Hume noted White House claim that "video news releases" are legal, ignored that GAO thinks otherwise

During a February 13 report on a Government Accountability Office (GAO) study that found that the Bush administration has spent $1.6 billion on public relations contracts since 2003, Fox News Washington managing editor Brit Hume noted that the "White House says the use of PR firms is legal and helps get important information to the public." But Hume failed to inform viewers that according to the GAO, the White House's use of such firms to produce video news releases (VNRs) -- prepackaged news stories promoting administration policies and programs -- violates federal law. The agency's repeated criticism of this practice even led the U.S. Senate to pass legislation in 2005 requiring the government to clearly inform viewers that such VNRs, which are often presented as unbiased news stories by local television news programs, were created by a federal agency.

On February 13, Democratic congressional leaders released a new GAO study that found that the Bush administration spent $1.6 billion on contracts with public relations firms, advertising agencies, media organizations, and individuals since 2003. As The Washington Post reported, "Democrats asked the GAO to look into federal public relations contracts last spring at the height of the furor over government-sponsored prepackaged news and journalism-for-sale."

On the February 13 edition of Fox News' Special Report with Brit Hume, Hume briefly mentioned the study:

HUME: The Government Accountability Office, in a survey of seven of the 15 cabinet level departments, finds that the Bush administration has spent about one and a half billion dollars on public relations efforts in 2003, [200]4 and the first half of 2005. The bulk of the money was spent by the Defense Department.

Congressional Democrats requested the report after disclosures that a commentator had been paid to promote the No Child Left Behind Act, and that some federal departments had paid for video news releases that appeared to some viewers at least to be independent newscasts. The White House says the use of PR firms is legal and helps get important information to the public.

But in simply reporting that the "White House says the use of PR firms is legal," Hume presented only one side -- the White House's -- and ignored the GAO's conclusion that the administration's use of these firms to produce and distribute certain VNRs violates the law.

In May 2004, the GAO determined that the Department of Health and Human Services broke federal law by releasing VNRs that favorably depicted a new Medicare law supported by the administration without indicating that the government had created and paid for the video segments. On January 6, 2005, the GAO announced that the Bush administration had again violated the law by producing similar "news segments" about drug use, saying the segments "constitute covert propaganda" because the government was not identified as the source of the materials. The GAO added that the administration "made it impossible for the targeted viewing audience to ascertain that these stories were produced by the government."

In a letter dated February 17, 2005, Comptroller General David M. Walker explained that, in both of these cases, the prepackaged news stories violated the government-wide prohibition, first enacted in 1951, on the use of appropriated funds for purposes of "publicity or propaganda." (The GAO released a full report rebuking the administration for this practice on May 12, 2005.):

In neither case did the agency include any statement or other indication in its news stories that disclosed to the television viewing audience, the target of the purported news stories, that the agency wrote and produced those news stories. In other words, television-viewing audiences did not know that stories they watched on television news programs about the government were, in fact, prepared by the government. We concluded that those prepackaged news stories violated the publicity or propaganda prohibition.

The GAO's conclusions were immediately met with resistance by the Bush administration. According to a March 13, 2005, New York Times article, numerous government agencies responded by simply instructing their various departments to ignore its findings:

Although a few federal agencies have stopped making television news segments, others continue. And on Friday [March 11, 2005], the Justice Department and the Office of Management and Budget circulated a memorandum instructing all executive branch agencies to ignore the G.A.O. findings. The memorandum said the G.A.O. failed to distinguish between covert propaganda and "purely informational" news segments made by the government. Such informational segments are legal, the memorandum said, whether or not an agency's role in producing them is disclosed to viewers.

The legality of the VNRs has since been a matter of debate in Congress. On April 14, 2005, the Senate unanimously passed an amendment to a supplemental spending bill that prohibited, for one year, "the use of funds by any Federal agency to produce a prepackaged news story without including in such story a clear notification for the audience that the story was prepared or funded by a Federal agency." Congressional leaders have since continued their efforts to advance legislation requiring that the Bush administration's use of this public relations tool comply with the GAO's 2005 ruling.