The Feds are Taking Over Local News

The news business has been in the business news in Iowa lately.

Meredith Corp., based in Des Moines, this week approved the sale of its TV stations to Gray Television, which owns KCRG-TV in Cedar Rapids and more than 100 other stations. Davenport-based Lee Enterprises, whose properties include 10 Iowa newspapers, has an offer to sell to Alden Global Capital, a hedge fund criticized for gutting newsrooms. It’s the same company that this year acquired Tribune, the biggest news publisher in neighboring Illinois.

Lee and Meredith aren’t exactly small outfits, but these deals nevertheless underscore the downsizing and consolidation that has been underway in the media for more than a decade. Community news has been on the decline and where it persists it is increasingly controlled by outside stakeholders. That’s bad for news consumers — I’m biased, but I think independent newspapers like The Gazette are doing some of the best work.

Politicians in Washington have an idea to bail out America’s struggling local news industry. More than $1.5 billion in tax credits to journalism companies over five years is included in the “Build Back Better” package, under consideration in the U.S. Senate.

It will be a welcome windfall if it earns final approval from Congress but it’s not the thing that’s going to rejuvenate local news.

The old subscription and advertising models have been challenged by the internet. Some readers resent being asked to pay to read online, while businesses have more options for reaching customers. But you get what you pay for with free news — humans who produce reliable content need to eat.

Newspapers — which often do the heavy lifting that blogs and TV stations rely on to inform their coverage — have been hit hardest. Print newsrooms have about half as many employees as they did a decade ago, according to data from Pew Research Center.

There will always be ample supplies of horse race politics, sports recaps and crime write-ups. When newsrooms shrink, it’s the sometimes unsexy but still vital journalism that usually gets lost — local government, investigative journalism and long-term trend pieces that give the necessary context to know what’s going on in a community.

So, the proposed tax credit in “Build Back Better” is well-intentioned. It’s a problem worth trying to solve, although this solution has some notable pitfalls.

The proposal supposedly is intended to sustain small community newspapers and TV stations. It makes a feeble attempt to exclude huge media corporations by making those employing more than 1,500 employees on one site ineligible.

But many of the largest media companies in the country have dispersed workforces, owning numerous titles and stations that are locally managed to some extent. My former employer, Gannett, for example, is the largest newspaper publisher in the United States with thousands of employees and dozens of local newspapers. It could get more than a $100 million boost over five years from the per-employee tax credit, according to the Associated Press.

There is nothing to stop the big guys from using the largesse to pad the compensation of their managers and executives. It’s no sure thing that dumping money into the news industry will result in an influx of reporters at city council meetings. As with the Democrats’ support for state and local tax deductions, this could end up being another example of giving tax breaks to the wealthy.

And if electoral winds shift as expected, it’s not hard to imagine the next Congress taking this idea and using it to somehow game the tax code to suit their political preferences. The government could try to target subsidies at publishers who meet certain standards set by a hypothetical Ministry of Truth.

In principle, most journalists probably would prefer not to pin our financial futures to a government kickback. It presents conflicts of interest and threatens the media’s independence.

In practice, though, principles don’t keep the lights on. News organizations will be happy to accept it.

(319) 339-3156; adam.sullivan@thegazette.com

2 thoughts on “The Feds are Taking Over Local News”

  1. The best way to get journalism back on track to honest and unbiased reporting would be to move slander and libel from the civil courts to the criminal. Any reporter caught obviously defaming someone with allegations and falsehoods could face jail time, so might tend to be a bit more honest in the future.

    1. If that was done we might return to a civil discourse instead the disgusting, slanderous, gossip coulmn type of so called news reporting.
      So many reputation have been savaged by the Democrat run media. It’s obvious that today’s media is without conscience, proporting to get scoops about people who don’t agree with these progressives. The only way to stop this shameful fall from honest reporting Is to punish the perpetrators criminally and financially.

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