Thursday, March 26, 2009

Newspaper Revitalization Act Would Allow Newspapers to Become Non Profits

One of the main topics of discussion when Kenton Ngo and I made an appearance on The Inside Scoop was the fate of the newspaper industry. I argued that the newspaper industry is important and that an effort should be made to keep newsrooms thriving because it spurs investigative reporting that can help to educate the public about complicated policy subjects and what is currently taking place in our public institutions. With the advancement of the internet and the poor economy impacting advertising proceeds, however, it appears as though keeping newspapers alive is becoming a difficult task.

It appears as though at least one Senator sees a way to help the newspaper industry as Maryland's Sen. Ben Cardin has introduced S.673, the Newspaper Revitalization Act, which would allow local and community newspapers to become non profit organizations. This move would allow tax deductible donations to be made to the papers as well as having some cost savings as a result of the papers not having to pay taxes on advertising and circulation revenue. As a result of becoming a non profit organization, however, the newspapers wouldn't be allowed to make political endorsements.

I believe the most important thing to note about this legislation is that it would only apply to local and community newspapers, which means that it wouldn't necessarily be used to bailout large corporate media chains. When you consider that it is many local and community papers that do the coverage of local government and keep the public informed about local events, I think it can become clear that they are providing a public service that is greatly beneficial to communities. If the non profit status allows a few extra reporters to stay on to research local issues or investigate potential corruption in city halls, then the move would most definitely be worthwhile.

On the other hand, there are a few negatives that could potentially be brought up with this proposal. First off, if an elected official or community leader didn't like something the newspaper published then I could see the leader potentially trying to take away the paper's non profit status. I don't think this would be widespread, but there is some potential for abuse there. Depending on who is making large donations to the newspaper, there might be some public debate about the objectivity of the paper -- although there are already a lot of people on all sides of the aisle who are already taking part in this debate surrounding the media.

With all that being said, what do people think? Is this a good idea? Is it something that we should be looking at right now? Should it be expanded to include all newspapers? Would it actually make any difference?


  1. No, no, no. This would do nothing to slow the demise of newspapers while making them more susceptible to the whims of donors (read: politicians and others who try to control the press) than ever.

    If this is what our "free press" is coming to, then we are in serious trouble.

  2. I'm not sure I'd be so hasty Vivian, though you do raise good points.

    We already have National Public Radio, which is non-profit and listener sponsored. They get large donors, yet theirs is some of the most respected news reporting around.

    What about England's BBC? They too maintain a decent reputation for their work in reporting the news.

    I wouldn't want to see privately operated newspapers disappear. And I would worry somewhat about winding up with Pravda. Official news outlets can generate well deserved skepticism. But some of the best news organizations are already publicly funded.

  3. I'd have to lean no on this idea simply because so many people look to local papers for guidance on how to vote in downticket elections. Local media favors covering races for US Congress, the Senate, or statewide races. State senate and delegate races get little attention.

  4. I wholeheartedly support this legislation. The simple fact is the current system is unsustainable while it is absolutely vital to maintain this brand of journalism. It's a classic case of the government stepping in to fix a massive failure of the market. Same as roads or police departments; there's no profit in it, so the market won't do it, but it's an absolute necessity, so the government funds it.

    As for the government controlling the press, I don't see how it could show any more deference to power than it does now. But I don't see it as an either-or scenario where there's either complete independence or Pravda-like subservience. Anonymous' comment is very important; it's not a new model. It's what our radio airwaves should have been before it was essentially given away in the 1930s.