Inside the Trump administration’s extortion-industrial complex

The Paramount settlement gives us just a peak into an industrial-scale extortion regime

FCC Chairman Brendan Carr at a news conference in Mississippi, 2021 / Eric Shelton/Clarion Ledger via Imagn Content Services

“A cold wind just blew through every newsroom this morning.”

These were the words of my colleague Bob Corn-Revere upon hearing that Paramount Global had agreed to settle President Donald Trump’s 60 Minutes lawsuit — to the tune of $16 million.

Trump filed the lawsuit in November, demanding $10 billion over what he alleged was the “deceptive editing” of a 60 Minutes interview featuring then-presidential candidate Kamala Harris. The lawsuit claimed CBS’s “substantial news distortion” was calculated to “mislead the public and attempt to tip the scales” of last year’s election in her favor. But despite legal experts widely labeling the lawsuit baseless, Paramount opted to settle.

Why?

Well, the lawsuit was a sticking point in the approval of the $8 billion Paramount-Skydance merger — approval which the Trump administration via the Federal Communications Commission, led by Chairman Brendan Carr, had the power to grant or deny. That approval was finalized last week, just two days after Trump formally dropped the lawsuit.

The timing is hard to ignore. And while the initial details of the dollar amount in the settlement attracted much controversy, it’s also been gradually revealed that the money was paired with other, more alarming agreements from Paramount Global.

First, they acceded to 60 Minutes releasing unedited transcripts of interviews with all future presidential candidates. Second, there was a rumored side deal — confirmed by Trump last week (SkyDance has not confirmed or denied) — that CBS will run advertising and public service announcements to promote Trump’s favored causes.

Finally, we learned that Skydance promised to appoint an ombudsman to review all complaints of “bias” involving CBS programming moving forward.

These components of the settlement stick out because it connects the ostensibly private matter of the 60 Minutes lawsuit to Trump’s presidential agenda. In other words, they are a function of the Trump administration’s policy priorities, blurring the boundary not just between Trump’s role as a private citizen and his role as president, but also between Paramount’s role as a private enterprise and as an arm of the White House.

But it gets worse. In fact, the Paramount settlement provides only a small window into a larger attempt — on the part of the president and his administration — to transform the relationship between the government and America’s media industry, powered by the machinery of the FCC.

It’s an extortion regime much bigger than any one-time cash grab, enveloping the media industry in a cloud of weaponized uncertainty created by lawsuits, selective regulatory investigations, and slow-walked merger approvals.

The ultimate aim? Getting some of America’s largest media companies to bend the knee and do the administration’s bidding.

Call it the extortion-industrial complex — a growing machine that counts Paramount as just one victim.

‘A cold wind…’

Let’s start with the implications of the 60 Minutes case.

First, there’s the “deceptive” editing of the 60 Minutes interview segment that was the target of the lawsuit, in which Harris was asked about the Israel-Hamas War. As FIRE explained in a filing to the FCC, the edited segment did not alter the substance of her response in any way. Rather, it was a routine and unremarkable trim — a simple shortening of a news segment to get to the point.

The president’s original complaint alleges the edit made her more “succinct,” and thus more palatable to voters. This is almost by definition true because an edit, by design, makes a candidate’s response briefer. But if an edit like this is legally actionable, then what editorial decision isn’t? The message to newsrooms, reinforced by the president’s litigious history, is that any anodyne decision they make could land them in court.

The role of the FCC

That brings us to the Trump-controlled FCC — the institutional machinery of the extortion-industrial complex that made Paramount’s submission to Trump an almost foregone conclusion.

Paramount’s surrender is due in no small part to the FCC’s final authority over Paramount Global’s merger with Skydance Media, which as we saw, just received approval from the body. Reporting indicates it’s all but explicitly understood by CBS executives and Paramount Global controlling shareholder Shari Redstone that bringing the lawsuit to a close was part of clearing the way for the merger.

Further obstructing the merger was a parallel FCC probe into a consumer complaint about the editing of the 60 Minutes interview. The probe and the lawsuit are supposedly separate, but there’s reason to believe otherwise.

