Freedom Line Blog

Congress doesn’t maintain a spotless record of affixing accurate titles to proposed legislation, but in the case of the American Music Fairness Act (H.R. 4130), the House of Representatives nails it.

Now it’s time for the Senate to take up companion legislation and bring greater fairness to performance rights in the music industry.

By way of background, federal law currently secures royalty payments for songwriters and others when their songs are played on AM-FM terrestrial radio, but not for the performing artists themselves.  Deepening that odd paradox, performance artists receive compensation when their songs play on digital broadcast platforms like the internet, satellite and cable.  Terrestrial radio broadcasters, however, somehow remain exempt under existing law from having to pay that same compensation.  There’s no logical or legal justification for that paradox, which amounts to crony capitalism in the form of a special government carve-out.

Fortunately, the American Music Fairness Act currently before the House would finally secure performance rights for artists whose recordings are played on terrestrial radio (with exceptions maintained for smaller mom-and-pop stations).  In 2021, we at CFIF joined numerous fellow conservative and libertarian organizations in a coalition letter to the House amplifying the need to pass this legislation to protect artists’ natural intellectual property (IP) rights:

The Constitution protects intellectual property rights and specifically delegates to Congress authority to protect creative works.  Artists who produce music therefore have the right to protect their intellectual property, including both the writer and performer of a given recording.  When a given work is transmitted, common sense and basic fairness dictate that the medium of transmission should not affect the existence of these rights.  Yet, under the current regime, a performer does not hold effective or enforceable rights to his or her product when it is distributed through terrestrial radio.”

Opponents of the American Music Fairness Act illogically suggest that it would somehow introduce needless market regulation, but the obvious reality is that the market is already regulated in the discriminatory manner described above.  The American Music Fairness Act would merely level the playing field and respect the value of the artists’ works.

Some opponents of H.R. 4130 also falsely attempt to portray it as creating a “tax.”  As leading anti-tax crusader Grover Norquist of Americans for Tax Reform answers, however, taxes are compulsory payments to government, whereas royalties are voluntary payments to broadcast others’ creations:

[W]hat is proposed is not, in fact, a tax but a royalty.  The definition of a tax is the transfer of wealth from a household or business to the government.  Taxes aren’t voluntary; paying a royalty is.  It is completely within the rights of broadcasters to decide not to pay for the use of a performer’s song by simply not using the song.  This may not be an ideal option, but these songs actually are the property of someone else…  Just as dishonest as calling a tax a fee or fine, so too is it wrong to apply the word ‘tax’ to a royalty payment.  Creating the negative perception that this legislation creates a new tax may be convenient in the short term and assist opponents in gaining political support;  in the long run it is incredibly unhelpful to those who work to reduce the burden of government in our everyday lives.”

By any standard of fairness and logic, performing artists possess a natural right to enjoy the fruits of their labor and creativity, just like any of us do for our work.  After all, artists already receive performance payments from non-terrestrial radio stations, reflecting the value of their work.  The American Music Fairness Act simply corrects an unfair and illogical federal carve-out.

Accordingly, the House should promptly pass this long-overdue legislation, and the Senate should similarly take up companionate legislation.

For years, we at CFIF have joined fellow conservative and libertarian organizations to spotlight the unfairness under federal law by which songwriters and others receive royalty payments when their songs are played on AM-FM terrestrial radio, but the performing artists themselves do not.

Exacerbating the illogic, performance artists do receive compensation when their songs play on digital broadcast platforms like the internet, satellite and over cable.  Yet terrestrial radio broadcasters remain exempt under existing law from having to pay that same compensation.

There’s no logical or legal justification for that paradox.  It amounts to crony capitalism in the form of a special government carve-out, and we’ve called for changes in federal law to finally correct it.

Fortunately, we can report good news in Congress on this unresolved issue.

New legislation before the House of Representatives entitled the American Music Fairness Act (H.R. 4130) would finally secure a performance right for artists whose recordings are played on terrestrial radio, with exceptions allowed for smaller mom-and-pop stations.

As we and fellow conservative and libertarian organizations wrote in our coalition letter to the House in 2021, that would protect artists’ natural intellectual property (IP) rights:

The Constitution protects intellectual property rights and specifically delegates to Congress authority to protect creative works.  Artists who produce music therefore have the right to protect their intellectual property, including both the writer and performer of a given recording.  When a given work is transmitted, common sense and basic fairness dictate that the medium of transmission should not affect the existence of these rights.  Yet, under the current regime, a performer does not hold effective or enforceable rights to his or her product when it is distributed through terrestrial radio.”

Opponents of the American Music Fairness Act might illogically allege that the proposal would introduce needless regulation of the market.  The truth, however, is that the market is already regulated in the discriminatory manner described above.  The proposed law would simply level the playing field and better respect the value of the artists’ works.

Opponents might also falsely attempt to portray H.R. 4130 as creating a “tax.”  As Grover Norquist of Americans for Tax Reform cogently answered, however, a tax is a compulsory payment to government while royalties at issue here are voluntary payments to broadcast others’ creations:

[W]hat is proposed is not, in fact, a tax but a royalty.  The definition of a tax is the transfer of wealth from a household or business to the government.  Taxes aren’t voluntary; paying a royalty is.  It is completely within the rights of broadcasters to decide not to pay for the use of a performer’s song by simply not using the song.  This may not be an ideal option, but these songs actually are the property of someone else…  Just as dishonest as calling a tax a fee or fine, so too is it wrong to apply the word ‘tax’ to a royalty payment.  Creating the negative perception that this legislation creates a new tax may be convenient in the short term and assist opponents in gaining political support;  in the long run it is incredibly unhelpful to those who work to reduce the burden of government in our everyday lives.”

Here’s the bottom line:  Performing artists have a natural right to enjoy the fruits of their labor and creativity, just like any of us do for our work.  Indeed, artists already receive payment from non-terrestrial radio stations, reflecting the value of the artists’ work.  Accordingly, the existing federal carve-out is unfair and illogical, and this bill simply corrects that imbalance.

It’s therefore time for Congress to pass the American Music Fairness Act (H.R. 4130) and achieve common-sense reform at last.