More than four years ago, following the "scandal" in which CBS News used forged documents in an attempt to attack President George W. Bush, I wrote that the modern news businesses — and especially newspapers — pretty much were relics of the Progressive Era (that always seems to be with us, despite its supposed demise during the 1920s). At that time, however, newspapers seemed to be surviving the digital and blog era.
That situation no longer exists. It seems that each week brings more news about the moribund state of newspapers. For example, the Seattle Post-Intelligencer now is up for sale, and if there is no buyer within 60 days, its owner has said it will close the paper or reduce it to an on-line publication. The venerable New York Times, supposedly the "standard of journalism" which proudly wears its moniker "the newspaper of record," has mortgaged its building in order to meet current expenses and there is no assurance that the "Grey Lady" will survive.
The culprit all over the country is the drop in advertising revenue and circulation. For example, the Hearst Company, which owns the Seattle P-I, says it is losing millions of dollars, and cannot afford to keep the paper afloat any longer. No doubt, that is true, but that only is part of the story. After all, a drop in circulation and advertising dollars cannot be a cause, but rather an effect. Yes, there is a serious economic downturn, but other entities that depend upon advertising still are viable, and newspapers have survived recessions in the past.
Analysts typically explain that newspapers are based upon "old world" technology that could not survive the digital age, and that is true, to a point. For example, the rise of broadcast news, first radio, and then television, helped reduce the number of newspapers, especially in large cities such as New York. People could hear about news events quickly, as opposed to having to wait until the next morning or that afternoon when the press runs were completed and the newspapers distributed.
Yet, it would seem that increases in technology should not stand in the way of competent news organizations being competitive. Just as changes in technology have helped other industries cut costs and increase productivity, newspapers should have been able to do the same.
The market itself for news certainly has not dwindled, even if the mechanism for bringing news to the consumers has changed. For example, three decades ago, the "major" news organizations were primitive in their scope compared to what is the situation today. When Ted Turner launched Cable News Network (CNN) in 1980, most pundits were extremely skeptical that the venture could survive, given that it was moving into uncharted waters. (Because the "regulated" financial system would not fund the CNN start-up, Turner sought Michael Milken, whose investment bank underwrote the enterprise with so-called junk bonds.) Today, the airwaves are crowded with 24-hour news networks and radio shows.
However, there is another aspect to the rise in digital and computer technology that has undermined the typical newspaper, and the industry has adjusted very poorly. I am speaking of the notion that journalists are supposed to be "professionals," something that came from the Progressive Era, and it reflects an attitude that is not limited to just newspaper journalism.
One legacy of Progressivism has been the emphasis that all occupations be filled with "professionals." For example, the celebrated Jane Addams believed that charity work needed to be done by "professional" people, which ultimately gave us government social workers. Other occupations which could be filled with people whose actual skills made them competent for the work at hand ultimately became closed to everyone but those who were "properly credentialed."
There is nothing inherent in journalism that requires credentialing. As one who has worked in newspapers off and on for three decades, I can say that the only skill needed is the ability to write quickly and accurately, and to be able to ask the right questions of people who are involved in the event the journalist is covering. None of that requires a special line of education.
One excellent example of a great journalist who could not find employment in that line of work today is Henry Hazlitt, who wrote for a number of major publications, including the New York Times, back when it really was the "standard" for journalism. Yet, Hazlitt never was a college graduate, even though his body of work was far greater and more intelligent than that of any Ph.D. economist or Pulitzer Prize winner today.
Today, the typical newspaper journalist is supposed to be "educated" and "respectable," which generally means a degree from an Ivy League university or the equivalent for the "elite" media, and certainly a secular and mostly leftist worldview. The actual work that occurs with good journalism rarely happens at the high levels any more, especially when the template that comes from the typical worldview of people in the "elite" newsroom can suffice.
An excellent example is the newspaper coverage of the infamous Duke Lacrosse Non-Rape, Non-Kidnapping, and Non-Sexual Assault Case. The so-called evidence was transparently laughable, yet the New York Times, Newsweek, Time, and The Washington Post pursued the case as though the prosecutor, Michael Nifong, were the second coming of Sherlock Holmes instead of the Inspector Clouseau that he really was.
As K.C. Johnson and Stuart Taylor (a former Times journalist) noted in their book on the Duke case, Until Proven Innocent, the mainstream press was guided by a crude "narrative" of "white jocks abusing black women" instead of the facts, which clearly demonstrated that no rape or assault had taken place, and the New York Times was an especially bad offender. Johnson, a history professor who runs a blog about the case, Durham-in-Wonderland, did some digging on his own and found out that Nifong had lent his campaign about $30,000 and until he began to pursue the lacrosse case, was behind and almost certainly would have been voted out of a job. Despite the fact that campaign contributions were public record, no "official" journalist ever researched those campaign loans, which clearly raised questions about reasons why Nifong would have pursued the case in the way he did.
The large mainstream news outlets had vast resources at their disposal; Johnson had his computer. Yet, the amateur was able to outperform the "professionals." So much for the "credentials" that make journalists "respectable" and "qualified."