For one, the consumer complaint heavily informed the lawsuit. And while Chairman Carr has been careful to avoid linking the lawsuit itself to the merger talks (wink, wink), he said the consumer complaint is “likely to arise in the context of the FCC review” — meaning, essentially, that the probe allows him to connect the subject of the lawsuit to the merger.

These tools are the core of the extortion-industrial complex, and they have their roots in certain powers of the FCC granted by the Radio Act of 1927 and the Communications Act of 1934, which birthed the agency itself. Those two laws granted the FCC regulatory power over who can use the radio and broadcast television waves, which sit at the low-frequency end of the electromagnetic spectrum (visible light sits in the middle of the spectrum). But signals at the low-end range often interfered with each other, prompting the government to step in and sort things out.

As a result, they introduced a government-sanctioned licensing regime, in which broadcasters could use part of the airwaves as long as they operated in the service of the “public interest, convenience and necessity.” If they didn’t, their license could be denied or revoked. This requirement became known as the “public interest standard,” which the Supreme Court upheld in the 1943 case NBC. v. United States on the basis that the properties of airwaves rendered it a “scarce” resource. This was a recurrent justification that became known as the “scarcity rationale,” and which the FCC used to set rules regulating broadcast programming.

To enforce these rules, the FCC was given a set of powers. They could deny or revoke licenses, decide the transfer of license ownership, and issue fines. In practice, this gave them power over any mergers and acquisitions when an owner of a broadcast station was involved. In addition to FCC’s direct oversight, members of the public could file complaints about violations that the FCC could investigate.

On the back of these powers and the public interest standard, the FCC issued regulations ranging from those on children’s programming all the way to rules governing balance in political coverage — including the well-known fairness doctrine, which required licensed broadcasters to present both sides of controversial issues of public importance.

Despite statutory guidance that “no [FCC regulation] … shall interfere with the right of free speech,” the rules offered discretion over content that put the commission in tension with that obligation, and left the door open for future abuse.

As our understanding of the technological landscape changed and a vibrant media ecosystem outside broadcast took shape, content-based rules like the fairness doctrine came under scrutiny. A 1985 report commissioned by the FCC noted that not only was the fairness doctrine a “pervasive and significant impediment to the broadcasting of controversial issues of public importance,” It also found that the scarcity rationale “which ha[d] historically justified content regulation of broadcasting . . . is no longer valid” in the era of cable and satellite and, shortly thereafter, the internet. Why should broadcast operate underneath a web of restrictions that its competition is free from?

The courts and Congress also cast doubt on the viability of the scarcity rationale in the modern media landscape, culminating in the FCC’s 1987 repeal of the fairness doctrine.

In spite of the scarcity rationale falling into disrepute, the public interest standard and other content-based rules predicated on it stayed on the books. Whether those rules were overlooked or left intact as “symbolic regulation,” the remaining public interest-based regulatory infrastructure was a loaded gun left on the table. After all, who decides what is in the public interest?

Enter Brendan Carr

Despite having lots of nice things to say about free speech before his current position, Carr took on the FCC chairmanship in January with a bold new approach. He understood that while some seismic changes in the broadcast marketplace had rendered the public interest standard antiquated, others opened up new avenues to exercise government power in its name. Big companies began buying up more and more radio and TV stations, so fewer and fewer people owned the airwaves. At the same time, the corporations operating these stations and producing their content grew much larger and more influential.

As we reviewed, the FCC already exercises a certain amount of power over the programming of the broadcast corporations through the stations and affiliates that run their content. But now, Carr has taken this to the next level, implicating the broader decisions of the conglomerates that own those broadcasters, and all the other media properties they control. His previously declared free speech principles took a backseat.

The FCC has authority over the licenses of broadcast stations (left column). In practice, Carr has treated that authority as expanding to their owners (middle column), including their vast portfolio of properties (right column).

One of his earliest moves as chairman was to unleash the FCC’s arsenal of tools in support of a top priority in Trump’s agenda that has little to do with the FCC’s traditional authority: the elimination of diversity, equity, and inclusion.

