Good Jack Shafer interview in Politico with Margot Susca, the author of “Hedged,” on how private equity helped destroy the newspaper business. I reviewed “Hedged” for The Arts Fuse last month.
Leave a comment | Read comments
Discover more from Media Nation
Subscribe to get the latest posts to your email.
Aaron Read
It occurs to me that if hedge fund ownership is the biggest single problem facing newspapers (and honestly, by extension, most of “journalism” today), then the goal should be to get hedge funds out of the newspaper ownership business. What’s the one company a hedge fund cannot own? A nonprofit! So how do we structure the tax code to make it damn near impossible for a newspaper to be O&O by anyone but a nonprofit?
For one thing, we could change the favorable USPS rates to only be for nonprofits; every other newspaper owner pays ten times the normal rate for mailing. We could remove the tax deduction for marketing/advertising that ad-buyers get unless it’s a nonprofit news outlet. (which, by the way, is more than ten times of a taxpayer giveaway than what the Corporation for Public Broadcasting gives, indirectly, to NPR) We could create a new and VERY punitive sales tax on sales of dead-tree papers and digital subscriptions, but nonprofit-owned news outlets would be exempted.
I wonder if there’s a way to muck with the payroll taxes by industry, so that anyone working for a newspaper that’s not owned by a nonprofit (and is earning more than a given amount, let’s say $75k (adjusted for regional COL)) gets slapped with a much higher payroll tax….thus encouraging high-quality employees to leave for-profit papers and go to non-profit papers.
Yes, there’s problems with nonprofit newspapers. I know that. But I challenge anyone to claim those problems are even 1% as big as the problem of publicly-traded/hedge-fund ownership destroying, as Susca astutely phrases it: “the one institution meant to give voice to average citizens in our democracy.”