WASHINGTON D.C. – Should America’s local newspapers and media get a federal bailout? Some, including Maine Senator Angus King think so, and they are pushing for the issue to be taken up in the next round of legislation in Congress to deal with the economic fallout from the COVID-19 pandemic.
The argument in favor of the bailout is that local newspapers are an essential source of important news in communities across the country. But in the information age, the newspaper industry is in steep decline.
According to Senator Angus King and a host of Democrats serving in the U.S. Senate, local papers and broadcasters are seeing serious declines in revenue due to communities being shut down during the COVID-19 pandemic.
That loss of revenue follows a decade or more of local news organizations losing ground to advertising mediums in social media and tech platforms. That loss of revenue has led to closures across the industry and the rapid consolidation of control in fewer and fewer hands. Maine is the model for consolidation, with all of Maine’s daily newspapers save one, the Bangor Daily News, under the control of one owner, Maine Today Media’s Reade Brower.
Brower, who purchased Maine Today Media from S. Donald Sussman, the husband of Congresswoman Chellie Pingree, has quickly consolidated Maine’s remaining daily papers under his control.
In a letter to congressional leadership pushing for the so-called “Phase 4” of COVID-19 legislation to include funding for local news organizations, Senator Angus King wrote, “Local news plays an indispensable role in American civic life as a trusted source for critical information, a watchdog for government and corporate accountability, and a building block for social cohesion.”
Further on in the letter, King and his Democrat colleagues make a direct pitch, “Any future stimulus package must contain funding to support this important industry at such a critical time. Such a provision should be tailored to benefit aid recipients who make a long-term commitment to high quality local news.”
The letter doesn’t offer a definition of what “local news” actually is, but does point to a PEN America report that includes case studies and conclusions that suggest public funding of local media, greater regulation of news organizations by the FCC and a “link tax” which would charge some companies for using links provided by local news organizations.
PEN America defines local news organizations as generally any news organization that focuses on news specific to any geographic location, basically excluding national news organizations but including most everything else.
One model in the PEN America report discusses the idea of the federal government sending more than $23 billion per year to local news organizations.
Public funding, whether one-time or continued, comes with great concerns about the influence of government on local news. The “Phase 3” COVID-19 legislation was delayed for days as liberal Democrats attempted to use their leverage to implement measures of government control over any company that accepted federal funds.
That control included demands that government have a say in the governance of the companies, new environmental regulations, new labor and pay regulations and more. While most of those demands were scuttled in favor of a bipartisan deal, more many it begs a question. If government begins funding local news, how much control will the “free press” have to eventually give up to qualify for the money?
According to SBA guidelines, any local business that employs fewer than 500 employees already qualifies for the Paycheck Protection Program (PPP), which would help local news organizations cover their payroll and overhead for up to eight weeks at no cost through a forgivable loan. Because that program is already approved, it appears that the funding Senators want to provide local news organizations would go beyond the standard benefit provided any other small business in America.
But even the PPP is now facing difficulty meeting demand. A partisan logjam last week led Democrats to oppose an additional $250 billion in funding for the program unless it was rolled into a larger package of funding for other groups and industries and only offered with greater strings attached on small business.