Public Policy and Funding the News

A Project of the USC Annenberg Center on Communication Leadership & Policy

Government’s Challenge

screensPolicymakers at every level of government face a challenge that has taxed anyone who has sought to understand the revolutionary changes affecting the news business. The emergence of digital news and broadband connectedness has turned longstanding principles and assumptions on their head. What does it do to antitrust regulation when news dissemination is distributed among millions of online producers? What happens to the body of regulations formulated by the Federal Communications Commission when a cellphone video can have wider viewership than the evening newscast? What does the Federal Trade Commission do when confronted with an overwhelming volume of publicly available messages that run the gamut from fact to fabrication? Who is a journalist? Who is not?

A body of laws and regulations governing the news industry has grown up at the Justice Department, the Federal Communications Commission and the Federal Trade Commission over many decades; much of it is outdated. What applied to an industry with a relatively small number of players is no longer good policy for a news ecology with millions of publishers. There are, for example, questions about the validity of cross-ownership rules designed to ensure multiple news voices in communities. Technology is making some old statutes simply unworkable.

For years, many governmental regulators were in a status-quo mode with respect to the news business because this “mature” industry was undergoing little fundamental change. Printing pressess and TV broadcasts were the unrivaled purveyors of the news.Now, though, federal, state and local governments are being forced to revisit their policies toward the news industry because the industry is being transformed.

What happens to the body of regulations formulated by the Federal Communications Commission when a cellphone video can have wider viewership than the evening newscast?

More fundamental: Is a new form of government intervention prudent, and necessary, to ensure that Americans have access to the kind of information they need in a democracy? There’s a second, potentially trickier question: If there is such a need, is government capable, amid such overwhelming change in the news business, of making choices that will make things better?

There are few obvious guiding stars, but two seem clear. First, government has an extremely important interest in what is now transpiring in the news revolution. American government doesn’t work if citizens don’t have a robust supply of reliable news and information.What’s playing out in the news business, then, is really in the realm of a vital national interest. Our society can’t afford to let policymakers be mere spectators while these remarkable changes flash by. Second, policymakers should not shy away from considering new investments in news and information. Government has supported the news industry for more than 200 years, but is now reducing much of its aid even as the news business is fighting for survival. It’s entirely appropriate and prudent, then, for government to consider new forms of assistance.

Many ideas have been thrown into the hopper: establishment of a WPA program for out-of-work journalists; revision of tax laws to allow newspapers to become nonprofits; tax credits for taxpayers who subscribe to newspapers; Public Policy and Funding the News 13 an antitrust-law timeout to allow publishers to form a common strategy; new federal investment in digital research.

Congress and the administration should also think anew about its public broadcasting and international broadcasting policies. Here are two ideas worthy of consideration:

  • Increase government funding of public broadcasting. News coverage on public radio and TV has the highest trust ratings of any American media. At the same time, U.S. tax support for public broadcasting is minuscule compared to many European and Asian countries. In short, policymakers have in public broadcasting an almost sure-fire bet for strengthening the quality and scope of news and information.
  • Relax restrictions on domestic consumption of news reports by Voice of America, Radio Free Europe/Radio Free Liberty and other government-funded international broadcasters.
  • These broadcasters have talented journalists in bureaus around the world, and the United States spends half again as much on international broadcasts aimed at foreign audiences as it spends on public broadcasting. Yet these entities are barred by law from distributing their news reports to an American audience.

Case in point: A Minnesota radio station wanted to run broadcasts by the VOA’s Somali service so that its audience – mainly Somalis who were getting news from other entities broadcasting in the Somalian language – would hear reports by a reliable source of news. Adhering to a law adopted 60 years ago, the VOA was forced to say no. In an era when all Americans, including expatriate populations, have access to both outstanding news sources and propaganda from around the world, it makes little sense to deny them excellent reports funded by the United States.Technology is making this prohibition mostly obsolete. It’s no longer possible to quarantine newscasts by VOA, RFE/RL, Alhurra and others, which are gaining a big domestic audience on the Web. A recognition of that reality would make this nearly $700 million annual investment in news coverage more useful to the American public.