This past week (May 1 – May 7) has been National Small Business Week.  Numbering more than 31 million, small businesses are the lifeblood of the American economy. The Taxpayers Protection Alliance (TPA) understands the importance of small businesses.  By advocating for tax reform and less regulation, TPA does everything that we can do to help small businesses.  We have spotlighted many small businesses in the past to highlight their stories and importance. I want to give a special shout out to the  Small Business & Entrepreneurship Council and the incredible work they do for small businesses.  Under the leadership of Karen Kerrigan, they have been representing small businesses for more than 25 years. These folks work tirelessly on behalf of small businesses. Please patronize small businesses this and every week.
 

Sweet Sound of Intellectual Property

When individuals perform a service or put on a performance, they naturally expect some well-earned compensation. The American economy is built on people using their talent and creativity to get ahead, and when pay doesn’t meet muster, companies are forced to change their ways. Unfortunately, this is not so in the radio world due to outdated loopholes allowing terrestrial stations (AM/FM) to stiff performers of famous songs despite playing their music all day long. Broadcasters are strangely exempt from compensating the creators of sound recordings under copyright law, even though they are required to pay royalties to the writers of the same songs. The recently introduced American Music Fairness Act aims to remedy this long-standing problem, but the bill is already encountering stiff opposition from special interest groups such as the National Association of Broadcasters (NAB). It’s time to do the right thing and give performers their due.

Copyright law has been carefully crafted in the U.S. to simultaneously protect the rights of artists and creators and allow for subsequent innovation that will improve on the status-quo. Sound recordings have been granted federal protection for half a century and are consistently protected by the courts if copying is more than a brief clip. The glaring loophole written for terrestrial radio stations makes little sense, given that more than half of adults have listened to music in their car over the past six months. Compare that to the 33 percent of adults who stream music online via a paid service and the 27 percent of consumers who listen to music streamed over the internet. Radio may eventually go the way of the dodo, but its continued staying power for the time being means that the “terrestrial exception” to copyright protection is no small matter.

And, the gulf in compensation between radio performance and everything else is growing because of recent compensation decisions by the Copyright Royalty Board. Last year, the Board released terms and rates for webcasting royalties through 2025 applying to virtually all broadcasters showing performances over the digital domain. The government has been busy hiking compensation for digital song performances while keeping radio – a leading listener choice – flatlined at zero. The American Music Fairness Act would change this broken status-quo and level the playing field.Interest groups such as NAB have cried foul at the new proposal, suggesting that allowing performers access to royalties would bankrupt radio stations. However, there’s preciously little evidence to support that view. It is entirely possible that larger radio stations would have to pay significant sums comparable to Sirius XM’s levy of 15.5 percent of its revenues. But, smaller radio stations would be protected against the sudden imposition of large performance royalties. The bill sponsors, Reps. Ted Deutch (D-Fla.) and Darrell Issa (R-Calif.) explain that their legislation exempts, “radio stations that fall under $1.5 million in annual revenue and whose parent companies fall under less than $10 million in annual revenue overall. For less than $2 per day ($500 annually), small and local stations can play unlimited music.” This provision allows for performers to get their due while protecting local radio stations from runaway royalties. The American Music Fairness Act walks the tightrope of fostering innovation while protecting the rights of all parties.

 
Sour Carbon Taxes 

It’s no exaggeration to say that the United States is struggling economically. Despite being at the tail end of the coronavirus pandemic, the nation recently saw GDP growth decline by 1.4 percent last quarter. This marked the first time since Q2 of 2020 that the U.S. experienced negative economic growth. Further, inflation rates consistently remain at or near historic levels. Gas prices are at record highs as well, and speculation looms about potential food shortages coming in the near future. Despite all of this, there is a push – led by the Business Roundtable (BRT) – to implement a new carbon tax on American consumers. The proposal, erroneously labeled by BRT as a “market-based mechanism,” would entail the government setting a price for carbon that would be collected at checkout and remitted to the government. Americans are already feeling the squeeze on their paychecks as inflation continues sending prices upward. It may be called by a host of other names, but in the end, this is a clear tax on American consumers.
 
The suite of policy recommendations by BRT also includes a host of special interest giveaways that include tax credits and subsidies to producers of alternative energies. These subsidies – which continue to mount each successive year – will contribute to the rising inflation that has come due to Congress’ inability to rein in its spending habits. Further, many of these industries have received subsidies for years to the point where they should either be able to stand on their own or be deemed too inefficient to function. Carbon taxes and these subsidy programs often fall far short of their environmental policy aims – as most attempts at government central planning do. For example, the push for electric vehicles (EV) necessitates the production of more EV batteries. These batteries are produced with little regard for the human and environmental toll exacted in the production process and the mining of raw materials. These solutions are far more complicated than flippant proposals to switch up technological means.
 
