The future of the press

The future of the press is critical to all liberal democratic societies because it is still our most important source of political and social news. By the press, I mean the morning, mostly broadsheet dailies in the large capital cities of virtually all Western countries. Of course, the morning newspapers no longer have anything like the largest audiences of the news media, dwarfed especially by television, but by and large they still set the news agenda that most of the others follow. Their editors decide what are the main stories that people will read that day, and they provide the editorial framework within which both the other older and newer media operate.

Most of the line-up for the evening television news still comes from the contents of that morning’s broadsheets. Talk show hosts, shock jocks, bloggers and the rest of the media commentariat mostly take their cues from stories that have been defined as important by the daily press. The reason for this is that the morning newspapers still employ the greatest concentration of journalists who do the research that makes the news: these journalists go out each day and see what people do, hear what they say, and write it up. Their research gives their editors a far greater pool of story material than anyone else from which to select the daily news. The journalism of reporters and editors on the morning newspapers still remains the first draft of history.

That is why the current financial crisis in the capital city press is also a cultural crisis. If the great volume of news research produced by these papers can no longer be afforded then the principal source of information about the workings of our societies and governments will be seriously eroded. So it is important to understand why they are in financial trouble.

From the 1950s to the 1970s, there was a long-tern decline in newspaper circulation and advertising revenue in many Western countries. By the end of the 1980s, competition from television news, in terms of both audiences and advertising, killed off the afternoon newspapers in almost all capital cities. Morning newspaper circulation also fell – in fact, in an era of substantial population growth, newspaper sales fell not just relative to population but in absolute terms. What saved the day was that most morning newspapers retreated to a smaller but better-educated and more highly paid readership, the AB demographic group (or Occupational Group 1) for whom they could charge higher advertising rates. This option was not open to the afternoon tabloid newspapers, which generally attracted a more down-market audience profile. I’m talking here mainly about the newspapers in the United States and Australia, especially those that serve the major capital cities. In Britain, where the London newspapers are also national newspapers the situation is different.

In the last two decades, circulation of the surviving newspapers has depended on how well they have adjusted to their more educated and more affluent readerships. The advent of the internet saw those newspapers that were dependent on classified advertising, especially employment and real estate advertising, lose much of their revenue to online competitors. But at the same time they enjoyed expanded advertising for lifestyle products and services and luxury goods for their more well-heeled buyers.

The real problem has not been competition from the Internet but the quality of newspaper journalism, or more accurately, the politics of their journalism. Some of the most prominent of these newspapers have been turned into radical versions of their former selves, openly promoting leftist political parties and causes and, in the process, shedding their conservative readership to such an extent that the future of the organization has been put at risk.

In the United States, the best analysis of this problem is William McGowan’s book published in 2010, Gray Lady Down: What the Decline and Fall of the New York Times Means for America. McGowan makes a convincing case that the New York Times’s failure to correct its political bias towards the left, combined with the post-2008 global financial crisis and some bad calls in policy towards the Internet, turned into a crisis of existential proportions. The real problem at the Times, he argues, “was the armaments of political correctness that crowd its newsroom: the subtle and not-so-subtle anti-Americanism, anti-bourgeois hauteur, hypersensitivity towards ‘victim’ groups, double standards, historical shallowness, intellectual dishonesty, cultural relativism, moral righteousness and sanctimony.”

McGowan’s analysis was confirmed in July 2012 by Arthur Brisbane, the New York Times public editor, who wrote a farewell piece saying: "Across the paper’s many departments, though, so many share a kind of political and cultural progressivism … that this worldview virtually bleeds through the fabric of The Times. As a result, developments like the Occupy movement and gay marriage seem almost to erupt in The Times, over-loved and undermanaged, more like causes than news subjects.”

McGowan makes it clear that the Times’s shift to the left was actually led by its publisher since 1991, Arthur Sulzberger Jr, who enshrined within his organization the ideology of the 1960s generation which he shared: radical advocacy, identity politics, New Age management theory.

But even on newspapers without a countercultural proprietor, there is an underlying problem. The bureaucracies needed to run daily newspapers are susceptible to staff capture. In the last thirty years, on those newspaper companies not controlled by traditional owners but run by boards composed mainly of the biggest stockholders, the autonomy that is essential for journalists and editors to do their job has been exploited by the Left. Once they reached a critical mass in an organisation, leftists recruited others sharing their political and cultural beliefs. They proceeded to impose the cultural values of the Left onto the entire editorial output. This did not prove to be a successful business model because it estranged at least half their newspapers’ potential readership – the conservative half – guaranteeing their circulations would continue to fall. Today it is clear that, in terms of the business prospects of newspapers, those values have been a total disaster. The stock market price of New York Times shares fell from $54 in 2002 to $7.80 in July this year.

In the late 1990s, I spent a few weeks in Boston and for a while bought the Boston Globe every day. I found its leftist bias so audacious, I had to give it up. Later, I saw I was not alone. In 1993, the New York Times bought the Boston Globe for $1.1 billion dollars. Today, its audience has fallen so much that the Audit Bureau of Circulation’s surveys no longer lists it among America’s top 25 selling newspapers. Stock market analysts put its value at just $94 million, a 90 per cent fall in value in twenty years.

