The Need for Increased Press Subsidies

U.S. press subsidies have greatly diminished in the past century as more democratic nations continue to fund free press at a much higher per capita rate.

Digital Disconnect

“Digital Disconnect,” by Robert W. McChesney, is a groundbreaking critique of the Internet and an urgent call to reclaim the democratizing potential of the digital revolution while we still can.

Cover courtesy The New Press

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Digital Disconnect (The New Press, 2013), by Robert W. McChesney, offers an in-depth analysis of how commerce has corrupted the Internet, collapsing credible journalism and freedom of access to information in favor of unchecked consumerism. McChesney also reminds us of our early hopes that the Web would eliminate media monopoly and provide a truly level playing field, and reveals how we might reclaim the Internet. The following excerpt from Chapter 6, “Journalism Is Dead! Long Live Journalism?,” explains how adequate press subsidies nourish democracy and tries to show how much America lags behind more democratic countries in terms of free press investing.

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In 1787, as the Constitution was being drafted in Philadelphia, Thomas Jefferson was ensconced in Paris as this young, undefined nation’s minister to France. From afar he corresponded on the matter of what was required for successful democratic governance. The formation of a free press was a central concern. Jefferson wrote:

The way to prevent these irregular interpositions of the people is to give them full information of their affairs thro’ the channel of the public papers, and to contrive that those papers should penetrate the whole mass of the people. The basis of our governments being the opinion of the people, the very first object should be to keep that right; and were it left to me to decide whether we should have a government without newspapers, or newspapers without a government, I should not hesitate a moment to prefer the latter. But I should mean that every man should receive those papers and be capable of reading them.

For Jefferson, having the right to speak without government censorship is a necessary but insufficient condition for a free press and therefore democracy, which also demands that there be a literate public, a viable press system, and easy access to this press by the people.

But why, exactly, was this such an obsession to Jefferson? In the same letter, he praised Native American societies for being largely classless and happy, and he criticizes European societies—like the France he was witnessing firsthand on the eve of its revolution—in no uncertain terms for being their opposite. Jefferson also highlighted the central role of the press in stark class terms when he described its role in preventing exploitation and domination of the poor by the rich:

Among [European societies], under pretence of governing they have divided their nations into two classes, wolves and sheep. I do not exaggerate. This is a true picture of Europe. Cherish therefore the spirit of our people, and keep alive their attention. Do not be too severe upon their errors, but reclaim them by enlightening them. If once they become inattentive to the public affairs, you and I, and Congress, and Assemblies, judges and governors shall all become wolves. It seems to be the law of our general nature, in spite of individual exceptions; and experience declares that man is the only animal which devours his own kind, for I can apply no milder term to the governments of Europe, and to the general prey of the rich on the poor.

In short, the press has the obligation to undermine the natural tendency of propertied classes to dominate politics, open the doors to corruption, reduce the masses to powerlessness, and eventually terminate self-government.

James Madison was every bit Jefferson’s equal in his passion for a free press. Together they argued for it as a check on militarism, secrecy, corruption, and empire. Near the end of his life, Madison famously observed, “A popular government without popular information or the means of acquiring it, is but a Prologue to a Farce or a Tragedy or perhaps both. Knowledge will forever govern ignorance, and a people who mean to be their own Governors, must arm themselves with the power knowledge gives.”

They were not alone. In the early republic, with no controversy, the government instituted massive postal and printing subsidies to found a viable press system. There was no illusion that the private sector was up to the task without these investments. The very thought would be unthinkable for generations. For the first century of American history, most newspapers were distributed by mail, and the Post Office’s delivery charge for newspapers was very small. Newspapers constituted 90 to 95 percent of its weighted traffic, yet provided only 10 to 12 percent of its revenues. The Post Office then was by far the largest and most important branch of the federal government, with 80 percent of federal employees in 1860.

