial about the resolution, however, was that its tax break would be paid for, in part, by ending another tax break — the Federal Communications Commission’s tax-certificate program.
Under this program, devised in 1978, a company selling a media property to a “minority-led investor group” could indefinitely defer paying taxes on the profit from the sale. The stated purpose of the policy was not to help the sellers — usually big, rich companies — though it obviously did that, but to increase the number of racial minorities in the broadcast media and, it was theorized, the different programming they could offer. There was never any good evidence to support this theory, and it clearly indulged the racialist stereotype which holds that there are such things as minority and non-minority viewpoints — that, to put it bluntly, thinking itself is a function of skin color. In practice, of course, many minority buyers were able to pay discounted prices for their new properties, and more than a few of them decided to make big bucks quickly by immediately turning around and selling at full market price to large, non-minority-owned companies. Over the years, the FCC issued 330 of these tax certificates (costing taxpayers around $ 2 billion). In those sales, buyers included blacks, Hispanics, American Indians, Alaskan Natives, Asians, and Pacific Islanders — the officially favored groups. Obviously, someone lacking the “right” race could not be a buyer in one of these transactions: The program was discriminatory.
For lots of reasons, the tax-certificate program was politically vulnerable. After the Apollo Theater debate, Bradley said he had voted against it because it was bad tax policy. But what actually carried the 1995 resolution that killed the program was the news that Viacom, then the world’s second largest media conglomerate, would receive as much as a $ 1 million tax break by selling its cable television systems to a partially minority-owned company. (It did not help that the company buying from Viacom was led by a man who, as the FCC’s general counsel in 1978, had helped craft the tax-certificate program and had since benefited from four similar deals.) The House passed the resolution by a vote of 381 to 44, and the Senate cleared it by a voice vote.
Clinton, reeling from the Republicans’ historic capture of Congress, proved unable to modify the legislation as it moved along. In signing the bill on April 11, he expressed regret over the demise of the race-based program. Since then, however, Clinton has not proposed its resurrection. Within his administration, of course, there are those who liked the policy — among them Gore confidants Bill Richardson, the secretary of energy who was a member of Congress in 1995 and voted against ending the program, and William Kennard, the FCC chairman. But the FCC has not tried to reestablish the program through clever rule-making. “Congress,” a commission spokeswoman told me, “would need to act.” Gore’s statement at the Apollo means that as president he would ask Congress to do just that: pass legislation that would revive the program.
Gore’s position puts him squarely at odds with his New Democrat friends. Soon after the tax-certificate program was ended, Will Marshall of the Progressive Policy Institute, in an analysis of affirmative action policy, wrote that “it was time for Congress to end the [preferential devices] the Federal Communications Commission uses to encourage minority and female-owned business in telecommunications.” Indeed, that statement placed PPI to the right of the Republican Congress, which took aim only at the FCC’s tax-certificate program, leaving other such FCC programs alone. “There’s little evidence,” Marshall continued, “that such preferences have achieved their stated purpose of promoting ‘minority views’ in broadcasting; the content of broadcasting is determined by what people want to see and hear, not by the complexion or sex of company owners.”
Neither George W. Bush nor John McCain seems to have noticed what Gore said in support of the tax-certificate program and the opportunity it offers for opening a debate on government programs that count and reward — and inevitably discriminate — by race. “To date,” a Bush campaign spokesman said, “he has taken no position.”
McCain voted for the 1995 resolution out of concern, his office told me, that rich companies which didn’t deserve tax breaks were using minorities as front men to get even richer. But, given McCain’s support of similar legislation, whether he could distinguish his position from Gore’s in a presidential matchup is an open question.
Last summer McCain cosponsored the Telecommunications Ownership Diversification Act, which looks suspiciously like the program he voted against. It would allow a seller to defer the tax on the profit from the sale of a telecommunications business to a “historically underrepresented” group. McCain’s office says the program he contemplates would not share the preferential features of the old tax-certificate program, and it is being sold on the Hill as race- and sex-neutral. But the devil is in the details. The bill’s subsections say that eligible purchasers include not only any taxpayer who is “a United States citizen,” which would seem to exhaust the possibilities, but also any taxpaying United States citizen who is “a woman,” a “Black or African American,” “a Latino or Hispanic American,” “an Asian American, a native Hawaiian, or other Pacific Islander,” or “an American Indian, Alaskan Indian, an American Eskimo, or Aleut.” And McCain’s bill requires the Commerce and Treasury departments to set eligibility requirements that take into account an underrepresented group’s historic inability to secure capital.
Anyone who knows how the executive agencies work will realize that such provisions are sufficient to permit preferential treatment that can often be hard to identify, much less challenge. For his part, the FCC’s Kennard likes what he sees. Applauding McCain’s bill upon its introduction, Kennard said, “A reinvigorated tax-certificate program is a sensible way to allow all small businesses to compete in the most dynamic sector of our economy.”
Terry Eastland is publisher of the American Spectator.
