Benjamin H. Day was the founder and publisher of “The Sun,” a newspaper based in New York City. He was a main pioneer of the penny paper – a cheap, tabloid-style paper that was mass-produced in the United States from the 1830s onwards – and slashed the price of the paper to one penny so more citizens could afford a newspaper. He was one of the first newspaper publishers to use advertising as the main source of revenue, and in doing so, created the for-profit commercial model for newspapers that still remains today. Besides democratising access to information and setting economic precedents for the newspaper industry, he also sparked a huge ethical debate that has lasted for almost two centuries with no signs of abating; should news agencies be funded from taxation? Funding them from taxation may promote objective reporting and access for all, but this also comes with downsides such as political influence and budget constraints – but examining present-day examples of both types may prove this debate to be a false dichotomy.
The world’s largest national market for English-language news is the United States. With a population of 333 million and an estimated 124 million U.S. adults reading newspaper media each week, it follows that there must be a plethora of different news sources, with different biases, objectives, and owners. In economics terms, the news industry should be almost perfect competition, with many buyers (the millions of readers who would naturally represent all of the political spectrum) and many sellers (news agencies). However, this could not be further from the truth. The variety of media ownership has condensed more and more over time – the media landscape is dominated by just six conglomerates (AT&T, CBS, Comcast, Disney, News Corp and Viacom). The lack of variety in the ownership of newspaper agencies, and media as a whole, means that the market has become an oligopoly, and the handful of owners may pressure news agencies to promote certain agendas or avoid criticizing their interests, compromising journalistic independence and objective reporting. An example of this is Rupert Murdoch, a media mogul and business magnate who owns, amongst other things, media outlets such as Fox News, The New York Post and The Wall Street Journal. One of the key characteristics of Murdoch’s media empire is its tendency to reflect his own political views and interests. Murdoch himself has described his political outlook as generally conservative, and many of his media outlets have been accused of misleading coverage to support his business interests and political allies. Many also point to the close relationships between Fox News and conservative political figures, including former President Donald Trump. The network often invites speakers with openly Republican viewpoints, and this contributes to the public perception of bias. Critics argue that Murdoch’s control over multiple media organisations can lead to a lack of diversity in the perspectives presented to the public, and this therefore highlights a problem with privately-funded news agencies; those with enough money to own one or more news agencies will often have their views reinforced by said agencies, leading to more biased news reporting and a limited range of viewpoints in the media.
Furthermore, privately funded news agencies often prioritize stories with broader appeal or those that generate higher ratings or web traffic, since they operate on a for-profit business model. As a result, there is often limited coverage of local news and events, including important issues affecting specific communities, as news agencies do not like to report on topics that may lose them viewership – and instead may focus on entertainment and sensationalism over informative reporting. For instance, celebrity gossip, entertainment news, and viral stories may receive more attention and resources than in-depth investigative journalism. Proper political stories may not receive the attention they perhaps deserve – and when they are reported, the news agencies often publish them in a way that pleases their target audience, whether that is left or right wing, young or old people, the idea is the same. An example of this is the language used to frame certain stories. Reason Magazine, a right-centre biased magazine, tends to use the words ‘abortion law’ when covering abortion issues, but CNN, a left-centre biased news outlet, uses the words ‘abortion rights’ to discuss the same matter, thus underscoring its ideological position on the matter. Subtle changes in language influence the readers’ opinions, which can be instrumental when it comes to reporting on political stories or international issues.
Russia is infamous for having censored media, and that has only been exacerbated after the invasion of Ukraine. Despite being a prime example of state-funded news, it has far from solved the problems that were highlighted above in the non-taxation-funded United States. In principle, tax-funded news agencies would be more independent from commercial interests, and thus would cover a wider range of topics, be more unbiased as they operate under a public service mandate rather than for profit, and be less prone to clickbait journalism. In practice, this has not been achieved. When applied in a real world context, issues such as government influence and potential for dependency on funding will arise.
One of the most significant concerns with tax-funded news agencies is the potential for government influence and propaganda, if the government sees its news outlets as tools for disseminating biased or misleading information to serve political interests. Examples of this are abundant; the Russian news outlets RT and Sputnik have regularly been described as major propaganda outlets for the Russian government and its foreign policy. The United States Department of State, various academics and fact-checkers, and news reporters (including some current and former RT reporters) have identified both outlets as purveyors of disinformation. China manages its news in a similar way, especially on topics of geopolitical importance, such as Taiwan or Tibet. China Daily is an English-language newspaper in China that is under the direct supervision of the Publicity Department of the Chinese Communist Party (CCP). It often promotes the administrative viewpoint of events within the country, focussing on justifying the Party’s decisions and offering reassurance to citizens, with headlines such as ‘economy on stable footing’ and ‘medical insurance fund remains strong’ (from 12th April 2024).
