by Gary North
Recently, I was flipping through the local TV channels. I get four stations clearly, but none is worth watching more than once a week. I stopped briefly at an interview. Talking head #1 was a nationally known TV news teleprompter reader, also known as an anchorman. The other one was unfamiliar to me. He was a print media journalist — a reporter. The anchorman began his questioning of the journalist with this observation. "We're both representatives of the MSM: mainstream media."
It hit me. The MSM is at long last visibly on the defensive. The moment you acknowledge that you are part of the mainstream media, you are necessarily also acknowledging the existence of another media, which I like to call the Upstream Media. It swims against the mainstream, which is flowing downstream. It's easy to flow downstream. You just let nature take its course.
The trouble with downstream rafting is that eventually you either hit the rapids or go over the falls. In any movie about going over the falls, someone in the raft asks:
"What's that noise?"
The optimists say that the river will carry them to the ocean. Fine. But if you don't climb off the raft, you will drift out to sea and disappear. The point is, at some point you had better get off the raft. The mainstream will eventually kill you.
Today, because of the Internet, hundreds of millions of people are getting off the raft, all over the world. They grab a motorboat and head back upstream.
There are lots of tributaries heading back upstream. No single tributary that is feeding into the river is getting all of the traffic. But hundreds of millions of people are now headed in the opposite direction, at least with respect to some important issues. Other issues will follow. Issue by issue, readers are concluding, "We've been lied to." They are correct.
The Establishment at some point will face the implications of widespread disbelief in everything it says. At some point, people will not voluntarily do what they are told when they perceive their leaders as liars. When that day comes, political consensus will disintegrate. So will the mainstream Establishment's control systems.
Upstream media were not readily accessible to most people as recently as a decade ago. The cost of locating alternative news sources was too high. The economists' rule held firm: "When price rises, less of the item is demanded." Now the same rule is being applied against the mainstream: "When price falls, more of the item will be demanded." The Internet has changed the relative pricing of media. This is a revolutionary turn of events.
The price of obtaining alternative views is falling fast. In fact, the main expense today is the value of our time. We have less and less time for the boring, superficial, and lying mainstream media. They know it. There is nothing they can do about it.
The monopoly that they have enjoyed for about 5,000 years is coming to an end. So is the free ride of political parties that rely on the mainstream media to keep the masses in line.
NEWSPAPERS ARE DYING
How much time do you spend each day reading newspapers? An hour? Probably not.
How much time do you read on-line? More than you spend with a newspaper.
Day by day, there are more people just like you.
A decade ago, I subscribed to three daily newspapers and about two dozen magazines. I also subscribed to a dozen investment newsletters. Since 2000, I have subscribed only to half a dozen paper-based newsletters. More and more newsletters are digital.
Instead of reading newspapers, I visit Websites. We all do. We are in news-overload mode. This is getting worse. Even with Google and similar search tools, we have too much on our plates. The allocation of our reading time has replaced the allocation of our subscription money as our most pressing reading problem.
Year after year, the network news departments of the three main TV networks are watching the Nielsen numbers fall. The same thing is happening to newspapers. They are declining in circulation. This is especially true of local newspapers. Readers are interested in national news, and they go to the Web for it.
This is creating a major problem for certain retail industries, most notably automobiles and furniture. Newspapers rely heavily on pages of full-page ads for local cars and furniture. As newspaper readers switch to on-line versions of local newspapers, as they are doing by the millions, the full-page ad's pull per dollar is fading. There are little ads on-screen, which we have learned to ignore. There are even PRINT THIS buttons that strip out most of the ads. When I post a link to an article, I always link to the print-screen version.
Local car companies and furniture stores ought to have on-line sites that are kept up to date hourly. A car is sold. Its photo should immediately be taken off the Website. But retailers in these industries have not yet made the transition to the Web. They do not understand it. Web marketing is still in its shake-out period. Yet the Web is replacing newspapers today. The Web shake-out will not be over before hundreds of paper-based newspapers die. Subscriptions since 1990 have been steadily falling at 1% per year. This has now risen to over 5% in some cases.
Beginning in the late nineteenth century, large-circulation urban newspapers shaped local public opinion in America. There were many papers, morning and evening, and each one represented one of the two major political parties. Then came radio and television, both regulated by the Federal Communications Commission, which controlled frequencies and station broadcasting power. Now the Web and for-pay satellite TV and radio have unplugged power from the FCC. The FCC legally regulates the content of only the no-pay airwaves. It does not regulate the Web at all.
Politicians in the two parties have built their power base on the basis of controlling local media. Today, local media are dying: newspapers and local TV stations. Broadcasting is dying; narrowcasting is replacing it. This will force a re-structuring of American politics.
LOCALISM IS DYING
Two competing social forces are now moving in opposite directions. Retail outlets along the main drag in every city are going national: Wal-Mart, Home Depot, Office Depot, etc. Locally owned retailers of physical stuff are disappearing. Price competition is killing them.
