Government policies define all economics – including those for news

I’ve been arguing with good friends and others for a while now about why I don’t think charity or government subsidies are the right way to “save newspapers.” There are philosophical and policy reasons to argue about, but my main point has been that only success in the marketplace can ensure robust, independent journalism.

That said, there’s nothing to prevent charities, non-profits and government itself from helping news companies transform to match today's radically changing landscape and transition their skills and values into the new, more pluralistic arena.

Philanthropies, universities and other non-profits are doing a lot of this right now. Hats off to the Knight Foundation, Pew, Poynter et al. On the occasion of Sen. Kerry’s hearings in the Senate, let’s focus on government involvement for now.

Many of the instant commentators have proved predictably eager to jump in and simply rain on the whole idea. Typical was Alan Mutter’s initial reaction, under the headline “Why the feds can’t – and shouldn’t – rescue the press.” (Jeff Jarvis didn’t have to wait for the actual hearing to have an opinion about what should happen).

Government shouldn’t bail out the press? Well, no kidding . Who thinks it should? Many of the arguments about this issues across the blogosphere are a classic examples of the straw man or red herring schools of rhetoric: mis-frame or abbreviate the issues to make it easy to prove the point you believed all along.

It simply makes no sense to circumscribe the discussion, as Mutter does, to reject government supplying “cash bail outs,” or noting that news companies, unlike financial giants or automakers, are not “too big to fail.”

I happen to agree with him on both those points, but it’s silly to extrapolate from there that government has no role to play. It always has, it does now, and it always will. We’re only arguing what it should be, what’s fair, and what’s in the public interest.

Government policy defines economic viability for everything from oil companies to internet start-ups. Do you suppose eBay and Amazon would do as well as they do if the government hadn’t decided to protect online sales from local sales taxes paid by brick-and-mortar competitors? Do you think Comcast and Verizon would have been in the same broadband business with different government policies about spectrum sales and local utility monopolies? Does the music industry care about how the government defines copyright? Does Pfizer care about patents?

Every one of those subjects describes government influence on business and industry, and there are thousands of other examples. Governments can make rules to serve the public interest or because somebody got bribed, but either way, they make them.

Jarvis has no issue with spending billions on extending broadband (me neither) or government policies that encourage “innovation” in areas he’s interested in. Mutter, who reminds of his tenure as a “Silicon Valley CEO,” surely knows what a role government policy and government spending played in the development of all things digital.

Not all press critics and internet triumphalists will acknowledge it, but there is a hugely valuable reservoir of talent and expertise at risk as newspaper newsrooms disintegrate. Governments routinely pay to retrain workers for new economy jobs. Governments routinely create tax and investment policies to encourage specific industries to transition into new fields (think about clean energy, solar, hybrid cars).

Why would people argue that thoughtful government policies that recognize the public’s interest in experienced, skilled and ethical journalism are somehow out of bounds?