By Zachary Roth

Last week, as everyone knows by now, The New York Times reported that numerous local television stations across the country presented, as news items, video news releases prepared on behalf of the Bush administration touting the benefits of the new Medicare law. The pre-packaged segments included public relations agent Karen Ryan posing as a reporter.

The real question, however, is: How did so many television stations end up running the segment? While taking ultimate responsibility for their error, many news directors pointed the finger at two other targets: the Bush administration and CNN.

The news directors we talked to all said they had strict policies against running VNR material unless it is specifically identified as such to viewers. In each case, a hurried or inexperienced producer looking to fill airtime found a pre-produced, complete story sent by CNN, saw that it treated a compelling national issue, and used it without adequately scrutinizing the content. Bud Veazey, assistant news director at WAGA-Atlanta — who on Thursday told The Atlanta Journal-Constitution, “You’d never see anything like that in Atlanta,” before Campaign Desk pointed out that his own station had run the VNR as news — explained the thinking: “You’re looking to fill four hours — oh, here’s a nice package.”

Tom Henderson of WTVC-Chattanooga was blunter, telling Campaign Desk, “It was our mistake.” The station aired a correction last week, explaining what the material was and how it had erred.

Most of the news directors we spoke with were also genuinely angry at the Bush administration, for what they saw as a deceptive public relations campaign that took conscious advantage of the smaller stations’ well-known lack of resources: “Shame on them — that’s pretty sneaky,” said Veazey, referring to HHS. Julie Akins of KSEE-Fresno was harsher: “It’s clear that there was an attempt to deceive … It’s shocking that the Bush administration would manipulate the news media in this way.”

But some also expressed strong displeasure with CNN, which distributes pre-packaged stories to local stations around the country through its CNN Newsource service, acting as a sort of wire service for TV. Veazey said that when his station receives VNR footage from CNN, it’s clearly labeled in the slug at the top as VNR. But other news directors told us that’s not the case in their systems: You have to search through the footage to find the VNR I.D. Henderson, of WTVC-Chattanooga, told us his station “ran what appeared to be a reporter’s package, which aggravates the mistake.” And Lynn Brooks of WVUA-Tuscaloosa, confirmed in an email to a viewer, obtained by Campaign Desk, that when her station received the Medicare story, it “was designated as a ‘reporter package’, with nothing distinguishing it as a video news release.” CNN, she said, “dropped the ball.” Akins of KSEE-Fresno agreed: “I think CNN does a disservice to its affiliates” by including VNR packages in its stream of news footage. “They should create a separate VNR feed,” she said.

According to the news directors, CNN makes money on both ends of the process. Understandably, it charges the news stations a fee to subscribe to its satellite news feed service, just as the Associated Press charges the newspapers it serves. But Larry Moskowitz of Medialink (which Moskowitz told Campaign Desk is the world’s largest producer and distributor of VNRs) confirmed that CNN Newsource and other similar services also charge the VNR distributor, by leasing transmission time on the satellite news feed that then goes out to local stations.

This suggests a clear conflict of interest for CNN, which is apparently charging both the party with a vested interest in promoting a particular story — in the case of the now-notorious Karen Ryan, that would be HHS — and the receiving station. Along the way, it mixes in the client’s material with legitimate, CNN-produced news stories to be used by local stations - acting as a paid “news launderer” on behalf of the VNR producers.

CNN did not return repeated calls for comment over a three-day period. A news director who had received the Medicare VNR from CNN and run it told Campaign Desk she contacted CNN to complain. She was referred to the company’s lawyers.

Zachary Roth is a contributing editor to The Washington Monthly. He also has written for The Los Angeles Times, The New Republic, Slate, Salon, The Daily Beast, and Talking Points Memo, among other outlets.