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Next Stimulus Package Should Target “Distressed” Local Journalism

March 27, 2020 , , , , , ,
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This blog post is part of a series on communications policies Public Knowledge recommends in response to the pandemic. You can read more of our proposals here and view the full series here.

The COVID-19 pandemic has created an explosion of misinformation, fraud, and fear. Unfortunately, the big digital networks that citizens are turning to for connection, entertainment, and information, despite what they describe as their best efforts, continue to serve up a stew of disinformation about cures, conditions, and causes of the virus. But despite the gloom, there are emerging true local heroes that now need help urgently: local journalism outlets, both analog and digital, that are meeting the needs of their communities for accurate, timely, local information and direction about the virus. That’s why the next stimulus package from our government must include support for local journalism to help the country weather, and ultimately recover from, the pandemic.

The “decline of local journalism” isn’t a new theme. For well over a decade, we have seen local news outlets lay off their staff, cut their schedules, and in many cases close their doors. Daily and weekly newspapers in small and midsize cities have suffered as their readers migrated to the internet and advertisers followed in one category after another. Others have been merged and consolidated beyond recognition by their local audiences. New outlets have sprung up, many digital, experimenting with different business models, but so far no single model has been proven to scale.

It matters. Local news outlets, whatever form they take, play a vital role in ensuring community welfare, civic engagement, and government integrity. A growing array of studies show that citizens without access to local journalism feel less of a sense of cohesion and community, vote less, are less informed, are less likely to run for office, and experience higher corruption, costs, and corporate malfeasance in their communities.

Now comes the pandemic, and with it a crazy irony: The need for quality local news is higher than ever, and news consumption is skyrocketing, but advertising in news outlets is plummeting. Newspaper advertising revenues were already forecast to decline another 10% or more this year, continuing a multi-year trend. But with local events cancelled to foster social distancing and many non-essential businesses shuttered, local advertising – one of the last safe sources of revenue for local news outlets – has dried up. For those that host digital ads, this is compounded by the flight of national advertisers, who are placing anything to do with coronavirus on their “black lists” – that is, lists of terms that they restrict from their advertising plans. Yes, in some cases subscription revenue is rising as people urgently look for news they can trust, but it doesn’t make up for the nearly total collapse of local ads.

Taken together, these forces have created what has been described as “an extinction event” and “a nearly perfect weapon” against local and alternative news outlets. In recent weeks, as the pandemic has progressed and the need for accurate local news has become more dire, there have been increasingly urgent calls and specific ideas for solutions in the stimulus packages from national news outlets and organizations that support local journalism.

But in the absence of powerful lobbying forces like those that are lining up for hand-outs from other industries, it will be difficult to ensure the stimulus packages designed to help Americans through the pandemic include sufficient targeted support for local journalism. The third stimulus package, the Senate CARES Act, may provide some assistance to a limited set of outlets, with its provisions for small business debt relief and “paycheck protection” designed to help small businesses keep employees on payroll. And perhaps some nonprofit journalism organizations may benefit from the expansion of the charitable giving deduction. And it offers some funds for the financial stabilization of some public radio and television stations. But there should be more specific and more targeted support for local journalism in the fourth stimulus package. Support could take the form of short-term federal funding earmarked for more pandemic reporting, emergency support, education, or public service ads, or, as some have suggested, tax credits for news outlets similarly targeted at maintaining current employment levels.

In the longer term, a promising solution may help solve both issues: a revenue stream for reputable local journalism organizations, while countering disinformation. We can imagine a “Superfund for the Internet,” modeled on the 1980 Superfund to clean up hazardous waste sites. It would compensate organizations that help detect, analyze, and counter disinformation on the internet (such as local journalism outlets, fact-checking organizations, and startup initiatives) through fees from the dominant digital platforms that enable distribution of disinformation. That could be a bridge to more long-term, structural solutions.

It shouldn’t take a global pandemic for Americans to appreciate the institutions that support them in their everyday lives, never mind in a crisis. The Senate CARES Act refers to assistance for “distressed” businesses and those that support “national security.” It’s not a stretch to think of local journalism as both of these.

 

Image credit: NS Newsflash on Flickr


About Lisa Macpherson

Lisa is a Senior Policy Fellow, focused on countering misinformation on the internet and developing alternative business models for local journalism. Prior to Public Knowledge, Lisa was a consumer marketing executive at Fisher-Price, Timberland, Hallmark, and Custom Ink, and an independent marketing consultant at Pernod Ricard. Her experience driving digital marketing transformation on behalf of brands led to concerns over the broader impacts of digital technology on individual well being, civil society, journalism, and democracy. She applied to the Advanced Leadership Initiative at Harvard University, where she is now a Senior Fellow studying how to mitigate the negative externalities of digital technology. Lisa is a current or past member of the Association of National Advertisers, Marketing 50 (M50), and the Marketing Leadership Council of the Conference Board, and a founding member of the Council of CMOs of the Conference Board. In 2017 she was selected as one of the D.C. Techweek 100, which recognizes excellence in technology and entrepreneurship in the DC area. Lisa received her B.A. from Colgate University and her M.B.A. from the State University of New York at Buffalo. She was raised near Boston, MA, and loves to travel, read, cook, and spend time with her daughter, Kelsey.