At the same time, information is decentralizing. Choices are decentralizing. These are aspects of the same trend: anti-localism. The decentralization of information is virtual, not geographical. It is the radical decentralization of the Drudge Report: straight into a guy's apartment in Hollywood. It bypasses regions, states, and townships. His apartment could be located anywhere. When information can come from anywhere and be delivered to anywhere at the same monetary price — zero — geography ceases to matter. We live in an information-centered age. So, we no longer live in a geography-centered age. This has never happened before. We are entering uncharted social waters.
"What's that noise?"
Localism is fading: local loyalties, local politics, local schools. Higher levels of government absorb our tax money. Textbooks are produced nationally. Local school boards are impotent. Local politics gets the leftovers.
When I want to buy a new product, I go onto the Web and read reviews. Then I use the Web to find the cheapest seller. For electronics, the seller is usually located in the northeast, probably in New York City, and is not open on Saturdays. (The seller is not a Seventh-Day Adventist.) What do I care? To save 20%, I'll buy on Thursday. Besides, I can order on-line 24x7. The phrase "24x7" is a sign of the times. Locally owned stores are not open 24x7. Web-based digital shopping carts are.
Regionalism is also fading. People are mobile. They move every five years. They do not establish local loyalties, which are costly to break. The ties that bind no longer bind very efficiently — in housing, occupations, regions, or marriage.
Regional mobility has been going on in the United States ever since the earliest days. Free land meant the move west. The kids got in a wagon and moved away . . . forever. Opportunity in America has always trumped regional loyalty in the long run. Regional loyalties have faded with every reduction in transportation costs. U-Haul and Ryder have done their work well.
The South will not rise again. Similarly, the yankees of New England have not visibly run the country since Jack Kennedy died. They do it indirectly. After Lyndon Johnson, the Texas presidents have been ersatz: both Bushes are of Connecticut stock, by way of Yale University and Brown Brothers, Harriman, the investment banking firm. George W. Bush bought his Crawford, Texas ranch in 1999 in preparation for the 2000 Presidential campaign. I call it "Potemkin Ranch." Here is a man who could afford to buy 2.5 square miles of land 25 miles from Waco — not exactly prairie dog country. The mainstream media never bothered to point out these incongruities. That is why they are mainstream.
When I say that the South will not rise again, I don't mean the old commitment of the South: resistance to centralized government. That idea is spreading as never before by means of the Web. It just isn't associated with a region any longer.
This is not just an American phenomenon. It is becoming universal. The gatekeepers of every national government are on the defensive. The gates cannot easily keep out electronic digits. The gatekeepers have lost power ever since the invention of the printing press. They could exercise some control over printing presses, ink, and paper. They cannot control electronic digits.
Our political world will change, even as our retailing world has changed. When it becomes obvious to voters that Washington, without robbing us blind, can no longer supply the stolen money with which it has bribed us for 90 years, mainstream politics will suffer a blow comparable to what the mainstream media are suffering.
NEWSLETTERS ARE MORPHING INTO WEBSITES
I mentioned that by 2000, I had cancelled all paper-based communications except for newsletters. They, too, are changing. They are dying off along with their editors.
My favorite newsletter, Otto Scott's Compass, ceased publication in January, 2005. Mr. Scott, now in his mid-eighties, could no longer write it. His daughters placed him in a rest home. My second favorite newsletter, Hilaire du Barrier's report on European affairs, ceased publication a year ago when the editor, age 94, died. Neither man was famous. Both were lifelong journalists. Hilaire du Barrier was not a well-known journalist. Yet I honestly believe that any historian who tries to write about European affairs, 1945 to 2004, who does not have a set of Hilaire's newsletters will not get the story right.
Hilaire was an upstream media man. He had been captured by the Japanese in 1941 in French Indo-China. He had been tortured for two weeks. He did not reveal anything about the network of French spies he knew about. After the war, they reciprocated. He had a network of informants like no other journalist I ever met. Yet he was always in the upstream. Almost no one knew about him.
A couple of years before he died, I persuaded a friend of his to put all of his reports on a CD-ROM. At some point, this CD-ROM will go on-line. Of this, I am sure. Then his life's work will get the readers it always deserved. The story of the insider's creation of the New Europe will then get the distribution it deserves.
The gatekeepers have a problem. The insiders have a problem. The story is getting out. As it gets out, political loyalties fade. The European Union was sold to the voters by Jean Monnet and his successors on the basis of greater economic opportunity, not the benefits of a new political loyalty. There is still little political grass-roots loyalty to the European Union. France will probably vote against the new 230-page EU constitution. Anyway, I hope so.
Websites are replacing paper-based newsletters. The flow of non-approved information is becoming a torrent. This undermines consensus. This process includes political consensus.