In February, Carr announced in a letter his intention to investigate the DEI programs of NBCUniversal and their parent company, Comcast. He also set his sights on the telecommunications industry, as a probe into Verizon’s diversity practices soon followed. In March, he came for Disney as well.

Around that time, Carr engaged in a strategy meeting with a conservative activist named Robby Starbuck, known for his pressure campaigns against the diversity efforts of Ford, Boeing, Walmart, and McDonald’s. Following the meeting, Starbuck posted, “Good luck with the FCC if you’re a woke company . . . You’re gonna need it!”

Two days later, Carr made clear that any businesses seeking approval for mergers or acquisitions — including Paramount Global — would be expected to “get busy ending any sort of their invidious forms of DEI discrimination.”

Corporations promptly complied with Carr’s demands. Verizon and TMobile sent letters to the FCC notifying Carr they had scrapped their DEI-related policies. Comcast withdrew from Pride march sponsorships and scrubbed their website. Just this week, Skydance confirmed to Carr a sweeping list of actions taken by Paramount to remove anything approaching DEI.

It’s important to understand the scope of Carr’s interventions. Under the FCC’s Equal Employment Opportunity rules, the commission can prevent radio and TV broadcasters from discriminating in hiring based on race, religion, or sex. So while he had a limited basis to, say, target affirmative action, Carr’s ambitions went beyond hiring practices and implicated First Amendment-protected speech.

For instance, the letter to Comcast notes the EEO rules, but there’s no direct mention of unlawful hiring practices on their part. What Carr does cite is the values of the company as described on their website, and the existence of employees and initiatives responsible for promoting DEI, including in TV and programming. With his letter to Verizon, this became a pattern.

Carr’s letter to Disney goes as far as to cite the encouragement of diverse and inclusive shows as incriminating. As Carr noted, his intervention followed extensive efforts already taken by Disney to scale back DEI. Company insiders complained, “What do we stand for now, keeping MAGA happy?”

The theory of authority behind all this is not completely new. After the events of the 2020 election and January 6th, 2021, a progressive watchdog group called the Media and Democracy Project (MAD) filed a petition to deny the broadcast license renewal application for Fox Corp-owned television station FOX 29 Philadelphia. Even though Fox News programming was not aired on the network (with the exception of then-host Chris Wallace’s Fox News Sunday), the petition cited their 2020 election coverage as grounds for the denial. Former Fox counsel and FCC officials supported it.

The response to these efforts from previous FCC Chairs was markedly different from Carr’s, however. Obama’s (retired) FCC Chair Tom Wheeler said of the broader scrutiny surrounding Fox, “Unfortunately, the FCC does not have jurisdiction over cable networks. In fact, it doesn’t even have jurisdiction over networks like CBS and NBC who use the airwaves.”

In January, outgoing Biden-appointed FCC Chairwoman Jessica Rosenworcel rejected MAD’s petition, noting in a statement they sought to “weaponize the licensing authority of the FCC in a way that is fundamentally at odds with the First Amendment.” She also rejected three other complaints: against NBC, ABC, and of course the infamous complaint against CBS and 60 Minutes.

Upon assuming the chairmanship in January, however, Carr reopened all three complaints with identical orders, citing an “insufficient investigatory record.” While these orders did not provide specific justifications for the reopenings, in interviews Carr has pointed to enforcing the public interest standard and combating ideological bias in news. In practice, this has played out as combatting disfavorable coverage of Trump — as evidenced by Carr’s curiously leaving the previous petition targeting FOX 29 Philadelphia in the grave.

The three complaints capitalized on the mostly dormant FCC content rules left over from the spectrum scarcity era — including the news distortion rule, which prohibits networks from engaging in deliberate falsification of the news; and the equal opportunities rule, which requires networks to provide the roughly same amount of airtime to competing candidates in federal elections.

However, in both cases the claims fall short of their respective standards. The equal opportunities proceeding against NBC for example — centering around the brief appearance of Harris on NBC’s Saturday Night Live — fundamentally misunderstands how the rule works.