Indeed, people are finding that someone with a computer and a cell phone can dig up and relay news as well as a highly-paid reporter — at much lower costs. Furthermore, modern journalists often are little more than conduits for government officials or leftist pressure groups.
Despite that fact that every student in J-school is taught that the press is a "watchdog" of government, the truth is that journalists are the lapdogs of the state. From the local police beat reporter to the top journalist at the New York Times, journalists pretty much repeat what government officials tell them. When journalists actually do pressure government, it is either for the authorities to pass laws that are stricter than what they are at the present or to demand that governments regulate businesses in a draconian fashion.
What one rarely will see in a newspaper, either in the news section or the editorial page, is something that promotes real liberty — people living without having to constantly bow down to the authorities. Instead, we will see journalists attacking gun owners, demanding the return of the "Fairness Act" (to keep Rush Limbaugh off the airwaves), and repeating the latest fantasies of Al Gore. In other words, they will demand the expansion of the state into the affairs of everyone except themselves. (Most journalists seem to think that the Bill of Rights begins and ends with the First Amendment.)
Yet, it is not just the realization by the public that most journalists are not the Great Experts they claim to be that is bringing down newspapers. Costs also play a huge role, and, not surprisingly, labor unions and government are in the middle of it. Large newspapers like the New York Times and Washington Post are dominated by labor unions, from the reporters to the people at the loading docks.
Labor unions often stand in the way of cost-effective capitalization that would bring down production costs and make the operations more efficient. When there were few other competitors, the union intransigence did not make such a difference. However, as the Digital and Internet Age advanced, suddenly labor unions no longer had the latitude they once did.
Yet, the "progressive" viewpoints of news organizations make it difficult for them to deal with the extra costs that unions place on them. A paper like the New York Times is going to have even more cost issues than most papers because of the practices of unions in that city, and a "progressive" paper like the Times, which believes that every business should have a union, is not going to be willing to fight the battles that would keep them in business, as that would go against the paper’s pro-union viewpoints.
The anti-entrepreneurial, interventionist or "progressivist" ideology that dominates the newsrooms also, I believe, stands in the way of newspapers being able to re-invent themselves and change to the current markets. In the 1950s, 1960s, and 1970s, IBM manufactured huge mainframe computers. Today, the company mostly is engaged in consulting. Between the mainframes and the present business model, IBM concentrated on personal computers and laptops.
In other words, the IBM of 1950 bears little resemblance to the IBM of today, yet the New York Times (once known as the "Grey Lady") has not changed much in the past half-century, except now it does run color pictures and it has a website. If there is any change to the paper, it is that its content is even more leftist than before. On the same editorial pages that Henry Hazlitt once wrote, we now have the economic illiteracy of Paul Krugman, the latest Nobel laureate.
Unfortunately, while the news-gathering model has changed elsewhere, newspapers still labor under the pretense that everyone anxiously awaits the arrival of the newsprint copy, as everyone is in complete ignorance until the paper arrives. At one time, that might have been true (I used to wait for the morning paper to find out sports scores from the night before), but no longer.
Yet, IBM survives, but the New York Times may not. Its people are finding out the hard way that the world no longer revolves around Linda Greenhouse’s manipulative articles on the U.S. Supreme Court or Maureen Dowd’s rants on the editorial page. Although the Times editorialists and columnists still are offering much advice to others, it seems that perhaps they should understand that few people are listening anymore, and for good reason.
If and when the New York Times goes under (unless it receives a government bailout, and I would not be surprised if that were to happen), everything and everyone else except for the real culprits will receive the blame for the paper’s demise. The pundits will claim Americans are short-sighted, or that free markets have failed, as the market participants failed to realize that the Times and other newspapers were the "soul of our society."
What they won’t cite is the destructive progressivist statism that has dominated "elite" journalism for more than a century. They won’t cite the unnecessary high costs brought on by labor unions and by the insistence that journalists be "credentialed." And they certainly will not admit that just maybe they were outhustled by people of "lower" credentials who were willing to dig and talk to people.
In a recent article in Reason, Jon Entine examines how activists took over the large pension funds and steered the money to Politically Correct causes. The results have been disastrous, as the value of these funds has plummeted. This is due not only to the current recession, but also to the fact that the "socially responsible" investments turned out to be real duds.
I mention this because "progressive" newspapers across the country touted these funds and this brand of investment as being the only morally-acceptable version of capitalism. Today, as both "socially responsible" pension funds and "progressive" newspapers fall over the cliff, we can learn the lesson that progressivism in any form is hazardous to one’s financial health.
Most important, newspapers (like "socially responsible" investment fund managers) will continue to insist that they and their "progressive" philosophy did not fail. Capitalism and free markets failed, and government needs to come to the rescue.
January 15, 2009
William L. Anderson, Ph.D. [send him mail], teaches economics at Frostburg State University in Maryland, and is an adjunct scholar of the Ludwig von Mises Institute. He also is a consultant with American Economic Services.