Moreover, there is a risk that the tax-funded news agencies may not receive the necessary funds from the government, either for political or economic reasons, and thus the quality and quantity of news being published declines. In an autocratic society such as Russia, this has been the case. The Russian government controls the allocation of funds to its three main news agencies, and as such is able use said funding as a tool to reward media outlets that produce favourable coverage of the government and punish those that criticize or challenge its policies. In some cases, media organizations perceived as too independent or critical have been denied state funding, leading to financial difficulties and potential closures. TV Rain is one such example. TV Rain, also known as Dozhd TV, gained popularity for its coverage of political protests and corruption scandals, but after conducting a controversial online poll about the Soviet Union’s role in World War II, it came under fire from the authorities and was denied access to state funding and advertising contracts, which had been a significant source of revenue for the channel. Without this financial support, the channel struggled to cover operating costs and faced mounting debts, only staying afloat by laying off staff.
A challenge similar to the manipulation of funding, is the dilemma that governments face when they have limited financial resources and as such must prioritise other services over news; this is an issue that is best exemplified by Greece’s public broadcaster, ERT (Ellinikí Radiofonía Tileórasi), which suffered a significant funding crisis in 2013. Greece’s government, under pressure from austerity measures imposed by international creditors during the Greek debt crisis, made the decision to abruptly shut down ERT, and this was met with widespread protests and criticism. Critics argued that the government’s decision to shut down ERT was undemocratic and violated principles of media freedom and independence, and despite it being reinstated with a new structure and name, the event underscored the risks associated with dependency on government funding for public media organizations, and how tax-funded news agencies can only be as reliable as the funding from the government.
However, these two polarised models of news agency funding are not the only models available. Examples of both privately-funded and tax-funded news agencies being mismanaged are easily found, but it is also possible to create tax-funded news agencies which still exhibit journalistic independence, and therefore the two models mentioned above represent a false dichotomy. Examples such as the United Kingdom, Sweden and Norway embody these values. The British Broadcasting Corporation (BBC) provides comprehensive coverage of news, current affairs, and cultural events across its various platforms, including television, radio, and online. It offers diverse viewpoints and perspectives, and, most importantly, operates under a mandate to the public; in fact, its charter goals are to “act in the public interest … to inform, educate and entertain”. This focus on public services ensures the BBC’s content is guided by the interests of the audience, rather than for profit or political power. It is also publicly accountable, its finances are publicly available to be scrutinised – its funding comes solely from TV license fees – and it regularly solicits feedback and complaints from its audience through reviews. Perhaps more interestingly, it is required by law to be ‘operationally and editorially unbiased’; only a handful of other countries have similar unbiased, tax-funded news agencies – Sweden with SVT (Sveriges Television), Norway with NRK (Norsk Rikskringkasting), Finland with YLT (Yleisradio) – and all of these agencies are legally bound to provide accurate and impartial information, free from commercial influence. Transparency, accountability, being free from commercial interests – these are all important factors in ensuring the success of publicly-funded news agencies, but ultimately, the effectiveness of tax-funded news agencies hinges on their adherence to a crucial factor: a legal obligation to serve the public interest.
In conclusion, the debate over whether news agencies should be funded through taxation remains a complex and ongoing one, with valid arguments on both sides. While privately-funded news agencies may face challenges such as bias, sensationalism, and commercial pressures, tax-funded news agencies are subject to different but equally serious problems like government influence, budget constraints, and potential mismanagement. Examples from countries like the United Kingdom, Sweden, and Norway demonstrate that tax-funded news agencies can operate effectively when they are managed with a clear public service mandate and maintain journalistic independence.
References:
Nieman Reports – ‘News is a Public Good’
Scientific American – ‘Journalism Should Be Publicly Funded’
BBC News – ‘United States Media Guide’
BBC News – ‘Russia Media Guide’
Berkeley High Jacket – ‘The Dangers of the Concentration of Media Ownership’
University of Rochester – ‘Study of headlines shows media bias is growing’
Wikipedia – ‘Mass media in Russia’
US Department of State – ‘RT and Sputnik’s Role in Russia’s Disinformation and Propaganda Ecosystem’
The Wall Street Journal – ‘Shut Down by the Kremlin, Independent Russian Media Regroup Abroad’
ChinaDaily.com
The Week – ‘Is The BBC Biased’
Author(s):
Mark Somers