Should newspapers ask for bailout funds?

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By Robert E. Beckner

Since the first of 2009 there have been rumblings that across the country, some newspapers are in bad shape, due somewhat to the recession, resulting in papers losing a lot of their advertising revenue.

The main street media has been quiet, so most of this news comes from TV stations that say the public was scared about the economy, that the recession was bringing pain and the truth about public policy was what the citizens wanted, not partisan cheerleading. The public wants the unvarnished truth, as everything else doesn’t help people.

This recession took most people by surprise.

How could the average Joe know mortgage companies were gaming the system by bundling risky loans, pushed by the government, and selling them to Lehman Brothers, etc.?

The point here is that because newspapers concentrated on ideology instead of accumulating correct information, there was a distorted view of reality. This ideology has corrupted the watchdog press that our founders envisioned.

Thus, people turned to TV for the true news, naming U.S.A. the top station, TNT number two and Fox number three.

Those liberal stations that favored the president during his campaign as well as now, giving the ol’ company line, were ranked much lower (CNN, listed number15 and MSNBC, listed number 23).

This shows the news agencies that tell it like it truly is are successful, meaning the top three TV stations. Left wing newspapers are folding in Seattle, Minneapolis and probably soon in San Francisco. Even the mighty New York Times is seeing bad times. They borrowed money from a Mexican guy at 14 percent interest and just recently sold a lot of its home office for $225 million. They actually sold 21 of the building’s 52 floors, about 750,000 sq. ft. The sale became necessary due to a sharp drop in revenue that had management scrounging for money.

Then we find that four owners of 33 U.S. daily newspapers were seeking bankruptcy protection since about the first of the year. These dailies are clearly gasping for survival. In order to emerge from Chapter 11 protection, they will have to agree to lender’s demands for radical changes, perhaps to putting some of their newspapers exclusively to online delivery.

Surely creditors have been trying to come up with better ideas, trying to shake things up, without a doubt their way of doing business will have to change as obviously the old ones aren’t working.

There were also filings of separate Chapter 11 by the New Haven, Connecticut, Register Publisher, Journal Register Company and by the owners of the Philadelphia Inquirer and the Philadelphia Daily News.

These filings came after a December 2008 filing by Tribune Co. whose media stable includes the Los Angles Times and the Chicago Tribune. In January, we saw the owners of the Star Tribune filling in Minneapolis.

The Poynter Institute, in an article by Rick Edmonds, a media analyst says, “there is a fairly high degree of uncertainty” and the futures of these papers are in the hands of the courts with creditors having a fair amount to say. There is no doubt that other publishers could seek bankruptcy protections in the coming months, as advertising prospects for 2009 remain bleak.

The papers are trying to cut costs by trimming newspaper widths, cutting jobs and trying to cut other costs to offset reductions in advertising revenue. As the debts became unbearable during this past two-year slump, they turned to the courts for protection.

They have been boosting their internet operations but the growth online ad revenue isn’t anywhere what’s needed to offset the reduction in print. Last year, print advertising in U.S. newspapers totaled $8.2 billion, while the online operation was $750 million.

Don’t look for a lot of forced sales, as lenders know the newspapers’ value are low right now. This alone will keep them alive, despite the bleak outlook. Here in our sunshine state it was recently announced that our probable largest newspaper, The Miami Herald and its Spanish language publication El Nuevo Herald will see about 75 employees losing their jobs. The remaining fulltime staff will see salaries reduced. This is necessary, just like the rest of America’s newspapers, due to plunging advertising revenue.

Their pay cuts, which started in March 2009, will be five  percent for those making $25,000 to $50,000 a year and 10 percent for those earning more.

In addition, there will be one week of unpaid furloughs beginning this month.

These cuts were announced by the newspaper’s owner, McClatchy Company as well as the publisher, David Landsberg, as part of an effort to seek at least $110 million saving over the next year. McClatchy is dropping 1,600 jobs in downsizing its work force, nearly a third in less than a year. They are also using more freelancers instead of full-time reporters, leasing out one floor of the Herald’s building downtown and ceasing its international edition. Now if they will neuter their left wing version of the news, maybe they’ll survive!

It’s obvious to some that the main street news media especially should go back to reporting the news and quit trying to make it to fit their ideology or the government’s of how things should be or as they want it to be.

Americans do not want to become as European socialists are, unbeknown to most they are being led down the primrose path every day by the new administration for bigger government, more redistribution of our tax money, free medical care, college education to all, everyone gets a home. The list is endless – the last word will be loss of our everyday freedoms. Stay alert, Americans!

Will the newspapers’ problems be solved by “newspaper bailouts”?

In Connecticut, both the Republican Governor and the Democratic Attorney General are supporting a government intervention for failing local newspapers, the New Britain Herald and the Bristol Press and 11 weekly papers that face closure.

They are claiming the papers provide “essential services,” such as marriage notices and school sport announcements.”

Opponents say such things could just as easily be disseminated online. Others say to go back to “town criers” with public subsidies that seem to be bottomless for bailouts, if you listen to Paulson.

Reality tells us that the Bill of Rights says, “A free press is an essential part of democracy.”

How can we have that if it is leveraged with government funding? No way could the free press ever be able to criticize other corporate enterprises seeking local, state or federal financial help to keep them afloat in hard times. A press must be able to stand on its own two feet – period! If those in charge of “bailouts” will read the Constitution for a change before they try to do something, then the newspaper business should be left alone!

Robert E. Beckner lives in Majestic Oaks with his wife, Sarah. He is a retired private investigator and insurance adjuster. He has also been a photographer and served with the Military Police in the Marine Corps.