Thursday, October 16, 2008

Discrimination prevents minority ownership and affects advertising revenues

Anglo advertisers’ interest in the Latino market does not mean that discrimination did not get in the way. In 1986, a group of black and Latino advocacy organizations and media outlets brought a complaint before a special congressional hearing arguing that they could not land lucrative national accounts due to advertisers’ discrimination. The testimony was largely given by black station managers who said advertisers often approached them based on market showings, then backed off when they saw the station was black. However, the issues raised had ramifications for all minority stations and give some insight into the thoughts of legislators and the Federal Communications Commission (FCC) at the time.

One of the most interesting arguments raised was Representative Matthew Rinaldo’s contention that such advertiser discrimination was not just socially offensive, but an affront against the free market.

When such discrimination occurs, it is not the result of the free market functioning as it should in our type of democratic society- it is a distortion of the market. It has been suggested that such discrimination in advertising materializes either as outright intentional discrimination, or as an uninformed stereotyping of the buying patterns of minorities.

Two committee members got into a heated debate when one said that wealthy minorities should not receive preference in buying stations. The other responded:

When you talk about a level playing field, because when they want to compete in the marketplace to get telecommunications properties, even though they have the ability to purchase those telecommunications properties, they are discriminated against because they are black. That is why, and we want to broaden the spectrum and allow for our rich black, Hispanic and other minorities and women prospective owners of broadcast properties, to be able to compete in the marketplace. That is the essence of our free enterprise capitalistic system that we are faced with today.

The argument, paradoxically, was that government intervention was necessary to make the market function as it naturally should-- blind to the skin colors of consumers. In capitalism, money became the great equalizer; if you had it, you had the power and the forces on the supply side had to cater to your demand. Racial discrimination was a malfunction of the free market.

Under this idea, in the 1980s and 1990s, Latinos, a long disenfranchised minority welcomed as workers and rejected as citizens, were again welcomed into American society—this time as consumers. Big business did not care if your skin was white, black or brown—as long as your money was green.

From 1970 to 1990, the population of “Persons of Spanish-origin” in Fresno county grew from 25.2 percent to 35.5 percent, the surrounding counties of Kings, Madera and Tulare showing similar increases. Fresno was soon one of the top radio markets in the U.S., ranked 73rd in the nation out of 260 by 1990, and over a third of that market spoke Spanish. The field of Spanish-language broadcasting was looking lucrative and corporations took notice. In the 1980s, Fresno was the fastest growing market in the U.S., growing at a rate of 44 percent, a full eighteen percentage points ahead of the closest contender.

In 1949, KGST was one of five stations in the Valley; by the year 2004, it competed with 29 other AM and 54 FM stations, over a third of them broadcasting in Spanish.

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