In the haze of the past century of commercially driven news media, we have lost sight of the fact that the American free-press tradition has two components. First is the aspect everyone is familiar with, the idea that the government should not exercise prior restraint or censor the press. The second, every bit as important, is that it is the highest duty of the government to see that a free press actually exists so there is something of value that cannot be censored. Although this second component of the American free-press tradition has been largely forgotten since the advent of the corporate-commercial era of journalism, the U.S. Supreme Court, in all relevant cases, has asserted its existence and preeminence. Justice Potter Stewart noted, “The Free Press guarantee is, in effect, a structural part of the Constitution” (Stewart’s emphasis). “The primary purpose of the constitutional guarantee of a free press was,” he added, “to create a fourth institution outside the Government as an additional check on the three official branches.” Stewart concluded, “Perhaps our liberties might survive without an independent established press. But the Founders doubted it, and, in the year 1974, I think we can all be thankful for their doubts.” In his opinion in the 1994 case Turner Broadcasting System v. FCC, Reagan appointee Justice Anthony Kennedy concluded, “Assuring the public has access to a multiplicity of information sources is a governmental purpose of the highest order.”

How big were these public investments in journalism (or press subsidies) in contemporary terms? In The Death and Life of American Journalism, Nichols and I calculated that if the U.S. federal government subsidized journalism today at the same level of GDP that it did in the 1840s, the government would have to invest in the neighborhood of $30 billion to $35 billion annually. In his Democracy in America, Alexis de Tocqueville wrote with astonishment of the “incredibly large” number of periodicals in the United States and concluded that the number of newspapers was in direct proportion to how egalitarian and democratic the society was. The robust press had little to do with free markets and everything to do with subsidies that dramatically lowered the costs of publishing and provided additional revenues from printing contracts. As late as the 1910s, when Postmaster General Albert Burleson questioned the need for newspaper and magazine postal subsidies, he was roundly dismissed as someone who knew little about news industry economics. To Americans of all political persuasions—and especially to progressive political movements like the abolitionists, populists, and suffragists—even during the most laissez-faire periods in American history, the necessity of a large public investment in journalism was a given.

Federal press subsidies—e.g., postal subsidies and paid government notices—have diminished in real terms to only a small fraction of their nineteenth-century levels, though they remain to the present day. Public broadcasting is the most visible investment by government in media, and it receives approximately $1 billion in public support, but only a small portion of that supports journalism. State and local governments, as well as public universities, provide much of this public subsidy, with only about $400 million coming from the federal government.

There are legitimate concerns about government control over the content of journalism, and I reject any investments that would open the door to that outcome. I also understand that a government with a massive military and national security complex, like the United States, could be especially dangerous with the keys to the newsroom, but we could fund real journalism with some of the roughly $5 billion currently used annually by the Pentagon for public relations. Moreover, the United States, for all of its flaws, remains a democratic society in the conventional modern use of the term. Our state is capable of being pushed to make progressive moves as well as regressive ones.

This is a crucial distinction. Most opponents of press subsidies assume that the places to look for comparison purposes are Nazi Germany, Stalin’s Russia, Pol Pot’s Cambodia, and Idi Amin’s Uganda. If a dictatorship or authoritarian regime subsidizes journalism, the “news” will be propaganda designed to maintain an antidemocratic order. But that does not mean the same outcome necessarily occurs when democratic nations institute press subsidies. What happens when we look at nations with multiparty democracies, advanced economies, the rule of law, electoral systems, and civil liberties? — places like Germany, Canada, Japan, Britain, Norway, Austria, the Netherlands, Denmark, Finland, Belgium, Sweden, France, and Switzerland.

For starters, all these nations are huge government investors in journalism compared to the United States. If America subsidized public media at the same per capita rate as nations with similar political economies, like Canada, Australia, and New Zealand, U.S. public broadcasters would have a government investment in the $7 billion to $10 billion range. If America subsidized public media at the same rate as nations along the lines of Japan, France, or Great Britain, the total would be $16 billion to $25 billion; if at the same rate as Germany, Norway, or Denmark, $30 billion to $35 billion.

These estimates do not even factor in the extensive newspaper subsidies that several democracies employ. If the U.S. federal government subsidized newspapers at the same per capita rate as Norway, it would make a direct outlay of approximately $3 billion annually. Sweden spends slightly less per capita, but has extended the subsidies to digital newspapers. France is the champion at newspaper subsidies. If a federal government subsidy provided the portion of the overall revenues of the U.S. newspaper industry that France does for its publishers, it would have spent at least $6 billion in 2008.

I have had the privilege of traveling to many of these nations in recent years, and my impression is that these nations are far from police states, nor do their extensive public media systems and journalism subsidies evoke comparisons to a sham democracy, let alone a one-party state. But appearances can be deceiving, and one prefers harder evidence, from unimpeachable sources that would not necessarily be inclined to endorse public press investments.

