Side by side, the two cartoon figures stride across the screen, their stick arms wrapped around massive boxes of gifts. Mischievous music tinkles in the background and a bemused narrator—his words punctuated by comic sound effects—tells a tale of petty corruption by Colorado Congressman Ed Perlmutter, a Democrat running for his fourth term.

Congressman Perlmutter sure knows how to work the system, the narrator begins, as stick-figure “Perlmutter” and ponytailed stick figure “Mrs. Perlmutter” stride into Washington, DC. The ad goes on to describe Mrs. Perlmutter as a lobbyist for the failed solar company, Solyndra, who got paid $140,000 to lobby for the company as her husband voted to steer taxpayer dollars into its coffers. The narrator concludes: Congressman Perlmutter voted for the bill. Lobbyist Perlmutter got paid. And taxpayers got scammed.

The offbeat charm of the ad, aired by Perlmutter’s challenger for Congress, Joseph Coors, was marred by one problem: Its allegations were false.

For starters, Perlmutter’s vote in favor of the massive 2009 stimulus bill did not steer money to Solyndra; the funds were allocated by the Energy Department. Two other details, equally crucial: By the time of the stimulus vote, Mrs. Perlmutter no longer worked for Solyndra. Also, she had already divorced the congressman.

In campaign 2012, political advertisers—riding the flood of cash that Citizens United uncorked—poured an estimated $2.9 billion into spots on broadcast television. A few of these resorted to outright falsehoods. Many more, like the attack on Perlmutter, perfected the ancient art of arranging a series of true or opinion-based statements in a way that leads to a plainly inaccurate impression. In Denver, such dubious campaign ads seemed to pile up as high as the Rocky Mountain peaks that overlook the city.

The presidential race alone brought roughly $59 million in Denver airtime for more than 55,000 spots, and an industry source cited by The Denver Post estimated that more than $67 million was spent in the Denver market overall. Mark Cornetta, general manager of Denver’s most watched local TV station, KUSA, estimates 45 percent of the money came from outside spending groups, such as super PACs and political nonprofits. The “vast majority” of the spots that this spending spree purchased, said Brandon Rittiman, a KUSA political reporter, included “distortions of some kind.”

Local broadcasters like KUSA are emerging as the biggest financial winners in the free-for-all following the Supreme Court’s 2010 Citizens United decision, which allowed unlimited checks to flow into political campaigns from donors who often remain secret. Yet each misleading ad that aired also made it a little tougher for stations to do the job they were granted monopoly of the public airwaves to perform: serving the needs of their communities by accurately informing and educating voters. And as the number of ads has grown in each election cycle, the danger is that they’ll set the political agenda in the future.

How did TV stations respond to this situation? And how should they respond? It’s a question for both executives and the newsrooms of local broadcasters, which air the majority of political ads. Let’s take a closer look at the Denver market.

The corporate side: to screen or not to screen?

Ads purchased by federal candidates—even deceptive ones like the Solyndra attack on the Perlmutters—by law must be aired by broadcasters, and at a discount rate and without any alteration of their content. In turn, broadcasters cannot be held liable if the content of a candidate ad is defamatory.

But for ads by outside spending groups, the situation is very different. Stations can charge as much as the market will bear; they can be sued for defamation over the ads; and, perhaps most important, they are entitled to reject ads or demand changes in their content. Guidelines on the FCC website direct stations in general terms to “act with reasonable care to ensure that advertisements aired on their stations are not false or misleading,” but the agency says that enforcement is primarily conducted by the Federal Trade Commission. In turn, the FTC says that it only regulates product ads, and the Federal Election Commission says there is no law regulating the accuracy of political claims by outside spending groups. So even as outside spending groups’ ads have proliferated, there is no agency minding the store. Given free speech considerations, some people are glad about that.

Broadcast executives in Denver maintain that unless ads contain blatant falsehoods, it is their policy—and even their responsibility—to air political spots by outside spending groups. Michael O’Brien, director of sales for EW Scripps Company, the owner of KMGH, Denver’s second most-watched station, said KMGH requires supporting documentation for claims made in ads by super PACs and nonprofits. In 2010, KUSA pulled an attack ad by a nonprofit that falsely accused the much-maligned Congressman Perlmutter of voting to require health insurers to cover Viagra for convicted sex offenders.

But not one Denver station could recall a single political ad it had rejected in the 2012 elections.

“We’re a business, and we’re also stewards of the public airwaves,” Cornetta said. “Political speech is protected speech. To the degree someone wants to send a message, we believe we have a responsibility to allow them do so.”

