Should Newspapers Be Funded By the Government?
Moral of the day: Selling access to government officials who are willing to contribute their time and power to the media's cause is a bad revenue model for newspapers. Another way of saying that is that newspapers should not be funded by indirect government subsidies. But the whole brouhaha confirms my long-held belief that newspapers should be funded by direct government subsidies.
The story of the decline of the newspaper business model can be expressed pretty simply: The things we have traditionally sold have become less valuable. Real estate agents are less interested in our listings. Classified advertisers have migrated toward Craigslist. Advertisers do not pay as much to appear in our pages.
The search, now, is for what we can sell that is valuable but that doesn't destroy our business. Take advertising. It used to be sufficient to give companies access to space in our pages without offering them any access to the newsroom. That was a weird convention, but it worked out pretty well. Unfortunately, it dropped in value. And so the trend now has been to sell things with more value. And those things are in the newsroom.
It's not just the half-baked salon idea that proved such an embarrassment this morning. The New Republic has "advertorials" in which, say, Saudi Arabia will pay money for articles on current events. The sections are labeled as advertisements but they are designed to mimic the magazine's core product. In recent years, they've gotten even closer to the basic brand and frequently feature discussions including New Republic writers who usually appear elsewhere in the magazine. For a short time, the magazine also had the energy company BP sponsor its environmental blog.
The National Journal frequently holds discussions that bring together the newspaper's core talent with major newsmakers. Its forum on health-care reform, for instance, paired Ron Brownstein with, among others, Andy Stern and Sen. Bill Bennett. The event was sponsored by Regency Blue Cross Blue Shield, the Peter G. Peterson Foundation and the American Heart Association.
The Politico, meanwhile, has begun the Politico Pulse, a daily round-up of health-care news that is sponsored by health advocacy organizations. The American Prospect runs special sections on policy issues that are edited in-house but funded by outside foundations. The Atlantic Media organization frequently holds corporate-sponsored events -- like the ideas festivals -- where its talent performs directly.
All of these efforts are, in their various fashions, somewhat like advertising. But they are all much closer to the actual writing shop than traditional advertising. When you're on a stage talking health insurance and your company is cashing a check for the event from a health insurer, you know perfectly well that you're not supposed to muck up this business model for your employer. When Saudi Arabia is funding your advertising insert, the point of the exercise isn't to say mean things about Saudi Arabia.
And even all this isn't keeping the various media organizations financially afloat. The more desperate their need for money, the more pressure they'll be under to sell access to their most valued assets. The salon-scheme was a very bad idea for this newspaper, but it wasn't a crazy strategy if you don't think of newspapers as occupying a special role in American life. In fact, the worst thing about the proposal was how perfectly rational it was. Newspapers can, of course, protect against such blatant violations of their ethical codes. But the greater the pressure, the more likely those codes get cut up on the margins. And how much of its code will a newspaper protect if the alternative is closing down? How much of its code should it protect if the alternative is closing down? And those, eventually, will be the options faced by many outlets.
The question, then, is whether we want newspapers (and magazines, and so forth) so agonizingly vulnerable to these pressures. The news, after all, is not a market good. Among other things, it is not profitable to sell it. But we think society needs it. Cross-subsidization from advertising and classifieds worked so long as they worked. Those days are over.
Thankfully, society has developed models for funding things we deem important but don't entirely trust to the private market. We have public universities and public centers for disease research and public firefighting departments and a public military and public roads. Why should news be different?
You can argue that it must be oppositional to government, of course, and so government funding is a conflict of interest. But many European countries have solved that problem by developing automatic funding structures free of government influence. Meanwhile, it's not as if NPR or the BBC seem particularly concerned about criticizing their respective governments (nor, for that matter, do professors at public universities seem particularly cowed). And those funding mechanisms can, at the least, be transparent, predictable, and partial, which would be better than newspapers quietly trying a thousand things, many of them far from the public eye.
That's not to dismiss all the concerns about this approach. But there is no perfect model. There are only bad models. And the pressures of the advertising model are getting rapidly worse: News-gathering institutions are closing, sensationalizing, selling off their news-gathering capabilities or losing their souls. At what point do the drawbacks of a partially public model become less than the drawbacks of a fully private model?
Uodate: Hoo boy. I had forgotten about this.
Photo Credit: Gerald Herbert -- Associated Press Photo.
July 2, 2009; 3:05 PM ET
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