Is John McCain Uncomfortably Close to Lowell ‘Bud’ Paxson?

by on February 21, 2008 · 0 comments

By Drew Clark

Sen. John McCain’s close relationship with media and telecom company lobbyist Vicki Iseman poses a challenge for his presidential campaign – if it can be demonstrated that he took specific actions on behalf of one of the companies she represented.

Today’s story in The New Times Times about McCain’s interactions with Iseman reports on legislative actions that he took on behalf of television broadcaster Paxson Communications from 1998 to 1999. That was the period of time in which Iseman’s relationship with McCain, then chairman of the Senate Commerce Committee, was of concern to members of McCain’s staff, according to The Times.

A spokesman for the Arizona Republican said that The Times story was “gutter politics,” and that there was nothing in the article “to suggest that John McCain has ever violated the principles that have guided his career.” The Page provides additional reactions from McCain.

The Times does not report about a more recent – and potentially more dramatic – action by McCain on behalf of Paxson.

After a brief period of Democratic dominance, McCain returned to become chairman of the committee in 2003 and 2004. During that period, he took crucial legislative action that saved Paxson Communications from a bill that would have, in the words of CEO Lowell “Bud” Paxson, finally ruined his company.

Even more ironically, McCain took this action for Paxson in spite of his long-standing position that television broadcasters had inappropriately used the transition to digital television (DTV) to benefit themselves financially at the expense of the American public.

McCain initially supported legislation that would have forced Paxson and handful of broadcasters – but not the great bulk of television stations – off the air by December 31, 2006. Bud Paxson himself personally testified about this bill with “fear and trepidation” at a hearing on September 8, 2004.

Two weeks later, McCain had reversed himself. He now supported legislation that would grant two-year reprieve for Paxson – and instead force all broadcasters to stop transmitting analog television by December 31, 2008. Paxson and his lobbyists, including Iseman, were working at this time for just such a change.

The Times reports none of this more recent history of McCain’s actions benefitting Paxson Communications, which renamed itself Ion Media Networks.

The Times reports none of this more recent history of McCain’s actions benefitting Paxson Communications, which renamed itself Ion Media Networks. McCain later fought hard to push the digital television transition date back in time, citing the needs of public safety officials. Those efforts were not successful. The DTV transition date now stands only a few weeks from the year-end 2008 date that McCain – and Paxson – first proposed: February 17, 2009.

A Close Relationship With the Florida Broadcaster

The Times’ story has this background about McCain’s close relationship with Paxson and his lobbyists, including Iseman:

Mr. McCain and Ms. Iseman were friends and nothing more[, according to a McCain friend and campaign aide]. But in 1999 she began showing up so frequently in his offices and at campaign events that staff members took notice. One recalled asking, “Why is she always around?”

That February, Mr. McCain and Ms. Iseman attended a small fund-raising dinner with several clients at the Miami-area home of a cruise-line executive and then flew back to Washington along with a campaign aide on the corporate jet of one of her clients, Paxson Communications. By then, according to two former McCain associates, some of the senator’s advisers had grown so concerned that the relationship had become romantic that they took steps to intervene.

A former campaign adviser described being instructed to keep Ms. Iseman away from the senator at public events, while a Senate aide recalled plans to limit Ms. Iseman’s access to his offices.

In interviews, the two former associates said they joined in a series of confrontations with Mr. McCain, warning him that he was risking his campaign and career. Both said Mr. McCain acknowledged behaving inappropriately and pledged to keep his distance from Ms. Iseman.

The Times links McCain’s interactions with Iseman to two aspects of legislative action by the senator on behalf of Paxson Communications: McCain’s support for the broadcaster owning two or more stations in a single market, and McCain’s attempt to intervene in Federal Communications Commission’s consideration of a pending Paxson merger.

Indeed, the relationship between the company and McCain has been strong.

According to information compiled by the Center for Public Integrity’s “Well Connected” Project on Telecommunications and Media, John McCain is the single largest recipient of campaign contribution by Ion Media Networks and its predecessor, Paxson Communications. McCain received $36,000 from the company and employees from 1997 to mid-year 20006. McCain’s donations edged out former Sen. Conrad Burns, R-Mont., who received $27,000, and former Rep. W.J. “Billy” Tauzin, R-La., who received $22,500.

