Free Markets, Free People

Subsidize journalism with public funds? The bad idea that won’t go away


ver since the internet has thrown the private journalistic business model into disarray, the idea that perhaps public funding should be used to "save" private journalism has found purchase among some.

I, as you might guess, wouldn’t be one of the "some".

This time it is Lee Bollinger, Columbia University’s president, pushing the "public/private partnership" necessary to "save" journalism. He cites the BBC and NPR as examples of the sort of partnership he’s talking about. However, he wants to expand that, obviously, across the board. His rational for such an expansion is to claim we’re essentially doing that now anyway. His examples?

Meanwhile, the broadcast news industry was deliberately designed to have private owners operating within an elaborate system of public regulation, including requirements that stations cover public issues and expand the range of voices that could be heard. The Supreme Court unanimously upheld this system in the 1969 Red Lion decision as constitutional, even though it would have been entirely possible to limit government involvement simply to auctioning off the airwaves and letting the market dictate the news. In the 1960s, our network of public broadcasting was launched with direct public grants and a mission to produce high quality journalism free of government propaganda or censorship.

The institutions of the press we have inherited are the result of a mixed system of public and private cooperation. Trusting the market alone to provide all the news coverage we need would mean venturing into the unknown—a risky proposition with a vital public institution hanging in the balance.

You have to love this convoluted thinking evident here – letting the market alone provide all the news coverage is “unknown” and “risky”.  Getting government more deeply involved in regulating and subsidizing “journalism”, however, apparently isn’t.

What Bollinger really doesn’t want, much like the priests and monks of Gutenberg’s era, is to loose their monopoly on providing the news, just as the priests didn’t want to lose their monopoly on the possession of and therefore the interpretation of the bible.  Unfortunately the printing press changed that dynamic forever.

In this era the internet has forever destroyed the journalistic business model that provided monopoly power to “journalistic” institutions by removing the barriers to entry.  For minimal cost, anyone can publish on the internet.  And the proliferation  on the internet of sources and opinions on the news – some far better than the traditional outlets provided – have decimated their advertising revenue base as readers turn from high cost alternatives to low cost ones.

Welcome to creative destruction – a lynch pin of capitalism and the engine for advancements in technology and the delivery of goods and services.  Lower cost and better delivery will usually always win out over higher cost and poorer delivery.

If you want the news as quickly as you can get it (assuming the internet didn’t exist) and your choices were newspaper, network news and cable news, which would you most likely choose?

Obviously – and the ratings and subscription info seems to support this – you’d choose cable news.  Who wants stale stories delivered the next morning via newspaper, or appointment TV, where you have to take time to sit down and watch when they decide to broadcast to catch a half hour capsule of the news?

So this revolutionary change didn’t start with the internet.  The internet has simply expanded the choices and put the “traditional” outlets in even more disarray.

It isn’t the job of government or the taxpayer to subsidize the old and discredited business models to which the Lee Bollingers of this world cling.  What Bollinger should do, instead, is join the legions of owners, publishers and other experts working hard day and night to find a viable new business model that will preserve at least part of the “traditional media”. 

But all government subsidy will do is intrude in a dynamic changing market and distort it. And journalists of the traditional media will simply become one more rent seeker among many.  We don’t need to be moving toward more crony capitalism, we need to be moving away from it as quickly as possible.

Bollinger is sure that the system he envisions could easily be kept free of government interference and journalistic integrity would be maintained. He sites various examples that he’s sure proves his point.  But that’s not the point – at least not the one that is important (even if I don’t believe his point to be true in the long run).  What is important is the government should have no role whatsoever in subsidizing a “free press”.  When it does, no matter how benign the subsidy, the word “free” disappears from “free press”.

And intellectually that’s a non-negotiable point.



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31 Responses to Subsidize journalism with public funds? The bad idea that won’t go away

  • I guess “government-subsidized press” sounds less threatening than “government-controlled press.”

  • This is directly connected to  “Net neutrality”  and campaign finance reform. If any of these three things happen it will dramatically reduce the freedom of information and speech allowed in cyberspace (and our society). The internet is one of the truly last bastions of freedom and expression “relatively” unmolested by government because it evolved faster than government could react. Our politicians who do not trust the “unwashed masses” and do not wish to relinquish any power or control cannot abide this and that is why it is being attacked on all sides – under the guise of protecting us!
    God help us if all three go the way of more regulation and government control.
    Cass Sunstein is frothing at the mouth at all of the possibilities it will open up.

    • Tan,  the FCC is leading the charge in enforcing net neutrality.  Without this Evil Guvmint Agency,  the Verizons of the world would already have it tiered off.    I’m not sure that your beloved Free Market is the solution to this particular problem.

