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2017-11-09 00:15:03
Mediator: In AT&T Deal, Government Action Catches Up With Trump Rhetoric

On Oct. 22, 2016, Donald J. Trump made his own history in Gettysburg, Pennsylvania, where he was holding a campaign rally just weeks before his election.

“AT&T is buying Time Warner, and thus CNN,” he told his audience, calling the proposed merger an example of a media “power structure” that was working to suppress his vote and the voices of his supporters. It was, he said, “a deal we will not approve in my administration.”

He specifically cited media concentration. But his singling out of CNN in the context of an alleged plot against him was lost on no one.

Now, CNN is at the heart of a dispute between the Justice Department and AT&T and Time Warner. Three people from the companies said Wednesday that the department insisted that AT&T divest either CNN’s parent company, Turner Broadcasting, or its valuable DirecTV service in return for approval.

This raised the chilling possibility that Mr. Trump was making good on his threatening statements in Gettysburg.

Adding to the chill was the lack of a compelling legal justification for the department’s conditions, which appeared to come out of the blue. Asking AT&T to divest DirecTV seems to be a non-starter, given how essential DirecTV is as a satellite distributor of content, and the Justice Department had to know that. So in effect, AT&T’s only choice would be to jettison Turner.

Justice Department officials offered reporters a different version on Wednesday, saying it was AT&T that had offered to divest CNN to allay antitrust concerns, which the company strenuously denied. The White House said the president had not been involved.

All the assertions and denials left a lot of questions about the administration’s motives, but they were ultimately of the president’s own making. There is copious evidence of Mr. Trump’s longstanding vendetta against CNN.

He has regularly called CNN “fake news,” filled with “really dishonest people.” He has posted on Twitter a doctored video of him beating up a supposed CNN journalist. And he has floated the idea that the CNN president, Jeff Zucker, would be forced out around the same time that administration officials were suggesting the possibility that they would use the merger to bring CNN to heel, as my colleague Michael Grynbaum reported in July.

Should that enmity emerge as the chief motivation for the Justice Department’s new moves against the proposed merger, Mr. Trump will become the first president since Richard Nixon to use the levers of executive power to threaten the economic interests of a news organization whose coverage he does not like.

Nixon used a threat to bring antitrust action against the broadcast networks for their control of prime-time programming.

Aside from threatening the AT&T-Time Warner merger, Mr. Trump has implied he would crack down on Amazon over “internet taxes” in retaliation for the coverage he receives in The Washington Post, which is owned by Amazon’s chief executive, Jeff Bezos. He has vowed to tighten libel laws to make it easier for people to sue news organizations, and threatened to challenge NBC’s broadcast license.

It is not in a president’s direct power to tighten libel laws. And NBC does not technically have a “license” — its broadcast stations do, and stripping their permits involves a complicated process out of a president’s control. So his anti-press threats have so far seemed to be more bark than bite (with the important caveat that news executives fear that his rhetoric could wind up inciting violence against reporters).

But the tussle over the merger details brings a new level of seriousness to Mr. Trump’s virulent, anti-press speech, raising fresh concerns that it could result in real-world, governmental action. The appearance alone could be enough to send a powerful message — cross the executive branch at your own peril.

“We’ve had our differences, but CNN is doing its job covering this administration,” said Ben Smith, the BuzzFeed editor in chief. “The idea that the White House would even allow itself to appear to retaliate against tough, accurate coverage by holding its parent company hostage is wildly out of line with American traditions.”

Late on Wednesday, administration officials, who were not authorized to speak publicly, told reporters that the Justice Department was driven by nonpolitical concerns — apparently that the huge combination of AT&T’s mobile services and DirecTV with Time Warner’s movie studio, sports and cable businesses would prove harmful to consumers.

Legal experts were struck by the idea that the merger has run into such regulatory turbulence, because the deal involves a so-called vertical merger in which the assets of the two companies do not directly compete. “From the standpoint of the last 45 years or so of antitrust, and from the standpoint of economic sense, it’s odd,” Ronald A. Cass, dean emeritus of the Boston University School of Law, said in an interview.

The head of the Justice Department’s Antitrust Division, Makan Delrahim, held a similar view when he was interviewed about the proposed merger in October of 2016, when he was a law professor at Pepperdine University. “I don’t see it as a major antitrust problem,” he said then.

Speaking at New York University last month in his Justice Department role, Mr. Delrahim offered a different view. He indicated that he preferred structural fixes to address potential anti-competitive issues — that is, he would prefer to see assets shed from a deal than to have government create conditions it would then have to police.

Mr. Delrahim issued a statement Wednesday saying he had not come under White House pressure on this issue or any other. Maybe he has had a legitimate change of heart about the arrangement since inspecting the deal more closely from his perch at the Justice Department.

But his new boss has left him with some troubling appearances. The dust-up comes just after Mr. Trump again inveighed against the “fake news” over the indictment of his former campaign manger Paul Manafort in connection with the Russia investigation (it was CNN that first broke the news that charges were filed). Not long after, he lamented how he was not supposed to personally influence Justice Department decisions, adding, “I’m very frustrated by it.”

If Justice Department officials with legitimate concerns about the merger worry that their work will be tainted by the perception that anti-press politics are at play, there’s one remedy: get the boss to zip it.