Thomas Jefferson said, “Were it left to me to decide whether we should have a government without newspapers or newspapers without a government, I should not hesitate a moment to prefer the latter.”
A recent study conducted by the Columbia University Journalism Review underscores Jefferson’s sentiment. The study shows that when a newspaper closes, local government waste skyrockets.
The study reports: “We conducted a systematic study of newspaper closures and government borrowing costs in the United States, for the period ranging from 1996 to 2015. We identified newspaper closures using hand-collected newspaper data from the Editor and Publisher yearbooks. Newspaper closures were especially prevalent during that time period because of the rising popularity of online news outlets (which do not focus as strongly on local government issues) and online classified ad sites such as Craigslist (which, as part of the larger effect of the internet on local newspapers, significantly eroded newspaper advertising revenues). We then collected government borrowing cost data from the Mergent Municipal Securities Database and cross-referenced this information with the newspaper closure data.
“We found that local government borrowing costs significantly increased for counties that have experienced a newspaper closure compared to geographically adjacent counties with similar demographic and economic characteristics without newspaper closures. Our evidence indicates that a lack of local newspaper coverage has serious financial consequences for local governments, and that alternative news sources are not necessarily filling the gaps.”
Sweetheart financial deals with local governments have always been a notorious cesspool of graft. Millions of dollars in fees and financing costs are associated with various bonds issued by local governments. Without the watchful eye of the press, sweetheart deals go undetected and government financing costs skyrocket. That’s what the study found.
I am not surprised in the least by the study, nor would Thomas Jefferson. As our nation has lost half its professional journalists over the last 20 years, I have seen an enormous increase in government corruption.
The cost of this corruption is many more times the cost of subscriptions. Those who think they are saving money by reading free news online are deluding themselves. They will pay many more times over in the form of government corruption and waste.
How did this come to be? How can an affluent nation like the United States lose half its journalists?
The answer: The destructive creativity of capitalism. Although the free market ultimately improves our lives, there can be a lot of disruption along the way.
It’s not like newspaper publishers didn’t see the digital age coming. Newspapers have had websites for decades. What we didn’t see was two companies becoming monopolies and dominating 90 percent of the online revenue. Facebook and Google produce zero original content. They pay no journalists to create content. Instead, they skim the content of newspapers and television stations for free and then repackage it through their software. They get all the benefit and none of the cost. It’s a beautiful profit model, but it is destroying journalism in America.
France has a simple solution. They force Google and Facebook to make payments to traditional newsgathering organizations that produce original content with professional journalists. That’s not likely to happen here.
Meanwhile, there is a race to the bottom in terms of content. There’s the endless drivel of Facebook chatter and sensationalist fake news designed to maximize eyeballs.
If that alone wasn’t enough, the FBI now calls digital ad fraud the second biggest illegal business after the drug trade. Who knows what’s a real eyeball and what’s a bot? The fraud is in the billions of dollars.
Meanwhile, our newspapers will hunker down and keep covering the city council and county board meetings as always. Over the last 150 years, we have survived two world wars and countless technological advancements. We’re still standing, waiting for the day people open their eyes and realize the value of original content produced by professional journalists.
Contact Wyatt Emmerich, president of Emmerich Newspapers, at wyatt@northsidesun.com.
