Share this story
Close X
Switch to Desktop Site

Loopholes Live!

SPECIAL deals and loopholes are alive and well in the 104th Congress. President Clinton has just signed, presumably with teeth clenched, legislation to let self-employed Americans deduct health-care costs from their taxes.

The tax break itself was something the president was quite pleased to sign into law. But the bill contained a provision giving media mogul Rupert Murdoch a $63 million tax benefit for the sale by his Fox Broadcasting of an Atlanta television station -- WATL -- to Qwest Inc., owned by Quincy Jones and other minority-group entertainment figures (55 percent) and the Tribune Company (45 percent).

About these ads

Here's an argument for the line-item veto. The sale of WATL was crafted to take advantage of an affirmative action program to afford a capital-gains tax break for owners of TV, radio, and cable properties who sell to minority owners -- a break Congress has just repealed.

But Senate Finance Committee chairman Bob Packwood (R) of Oregon teamed with Carol Moseley-Braun, a liberal Democrat from Illinois, to write customized legislative language to protect the Murdoch deal, even as others like it were being scuttled. She characterized her involvement as routine constituent service to the Chicago-based Tribune Company.

Some congressional Democrats, noting the Georgia connection and mindful of House Speaker Newt Gingrich's book deal with Murdoch-owned HarperCollins, think they see his fingerprints here, too.

Diversifying the ownership of media organizations is important, but the affirmative action program of which the Fox/Qwest deal was seeking to take advantage had been criticized as expensive, ineffectual, and prone to encourage ''front'' ownership.

The most galling case involved a proposed sale that would have given the New York conglomerate Viacom a $600 million break for selling a TV station to a minority owner who, as a government lawyer, had helped write the rules from which he stood to benefit. The repeal of the program quashed this and 17 other pending deals -- whose principals evidently had less pull than Mr. Murdoch.

Follow Stories Like This
Get the Monitor stories you care about delivered to your inbox.