The Well Connected Project also documents the $860,000 that Ion Media spent from 1998 to mid-year 2006. All of that money went though the lobbying firm of Alcade & Fay, where Iseman has been and remains one the principal lobbyists for Ion Media. According to documents available online from the Senate Office of Public Records, Ion is the client that Iseman has represented the longest, since at least 1998.

According to the Senate public records, these are the issues on which she lobbied, for each of the six-month periods in 2004 and 2005:

Media Ownership Issues
Cross-Ownership of Broadcast, Cable, Newspaper and Radio
Digital Must Carry
700 MHz Spectrum Auction
Digital Transition
UHF Discount
Satellite Reauthorization
Cable A la Carte

Paxson has done more than simply contribute, and have his company contribute, to McCain. Paxson held at least one fund-raiser for McCain in Florida, where Ion Media is based.

Just as some of McCain’s aides had feared with regard to Iseman, McCain’s ties to Paxson became a brief issue in his 2000 campaign for president.

In an interview with Tim Russert following the GOP debate on January 6, 2000, NBC’s Tim Russert asked these questions of McCain:

RUSSERT: You’ve been under the gun the last couple of days, in the spotlight, because a contributor to your campaign went to the FCC, got a favorable decision, and urged the FCC to make a decision. You canceled a fundraiser with the same gentleman, Mr. Paxson, Friday. The appearance of Mr. Reformer being a pawn of special interest money — has it hurt your campaign?

MCCAIN: Oh, no. But this is the reason why I’m so dedicated to reform because we’re all tainted by it. We’re all under suspicion. Look, my job, as the chairman of the oversight committee of the FCC, is to make them do their job. They went 700 days without making a decision. I didn’t tell them, as eight other members of Congress did, how they should decide. I said, Just do your job and decide. And I’ll continue to do that because that’s my — as long as I’m chairman of the Commerce Committee.

RUSSERT: No apologies?

MCCAIN: Oh, no.

The “Spectrum Wars” For Radio Frequencies

The battle over the right to use the nation’s radio frequencies has been one of the most intensively lobbied issues before the Senate Commerce Committee – before, during and after the time of McCain’s chairmanship. And putting aside the broadcasting, cable, satellite, telephone and technology industries, a new lobby was in the offing: homeland security. In a feature story about the “Spectrum Wars” published in National Journal in February 2005, I recounted the legislative state of play at that time:

When the terrorists crashed the airplanes into the World Trade Center on September 11, 2001, the fire chiefs responding to the attack had no means of communicating with the police. Arriving on the scene, New York Fire Department Battalion Chief Joseph Pfeiffer could hear only two fire department channels and could not get reports on the towers from the police helicopters circling overhead.

New York City police officers, whose radios used 55 frequencies, heard the warnings from the helicopters, and most of them got out. Firefighters and fire chiefs, including special operations chief Ray Downey, heard nothing. These communication failures prompted the national 9/11 commission to recommend that broadcasters promptly vacate four television channels for public safety. It has yet to happen.

Moreover, this deadly situation was not new. After the 1993 bombing of the World Trade Center, police officers could not communicate with firefighters on the very next floor, according to Downey, who supervised those rescue efforts. In 1995, the same problems occurred after the bombing of the federal building in Oklahoma City. Downey, who led an NYFD contingent to aid the Oklahoma City rescue effort, had to send runners to coordinate orders.

A Public Safety Wireless Advisory Committee was formed in Washington, and it had one key recommendation: “Public safety agencies will not be able to adequately discharge their obligations to protect life and property” if they don’t get more frequencies within five years. The report was released on September 11, 1996.

Five years later, Pfeiffer and Downey still didn’t have the spectrum they needed. After the tragedy, fire and police officials boiled with anger. At an FCC field hearing in Brooklyn weeks after the towers came down, Peter Meade, chief of the Nassau County fire department on Long Island, spoke for many in his profession: “Television be damned,” he said.

Meade coordinates police and fire frequencies in New York for the Association of Public-Safety Communications Officials-International. He and his public safety colleges in the organization took their outrage to Washington. They worked with Reps. Curt Weldon, R-Pa., and Jane Harman, D-Calif., on a bill forcing broadcasters to vacate television channels 63, 64, 68, and 69. It went nowhere. Reintroduced in the last Congress, the bill did get a hearing, at which Weldon, a beefy former firefighter, mourned Downey, who did not survive the towers’ collapse.