I start with Britain’s The Economist, a business magazine keenly in favor of capitalism, deregulation, and privatization, unsympathetic toward large public sectors, labor unions, or anything that smacks of socialism. Every year The Economist produces a highly acclaimed Democracy Index, which ranks all the nations of the world on the basis of how democratic they are. In 2011 only twenty-five nations qualified as democratic. The criteria are: electoral process and pluralism, functioning of government, political participation, political culture, and civil liberties. The United States ranks nineteenth by these criteria. Most of the eighteen nations ranking higher had government media subsidies on a per capita basis at least ten or twenty times that of the United States. The top four nations on the list—Norway, Iceland, Denmark, and Sweden—include two of the top three per capita media subsidizers in the world, and the other two are dramatically ahead of the united States. These are the freest, most democratic nations on earth according to The Economist, and they all have perfect or near-perfect scores on civil liberties. The United States is tied for the lowest civil liberties score among the twenty-five democracies, and on this issue trails twenty nations described as “flawed democracies” in The Economist’s rankings.

Although all of the Democracy Index criteria implicitly depend to a large extent upon having a strong press system—and the report specifically discusses press freedom as a crucial indicator of democracy—freedom of the press itself is not one of the six measured variables. Is there a more direct source on press freedom?

Fortunately, there is. The Democracy Index can be supplemented with the research of Freedom House, an American organization created in the 1940s to oppose totalitarianism of the left and right, which with the coming of the Cold War emphasized the threat of left-wing governments to freedom. Freedom house is very much an establishment organization, with close ties to prominent American political and economic figures. Every year it ranks all the nations of the world on the basis of how free and effective their press systems are. Its research is detailed and sophisticated, particularly concerned with any government meddling whatsoever with private news media. For that reason, all communist nations tend to rank in a virtual tie for dead last as having the least free press systems in the world. Freedom House is second to none when it comes to having sensitive antennae to detect government meddling with the existence or prerogatives of private news media.

Freedom House hardly favors the home team. In 2011 it ranked the United States as being tied with the Czech Republic as having the twenty-second freest press system in the world. America is ranked so low because of failures to protect sources and because of the massive economic cutbacks in newsrooms that have been chronicled in this chapter.

Freedom House’s list is dominated by the democratic nations with the very largest per capita journalism subsidies in the world. The top nations listed by Freedom House are the same nations that top The Economist’s Democracy Index, and all rank among the top per capita press subsidizers in the world. In fact, the lists match to a remarkable extent. That should be no surprise, as one would expect the nations with the freest and best press systems to rank as the most democratic nations. What has been missing from the narrative is that the nations with the freest press systems are also the nations that make the greatest public investment in journalism and therefore provide the basis for being strong democracies.

Freedom house research underscores the fact that none of these successful democracies permit the type of political meddling that is common in U.S. public broadcasting, particularly by those politicians who want to eliminate public broadcasting, with no sense of irony, because it has been “politicized.” Matt Powers and Rodney Benson conducted a thorough analysis of media laws and policies in fourteen leading democracies and “found that all of these countries have self-consciously sought to create an arm’s-length relationship between public media outlets and any attempt at partisan political meddling.” They conclude:

What matters for both public and private media are the procedures and policies in place to assure both adequate funding and independence from any single owner, funder or regulator. Inside corporate-owned newsrooms, as profit pressures have increased, informal walls protecting the editorial side from business interference have crumbled. In contrast, the walls protecting public media are often made of firmer stuff such as independent oversight boards and multiyear advance funding to assure that no publicly funded media outlet will suffer from political pressure or funding loss because of critical news coverage.

“I’d like to think that this finding rather than our calculation of funding is the major contribution of our study,” Benson told me.

Although no nation is perfect and even the best have limitations, these examples consistently demonstrate that there are means to effectively prevent governments from having undue influence over public media operations, much as in the united States we have created mechanisms to prevent governors and state legislatures from dictating faculty research and course syllabi at public universities. In other democratic nations, public broadcasting systems tend to be popular and are defended by political parties throughout the political spectrum. Even in the United States, despite its paltry budgets and spotty performance, public broadcasting routinely polls as one of the most popular government programs.


Copyright © 2013 by Robert W. McChesney. This excerpt originally appeared in Digital Disconnect: How Capitalism Is Turning the Internet Against Democracy, published by The New Press, and is used here with permission.