Wednesday, September 21, 2005

Think Like a Lobbyist

In the news yesterday, "New York Times Co. (NYT) on Tuesday said it would cut about 4 percent of its work force, or 500 jobs, and warned that weaker newspaper advertising and rising costs could reduce earnings to less than half of Wall Street forecasts this quarter. Knight Ridder Inc. (KRI) also plans to cut staff as the newspaper industry struggles with a lackluster ad market, increased newsprint costs and circulation declines with readers turning more often to the Internet for news."

The New York Times and other newspapers have also turned to the Internet to generate additional revenue, but have still been unable to compete against other online sources -- particularly blogs which charge no monetary fee for their use. Could it be the quality of the news online? Or perhaps the lack of monetary costs associated with clicking on a link to a blog has something to do with this phenomenon. I decided to think like a lobbyist for the newspapers, ignoring any moral objections to manipulating law in my favor at the expense of others, and asking myself: what would a lobbyist write ... ?

We must save these jobs! Newspapers are an integral part of history and we cannot let them disappear due to the rise of weblogs and other online news sources! Think of the days as a child, watching your father sit at the table with his newspaper and coffee. Remember clipping articles about your favorite athletes. Consumers are falsely led to believe that the Internet is a good substitute for newspapers. We must do something to save the newspaper industry!

If I were a lobbyist, I’d start proposing a “FAIRNESS IN JOURNALISM” law. Here are two options.

Option 1
Stated reasoning:
How do we know that the information presented in blogs is accurate and well researched? In the interest of protecting the public from misinformation, we should require the leader of each organization that produces articles which may be seen as news to take classes or obtain licenses to ensure that they understand and communicate the news. All they have to do is have one representative from their organization take a course and they can write all they want! It is such a simple step and will ensure that Americans are getting reliable information.

Hidden reasoning:
This law eliminates our competition by reducing the supply of competitors. Although it applies “equally” to everyone, it does not impact everyone equally. This is its intent. From the perspective of the NYT, this representative would be one of many – a small percentage of the workforce. (If 4% = 500 workers, their total workforce is approximately 12,500; therefore one person out of 12,500 accounts for only .008 percent of the NYT workforce). However, let’s suppose that one person from Capital Freedom were required to take the same class. One person accounts for 100% of the “Capital Freedom workforce,” and that workforce has much better things to do with her time. We can easily put Capital Freedom and other blogs out of business!

Option 2
Stated reasoning:
News organizations need to start "giving back to the community." As the NYT representative, I will be the first to support a law requiring all providers of information on current events to pay a flat $100 fee that will go to help the underprivileged in their community. Any news organization that refuses to pay the $100 is obviously doesn't care about helping the community and should no longer be allowed to serve as a source of news.

Hidden reasoning:
Let’s suppose we charge $100 flat fee to post any news. For the NYT, this is pocket change – especially compared to the profits that they can make as a result of the law. For a blogger like myself, $100 has to be greater than the psychological benefit I get from maintaining a weblog in order for me to continue it. We would therefore observe a law which disproportionately affects those news organizations designed to generate little or no revenue. A licensing fee has the same effect.

Luckily no one is proposing these (at least, not yet and not to my knowledge). We would know that the effect of either option in the "FAIRNESS IN JOURNALISM" law would be to reduce the supply of bloggers and other online news sources, reduce competition and lower incentives to provide the best quality news. Sometimes we have to think like a lobbyist to understand the true motives behind lobbyists' "consumer advocacy."

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