      • Geez, pedro…  Your ignorance is showing brightly this morning!  There is a very REGULATED market for net providers, which is 95% of the problem.  A free market would solve that…as if (to you) by magic.

        • sorry, still don’t see that.   take away regulation and there’s one carrier again.  and that carrier will tier so it can squeeze every last drop out of us.

          • So, your position is that monopolies WITHOUT government protection can survive in a market economy.  Got a model for that, pedro?  Hope it’s a really good one, because I can show thousands of examples that prove they cannot, and very clear rational reasons why that is true.

          • that clause ‘without goverment protection’ is the gotcha.  sure, if they could keep their hands entirely off of everything great.  but they can’t seem to do that.   we’re never going to see that dream scenario though,  and the barriers to entry right now are too high to let the telecomms do as they please.
            if you’re for net neutrality then you’re for government involvement in this particular subject,  because they are the only ones preventing it from happening right now.
            i gotta dash and won’t be back for a week or two, but hope you guys all keep cool during the rest of this heat wave.  hasta la vista.

          • Well, I think that’s an admission…er, agreement…
            So, pedro, your solution is to RAISE the costs of entry further (ALWAYS the result of regulation), and cement the quasi-monopoly of incumbent market players?
            How about TRYING the actual free market?  Hmmm…???

          • Really – so how do they maintain a bar to entry high enough to keep lower cost competitors out of the market or subscribers from turning to an alternative of lower cost – without government, I mean.

          • EzzzzACTLy…McQ…
            The ONLY places you find a paucity of choice is where GOVERNMENT assures that.  Otherwise, market forces WILL invite competition from market players eager to take their share of a very lucrative market (in some cases, a “pure profit” market) which you naturally have with a PROTECTED monopoly or quasi-monopoly.
            The VERY worst kind of monopoly is where you have GOVERNMENT as a THE player.  This is such a paradox, as Collectivists PRETEND to hate monopoly.

      • “the FCC is leading the charge in enforcing net neutrality”
        You fell for the oldest trick in the book – believing that the name given to a thing by those people advocating for it is an accurate description of its intention or mechanism (for further examples see the “Patriot Act” ) This is not about net neutrality, it is about giving the FCC (or if it takes the legislative route – congress/president) the ability to regulate and oversee (monitor, administer, censor, etc) the only true medium left for average citizens to communicate and broadcast views and share information to the public. In order for the FCC to “enforce” this net neutrality is to acknowledge and therefore grant them the ability to oversee cyberspace the same way that they do TV, radio, telecommunications etc. A correct description of such a movement/act should be called “Internet regulation Authority.” That would start to make people pay more attention as this is what is really going on!

        • 90% of what the FCC does is regulate content.  Putting them in charge of defending my content choices is like having the cat protect the canary.

  • Bollinger is sure that the system he envisions could easily be kept free of government interference and journalistic integrity would be maintained.

    For that to be the case, the likes of the NYT and MSNBC would have to have integrity to maintain in the first place.

  • Trusting the market alone to provide all the news coverage we need would mean venturing into the unknown—a risky proposition with a vital public institution hanging in the balance.

    Bollinger is either a)  completely ignorant of history, or b) trying to promote a lie.  For over two centuries, Americans have relied “alone” on market players for provision of news and comment.  Even NPR and PBS, while subsidized, make market appeals and sell thinly disguised commercials for the bulk of their funding.
    I think it would be very easy to find people in the BBC market who do not regard the BBC as untainted by their government connections, and for absolutely impeccable reasons.

  • “the broadcast news industry was deliberately designed ”

    First of all, the news industry was never ‘designed’; it evolved by itself in response to market forces.

    ” Trusting the market alone to provide all the news coverage we need would mean venturing into the unknown..”

    Had he bothered to stay awake during those history of journalism classes, or even regular history classes, reality would not be ‘unknown’.

    • Yeah, I mean, did the guy never see a MOVIE?  Like one of the dozen or so Westerns (The Man Who Shot Liberty Valance being one), or one of the dozens of others vaunting the plucky entrepreneurial and idealistic (or sometimes not…see The Fountainhead or Meet John Doe) journalist?
      It is just another appeal to the uneducated, truncating history at day-before-yesterday.

    • I am sure there have been periods where the market provided all the news, and even now in some countries I am sure this exists.  God, these guys are incurious.

