Why We Shouldn't Let Newspapers Die

What to do about the rapidly disintegrating newspaper industry? Michael Kinsley answers:

How about nothing? Capitalism is a "perennial gale of creative destruction" (Joseph Schumpeter). Industries come and go. A newspaper industry that was a ward of the state or of high-minded foundations would be sadly compromised.

Would it be "sadly compromised"? Not really. 

The newspapers that are supported by foundations right now -- The Guardian or the St. Petersburg Times come to mind -- aren't exactly viewed as compromised, and the BBC exists because a "license fee" (a big euphemistic tax) provides the company with about 4 billion pounds a year. It isn't really seen as compromised either, although you do end up with the occasional odd situation in which the head of the BBC is asked to resign for doing something like insulting the Queen.

But, more generally, I'm not sure why we should think of a for-profit newspaper or news service as fundamentally less compromised than the alternative. I have a vague sense that most people believe the purpose of a news industry is to do something other than turn a profit. The purpose is to provide a public service -- you know, the old yarn about how an informed democracy can't function without information. This is all slightly preachy and perhaps exaggerated, but it might be true.

If it is true, then why wouldn't the marketplace also distort the news industry? (I think it's better to ponder the news industry rather than newspapers. But both are struggling.) If news industries are going to make money, then they need to create a product that consumers will want to purchase and advertisers want to sell. That profit-maxmizing product might overlap a bit with the product that is in the best interest of an informed democracy. But the overlap will not be perfect. That's why the most popular article in the history of the New York Times (by one standard) was a piece about animal training and marriage, not a piece about Afghanistan or Iraq.

It's not crazy to think about how the government might subsidize public goods, or subsidize the consumption of goods with positive externalities. Think about something like the market for vaccines. The value you place on one dose of a vaccine (you won't get sick and die) is lower than the value society places on the vaccine (you won't make everyone else die either). The government can and should close the gap between the individual value and the social value.

If you think the news is a public good, then it's reasonable to think about propping it up. If you think the news is just another industry, then it's one more tumbleweed to be whisked away by creative destruction.

Presented by

Conor Clarke is the editor, with Michael Kinsley, of Creative Capitalism. He was previously a fellow at The Atlantic and an editor at The Guardian. More

Conor Clarke is the editor, with Michael Kinsley, of Creative Capitalism, an economics blog that was recently published in book form by Simon and Schuster. He was previously a fellow at The Atlantic and an editor at The Guardian. He is also on Twitter.

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