When challenges to ads do arise, Cornetta added, it is usually because lawyers representing the target of the ad send a cease-and-desist letter to the station. The station then forwards the complaint to the advertiser, who must either refute the factual challenge or revise the contents. KUSA will not pull a spot without offering an advertiser a chance to respond. “A lot of times it just goes away,” Cornetta said.

Challenges from the stations themselves, meanwhile, seem to be far and few between. By opting for skillful deceptions instead of black-and-white falsehoods, outside spending groups appear to have identified a loophole that neither broadcasters nor the fcc have shown any appetite for closing. Jeff Harris, KMGH’s news director, argues that “Ads are much more sophisticated now. They’ve gotten defensible.”

Free Press, the media watchdog organization, analyzed the political advertising and news coverage of Denver’s four leading broadcast stations in during August and September. Timothy Karr, senior director of strategy for Free Press, contends that the approach most local broadcasters take—waiting for challenges and then demanding proof of blatant falsehoods before pulling an ad—falls short. The stations, he says, need to reject deceptive ads before they hit the air.

EW Scripps’s O’Brien said that a “common tactic” among political advertisers is to make outrageously false claims in the expectation that they will gain wide attention before eventually being taken down. “It’s a shock factor,” he said.

If the corporate side of local television stations were to screen out these falsehoods before they aired, the public might be better served. And if they drew the line at deceptions, and not just at inaccuracies, they might raise the level of political debate a notch.

In the newsroom: Is factchecking the answer?
When the stick-figure ad attacking Perlmutter was released, broadcasters were legally required to accept it, because it belonged to a federal candidate, Joseph Coors.

But two Denver stations gave it additional treatment on the air. KUSA’s “Truth Test” found the ad’s allegation—that Perlmutter was responsible for scamming taxpayers—was “a misleading statement.” KCNC’s edgier “Reality Check” segment declared the ad “DECEPTIVE,” with a bright red stamp. “Bottom line,” announced kcnc’s reporter, Shaun Boyd, “there is no evidence Ed Perlmutter was corrupted by his ex-wife’s lobbying.”

Kathleen Hall Jamieson—the director of the Annenberg Public Policy Center and a crusader for factchecking of political ads—says Denver had the best on-air reality testing in the nation. “There were more stations doing more factchecking than any other market we could find,” she said.

But even in Denver, the factchecking was swamped by the endless barrage. Karr’s Free Press report compared the amount of time spent airing ads by five leading outside spending groups to the time the stations devoted to covering the ads, and found this: Though Denver’s factchecking surpassed all markets Free Press studied, its stations cumulatively aired 162 minutes of advertising by outside groups for each minute they spent covering them.

“Free Press concluded that local news coverage about these political groups did not begin to address the avalanche of misinformation in political ads,” the report declared. Karr contends that although stations could not be expected to match ads that run repeatedly minute for minute, his findings illustrate a serious deficit in the quantity of factchecking and news coverage of political ads and expenditures.

The debate over the adequacy of Denver’s factchecking bears on two key questions facing broadcasters: How frequently and prominently can they reasonably be expected to debunk misleading ads? And what is the effect?

Patti Dennis, Vice President/News at KUSA, said that between its broadcasts, website, and mobile apps, her station provided its audience with the information necessary to accurately understand the issues at stake. But she argues in strong terms that it is the responsibility of viewers to go beyond passive viewing and seek information out. “If you think that sitting down for 30 minutes a day and watching a television broadcast, leaning back in your La-Z-Boy, you will be comfortable with every vote on your ballot, then you are a fool,” Dennis said. “It takes a little lean forward by the viewer. Sit up in the La-Z-Boy and do your own homework.”

But don’t stations have a special responsibility to rebut deceptive claims on their air? Citing broad language in fcc licensing guidelines—calling on broadcasters to serve the public interest—Karr said “there needs to be a return to the public in the form of increased factchecking and investigative reporting” when stations air specious ads.

The Annenberg Center’s Jamieson recommends dedicated Web pages for factcheck segments. Especially when they are promoted on the air, she said, they allow motivated viewers to educate themselves. Karr concedes that such online factchecks help, but notes that they draw a much smaller audience than newscasts.
Jamieson also suggests that newsrooms develop a convention that would allow factchecks and political newscasts to include brief recaps of previous truth test findings, thus establishing a running narrative on accuracy in a campaign.

