Sometimes it seems like the only legislation that gets prioritized in Washington are bills that rip off taxpayers. But in a welcomed change of pace, Congress has an opportunity to stop American artists from being ripped off via the American Music Fairness Act, which has been introduced in the House and will soon be unveiled in the Senate.
It should go without saying that artists should be paid for their work. A painter shouldn’t have his or her painting taken without compensation and, similarly, music performers should not have their works used without compensation. While this may seem like common sense, this is not how we treat music currently.
Under current law, while streaming services, online platforms and even satellite radio stations are all required to pay music artists when they use their work, AM/FM “terrestrial” radio stations enjoy a zero-cost compulsory license that allows them to play any music they want while paying artists (unless they also wrote the songs – songwriters are paid) exactly zero.
AM/FM stations quite literally profit off the backs of performers – whose content they depend on for advertising sales – but due to a legal carveout, they aren’t required to pay artists in the process. This would be akin to the government telling film studios it’s illegal to charge fees to movie theaters that want to air their movie, while simultaneously allowing the theater to pocket all the money from movie ticket sales. Whether you stream a song on Spotify, listen to it on the radio, or buy an album from the store, a composer or performer should be appropriately compensated when their creative work is aired.
The American Music Fairness Act also strikes an appropriate regulatory balance by exempting small broadcasters as well as college and non-commercial stations — ensuring that no truly local station pays more than $2 per day for all the music they need to play. This isn’t a money grab on small town radio stations, but an effort to ensure that large, profitable radio networks will finally compensate the artists who pay their bills and compete on a level playing field with streaming services.
The bill will also allow American artists to collect royalties when radio stations in other countries play their music. Under the Rome Convention, artists have performance rights in their recordings and can enforce royalty payments; but the free pass Congress has given AM/FM broadcasters leaves the US on the outside looking in, and because international artists cannot collect royalties from US stations, American artists are forced to forfeit their international radio royalties.
Republicans believe in property rights and Democrats believe in their friends in the music industry. Maybe that will finally be enough to overcome the political power of the broadcasters and end the AM/FM free rider problem.
Jon Decker is executive director of American Commitment
By Phil Kerpen
Can the president spend an estimated $500 billion to $1 trillion without approval from Congress, the branch of government that holds the power of the purse under the US Constitution? My Constitution says no. But if the Biden student loan bailout is illegal, who can stop it? And will they? Those are the key questions and it may fall to two uniquely positioned states: Missouri and Oklahoma.
Under the Supreme Court’s recently codified Major Questions Doctrine, a program of that scope requires a crystal-clear directive from Congress, which is why most legal analysts doubt President Biden’s sweeping student loan discharge order based on a twisted reading of the post-September 11, 2001 Heroes Act combined with an allegedly ongoing COVID emergency can withstand legal scrutiny.
Biden’s gambit depends on the matter not being litigated, and that in turn depends on no party willing to challenge the order having standing to sue. The arguments for state, taxpayer, and legislator standing are tenuous. The arguments for loan servicers, on the other hand are strong.
A comprehensive analysis by Colin Mark in the Journal of the National Association of Administrative Law Judiciary concluded: “In sum, student loan servicers could sue to prevent the Department of Education from forgiving student loans. Servicers could demonstrate an injury in fact, fairly traceable to the Department’s forgiveness of student loans, and redressable by equitable relief under § 702 of the APA.”
Publicly traded loan servicer Nelnet is clear in its most recent SEC filing that a program like Biden’s would materially injure the company: “Legislative and executive action risk exists... If the federal government and the Department initiate additional loan forgiveness or cancellation, other repayment options or plans, consolidation loan programs, or further extend the suspension of borrower payments under the CARES Act, such initiatives could further increase prepayments and reduce interest income and could also reduce servicing fees.”
Curiously, the company has made no public statement on Biden’s announcement indicating that it might sue. In fact, the administration may be counting on servicers being unwilling to risk losing future contracts by challenging the order. That may be why the Department of Education has set all current servicing contracts to expire at the end of 2023, making servicers more inclined to absorb the loss of business from mass discharge without complaint to stay in the good graces of the Biden administration future contracts.
Two servicers, however, are state agencies of conservative states, and should be willing to stand up for taxpayers and prevent an unprecedented, unlawful transfer of wealth from people who played by the rules and paid their own way – or didn’t go to college at all – to generally higher-income college graduates.
Both the Higher Education Loan Authority of the State of Missouri (MOHELA) and the Oklahoma Student Loan Authority (OSLA) are instrumentalities of their respective states, governed by boards appointed by their governors and subject to for-cause removal. That puts governors Mike Parson of Missouri and Kevin Stitt of...