I want to react to Paul Starr’s observations about subsidy, which I largely agree with.
To put his observations in economic terms, we have been in the unusual and happy situation, in the 20th century, of having an essential positive externality — an informed public, supported by an aggressive and talented press corps — subsidized both by advertisers and by the readers who paid full price for the paper to read about the Lakers or Megan Fox, while ignoring articles on the City Council or the Honduran coup. These subsidies allowed publishers to fund serious reporting for readers who do care, even though that reporting operated at a loss.
The “Come for the crosswords, stay for the war crimes!” theory of newspaper reading doesn’t describe the real world. Citizens who regularly read and react to detailed political news are a small but critical minority. Publishers know this; newspapers are divided into sections for a reason, and that reason isn’t to maximize the chance that a basketball fan will stumble across dispatches from Tegucigalpa.
Because the newspapers are being unbundled, they are suffering, but I believe Professor Starr is right to focus on the threat to subsidy rather than revenue. Because most of the staff of a newspaper isn’t engaged in production of civic value, the profitability of newspapers isn’t a matter of public concern, but the subsidy of people creating that value is.
The question of public subsidy raised by Starr creates the especially tricky question of incentives with taxpayer dollars. I am an avid New York Times reader, and love the work of both Gretchen Morgenson, a financial reporter, and Eric Asimov, a restaurant reviewer. I am also a politics junkie, and was glued to Nate Silver’s 538.com, which tracked electoral votes in the 2008 presidential election. Subsidizing newspapers would help Asimov but not Silver, a perverse outcome if the goal is civic value. The ideal would instead be a subsidy that aids Morgenson and Silver but not Asimov, not because his work isn’t terrific, but because the behavior of the nations’ banks and the outcome of its elections are critical public issues, but the quality of that new restaurant in the East Village isn’t.
With the caveat that politics is the skillful wielding of blunt instruments, such subsidies would almost have to be applied to the income tax of individual citizens. I have a hard time imagining how such a thing would work, though my imagination about tax matters has never been of the finest.
My best guess is instead that we will have to double down on new forms, both of journalism and of subsidy. (And let me cop to Mamonides Ladder’s complaint, quite correct, that I oversimplified the landscape of subsidy in my original post.) These new forms could involve anything from making it easier for virtual corporations to fund journalism to creating a new class of non-profits that would endow journalistic outfits (possibly with new language allowing non-profit political endorsements), as well as all the other forms of subsidy that will come from amateur participation.
Much as I like the idea of a single, content-neutral set of subsidies that reward civic value, as postal subsidies did, and as much as I understand the value created by commercial subsidy, as the metro dailies’ advertisers and readers did, I don’t think either of those models can be saved at the scale we need, and more importantly, I don’t think they can be replaced by other subsidies that work the same way.
I think, as so often with the move from analog to digital, we’re seeing to see a radical fracturing of what was a previously coherent activity, and the only response likely to help us discover workable solutions will be an equivalent fracturing of many forms of subsidy.