Think of what home schooling means for the intellectual consensus. Think of the threat to the Powers That Be. The cost of textbook production has kept upstream interpretations away from most students. But now home school curriculum developers can get new views to millions of students by way of CD-ROM and the Internet. Parents who are sufficiently upstream to have pulled their children out of America's only established church — the public school system — are ready to consider new interpretations. This is driving the academic gatekeepers crazy. Their monopoly over the media is fading. Now their near-monopoly over tax-funded education is slipping.
Today, American higher education absorbs something in the range of a third of a trillion dollars a year, and this is rising by about 7% a year — the sign of government-enforced monopoly. The government-supervised college accrediting system keeps out price competition. It also keeps upstream opinions out of most colleges. But this monopoly is producing the familiar result: falling standards and falling output.
The young wife of a college professor (engineering) I know told me that at the college, where she is finishing her bachelor's degree in June, several of her professors in the social sciences will not accept as valid any citation from a Web site that does not end in .gov. These people are crazy leftists. I mean really crazy — over the top Democrats and statists who honestly believe that their students are being corrupted by non-.gov political Websites. They are trying to keep students away from non-government-approved digits. They really are crazy. They have lost touch with reality. They are tax-subsidized nut cases.
In January, I visited an old friend who teaches history at an obscure state university. He and I were teaching assistants in the Western civilization program at the University of California, Riverside, in the late 1960s. That was back when all college grads had to take a class in Western civilization: dreary, long-dead days indeed.
For 35 years, I have recalled that when he could not decide what grade to give a student exam, he would have me read it. This was always an A/B decision. Invariably, I could not help him. I always graded it the same way: right on the dividing line. Yet he was a New Deal Democrat, and I thought Reagan was a sell-out. (I voted for William Penn Patrick in the 1966 Republican gubernatorial primary.) We had the same sense of what constituted student competence. That world of semi-objective standards is gone — buried in waves of political correctness.
He told me that his students today are extremely well-versed in digital research. They have grown up with the Internet. But, he said, there are two major problems: (1) they cannot evaluate the truth of what they read; (2) they are prone to submitting term papers that they have bought on-line.
So, we are seeing the result the triumph of official relativism in academia: "There is no objective truth." The students have bought the academic party line. They respond accordingly: (1) "One opinion is as good as another." (2) "A purchased term paper may be worth the money and risk." The Web is filled with conflicting opinions and cheap term papers.
Problem: in engineering and architecture, this outlook can lead to collapsing structures.
THE POOL OF TALENT
Year by year, a third of the labor pool emerges with a college degree. Most of these degrees are in the humanities and social sciences.
Meanwhile, China produces over 450,000 college graduates a year in science and engineering — as many scientists and engineers as the United States has, total. Then, next year, China will do it again.
There are teamwork issues here. There are also cultural mindsets. If I were an American manufacturer, I would rather employ a team of scientists and engineers that individually graduated from American colleges and whose members are entrepreneurial. Progress in commercial product development is not just a matter of individual competence in surviving formal education, based mainly on skill in mathematics. But as the comparative supply of such graduates shrinks in the United States, and as the American tradition of entrepreneurship invades Asia — as it is invading — there will come a time when wage competition from Asia will undermine the competitive advantage enjoyed today by teams of scientists in the United States. Even if companies develop products here, they will have them produced off shore. Only the most creative science grads will be amply rewarded here for product development. Civil engineers — road-builders — will have an advantage based on geography. Electrical engineers won't.
Until the year 2001, Asia sent its best graduate students to study in the United States. The post 9/11 tightening of immigration standards (not on the border with Mexico, of course), coupled with the new prestige of Asian technical training, has reduced the percentage of foreign graduate students in American universities. This has never happened before in the post World War II era.
Mainstream media are losing to upstream media. This is eroding consensus among readers and TV viewers. Cable and satellite TV are undermining the networks. The Web is undermining the newspapers. Narrowcasting is undermining broadcasting. Home schools are undermining the tax-funded schools, though only at the fringes. Only the colleges seem immune, where government control is greatest. But they are becoming a laughingstock, even though parents still shell out far more than they need to (at least three times more) by sending their children off to college. Parents who know the system can get their kids through school for under $15,000 — maybe as little as $10,000 — which means that the kids can pay for their college educations by working part-time. The Establishment is on the defensive even in the halls of ivy.
This is becoming clear: price competition is now unstoppable. If you are not in a position to sell something cheaper, you are in big trouble. This fact is killing the mainstream media, which lost its ability to compete after 80 years of government regulation and protection. It is going to kill every other cozy little arrangement with the state.
Sell services, not stuff. Sell services locally, where Chinese college graduates cannot compete. Sell information, where Chinese college graduates cannot compete . . . and not many American college graduates can, either.
This is the era in which everything mainstream is hitting the rapids. The mainstreamers thought they were cruising up a lazy river. They weren't.
"What's that noise?"
May 25, 2005
Copyright © 2005 LewRockwell.com