TPA Joins Coalition Urging Opposition to Local Radio Freedom Act

The Taxpayers Protection Alliance (TPA) is a strong proponent of property rights, and when it comes to the issue of intellectual property, we are also firm believers in a property rights system that is fair to all parties.  This includes distribution and attribution. Artists who produce a product (music for example) deserve to hold actual rights to said product, including both the writer and performer of a given recording, regardless of the medium under which that work is transmitted. Unfortunately, under today’s existing rules, a performer holds no rights to his or her product in terrestrial radio. There is now a resolution is Congress, H. Con. Res. 16, the Local Radio Freedom Act (LRFA), essentially codifying this current system, and TPA does not support such a resolution. Last week, led by the Institute for Liberty, TPA joined with Americans for Tax Reform, American Commitment, the Council for Citizens Against Government Waste, Center for Individual Freedom, and Digital Liberty and signed a letter urging House Republicans to withhold any support and/or co-sponsorship of this resolution because “it closes the discussion about how best to protect property rights by resolving that terrestrial radio should never pay performance royalties on music broadcast on their stations used for raising advertising revenue.”

Read the full letter below:

September 12, 2013

To Republican Members of the US House of Representatives:

As organizations supporting property rights, we believe that artists who produce music deserve to hold real, effective rights to their products, including both the writer and performer of a given recording. If a given work is transmitted, common sense and basic fairness dictate that the medium of transmission should not affect the existence of these rights. Currently, however, a performer holds no effective rights to his or her product in terrestrial radio.

As you may be aware, H. Con. Res. 16, the Local Radio Freedom Act (LRFA) has been introduced in the House. This resolution is a specific endorsement of the current regime, which offers no meaningful property rights to music performers in regard to transmission over terrestrial radio. Because this resolution endorses the status quo, it has a chilling effect on the development of a forward-thinking policy that respects the rights of all music producers in all media. For this reason we urge you to refrain from co-sponsoring H. Con. Res. 16.

The Constitution protects private property rights and specifically delegates to Congress authority to protect creative works. Unfortunately, LRFA closes the discussion about how best to protect property rights by resolving that terrestrial radio should never pay performance royalties on music broadcast on their stations used for raising advertising revenue. This is not equitable treatment for any musical artist or music distribution service.

Supporters of LRFA have argued that requiring terrestrial broadcast stations to pay a performance royalty is akin to a performance tax. This is incorrect; a performance royalty is not a tax. The definition of a tax is the transfer of wealth from a household or business to the government. Royalties go to rights holders, not to the government. It is completely within the rights of broadcasters to decide not to pay for the use of a performer’s song by not using the song. Paying a private citizen or business for the use of their property is clearly not a tax.

Additionally, supporters of LRFA claim that the promotional value artists derive from having their music played on the radio exceeds compensation which would be due under a royalty. However, cable, satellite, and Internet pay a royalty for sound performances. In a free market, some copyright holders might decide to forego royalty payments in return for having their music on the radio. Nonetheless, these decisions should be made by the free market, not the government.

Congress should not preclude a free market approach to royalty payments. We, the undersigned, urge you to refrain from cosponsoring H. Con. Res. 16, the Local Radio Freedom Act, and allow the discussion to remain open about how best to protect the rights of both performers and writers in the creation of music.

Sincerely,

Andrew Langer, President, Institute for Liberty

Grover Norquist, President, Americans for Tax Reform

Tom Schatz, President, Citizens Against Government Waste

Phil Kerpen, President, American Commitment

Jeffrey Mazzella, President, Center for Individual Freedom

David Williams, President, Taxpayers Protection Alliance

Katie McAuliffe, Executive Director, Digital Liberty