As the FCC’s letter dismissing the original complaint points out, Trump came to an agreement with NBC after the SNL airing to give him coveted ad time during a Sunday evening NASCAR race, roughly equivalent in length to that of Harris’s appearance on SNL. The complaint says this is “too little, too late” — ignoring, as the FCC pointed out, “[a]n agreement reached after the use of broadcast facilities is a standard way for broadcasters to adhere to the equal opportunities rule.” FCCs records demonstrate that Carr himself knew that NBC complied with the rule, though that didn’t stop him from claiming otherwise.

This brings us to the news distortion rule, which has historically been understood as having a very high bar, requiring documented evidence that broadcast leadership directed reporters to deliberately mislead the public in order to actually threaten a broadcaster’s license. In fact, there has been only one finding of news distortion since 1982 — involving NBC staging a car explosion in a 1993 Dateline report warning about unsafe gas tanks. Even there, no adverse action was taken against the network beyond a frankly worded letter.

With this in mind, it should follow that the complaint against CBS and 60 Minutes would allege extensive evidence of an elaborate plot to rig then-candidate Kamala Harris’s responses, with orders coming from the very top. But as FIRE’s filing in the FCC’s docket on the matter points out, it did not do that. Instead, as with the NBC complaint, “it fails to grasp the basic elements of the [policy.]”

We’ll tackle more problems with the CBS complaint in a moment, but first, let’s make one thing perfectly clear: By lending legitimacy to a complaint like this, the FCC isn't just enforcing the news distortion rule — it’s reimagining it. This reinterpretation sets a troubling new precedent, opening the door wider for government coercion of broadcasters and giving Trump and Carr fresh leverage to intimidate media owners. It’s another way the extortion-industrial complex grows.

The role of the Center for American Rights

Who filed the CBS complaint?

The same organization that filed the complaints against NBC and ABC: the Center for American Rights. It’s worth parking our car here for a second to get a sense for how rickety and rusty some of the extortion-industrial complex's foundation is.

The paper-thin CBS complaint leans on speculation from conservative commentators as evidence, appoints CAR as a spokesman for the general public, and fails to actually allege an instance of news distortion, the purported violation CBS is guilty of. Other complaints aren’t much better, from citing Brendan Carr tweets as if they were case law to equating news coverage that mentioned the presence of an autistic child in the back of deported Salvadoran immigrant Abrego Garcia’s car when he was arrested with “villainiz[ing] the police.”

The role of CAR emphasizes how the public input can be abused by a commission with malign intentions. CAR gives the FCC specific public cover to engage in shakedowns of media entities. The chairman gets the benefit of the appearance that he is just looking into the duly filed legal grievances of the faithful public, even if he is granted some agency by the likes of CAR as to when and where those grievances appear.

Take one example from last April: Carr took issue with MSNBC and other outlets’ coverage of Abrego Garcia’s detention and deportation, and went as far as to post allegations of news distortion on the part of Comcast (again, the FCC has zero authority over cable news channels, and again, this is a reimagining of what the news distortion rule is). Within a week of Carr’s social media posts, CAR filed a complaint alleging news distortion on the part of NBC, CBS, and ABC owned properties, citing coverage on their websites in addition to their broadcast channels. It’s like a dog responding to a whistle.

CAR has benefitted from its newfound role in the extortion-industrial complex, as Trump is reportedly considering CAR’s president Daniel Suhr for an appointment on the Seventh Circuit Court of Appeals.

The extortion-industrial complex threatens our First Amendment rights, but we can (and should) fight back

When you add up the lawsuits, the complaints, and the FCC’s broader content-based regulatory regime, the scheme becomes clear: strangle America’s broadcast industry into submission with a series of looming threats. That’s the extortion-industrial complex at its heart, and how they harmonize together is simple. Let’s review.

First, there is often a merger, acquisition, or some other needed regulatory approval coming down the pipeline that introduces a point of leverage for the government. The Skydance-Paramount merger is the second time an entity owning CBS News has been involved in a merger under Trump’s presidency, and the lead-up to a merger like that actually taking place can take years.