  • Haven’t you seen the data? Government jobs now pay more, have better benefits, and provide earlier and more comfortable retirement. And besides, the old cartoon with guys leaning on their shovels has more than a grain of truth to it – performance is not a requirement.  Mr. Bollinger simply wants his profession to hitch a ride on that gravy train. The tendency of most leftist journalists ( is “leftist” redundant?) to be for any and all things “government” meshes neatly with self-interest.
    BTW, McQ,  it’s “cite”, not “site”.  (Not trying to be Mr. Grammar Cop, it’s just that that, and “affect/effect” … annoy me)

  • I wonder if any of these people that have argued for a government-subsidized press have ever considered the arguments that were made in favor of Obama setting the pay scale for officers of those companies that took TARP funds.
    Hey, if we can say that the CEO of Bank of America should have his salary set by Obama because the taxpayers had to bail the bank out, then I’m sure that the same argument will apply to all the newspapers that accept continuing subsidies from the feds.  After all, if the feds are paying the bills, don’t they get to have the last say in the operation of the publications they’re subsidizing?  And wouldn’t that also include the content of those publications?

    • The PBS/NPR model show that liberals can make big bucks in a government subsidized operation.

      • They already make big bucks

        Then-president of NPR Kevin Klose made $465,994 from the network and $151,375 from the NPR foundation for a total of $617,369.

        Kenneth Stern, who served as CEO before leaving abruptly in March of this year, made $427,057.

        The 2007 return showed 15 people at NPR with the title of vice president or senior vice president. Most made between about $190,000and $260,000. A page on NPR’s Web site shows 14 current vice presidents.

        NPR reported its five highest paid employees were:
        1. Managing Editor Barbara Rehm, $383,139
        2. All Things Considered host Robert Siegel, $350,288
        3. Morning Edition host Renee Montagne, $332,160
        4. Morning Edition host Steve Inskeep, $331,242
        5. NPR afternoon programming director Richard L. Harris, $190,267.

        The most eye-catching salary ever reported on an NPR tax form is probably the $505,132 paid to broadcaster Bob Edwards in FY2004, the year he was ousted as host of Morning Edition, quit, and went to XM Radio. He hosted his last NPR show in April, five months before the end of the fiscal year, so the half-million dollar salary (presumably including some kind of severance) seems to have been for just seven months work.


        • … and with a minimum of governmental involvement.
          Of course, they have the protection of the MSM … now.

  • Øbama needs the NYT like Stalin needed Pravda, and for the same reasons.

    • That’s what this is really all about.  The left needs MiniTru to control the information that the proles get.  MiniTru needs the lefty-controlled government to eliminate competition that is both bankrupting and embarrassing it.  It’s a match made in heaven (for them, any way).

      The presupposition is that, even if the dems don’t control the White House and Congress, the GOP will not undo what the left does.  The left is confident that even a raving conservative like George Bush (/ sarc) will continue to fund their media lapdogs and NEVER bother to ask where the money goes, much less demand (ahem) “fairness”.

  • When it comes to free speech, you can’t afford to give one inch. I live in Venezuela and have witnessed what can happen to freedom of expression under a suposedly democratic government. Its scary.

  • They are not going to give up on this. All the more necessity to win big in November.

  • What all of us doing right here and now is exactly what the gov’t/pols want to put an end to with Net Nuetrality, with the willing cooperation and avid backing of the MSM.

    They really dislike the egalitarian democracy free market of the Internet.  It allows too many voices, too many opinions differing from theirs. Too much discussion; not only of the topic at hand, but of their qualifications for making decisions about it for everyone else, and about their conflicts of interest.  Questions about sources of campaign donations. Questions about the validity of elections.  That kind of scrutiny is oh so embarassing to the self-appointed and self-annointed “leaders.”   It really hampers their ability to control, er, I mean, lead the rest of us.

    Recollect the Obama administrations consternation about all the “misinformation” about the health care bill?  turns out most of that misinformation was pretty close to the truth.  But it sure made his life difficult, and he didn’t like it one bit.   The government prefers you get information from a bunch of lock-step journalists who get their information from the government. 

    Oh, they’ll come at you all crabbed up and sideways, talking about poor quality, deliberate misinformation, lack of journalistic standards.  (As if the MSM has shown any real journalistic ethics in the past few years!) It’ll sound like consumer protection, but will be iron-fisted control of access and content.

  • Journalism at almost every level is unworthy of subsidy. If Air America had been worthy, some of their programs would be on air today; they did not present a worthy product. Multiculturalism aside, without governmental support much of what the Left produces is simply unworthy by any objective criteria. Providing diversity and “fairness” are not good reasons for subsidizing journalism.  The msm have been hell bent to undermine much of what many of us hold dear. To hell with them. Let them drown!