Tuesday, March 24, 2009

Newspapers: Shall We Play The Requiem Now?

By Barnie Day; Another Guest Shot From Meadows of Dan

Not just yet. Let’s at least have a national debate before we bury this one.

The cataclysmic demise is well documented. Going forward, the question is: Is there a model that (1) acknowledges and accommodates the current reality and (2) preserves the critical role of a free and independent press?

There might be—a national newspaper trust that could purchase these faltering papers. (If there is an upside to an 83% devaluation in newspaper stocks in 2008, it is the creation of an incredible buyers' market.)

Sure to God, if such a structure can save swamps, farmland, old buildings, artifacts of importance, odd plant life, long-eared rodents, queer little birds, and a host of other good and worthy considerations, such a thing could be established to preserve an entity that is so very crucial to policy, to government, to Democracy, to our collective well-being, as independent newspapers are.

There is no evidence whatsoever that the industry can save itself. Newspapers are cannibalizing themselves by giving their content to the Internet, and if that’s not bad enough, they’re slashing the only real competitive advantage they have—their reporters, writers and editors. Seems an odd survival strategy, if you ask me.

If newspapers are to survive, then retro, or old school, journalism relieved of profit pressure by trust ownership and subsidy may be the model.

How to fund such a trust? Three ways:

1) A national newspaper lottery would generate significant proceeds. Although 42 states and one or two territories conduct lotteries of some sort, there is no national lottery in the U. S. Lotteries are a form of taxation, but as Jefferson pointed out, the fairest form of taxation in that the burden is laid “only upon the backs of the willing.” This burden would be a worthy one.

2) A voluntary one-dollar check-off contribution on federal income tax returns would raise significant money, too—and give taxpayers a direct voice in how at least some of their money is spent. It wouldn’t be complicated. They could say “yes” or “no” simply by checking or not checking the box. It’s a pity we don’t have more such direct opportunities to say “yes” or “no” with a lot of other spending.

I know the "government" argument. It makes some folks queasy. It does me sometimes, but the granting of tax-exempt status and playing the role of mere pass-through collection/disbursement agent for a lottery and for income tax check-off falls short of "government sponsorship of newspapers."

A national trust would, in fact, come closer to vesting ownership with that teeming miasma otherwise known as "the people"—a good thing, in my opinion—than any other arrangement I presently know of, far closer than family and/or corporate ownership (think Rupert Murdoch) does now.

3) The largest consumer, and beneficiary, of newspapers in the world has to be Google, which means Google, and other search engines, have the most to lose if (when) the newspaper industry collapses. It is an interesting paradox: the primary instrument of newspaper destruction has the most to lose. The implication is that they must dance together.

Google doesn't pay for newspapers' proprietary content, although it does pay the Associated Press under a contract negotiated in 2006.

Let's consider the numbers.

Google performs approximately 235 million searches per day. If ten percent of these searches referenced newspaper print, and if Google agreed to contribute one penny ( 1 cent) for each of these to a national trust, the annual contribution would exceed $85 million. Can Google afford this? Yes. They earned $1.21 BILLION just during the last 90 days of 2008 alone. (I won’t even point out that Google could write such a contribution off as a tax deduction.)

Why propose this? What does it matter? That's the easy one. It is in our national interest that newspapers survive.

Barnie Day is a banker in Stuart, Virginia

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