Creative destruction – the dismantling of an outdated industry and the emergence of a new one – is often difficult for the folks employed by the industry in peril. Many journalists are understandably worried about the future of their profession. Some news organizations are embracing their changing information marketplace. Just this week, Google announced that it will partner with the Washington Post and the New York Times to launch a new, free news service featuring up-to-the-minute content. Nevertheless, many prominent media voices are calling on Americans to take “collective responsibility” for saving journalism. How do they propose we save it? By demanding that U.S. taxpayers support and subsidize struggling news organizations.
Former Washington Post editor Leonard Downie Jr., John Nichols and Robert McChesney of advocacy group Free Press, and U.S. Representative Henry Waxman (D-CA) are just a few of the voices that have come forward in favor of a newspaper bailout in one form or another. Proposals floating around in Washington include direct tax subsidies, university-supported public news organizations, and even surcharges on Internet users.
Most of these critics have something in common: a self-interest in maintaining their livelihoods. But should taxpayers be on the hook for saving yet another changing industry? Voters are still steaming mad about bailing out poorly-managed, uncompetitive domestic car makers GM and Chrysler. It appears that the government has set a precedent with the financial and subsequent auto bailouts. Now other industries feel entitled to taxpayer money.
Journalism – the creation and distribution of news and information – is hardly a dying industry. One need only to look at the Internet, talk radio, and cable news channels to see how journalism remains vibrant and dynamic. Establishment journalists complain that consumers aren’t willing to pay for what they produce, demanding that the government step in to force consumers to pay for a product they often don’t otherwise value. But as the recent proliferation of high-quality niche blogs illustrates, high-quality journalism” can thrive whether professional journalists get paid or not. After all, the world is full of smart people who enjoy writing, reporting, and providing commentary for free. Independent bloggers offer up content for little to no direct compensation. And bloggers can publish their work almost immediately, without having to wait for their site to “go to press.”
Newspaper apologists often claim that bloggers merely copy the work of “real” reporters, and that without newspapers there would be no original reporting or investigative journalism. But other free (or nearly free) ad-supported media already do this: radio and television news. There’s no reason that free news websites can’t do investigative reporting, either. Gawker Media, which owns several popular sites like Gawker.com and Gizmodo, is one of many independent online news sites that produces volumes of original, high-quality content.
In calling for government handouts and tax breaks, apologists for traditional journalism often claim that a state-supported press could still be “independent.” This argument ignores the lessons of history; it is foolish to believe that either direct subsidies or preferred tax status would be given without any rules of conduct, either explicit or implied. Remember the recent AHIP debacle, in which the government threatened legal action against America’s Health Insurance Plans (a health insurance trade group) after it released a report that criticized of some of the proposed Democratic health care reforms? Clearly, the current administration isn’t above issuing legal threats to private companies that engage in political speech that is at odds with the administration.
In the 18th century, philosopher Edmund Burke designated the press society’s “fourth estate” – the civilian watchdog of government, which he described as the most important estate in society. The media are supposed to be the people with their eyes and ears on the government, the powerful, and the corrupt. But today, they more closely resemble the dog at the government’s dinner table, begging for a bone.
If politicians want to “do something” in the name of promoting quality journalism, the best idea is to relax prehistoric media ownership rules. More newspapers might be saved if they could join forces with other media outlets in their communities. Right now, single-company ownership in a media market is limited to 45%. But in some medium-sized markets, a single large company producing competing newspapers makes good economic sense. Under such an arrangement, production costs can be cut while still serving multiple consumer segments. Lifting the burden of obsolete regulations would do far more to promote truly independent journalism than subsidizing it. Media ownership rules were crafted in an era where distribution was tightly controlled by a handful of firms and journalism was reserved for the lucky few. But the scarcity of yesterday’s media environment has been replaced by an era of abundance full of alternative sources for content, both paid and free.
The business model of the traditional daily newspaper seems to be on its last legs. With the advent of abundant, instantaneous media sources, consumer preferences have largely shifted away from yesterday’s printed news. If consumers aren’t willing to spend enough on newspapers to sustain them, why should they be forced to support them through taxes?
The real question policymakers must ask is not “who is going to save all the newspapers;” rather, it’s “do we even want to?”
Elizabeth Jacobson is a research associate at the Competitive Enterprise Institute in Washington, D.C.
