Should you be taxed to subsidize ‘The New York Times’? — CNet

Newspapers around the country, by and large, are suffering declines in revenue. Most of the decline can be directly attributed to corresponding aspects of the Internet (although, one can make a strong argument that a not unimportant reason for the decline is the overwhelming political bias of the big papers). Now, the first mention of subsidies for newspapers has slipped out.

Now newspapers are facing a hurricane-strength competitive gale, and they, understandably, don’t like it one bit. A recent article in the Columbia Journalism Review titled “The Uncle Sam Solution” suggests everything from ownership tax incentives and R&D subsidies for the development of electronic paper–to a straightforward redistribution of wealth from taxpayers to newspaper owners and employees.

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But probably the biggest reason to be wary of higher taxes to help out newspapers is the broader one: Bailing out an industry that’s suffering because of technological change or increased competition is not a wise choice in the long run. Afternoon newspapers are largely a defunct breed for the obvious reasons; would society really be better off if taxes were raised to subsidize such money-losing ventures for purposes of nostalgia?

I quote the CNet article instead of the underlying article furthering the idea of subsidies, et al., because of some finer points mentioned:

The stiff winds of Internet competition have already swept through countless businesses, including travel agents, car dealers, wine retailers and stock brokers.

Some have adapted. Some have perished. I have a friend who, to his chagrin, became a licensed stockbroker in Pennsylvania just as E*Trade and other Internet brokerages were becoming popular. And does anyone even remember travel agents anymore?

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Now, everyone says they like competition in theory, but nobody actually likes to have competitors in practice. For the better part of a decade, Craigslist and eBay have been slowly nibbling away at newspapers’ classified-ads business. A 2005 MediaPost article says that as a result, according to McKinsey, newspapers have lost as much as 75 percent of their pricing abilities in key categories such as employment and general merchandise. Google is another competitive threat, with both broad and very targeted ads, and the cost of newsprint probably isn’t helping.

The statement “nobody actually likes to have competitors in practice” is a bit overbroad. The author obviously means that nobody likes to have their own competitors, but I am quite happy — in fact, perfectly happy — to have competitors of every product that I purchase.

I’m not nit-picking the author’s article; I just want to point out that I like having competitors for my news, too, and there are plenty. The newspapers can either compete or die, and because of the aforementioned reason in the parentheses above, I just as soon prefer they die.