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Newspaper bailout is no solution
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| One More Time - Comment and observation By: Joe Lee, III |
January 27, 2009 |
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Connecticut lawmaker Frank Nicastro is talking about introducing a bill to bailout newspapers. While we appreciate his concern for the free press, we think newspapers are no more deserving of taxpayer-financed rescue money than General Motors, Chrysler, or a bunch of banks and stock traders.
We won't go into the automobile and financial woes at this writing, but we do feel we have earned credentials that allow a somewhat informed discussion of what is facing newspapers.
Large newspapers such as the New York Times, Chicago Tribune, and others are a completely different animal from the newspaper you pick up in most Mississippi towns.
Too much debt
The Tribune, for example, is part of a large conglomerate including radio, television, the Chicago Cubs, and who knows what else. The relatively-new owner is leveraged to the hilt. (In Mississippi talk, that means he borrowed $8.2 billion to buy the outfit.) There is (was) no way the Tribune and her sister newspapers could possibly service the debt - even in the best of times.
The New York Times is probably just as mired as the American auto makers in so-called legacy costs. There is no telling how much it cost for the Times to produce and deliver a single page of news and advertising in New York's traffic and union production environment.
In 2006 the McClatchy group bought Knight-Ridder's 32 daily newspapers to jump from relative obscurity to the nation's second largest newspaper producer. The transaction was something akin to a crappie swallowing a whale, and McClatchy has since sold 12 of the 32 dailies. In mid-December McClatchy stock fell to below $1 a share - and market capitalization dropped to two percent of the company's previous value, according to Wikipedia. More recently the stock was $1.78.
A different planet
Small, family-owned newspapers - of which there are a dwindling few - are, needless to say, on a different financial planet from those previously mentioned.
We small fry share some of the same maladies - a 37 percent increase in newsprint cost last year, soaring delivery gasoline costs (destined to return), and the same government-inflicted, worthless crap that all businesses face - but our most severe problem is more linked to a shrinking retail market than to anything else.
Fortunately small town folk still tend to read local news about local friends in local newspapers, and in most small towns the only really active internet site is that of the local newspaper. OK, so it's not the best of times for small newspapers (or any other business), but small town publications have pretty good readership in print and on the Web.
Even Super Bowl affected
Along with severe postal, newsprint, and gasoline expense, the average small town newspaper faces a severely shrinking retail base. Other small town media face this same problem. Even the big television networks are having trouble. There was some difficulty selling all of the Super Bowl ad spots this year.
We can all remember local retailers that are no longer with us: Nichols Ford, Huey White Chevrolet, Kellwood Outlet, Western Sizzlin', Perkins Hardware, Perkins Place, Northwest Office Supply,
Red River Tractor, Friedman Jewelry, Southern Tire & Automotive, Hale Lumber, Skeen Furniture, and Kid's Corner. Mattress Direct is closing this month. We are sure our readers could name others.
These businesses all gave shoppers a broader retail base than we have today. These were the folks who worked hard for the Tate County Economic Development Foundation, in local churches, and at local civic clubs. They bought newspaper and radio advertising.
To be sure, we have some great new stores. Some have even replaced those that have fallen off the list, but the big box stores have changed forever - for better or for worse - the small-town retail landscape.
Fewer shopper choices
This void of sales opportunity for a town's media and dwindling number retail choices for local shoppers has definitely had an impact on small town business and, yes, on small town newspapers.
Some Mississippi cities should not have had a daily publication to begin with. At least one Mississippi daily publisher is contemplating going to twice weekly publication. Another is considering dropping Monday delivery. In DeSoto County, a daily converted to three times a week. A North-Mississippi newspaper was combined with a competitor in the past few months. Some small towns can no longer afford even a weekly - Newton lost its 107-year-old publication earlier this month.
The taxpayers are in the process of subsidizing television stations at least $2 billion in the form of digital converters. An additional $650 million was earmarked for this project in Congress' economic stimulus package passed last week, and it would be easy to say newspapers should get their share of the bailout money, too.
Too much government
There are few creatures more independent or more cantankerous than an independent newspaper publisher, and we doubt that many would put up with the strings attached to government money. Most believe the government meddles too much as it is. (It does.)
Our sentiments on the press and government were best put by Pres. Thomas Jefferson who said, "Were it left to me to decide whether we should have a government without newspapers or newspapers without government, I should not hesitate for a moment to choose the latter."
It appears we are destined to have more and more government. We hope the future does not produce bring fewer and fewer community newspapers.
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©The Democrat 2013
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