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Article posted Jun 01 2010, 6:22 PM Category: Commentary Source: Washington Examiner Print

Will journalists wake up in time to save journalism from Obama's FTC?

by Mark Tapscott, Washington Examiner

Release of the Federal Trade Commission's working paper on "reinventing journalism" makes it clear that there is no more time for diplomacy about this issue: President Obama is determined to federalize the news industry just as he has banking, autos, and health care.

Everybody who wants independent journalism had better wake up to these three facts about what is going:

* Journalists must understand that there is no way the First Amendment's guarantee of freedom of the press will survive if the federal government regulates the news industry as envisioned by the FTC. Those who accept at face value protests to the contrary or the professions of pure intentions by advocates of government takeover of the news business are, at best, incredibly naive.

* Journalists who remain silent or apathetic about what is being prepared by the FTC for their profession become unintentional accessories in the strangulation of independent journalism.

* Journalists who support or assist, for any reason, the FTC process are accomplices in the strangulation of independent journalism.

Those in the administration who clearly view independent journalism as an obstacle to "change we can believe in" and their numerous allies in the old media, non-profit, and academic communities who either share a similar ideological vision or see the FTC process as their salvation against the Internet, will no doubt dismiss my assertions as extemism or alarmism.

Fine, call me whatever, but what they cannot deny is what is clearly written in the FTC document and what it reveals about the intention behind the initiative, which is to transform the news industry from an information product collected by private individuals and entrepreneurs as a service to private buyers, to a government-regulated public utility providing a "public good," as defined and regulated by government.

The authors hide this dangerous intention behind carefully worded expressions of concern for preserving "quality journalism" and "addressing emerging gaps in reporting," and they rationalize their proposed approach of massive government intervention in the news process as simply an extension of what government has always done via postal subsidies, tax breaks, and so forth.

Jeff Jarvis, a veteran of the old media and a pioneer of the Internet-based new media with his Buzz Machine blog, provides a thorough analysis of what the FTC is considering and explicates the dangerous consequences that will follow. He summarizes those recommendations as:

"Antitrust exemptions. The FTC looks at allowing news organizations to collude to set prices to consumers and with aggregators. Isn’t that the precise opposite of what an agency charged with protecting competition for the benefit of customers should be considering? Shouldn’t the FTC recoil in horror at such sanctioned antitrust to protect incumbents’ price advantages? Not here.

"Government subsidies. After saluting the history of government subsidies for the press — namely, postal discounts, legal notice publication, assorted tax breaks, and funds for public broadcasting — the agency looks at other ideas: a journalism AmeriCorps paying journalists; increased funding for public broadcasting; a national fund for local news suggested in Columbia’s report on journalism; a tax credit for employing journalists; citizen news vouchers (a la campaign checkoff); grants to universities for reporting. It also looks at increasing the present postal subsidy (which would only further bankrupt the dying postal service in the service of dying publications); using Voice of America and Radio Free Europe content (aka propaganda) in the U.S.; and enabling the SBA to help nonprofits.

"Taxes. At least the FTC acknowledges that somebody’d have to pay for all this. In one section, the FTC looks at licensing the news: having ISPs levy a fee on us that the government then dolls out to its selected news purveyors — call that the internet tax. It’snothing but a tax and it would support incumbents surely. In another section, it examines the aforementioned iPad tax; a tax on the broadcast spectrum; a spectrum auction tax; a tax on ISPs and cell phones; and a tax on advertising (brilliant: taking a cut of the last support of news in America).

"New tax status. The document spends much space looking at ways to make journalism a tax-exempt activity and suggests the IRS should change its regulations to enable that. It also looks at changing tax law to enable hybrid corporations (“benefit” and “flexible purpose” corporations that can judge success on serving a mission and not just maximizing profits) as well as L3Cs.

"Finally, the document looks at the one thing that should be in its purview as a government agency: getting government to make its information open and accessible to view and analyze. Well, amen to that."

If that menu doesn't scare the hell out of every true journalist in America, perhaps this graph from Jarvis will:

"What disturbs me most in this section is that the FTC frets about 'difficult line-drawing being proprietary facts and those in the public domain.' Proprietary facts? Is it starting down a road of trying to enable someone to own a fact the way the patent office lets someone own a method or our DNA? Good God, that’s dangerous."

You got that right, Jeff, but that's exactly what these people intend to do - put government in position to define who gets to report what and how.

Conservative journalists will do well not to role their eyes impatiently with liberal colleagues who don't understand that government always expands its control over any activity it either funds or regulates, and therefore must be limited at every level to well-defined, narrowly circumscribed powers that only it can fulfill, as was done by the U.S. Constitution.

Better to explain yet again that the original intention of the Founders with respect to the media - "Congress shall make no law respecting ... the freedom of the press" - is the key to saving independent journalism.

Then we must remind them that the adversarial relationship that is supposed to exist between journalists and public officials must apply no matter who those public officials might be or what political party or ideological school of thought they represent.

Elected officials' first thought is always about re-election, while career government workers' is job security. A journalist's first thought is supposed to be getting the facts.

To that end, we're supposed to be adversaries, not co-conspirators, partners, favored "stakeholders," or beneficiaries. That's why the Constitution made us independent.





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