Of Course There's Going To Be A Newspaper Bailout

News that the Boston Globe could shutter its doors any day now, leaving the city without its most famous paper, prompted some reporter to ask White House Press Secretary Robert Gibbs whether there would be a bailout for the newspaper industry.

Gibbs said no: “I don’t know what, in all honesty, government can do about it.” But then he added that, “(Obama) believes there has to be a strong free press” and that the President has expressed “concern and sadness” over the state of the industry.


Folks, a newspaper bailout is coming. Maybe not in time to save the Boston Globe, but certainly in time to save “systemically important” papers like The New York Times, The Washington Post, The Chicago Tribune and the LA Times.

First it starts with the president expressing “concern and sadness.” Then that’s followed up by a series of columnists and pundits talking about how the lack of a thriving fourth estate posed “systemic risk” to democracy.

A free and informed press with the resources to criticise business and government is especially important during this crisis, they’ll say. Internet journalism, we’ll be told, is a positive development, but alas there are too many people not online — particularly the poor, the most vulnerable in society — so a digital only press can not suffice.

Next we’ll be told that the economic crisis is an extraordinary black swan. The economic crisis is not the newspapers’ fault, they’ll say (they played by the rules!) and had there been no crisis, then newspapers would’ve had the time to develop a sustainable digital-based business model. Alas, the economic crisis circumvented what would’ve been a smooth transition.

The question, then, will be: what can be done? The public may not have the stomach for a direct capital infusion, but there are alternatives. A national media bank providing low-interest bridge loans and grants could be established — oh but, there will be plenty of independent oversight to ensure that the bank does not attempt to influence coverage.

Maybe even a bi-partisan commission. Journalists will be encouraged to pursue investigative work into government, with a promise that funding could never be revoked for such a reason.

The thing is, this is hardly speculation

Senator John Kerry, worried about his beloved Boston Globe, talked about a newspaper bailout just last month:

Washington Times has the quote: “America’s newspapers are struggling to survive, and while there will be serious consequences in terms of the lives and financial security of the employees involved, including hundreds at the Globe, there will also be serious consequences for our democracy where diversity of opinion and strong debate are paramount.”

Other politicians have proposed some sort of non-profit or non-taxpaying status for newspapers.

Bottom line is, they’re going to find some way — or they’re going to try like crazy — to establish some form of government support for the dead trees.


P.S. Judging from some of the comments, it seems that one of the main objections to this post is that it would be ridiculous, stupid or illogical. But looking at this question through the eyes of a technologist or anyone that’s thinking logically about business is the wrong approach. This is not about what’s a good or bad idea. It’s about politics only. And the political winds favour a bailout of some sort for newspapers.

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