Do checkers miss the big picture?
As factchecks emerge as a staple of campaign coverage, not everyone is applauding. Eli Stokols, a reporter at Denver’s KDVR station—known for a comprehensive, shoe-leather approach to politics—mocked the breathless promotion of factcheckers. “They might as well be wearing capes,” Stokols said. Each of Denver’s broadcasters has a branded factcheck franchise: Stokols’ Fox affiliate ran a “Fact or Fiction” segment; KUSA, the NBC affiliate, ran “Truth Tests;” Boyd, at CBS’s KCNC, did “Reality Checks”; and KMGH, the ABC station, had a “Truth Tracker.” But factchecking is “not this altruistic pursuit,” Stokols said. “It’s easier than other reporting, and it’s also very popular.” Some factchecking is appropriate, he concedes, but trying to keep up with misleading ad claims was a “losing game of Whac-a-Mole,” in which journalists are at a perpetual disadvantage to wealthy political financiers. The explosion of factchecking, he contends, sucked oxygen away from traditional political reporting, and from reporting on local issues more relevant to viewers’ lives.

“When you do nothing but factcheck ads, you are in a way letting the big money behind the ads set the terms of the race,” Stokols said.

What can TV reporters do instead? Stokols cites a series of stories he did over the summer about the contortions of prominent Republicans who supported a wind energy tax credit—including then-VP hopefuls Rob Portman and John Thune—until Mitt Romney called for its elimination. More than 1,000 Colorado jobs were at stake with the credit, but Stokols said he was the only TV reporter who showed up at Portman and Thune’s campaign stops to ask about it.

Boyd, who did the “Reality Check” at KCNC and is the station’s sole political reporter, acknowledges that her popular factchecks often made it difficult to cover state and local races. But her news director, Tim Wieland, notes that “Reality Check easily generates more viewer response that anything else we do,” and that the brand had come to permeate the station’s political coverage. Boyd estimated that 90 percent of KCNC’s political coverage was Reality Checks, mostly aimed at political ads, but also at debates and speeches.

In addition to local races, another area that appeared to get short shrift in Denver was investigations of outside spending groups. Reporters at each of Denver’s stations said that their factcheck segments included a discussion of who paid for the ad. But none of the stations could point to specific reports that delved into the financing, or the political connections of outside spending organizations, the often shadowy groups working to influence the viewers and voters.

Bill Wheatley, a former vice president of NBC News, has called on stations to hire additional staff during election years to beef up their political coverage. What could be done with such resources? He suggested in-depth profiles of candidates, including congressional and statewide races, and segments examining candidates’ positions on local issues that the editorial staff judges to be important, rather than just focusing on ads or stump speeches.

“To do a good job on a campaign requires manpower,” Wheatley said. “Most stations could use some extra people in election years.”

The bottom line
Where does all the ad money end up, anyway? Local broadcast stations are usually owned by large media companies, or, in some cases, by the networks themselves. So the flood of new ad revenue is rarely under local control. “Just like any revenue that comes into the company, it gets accounted for,” said Dana McClintock, a spokesman for CBS, about earnings from political ads on local stations that CBS owns and operates. “There’s nothing special about it.”

None of the stations we spoke to in Denver discussed plans for these revenues, which ultimately flow to their parent companies. At press time, the earnings reports for leading broadcast ownership companies included early estimates for the fourth quarter of 2012, and thus the heavy crush of ads before election day. Carl Salas, a senior analyst at Moody’s who rates companies that own TV stations, said the majority of them were using 2012’s unprecedented political windfall to pay down debts, pay dividends to shareholders, and conduct mergers and acquisitions.

In other words: The rising tide of political advertising does not appear to be floating any groundbreaking TV journalism. That’s unfortunate, for now and the future. The avalanche of ads that hit Denver this year, nearly half of them produced by super pacs and nonprofits, will likely be a regular occurrence for many election cycles to come. Salas estimated that political ads will increase their share of broadcast companies’ earnings from a historical average of 6 to 7 percent over the two-year political cycle to 9 percent in the future. “This is a new baseline, and it will continue to grow,” he said.

The rise of factcheck segments is encouraging; factchecking is a crucial tool. And Denver newsrooms demonstrated the capacity and the integrity to effectively truth test ads with teams as small as a single reporter.

But some TV journalists think much more could be done on politics and policy with just a few more resources. Raising the bar costs money. But, hey, the money is there.

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Sasha Chavkin covers political money and influence for CJR's United States Project, our politics and policy desk. He has written for ProPublica, the Center for Public Integrity, and The New York World. Follow him on Twitter @sashachavkin.