followthemedia.com - a knowledge base for media professionals
Fit To Print

Newspaper Industry Tells US Congress It Doesn’t Want a Bailout But Loads of Tax Breaks Would Be Nice – That’s Not A Bailout?

The American newspaper industry and US Congress agree on one thing – no bailouts for newspapers – but that hasn’t stopped the industry from endorsing a slew of Congressional tax breaks that would be the next best thing.

newspapers buriedBut is Congress really interested in helping newspapers or was last week’s Joint Economic Committee hearing on “The future of Newspapers: The impact on the Economy and Democracy” just a convenient prestigious platform to get a load of favorable publicity on the plight facing newspapers and earn some public sympathy?  After all the committee has 20 members from the House and Senate but just three members turned up so the industry wasn’t really “talking to Congress” and that Congressional “body language” sends a resounding message to the industry that savings newspapers is not exactly a top Congressional priority.

But the news media covered the hearings en masse – loads of coverage in print and on the Internet with nary a mention of how few committee members showed up (at one time just two members were present as the chairwoman left for a House vote). Nevertheless, appearing in a Congressional hearing room was a great peg to make the industry’s pitch.

Chairwoman Democratic Representative Carolyn B. Maloney of New York was definitive about what was not on the table. “I want to be very clear. This is not about bailouts. No one’s talking about bailouts. We’re through with bailouts.”

Well, that was pretty clear and straight-forward. But we all know there is more than one way to skin a cat. So John F. Sturm, president of the Newspaper Association of America (NAA) agreed wholeheartedly that the newspaper industry didn’t want cash dollars paid up front -- “We don’t believe direct governmental financing is appropriate for an industry whose core mission is news gathering, analysis and dissemination, often involving that very same government” -- but a few tax breaks that translate into dollars on the bottom line, now that would be very nice, thank you very much.

For example, there are already House and Senate versions of legislation that would allow all businesses (not just newspapers) to carry back net operating losses for five years instead of the current two years. Sturm also urged legislation that would allow businesses to spread out future pension plan contributions. Currently, Sturm said, businesses must use cash to fund those plans. “Newspapers need cash now to preserve jobs next year. It’s really that simple,” he argued. 

Perhaps the most interesting legislation which even President Obama has said could be of interest is the Newspaper Revitalization Act that would permit newspapers to organize as non-profit entities while continuing to generate advertising income. But there is one aspect of that proposed legislation as it is now written that makes newspapers shy away – that such non-profit entities cannot make political endorsements.

Sturm told the hearing that he recognized the industry needs to get its own house in order. “The original reporting done by newspapers each and every day cannot be sustained over the long run if newspapers are not able to obtain fair a reasonable compensation for the content they produce,” he argued. “The industry is working on a variety of solutions to address this issue and make it convenient for users of newspaper-generated content to license and pay reasonable fees for such use. We expect these solutions will be in the marketplace next year.”

Not that Congress is not aware up-close of the problems hitting newspapers.  In July  two publications dedicated to covering the US Congress merged (Roll Call owned the British Economist Group bought Congressional Quarterly) and on the very day of the joint Congressional hearing on the vitality of the newspaper industry the combined new company fired 20% of its staff – some 44 jobs. Overall, the US newspaper industry since the summer of 2008 until the summer of 2009 has cast off about 15% of staff.

Princeton professor Paul Starr told the committee that all the editorial cutbacks over the past years have really adversely affected how newspapers cover their local and state governments. There just aren’t as many people to cover everything that needs to be covered. “Resources for traditional journalism at this level are disappearing far more quickly than they are being created online,” he warned.

So with all of this coverage on how Congress can help newspapers, it was somewhat startling to find this headline on Daniel Lyons’ Newsweek blog: “Don’t Bail Out Newspapers – Let Them Die And Get Out Of The Way”. He argues, “Nobody in their right mind believes the future of the news business involves paper and ink rather than pixels on a screen. We all know where the news business is headed, and what’s more we’ve known about it for at least a decade. So why on earth are people talking about a bailout for newspapers…it’s like introducing legislation to save horse-drawn carriages, or steam engines, or black-and-white TV. It’s stupid. It’s pointless. It won’t work.”

He says he has been a journalist for 27 years “and I love that romantic old notion of the newsroom as much as the next guy” but he concludes, “please, Congress – drop this crazy idea about saving newspapers. You can’t save them. They are going to die. All you can do is prolong their agony, and delay the shift to Internet. That doesn’t do any of us any good.”

Well for this writer who has been in the news business for some 47 years paper still wins out over Kindle and other digital delivery methods, but there can be no doubt that in the future the word “newspaper” will not mean just the news in print, but the news provided by that news organization on a multiplicity of platforms.

The hope is that the economics can make enough sense to keep one of those platforms as print.

 

 


related ftm articles:

Publisher Explains To US Congress How Advertising-Supported Free News Works On The Internet: ‘It’s Similar To A Dancing Club That Charges $10 A Beer While Providing Dancers For Free’
By most accounts a Congressional subcommittee looking into whether US newspapers should get more anti-trust protection because of their dire financial conditions was little more than a farce this week with those House representatives who turned up taking the occasion more to bash the media that usually bashes them.

Has Solving The Newspaper Crisis Really Come Down To This: “If I Could Do Anything, Literally Anything, To Reverse It – I’d Saw Off My Right Forearm – I Would” – UK National Newspaper Editor
The editor of the UK’s Independent national newspaper describes market conditions as “horrific” because “the combination of free newspapers, free content on the Internet, coupled with this most astounding recession, makes it a very, very inhospitable time for newspapers.”


advertisement

ftm resources

no resources posted as of September 30, 2009->->


ftm Knowledge

Media in Spain - Diverse and Challenged – new

Media in Spain is steeped in tradition. yet challenged by diversity. Publishers hold great influence, broadcasters competing. New media has been slow to rise and business models for all are under stress. Rich in language and culture, Spain's media is reaching into the future and finding more than expected. 123 pages, PDF. January 2018

Order here

The Campaign Is On - Elections and Media

Elections campaigns are big media events. Candidates and issues are presented, analyzed and criticized in broadcast and print. Media is now more of a participant in elections than ever. This ftm Knowledge file reports on news coverage, advertising, endorsements and their effect on democracy at work. 84 pages. PDF (September 2017)

Order here

Fake News, Hate Speech and Propaganda

The institutional threat of fake news, hate speech and propaganda is testing the mettle of those who toil in news media. Those three related evils are not new, by any means, but taken together have put the truth and those reporting it on the back foot. Words matter. This ftm Knowledge file explores that light. 48 pages, PDF (March 2017)

Order here

More ftm Knowledge files here

Become an ftm Individual or Corporate Member to order Knowledge Files at no charge. JOIN HERE!


copyright ©2004-2009 ftm partners, unless otherwise noted Contact UsSponsor ftm