By Dick Morris
TheHill.com
Jon Leibowitz, the chairman of Obama’s Federal Trade Commission, is at
the epicenter of a quiet movement to subsidize news organizations, a first
step toward government control of the media. In our book,
2010: Take Back America — A Battle Plan, we reported that he had
commissioned a study to examine plans for a federal subsidy for news
organizations. Among the measures under consideration are special tax
treatment, exemption from antitrust laws and changes in copyright laws.
Now Leibowitz has begun to pounce. A May 24 working paper on
“reinventing” the media proposes that the government impose fees on websites
such as the Drudge Report that link to news websites or that it tax consumer
electronics such as iPads, laptops and Kindles. Funds raised by these levies
would be redistributed to traditional media outlets.
While Leibowitz distanced himself from the proposals for the taxes,
calling them “a terrible idea,” his comments appear to be related only to
the levies proposed in the working paper. Nobody is commenting on the other
part of his proposal — a subsidy for news organizations.
By now, the Obama MO should be clear to all. As he has done with the
banks, AIG and the car companies, he extends his left hand offering
subsidies and then proffers his right laden with regulations. Should the
government follow through on Leibowitz’s ideas and enact special subsidies
and tax breaks for news organizations, it will induce a degree of
journalistic dependence on the whims of government not seen since the days
when the early presidents bestowed government advertising on favored
periodicals.
Is it too difficult to imagine that the Democrats might pass laws
favoring news organizations, only to question — as former White House
communications director Anita Dunn did — whether or not Fox News is a news
organization or an “arm of the Republican Party”? We can see a future in
which news media are reluctant to be too partisan or opinionated for fear
that they would endanger their public subsidy.
Once such a subsidy is extended to news organizations, every company in
the business must have it. Otherwise, the competitive advantage for the
subsidized companies would prove too steep an obstacle to overcome.
In all the attention that has been given to the idea of an Internet tax
on news aggregation sites and on tech equipment — trial balloons that would
obviously be shot down — very little attention has been focused on the
expenditure side of the proposal — the subsidy of news organizations.
But The Wall Street Journal reported six months ago that Leibowitz had
commissioned a study to determine “whether the government should aid
struggling news organizations which are suffering from a collapse in
advertising revenues as the Internet upends their centuries-old business
model.” Among the steps under consideration are changing “the way the
industry is regulated, from making news-gathering companies exempt from
antitrust laws to granting them special tax treatment to making changes to
copyright laws.”
These are exactly the kind of subsidies that could and would trigger
government oversight and control.
Look at how radio stations squirm when their licenses are up for renewal
before the FCC. We can imagine news organizations pulling their punches in
order not to antagonize the hand that feeds them.
The Leibowitz study, and the subsidy proposals that are likely to emerge
from it, represent a chilling threat to the First Amendment and to our civil
liberties.