American Press Subsidies
A brief history of the United State’s subsidies to journalism and the press, from The Nation’s “How to Save Journalism” by John Nichols and Robert McChesney:
Even those sympathetic to subsidies do not grasp just how prevalent they have been in American history. From the days of Washington, Jefferson and Madison through those of Andrew Jackson to the mid-nineteenth century, enormous printing and postal subsidies were the order of the day. The need for them was rarely questioned, which is perhaps one reason they have been so easily overlooked. They were developed with the intention of expanding the quantity, quality and range of journalism–and they were astronomical by today’s standards. If, for example, the United States had devoted the same percentage of its GDP to journalism subsidies in 2009 as it did in the 1840s, we calculate that the allocation would have been $30 billion. In contrast, the federal subsidy last year for all of public broadcasting, not just journalism, was around $400 million.
The experience of America’s first century demonstrates that subsidies of the sort we suggest pose no threat to democratic discourse; in fact, they foster it. Postal subsidies historically applied to all newspapers, regardless of viewpoint. Printing subsidies were spread among all major parties and factions. Of course, some papers were rabidly partisan, even irresponsible. But serious historians of the era are unanimous in holding that the extraordinary and diverse print culture that resulted from these subsidies built a foundation for the growth and consolidation of American democracy. Subsidies made possible much of the abolitionist press that led the fight against slavery.
Our research suggests that press subsidies may well have been the second greatest expense of the federal budget of the early Republic, following the military. This commitment to nurturing and sustaining a free press was what was truly distinctive about America compared with European nations that had little press subsidy, fewer newspapers and magazines per capita, and far less democracy. This history was forgotten by the late nineteenth century, when commercial interests realized that newspaper publishing bankrolled by advertising was a goldmine, especially in monopolistic markets. Huge subsidies continued to the present, albeit at lower rates than during the first few generations of the Republic. But today’s direct and indirect subsidies–which include postal subsidies, business tax deductions for advertising, subsidies for journalism education, legal notices in papers, free monopoly licenses to scarce and lucrative radio and TV channels, and lax enforcement of anti-trust laws–have been pocketed by commercial interests even as they and their minions have lectured us on the importance of keeping the hands of government off the press. It was the hypocrisy of the current system–with subsidies and government policies made ostensibly in the public interest but actually carved out behind closed doors to benefit powerful commercial interests–that fueled the extraordinary growth of the media reform movement over the past decade.