That’s ample opportunity for the government to make demands.

And if there isn’t a merger or acquisition coming to provide the government with the opportunity to extort? Then CAR or some other political front group can draft a complaint to the FCC and create one. If an FCC probe isn’t threatening enough, Trump’s legal team will bolster it with a lawsuit. And as we saw with Paramount, when the government’s desires are big enough, they’ll combine all three.

Provided Trump sues, the settlement agreement then acts as the depository for the targeted company’s tributes — whether money, policy concessions, or both. Job done.

The uncertainty with which all this places the companies operating under this racket’s thumb is what makes the extortion-industrial complex such an effective force. That uncertainty means less commercial investment, both into the company and out of it.

So, taking advantage of the natural corporate aversion to uncertainty, Trump and his extortion apparatus offer an off-ramp: don’t do anything we don’t like, and your business’s future looks a little more predictable and profitable.

That’s an incredible source of soft power.

This is why Skydance’s agreement to bring on an ombudsman to monitor bias in CBS’s news programming paints a worrying picture. It signals what Trump and Carr’s efforts could be building towards: a future where their interventions are no longer required because soft power does all the work.

That’s a five-alarm fire for free speech, and neither Carr nor the Trump administration show any sign of stopping. As Carr sees it, “the media industry across this country needs a course correction.”

We’ve seen Trump use similar extortionary tactics in other contexts — including with universities and law firms — and unfortunately, many of his targets have capitulated. This includes Columbia University, who acceded to a list of demands provided by the Trump administration and was later forced to pay $200 million dollars. It also includes law firms like Paul Weiss and Willkie Farr & Gallagher — targeted for the crime of employing Trump enemies — who settled under the expectation they would be doing pro bono work on behalf of causes like helping veterans, only to see Trump later suggest they’d be negotiating his trade deals.

All of this has provided us with a chilling reminder: extortion is seldom a one-time deal. Behavior that gets rewarded gets repeated, and too many have caved to the pressure at the expense of free speech in our country’s most important institutions. They’ll discover for themselves that selling out the First Amendment is a debt that always comes due.

Those capitulations are all the more frustrating because we have seen that fighting back can pay off. For example, the law firms Perkins Coie, Jenner & Block, WilmerHale, and Susman Godfrey all fought Trump’s executive orders — and they won. Enforcement of the orders have been blocked on First Amendment grounds for all four of them.

America’s media conglomerates would be wise to take their example. Also, fighting back isn’t limited to their leadership. The creators of South Park saw Paramount announce a $1.5 billion deal with them to create new episodes for their streaming service, and 10 hours later, they aired an episode featuring a scathing criticism of both Trump’s extortion and Paramount’s appeasement.

While resistance will help fend off the immediate crisis, the root of the problem remains with the core machinery of the extortion-industrial complex itself. Thankfully, dismantling that wouldn’t be too tall an order.

For example, the next FCC chair can simply get rid of the news distortion rule, which serves little utility other than abuse, especially under Carr’s understanding of the rule. Similarly, the FCC could halt unnecessary investigations, both formal and informal, into the content decisions of those under its regulatory purview. FIRE has detailed both of these recommendations in previous filings to the FCC.

Finally, the FCC can use their discretion over the merger process to eliminate content-related considerations. These moves would align the commission with court and congressional guidance, and also close the government’s pivotal extortionary pressure points. Importantly, destroying these levers wouldn’t weaken legitimate oversight. Rather, it would restore the FCC to its core technical mission and insulate speech from bureaucratic ransom.

It’s a necessity that transcends partisan lines. One could very much imagine a future Democratic chairman taking Carr’s playbook, reviving the petition against FOX 29 Philadelphia, and reorienting the extortion-industrial complex’s machinery towards the conservative media ecosystem. If and when that happens, proponents of Carr’s current behavior may change their tune about how permissible and necessary these crackdowns are. And that will only make it more obvious that this usage of government power is not compatible with an open democratic society.

To preserve free expression and our First Amendment rights, the extortion-industrial complex must be dismantled.