MINOT, NORTH DAKOTA — Speaking to editors of the Pittsburgh
Post-Gazette and Toledo Blade, President Obama said, “I haven’t
seen detailed proposals yet, but I’ll be happy to look at them.” He
was responding to newspaper editors looking for bailouts or tax breaks.
The President acknowledged his interest in subsidizing newspapers unable
to deal with readers not buying their papers.
Senator Ben Cardin (D-Md.) has introduced a bill for consideration
by the U.S. Senate, S.673, titled the “Newspaper Revitalization Act.” The
measure would give tax deals to news organizations if they restructure
as 501(c)(3) corporations -- in short, as nonprofits. Sen. Barbara
Mikulski (D-Md.) is a cosponsor.
The free press is a critical institution in our political system.
Making it into 501(c)(3)s effectively takes it out of the political
reporting and commentary business. These 501(c)(3)s are not permitted
to spend more than a small fraction of their income on political speech
and are strictly regulated when it comes to expressing opinions on
political issues. Entities with such designations are given tax breaks
, but these breaks come with government controls — a death knell for
a free press.
Why are these news organizations in need of bailouts or tax exemptions?
According to the bill’s sponsor, the causes are the economic
downturn and dwindling advertising revenues and dramatic drops in subscriptions.
Yet ad revenues follow subscriptions. When people chose not to subscribe
to a paper, it is because they do not believe they are getting good
value. This is the essence of a free market. Producers who do not provide
what people want, or who fail to do it efficiently, go out of business.
However, Congress and this administration are happy to give your money and mine
to certain entities to continue when the market says otherwise. This is especially
the case where political capital is being purchased. Subsidies or tax breaks
to news organizations will effectively destroy their objectivity and will subject
them to pressure to not offend the provider of the goodies.
Obama said, “I am concerned that if the direction of the news
is all blogosphere, all opinions, with no serious fact-checking, no
serious attempts to put stories in context, that what you will end
up getting is people shouting at each other across the void but not
a lot of mutual understanding.”
Apparently, some in Congress and the administration think that directing
to news organizations will ensure fact-checking, putting stories in
context , and offering responsible opinions.
The fact that the President comforted these editors with his assurance
that he is “happy to look at” steps to subsidize their
faltering businesses should frighten us all. A statesman would have
made it clear that those coming hat in hand seeking taxpayer-funded
bailouts will be turned away. Instead, the President gave these beggars
Will taxpayers ever say, “Enough!”? Those who do not believe that
with government money come controls should beware. The financial and auto industries
have learned this lesson the hard way. Freedom of the press is at risk. If these
organizations take taxpayer s’ money, the bureaucratic offices of government
will direct what they do and say. There will certainly be another czar to oversee
such a program. Those who wish to see the outcome should read George Orwell’s
Animal Farm or Ayn Rand’s Atlas
Shrugged. Better yet, they can
look at Russia, Iran, Columbia, and Venezuela.
These bailouts are a vain attempt to sustain a status quo that is
unsustainable. The only certain outcome is the waste of billions of
and a lower standard of living for hardworking Americans.
While it is difficult for companies to adjust to changing markets, tastes, and
consumers who no longer want their products, government subsidies cause far more
harm than good. The sooner organizations adapt and change, the sooner everyone
will be better off.
Bills such as the Newspaper Revitalization Act are nothing more than
a veiled attempt to put control of newspapers in the hands of a politically
motivated bureaucracy. All the rhetoric to the contrary is just that
— rhetoric. There is nothing “researched,” objections
need no “context” to
be understood, and “opinions” supporting the proposed legislation
distain freedom of the press.
Will our new bailout government let businesses fail and permit people to vote
with their pocketbooks? Or will we again be taxed to support those we would not
choose to support?
A Voice from Fly-Over
A Voice from Fly-Over Country is copyright © 2009 by Robert
L. Hale and the Fitzgerald Griffin
All rights reserved.
Robert L. Hale received his J.D. in law from Gonzaga University Law
School in Spokane, Washington. He is founder and director of a non-profit
public interest law firm. For more than three decades he has been involved
in drafting proposed laws and counseling elected officials in ways
to remove burdensome and unnecessary rules and regulations.
See a complete biographical sketch.
To subscribe or donate to the FGF E-Package online or
send a check to:
P.O. Box 1383
Vienna, VA 22183