“Is a TV show in my district in Pennsylvania more important than saving Ray Downey’s life?” Weldon said at the hearing. Later, he said, “I am not speaking, I am shouting against the broadcasters.”

McCain, as chairman of the Senate Commerce Committee and eyeing another run for the White House, gravitated to public’s safety’s cause. With the release of the 9/11 report in July 2004, McCain decided to go on the offense against the National Association of Broadcasters, just as he had done in 1996 and 1997, when NAB successfully lobbied for a second television channel, free of charge. Broadcasters’ second channel allowed them to transmit their over-the-air signals digitally, without forcing them to immediately cut off analog television.

Few Americans were receiving digital television, even as late as this time, in 2004. Ever since the transition was put into effect with the 1997 Balanced Budget Act, there had been a December 31, 2006, target date for the switch-over. But this year-end 2006 date was non-binding: so long as at least 15 percent of Americans received their over-the-broadcasts via analog televisions, broadcasters – including Paxson – would never give up their spectrum.

With the heightened attention to the needs of public safety, McCain saw an opportunity. Just before the third anniversary of the September 11 attack, McCain introduced Weldon and Harman’s bill together with Sen. Joe Lieberman of Connecticut, then a Democrat. With that bill, there would finally be an end-date to the decades-long digital television transition.

Paxson versus the National Association of Broadcasters

Paxson Communications, however, was in a particularly tough spot by the Weldon/Harman – and now the McCain/Lieberman – legislation. At least 17 of his 65 television stations were numbered channel 60 or above, including WPXP-67 in West Palm Beach, Fla., and WBPX-68 in Boston. Back in 1997, channel numbers 62, 63, 64, 65, 67, 68 and 69 had been reserved for use by public safety – as soon as the broadcasters vacated. In other words, someone would have to move them out.

At the same hearing in which Weldon made his empassioned pitch, Paxson also appeared before McCain. This is what he said:

If the Harman Bill is enacted as is currently written, my company would face severe financial hardship and the likelihood of failure is a possibility. Naturally, we would seek court relief and compensation from the government from the losses and impairment of our assets.

Please make no mistake about my testimony. I’m enjoying my 50th year as a wireless communicator better known as a broadcaster, but I have never experienced such fear and trepidation, and I do not say these words lightly.

I live in Florida and the two recent severe hurricanes prove a point. Five of our Florida television stations were among the first providers of safety and survival information for many Floridians 24/7. Now that information saved lives and I’m sure the storms also demonstrate the need for more spectrum for public safety services. The faster the digital transition proceeds, the quicker public safety will get its needed spectrum, but not at the expense of free over the air broadcasting.

But something funny happened on the way to the markup on September 22, 2004. McCain changed his mind about the best end-date. He and Paxson would end up on the same side, supporting each other – against the National Association of Broadcasters.

Other legislative and regulatory officials, while supporting McCain’s idea of a fixed end-date, thought it better to give a bit more time – until December 31, 2008. Among them were Rep. Joe Barton, R-Texas, Chairman of the House Energy and Commerce Committee, and then-FCC Chairman Michael Powell, who had been hand-picked for his position by McCain.

McCain re-introduced his bill with a cut-off of December 31, 2008. More significantly, the broadcasters in the public safety zone – like Paxson – would no longer be singled and forced off-air before other television broadcasters.

Sensing political danger in the emerging consensus for an end to the DTV transition, the NAB quickly enlisted Sen. Burns in their cause. Burns, a former broadcaster, introduced an amendment to McCain’s bill that boasted an earlier cut-off date: January 1, 2008. But it would have impacted Paxson and comparable high-frequency broadcasters, like Univision.

At the markup, McCain was mad. “As usual, the National Association of Broadcasters is up to their old tricks, using their water-carriers,” he said, in a reference to Burns. “This is public safety versus the NAB, and we will all be on record as to where we stand. I want to tell my colleagues: If we adopt the Burns [amendment], and this results in delaying this channel, and there is another disaster in this country, and there is not interoperability, will will be making a very serious mistake.”

But Burns had out-maneuvered McCain. Burns had 13 votes – most of the Republicans and most of the Democrats – to McCain’s nine votes.

Sen. Bill Nelson, D-Fla., who supported McCain’s approach had this to say about what the NAB did to Paxson and Univision. “I don’t see how the NAB can take this position to stick it to two of their major members.”

McCain said: “Sometimes, I guess, they have to throw someone over the side.”

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