Waxman Wants Federal Government to 'Resolve' Newspapers' Problems

December 3rd, 2009 1:20 PM

A powerful Democratic lawmaker has stated his willingness to intervene on the behalf of the federal government in the nation's news sector. Insisting that the newspaper business is vital to democracy, Rep. Henry Waxman, D-Calif., suggested that the government "resolve" the problems in the industry, potentially though misguided federal bailouts.

At a workshop on the future of journalism at the Federal Trade Commission, Waxman, who chairs the House Energy and Commerce Committee, suggested the federal government secure "public funding for quality journalism as a means to preserve a critical mass of resources and assets devoted to public media."

Though Waxman raised other options, he devoted more of his address to public funding for newspapers than any other avenue for preserving the medium. Newspaper bailouts could, he stated, "preserve and maintain key functions of modern journalism ... by cushioning the economic squeeze publishers are facing."

Waxman cited a recent report commissioned by Columbia University Journalism Review and the radical leftist media organization Free Press to bolster his claims. The report advocates the creation of a "National Fund for Local News" to subsidize the press. The report echoes previous calls from Free Press and other organizations to get the federal government directly involved in the news business.

Free Press was co-founded by avowed socialist Robert McChesney, who has been a long-time advocate of direct government subsidies for newspapers, and has praised the media ownership model advanced by Venezuela's Marxist dictator Hugo Chavez, who has notoriously cracked down on media opposition in the South American nation.

This humble blogger has written of the dangers of federal funding for newspapers, as have NewsBusters writers Tom Blumer, Tim Graham, and Jeff Poor. Seton Motley has written on the topic and appeared on Fox News to discuss the dangers of such a policy.

A Business and Media Institute report by Dan Gainor and Catherine Maggio found that government involvement would lead to at least some degree of government control, that public news outlets are generally politically biased due to political funding, and suggested that the media industry resist the temptation of government money.

The reports findings echo what scores of media commentators, including those at NB, have found: the government cannot fund the news without at least inadvertently affecting the content of the news. Bailouts for financial and automotive firms undertaken during the last year have demonstrated this fact--the federal government can now dictate the products and services they offer, arbitrarily impose union and ownership contracts, and limit compensation for their employees to quell populist anger.

Recent studies of the real-world consequences of government funding for newspapers have demonstrated these facts. A Harvard University study on the newspaper industry in Argentina, which has benefited from significant federal funding,

found a “huge correlation” between, in any given month, how much money went to a newspaper and how much corruption coverage appeared on its front page...

[I]n periods where newspapers were getting more money from the government, they produced fewer corruption scoops of their own and covered fewer of the scoops produced by other newspapers.

Even if editors do not make conscious decision to avoid coverage damaging to their federal financiers, the knowledge that such funding can be withdrawn on a whim is enough to chill free speech. Government money will mean a say--directly or indirectly--in what newspapers cover, how, and how much.

Free Press has been quite open about this element of government funding; the organization wishes to see the federal government impose rules on the media to promote "underrepresented groups," according to its report Towards a National Journalism Strategy. Such a policy, the report states, would "greatly increase minority and female ownership of news media outlets, which currently stand at an appallingly low number."

Free Press wants the government to have a say in the composition of the news business so it can promote the roles of politically favorable groups. Not exactly what most people would have in mind when describing a free press.

Waxman did touch on a number of other options--an alternative tax status for newspapers, a reworking of antitrust laws, and additional philanthropic support for newspapers. All of these could contribute to the viability of a free press without compromising its objectivity by placing it on the government dole. All of these options should be exhausted before Waxman or other federal officials consider propping up the industry with taxpayer dollars.