Putting the Watchdogs on the Payroll

The internet is the best mechanism ever invented for the distribution and promotion of baseless conspiracy theories. But it is also a matchless device for distributing information on true, and truly disturbing, developments. Case in point: the Federal Trade Commission (FTC)'s recently released  discussion draft on "reinventing" journalism.

Those who have read the 35-page document are mostly left agog by its absurd reach and its dangerous suggestions. 

Among the items under discussion: Enhanced postal subsidies for newspapers, which already have their own uniquely cheap postage rates. Tax credits for organizations with journalists on the payroll. The formation of a new journalism cadre within AmeriCorps.  

The estimated $35 billion required to keep traditional journalism afloat would be raised via several mechanisms, including a check-off box on tax returns. Those who are sympathetic to the industry's plight -- nationwide, they must number in the dozens -- could send a portion of their tax return to ameliorate the woes of the nation's MSM. As the report states,"If desired, this proposal could be structured to apply to commercial, as well as non-profit, news entities."

No plan is complete unless it calls for new taxes, and the discussion includes some doozies, including substantial new taxes on news aggregators on the web. Critics have quickly dubbed this plan the "Drudge Tax," but it would also impose new taxes on others, including Digg and the Huffington Post. The paper also floats a proposal to add a five-percent tax on consumer electronics, producing an estimated $4 billion annually. These funds would be distributed by the FTC.

The report also suggests that a "Fund for Local News" could be created using existing and new fees imposed by the FCC "on telecom users, television and radio broadcast licensees, or Internet service providers." These funds would be distributed directly to newspapers and other media outlets by state panels.

If written into law, this program would make the government a partner with each participating newspaper.

I'm not prone to hyperbole, but I frankly cannot imagine a greater, more odious conflict of interest than this one. As a journalist of thirty years standing, I wish I had an ounce of faith that publishers would reject the money, but I don't. After all, newspapers exist to make money, and they will quickly convince themselves they can enjoy the government largesse and remain independent in thought and spirit. 

You know, just like they do now with their biggest advertisers.

The fundamental issues that led to the collapse of the newspaper industry are still in play, so this is surely a patch -- a brief and very expensive putting-off of the inevitable. Unfortunately, those in the Obama administration don't seem to understand even the simplest economic concepts, including this one: Newspapers, like car companies, suffer when they don't provide the purchasing public with what the latter want. And newspapers, by dint of their twentieth-century technology, cannot give consumers what they want.

Many critics of the nation's newspapers suggest the liberal bias that suffuses most is a leading cause of the declining fortunes of the major newspapers.

That's just one issue newspapers are tackling, and in the larger scheme, it's an insignificant one. Boston Globe columnist Jeff Jacoby states the dynamic more accurately. Regarding the idea that liberal bias is cooking the news goose, he says, "I wish that were true ... because then newspaper companies would know what it would take to recover: a reorienting of their editorial views from left to center-right and the recruitment of editors and writers with a more conservative outlook." In support of his theory, Jacoby notes that recently failed newspapers include some right-of-center publications, while many left-of-center newspapers are thriving -- or at least surviving.

Jacoby's words could be seen as self-serving -- after all, he works for one of the nation's most transparently left-leaning newspapers. But his column is lent credibility by including what so many others in the media deny, as Jacoby readily admits that most newspapers do in fact exhibit a liberal bias. 

I wish the lack of ideological diversity that tends to characterize most major newspapers -- the reflexive support for Democrats, the distaste for religion and the military, the cheerleading for liberal enthusiasms from gun control to gay marriage -- really did explain the industry's present woes.

Jacoby is exactly right. Newspapers are dying not because of their liberal bias, but rather because they rely on obsolete technology. In the age of the internet, publishing a daily print newspaper is the marketing equivalent of bringing a knife to a gunfight.

Even if their former circulation numbers were maintained, the big newspapers would still be in serious trouble, because classified advertising -- their bread and butter -- is moving to the web, particularly Craigslist. Craigslist is free and effective, and the results are telling: The gross receipts for classified ads for the American newspaper industry have declined from $19.6 billion in 2000 to an estimated $6.0 billion in 2009.

Politicians have long used tax dollars to purchase political leverage. From that perspective, going into business with the ailing newspaper industry would  hardly be unique. George Will recently provided an excellent example, noting the federal portion of education spending on kindergarten through twelfth grade has doubled since 2000 to 15 percent. This has left Democrats "in a relationship of co-dependency with teachers unions."

The majority of Americans agree that we need schools, but how many would be happy to support the obsolete technology of print newspapers? Despite the clumsiness and greed of their unions, teachers retain some measure of respect, but journalists rank with lawyers and telemarketers.

The FTC can put a gloss on this, calling it an attempt to find solutions to what they see as "emerging gaps in news coverage," but few members of the public are likely to mistake the bottom line: This document suggests the government should be doling out billions of taxpayer dollars to the self-described watchdogs of government.

You will not likely see that fact stated so plainly in the newspapers, but that's okay. The internet is a matchless device for distributing information on true, and truly disturbing, developments.

Theodore Dawes is a freelance writer in Mobile, Alabama.
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