Thankfully, the fact that these recommendations got any sort of traction raised red flags with some lawmakers on Capitol Hill. House Republican Whip Rep. Steve Scalise (R-La.) released a statement with fellow Reps. Markwayne Mullin (R-Okla.) and Jeff Duncan (R-S.C.). In the statement, they said, “At a time when skyrocketing inflation is hammering American families, it is shocking and tone-deaf that The Business Roundtable’s latest energy policy proposal calls for a new energy tax that would increase energy costs even higher while also pushing for crony tax credits that will only benefit special interests and Washington insiders.” The joint statement from these members of Congress also noted an important point. An energy tax of the sort described by BRT would disproportionately hit low-income Americans. Alternative sources of energy are expensive and, oftentimes, inefficient. That is why they so often require billions in taxpayer subsidies to even come close to viability on the open market. It is also why they are typically utilized only by the more affluent sections of American society. Lower income brackets utilize more traditional forms of energy because they are both more efficient and affordable for them. It is easy for a group of CEOs to propose a carbon tax, knowing it will hit those less well-off.
 
Congress has a whole host of issues to deal with at the moment. None of them will be solved by implementing an energy tax on low-income Americans or subsidizing inefficient technologies. Elected officials need to focus on getting inflation and spending under control. They need to make America more competitive abroad and decrease the regulatory burden on energy producers that could produce good, clean alternatives. It is encouraging to see Reps. Scalise, Mullin, and Duncan recognize this. Hopefully, the rest of the powers that be in Washington – both in and out of the halls of Congress – recognize this as well.

BLOGS:

Monday:  Lawmakers Sing the Right Tune with Copyright Reform

Tuesday: Senate Judiciary Tees Up More Price Control Pain

Wednesday: Congress Is Putting Attacking Big Tech Ahead of Protecting Americans

Thursday: EU Antitrust Charges a Sign of Dangers Ahead

Friday: Watchdog Calls for Real Postal Reform After $639 Million Quarterly Loss

 
MEDIA:
 
April 29, 2022: Jeff Stier, TPA Senior Fellow, joined The Lars Larson Show (Portland, Or.) to discuss the proposed ban of menthol cigarettes.
 
May 2, 2022: WBFF Fox45 (Baltimore, Md.) interviewed me about property sales tax problems in Baltimore.
 
May 2, 2022:  KXL 101 FM quoted TPA in their story, “The Same Government Giving Out Free Crack Pipes Tries To Ban Menthol Cigarettes.”
 
May 2, 2022:  Real Clear Policy ran TPA’s op-ed, “Congress Is Putting Attacking Big Tech Ahead of Protecting Americans.”
 
May 3, 2022:  The Center Square ran TPA’s op-ed, “President Biden should use Small Business Week to save lives.”
 
May 3, 2022: I joined John Solomon and Amanda Head on Real America’s Voice to discuss a potential student loan bailout.
 
May 3, 2022:  WBFF Fox45 (Baltimore, Md.) “Accountability Desk: Investigation continues into organizational structure of Safe Streets.
 
May 4, 2022: Dan Savickas, TPA’s Director of Tech Policy, joined The Barrett Brief (New Orleans, La.) to discuss the Digital Services Act.
 
May 4, 2022:  Real Clear Policy ran TPA’s op-ed, “A New Carbon Tax is the Last Thing Americans Need Right Now.”
 
May 4, 2022: Patrick Hedger joined The Jason Rantz Show (Seattle, Wa.) to discuss student loan forgiveness.
 
May 5, 2022:  I appeared on WBOB 600 AM (Jacksonville, Fla.) to talk about inflation and the deficit and debt.
 
May 5, 2022: WBFF Fox45 (Baltimore, Md.) interviewed me about the new $3 billion electric vehicle battery initiative.
 
May 5, 2022: Townhall.com ran TPA’s op-ed, “Raise a Glass, Not Taxes, On National Beverage Day.”
 
May 5, 2022: Martin Cullip, TPA International Fellow, joined TalkTV (UK) to discuss the ongoing independent tobacco review.
 
May 5, 2022: I joined ‘Real America with Dan Ball’ on OANN to discuss student loans, the latest jobs report, and economy.

Have a great weekend!