The Great Newspaper Bailout: Executive Summary

Executive Summary

The pattern repeats itself - an industry in chaos, companies going bankrupt, thousands of workers losing jobs. It's time for government intervention. That's been the Obama administration's model for Wall Street, insurance giant AIG and the auto industry. Now it could be the same for the American media. Congress, the Federal Trade Commission and the FCC are all looking at ways to 'help' journalism. On Sept. 20, President Obama threw his support to the concept by saying: 'I'll be happy to look at' bills aiding the industry. That fits the Obama mindset, who said in a Sept. 22 interview that big government wasn't the problem with Wall Street. 'We had too little government, too little regulation,' he explained.

The Great NewsPaper Bailout

There's no question that the news industry has fallen on hard times. The rise of the Internet, plummeting advertising and more have contributed to a broad decline, especially in newspapers. But even prominent journalists are so desperate to save their profession and their own jobs that they are heedless to the overall dangers inherent in Government Media.

Instead, journalists are working hand-in-hand with left-wing media groups including the and George Soros-funded Free Press to plan how government can expand its media influence. Both Free Press and American Public Media, which owns and operates 780 public radio stations in the U.S., joined top media experts in an August session on the future of journalism. That event included extensive discussion of ways government could aid the news business, from to tax policy to 'direct government subsidies for media.'

With Congress looking into a media bailout, here are some important aspects of the debate that must be considered:

  • Government Aid = Government Control: As soon as Obama bailed out Detroit, he forced out GM Chairman and CEO Rick Wagoner. The White House also gave majority ownership in Chrysler (55 percent) to the UAW. Wall Street bailouts resulted in overnight government regulation - even salary controls. Government intervention in media gives Obama the same opportunity to control the news. Seven major newspaper chains have gone into bankruptcy. If he uses the same strategies he used for Detroit, that would let Obama control major media outlets across the nation and he could dictate the news.
  • BBC or Pravda, Does It Matter?: Liberal supporters of government involvement argue the U.S. pays less for public media than other major nations. But the liberals have it exactly backward. One cannot have a successful democracy without a free press. Or put it another way, the less government controls the media, the more free the people are. As such, it should be our goal to have the U.S. government pay nothing for public media.
  • Left Wants a 'PBS on Steroids': The cornerstone for government involvement in media is more money for public broadcasting. Liberals and media executives want to use the 'existing infrastructure' to promote local news media - through public media. These attempts ignore repeated analysis showing the left-wing tilt of public broadcasting. Speaking in front of a left-wing media group, FCC commissioner Michael J. Copps raised the idea of funding a 'PBSS - Public Broadcasting System on Steroids.'
  • Liberals Advocate $60 Billion for Government-Funded Journalism: At a time of massive government growth and trillion-dollar deficits, liberal groups are calling for a 'bridge' to the future of journalism. They want $60 billion over three years for everything from subscription subsidies to postal 'reforms.' Much of that funding would, of course, go to NPR and PBS. The Corporation for Public Broadcasting is slated to get $420 million in the 2010 budget. If all of the new money went to public broadcasting, that would be a more than 4,700 percent increase.


Increasing government involvement in the media is wrong-headed and dangerous. The government is already too involved in media. The 1st Amendment clearly states: 'Congress shall make no law respecting an establishment of religion, or prohibiting the free exercise thereof; or abridging the freedom of speech, or of the press.' Getting government more involved in the media - either through regulations or outright funding - would have horrible long-term consequences.

The biases of the traditional media have been long established in numerous studies. Making journalists more beholden to the politicians and government officials they are supposed to cover would further undermine the integrity of the Fourth Estate.

Instead, the Business & Media Institute has several recommendations on the future of journalism:

  • Just Say No: Journalists have to draw a clear line in the sand and say they neither want nor need help from government. This should include the overt help of direct subsidies and the more subtle forms of aid such as specific tax breaks and antitrust assistance.
  • Trust in the Marketplace: The future of journalism won't be exactly like anyone envisions it. It will depend on what people want, not what the media elites want, and wants change with time. Readers and viewers might not want news the way it has been traditionally delivered. News organizations need to first focus on ways to make money - online and off. Then, essential areas that aren't easily funded - such as foreign bureaus - can be aided through nonprofits and foundations.
  • The Media Are Not the Message: The reporting of a free press is essential to a thriving democracy. How that reporting reaches its audience - TV, radio, print, Internet or text message - is inconsequential. Journalists need to recognize that the day of print is changing. Secondary newspapers continue to fold as they have done for decades and some mismanaged larger outlets are closing as well. But just because newspapers die doesn't mean the news will. The print newspaper is just a vehicle. The information is what is important. Too many in the industry and in government are stuck on the old way of delivering information.