Nobody Wants to Pay Taxes to Save Newspapers, and Why Should They? [Updated]

newspapers versus new media

The newspaper industry is almost, but not quite, running like a headless chicken in the last throes of life thanks to the digital revolution. Can it be supported by extra taxes? Should it be? Regardless of your answer, a new survey shows that nobody wants to pay the tax anyway.

A national telephone survey by Rasmussen Reports has a staggeringly bold statistic to support this fact: Of 1,000 adults surveyed over two days this week, 84% of respondents oppose imposing a 3% tax on cell phone calls to provide a fund to prop up the newspaper business and "traditional" journalism. 76% of people opposed a 5% tax on computers, including devices like iPads and Kindles for the same purpose, and 74% opposed a tax on news Web aggregators to help support the "traditional" news services they draw their stories from. A full 71% of respondees opposed the idea of creating a tax-funded program to hire and support young reporters to work in nationwide newspapers, and only 14% of those surveyed supported the notion.

These stats all have 95% confidence, with a sampling error of only 3% either way—meaning the results are unequivocal. You can still level the easy accusation that nearly nobody would approve the paying of extra taxes (remember that old saying "People who complain about taxes can be divided into two classes: men and women"?) and so for this survey to reveal that people approved paying more, no matter what it's for, would've been surprising. But you can't argue with the strength of feeling expressed here: The survey respondees most definitely do not want to pay tax to support an old industry.

And you can understand why. All the questions were reflections of proposals the FTC has put forward recently as ways to aid the ailing newspaper business. But the main thrust of this thinking is flawed in two important respects. Firstly that the industry must be saved, rather than obeying the rule "evolve or be damned" and developing itself to accept the new challenges. And secondly that "traditional journalism" and the newspaper industry go hand in hand, as if writing for a fast-paced digital publication excludes one from producing journalism (or is it the "tradition" that's in question here? Because even this notion is flawed—"traditionally" hacks would've resorted to typewriters and phone calls to the newsroom, and before that handwritten notes rushed to the typesetters for the daily, or even special edition). The newspaper business is in disarray precisely because it held onto its traditional roots for too long (not through any notion of serving the public), and in doing so ignored the digital revolution that had been fomenting before their very eyes for decades. Now there's a move to "help" them catch up with a movement they totally ignored.

The FTC and lawmakers are concerned that the online news industry isn't as high quality as the old printed news industry—and there is indeed a lot of chaff among the wheat in online news. But the same was true for the "old" industry. And any potential deficit in quality online news reporting is due, at least in part, to the old industry ignoring the opportunities of the new one. Also 58% of Americans are "confident" that online and other digital news sources can make up the gap if newspapers go out of business, indicating that the FTC may be chasing a fake problem.

Instead of taxing the public (the news consumers, remember!) to save an old industry, perhaps the FTC's efforts are better spent helping the industry grasp the amazing opportunities the digital revolution offers, taking all the core values and energy of "traditional" journalism into the new medium. Check out this fascinating effort by the Journal Register Company, reported by Niemen Labs, to try to revolutionize its business. Taking a leaf out of uber-high-tech Google's book it's creating a limited-place "ideaLab" program where journalists would have 25% of their time freed up to experiment with new media's hottest tools to try to create ideas for future JRC news publication. As the JRC's CEO John Paton notes, journalists were once famed for being revolutionary, rule-challenging, anarchic, and innovative ... hence the current trend to "support" the status quo by taxation is actually rather shocking.

Update: The FTC just gave us a call on this matter. They've got an interesting point to make: These hot-topic suggestions that taxation be used as a buffer for the stumbling news industry don't technically originate with the FTC itself. The FTC has in the past, and will in the future, run a series of workshops on the theme of "The Future of Journalism," where it encourages discussion and ideas-creation from panelists as diverse as SearchEngineLand and News Corp. It then publishes a summary of the workshop panelist's thinking ahead of the next workshop, to act as a touchstone for ongoing debate. The ideas about newspaper-saving taxation were included in this recent FTC publication, but the FTC does "not endorse" the idea, nor any notion of "making any policy recommendation" based upon these. 

Nevertheless, the idea stands by itself as an interesting notion, and echoes recent strong words from the President himself about the future of journalism, and avoiding a blog-heavy future. Would you be prepared to pay more tax to prop up the news industry?


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  • XSportSeeker

    There's yet another problem not addressed in the article with this taxation I can vouch as a 2nd year Journalism student.
    Mixing government policy and media is never a good thing.
    "Traditional" journalism already suffers a lot of influence due to it's need to survive dealing with revenue from ads and other capitalist means.
    If you add that to editors having to be worried about publishing a news piece on politicians and getting that tax lowered or even extinguished, than the few trust readers have will be just about over.
    And don't get me wrong. I'd really like for newspapers, magazines and other "traditional" forms of journalism to keep going (though I also have concerns about how stalled things are).
    But creating new taxes to save x form of business will almost always create undesirable side effects...

  • jason brown

    Fast Company makes a name for itself by not just forward thinking but lateral thinking. However, here, FC reveals the same blind spot afflicting most commentators on the "future of news" and similar sentiments.

    Journalism is in crisis and this crisis predates the internet, way back to the 1970s when large corporate investors identified the news media as a profit machine and began buying up independent media. In the US, for example, where there once dozens of major media companies, there are now barely five.

    By reporting on our glorious digital future, as if it was the only reality, FC and others miss the gorilla in the corner - the fact that roots of the global financial crisis can be traced back to a lack of strong, independent journalism from the news media. Trillions wiped off "free" markets. By the same interests that own the media companies.

    So two thumbs up to Seeker for making the point about propaganda. The only thing I would add is that evidence strongly suggests we're getting propaganda already - internet or otherwise.

  • Stephen

    Seeker makes a good point. A Pew Research Center study reported that 95% of stories with new information on the Internet originated with "old media" — print, radio or TV — but mostly newspapers. It makes sense since they're still basically the only industry willing to pay people to gather and report the news.

  • Seeker46

    Leave "papers" out of the question. The technology is obviously obsolete. A more pertinent question is, "Will people pay professionals to report news?" If we don't, we're going to get nothing but propaganda.

  • rainydayinterns

    If people actually start to smoke less, are we going to tax healthcare providers to save the tobacco industry?