One of the qualities of good news reporting is drama, but in Boston even the most loyal leftist readers must have become bored with the predictability of the stories their newspaper ran and the angles it took. My favourite example is a story in 2005 about a seal hunt in Nova Scotia which took the familiar line that white male seal hunters were all bad, and the environmentally innocent seals were all good. The journalist concerned, a former New York Times reporter named Barbara Stewart, reported the dimensions of the hunting force and gave gruesome descriptions of the killings: “Hunters on about 300 boats converged on ice floes, shooting harp seal cubs by the hundreds, as the ice and water turned red.” The truth is she wasn’t even there and did not know the hunt had been put off for a day due to bad weather. She knew so well what was required in a story of this kind that she could write it before the hunt had even begun. The Boston Globe published her account of what happened on the morning before the hunters had even set out.

It is not that these newspapers have lost their most loyal readers. There are many people today in the AB demographic group who are leftists, especially in the major cities. But if you have a newspaper that offers little to conservative readers, and which actually insults their intelligence every day, you cannot generate enough readers to properly sustain a morning broadsheet, at least not in America.

The situation in Australia is almost a replica of the United States. The 170-year old Fairfax newspaper group now appears to be on its last legs. It once dominated the country’s two major cities with the Sydney Morning Herald and the Melbourne Age. Conrad Black and his Hollinger Group bought a major shareholding in 1993 but government ownership regulations forced him to sell up. Private equity investors then took over and, without an effective owner, both its major newspapers were soon subject to staff capture. One of its former journalists, Miranda Devine, who is from a well-known newspaper family and who was employed on the Sydney Morning Herald for ten years until 2011, has described her experience: “When I arrived at the Herald it was controlled by a handful of hard-left enforcers who dictated how stories were covered, and undermined management at every turn… the worldview of the collective [was] inarguably left-leaning and anti-business. It was also anti-religion – especially anti-Christian – and hostile to bourgeois family values, The tragedy was that Fairfax’s core audience was a conservative audience. You’ve never seen a paper more disengaged from its core audience, particularly The Age.”

Fairfax also owns the Australian Financial Review, the national newspaper that is local equivalent of the Wall Street Journal. In Sydney business circles, the paper has long been a standing joke, commonly derided as the world’s only leftwing business daily. The chairman of the Sydney Stock Exchange once famously cancelled his subscription. Its Friday review section typically reprints one or two long essays from the English socialist magazine New Statesman plus other reprints from the liberal New York Review of Books. A staff writer once told me this was an exercise in “civilizing” business people. But any publication that patronizes its readers like this deserves its fate. The scale of the Financial Review’s market failure can be seen by a comparison with the circulation with the Wall Street Journal, which sells to 0.67 per cent of the American population every day, while its Australian counterpart sells to only 0.33 per cent of the Australian population. In other words, if the Financial Review served its business readers properly it would double its circulation. Belatedly, in September 2011, the publishers grasped this fact and appointed a business-oriented editor to start the long and by no means certain process of turning its prospects around.

After almost a decade of control by financial institutions, and without an obvious owner, in 2007 the Fairfax organisation was partly re-acquired by one of the descendants of the original family, John B. Fairfax. He put $1 billion of his own money and assets into it. But he lacked the gumption or the insight to retrieve its lost conservative readers. He watched various CEOs come and go without changing the editorial policy of the in-house left-wing collective, while all his advisers blamed the company’s escalating financial misfortunes on the Internet’s poaching of its advertising. John B. Fairfax decided to bail out, selling his original $1 billion stake for just $189 million. The story does have a touch of poetic justice. In July, 2012, the latest CEO finally gave retrenchment notices to the recalcitrant journalists when the company dismissed 1900 staff, and outsourced its sub-editing to New Zealand. In that country they speak what is becoming almost a different dialect of English so you can imagine the howlers the outsourcing has produced. The leftist collective had worked itself out of a job, and the new CEO was predicting that soon all the firm’s print titles would be published online only. Fairfax stock, which in 2007-8 stood at $5, was in late 2012 as low as 41 cents.

Most financial analysts of the company still insist on blaming its demise on the internet, including some bad purchases of online service companies, plus some other unprofitable acquisitions just before the Global Financial Crisis of 2008. These mistakes were certainly part of the story, but they were a long way from being all of it.

You can see this by comparing the career of Rupert Murdoch over the same period. He too took some bad advice about the Internet, investing $800 million in the online service MySpace, which turned out to be a dud. He also made some risky acquisitions which, had they not been successful, would have shaken his empire too. In 2007, he paid $5 billion for the Wall Street Journal and Dow Jones. But since then the Wall Street Journal improved its circulation thanks to the recruitment of some quality journalists and some aggressive marketing designed to steal readers from the New York Times. As a result, despite the economic downturn, the Wall Street Journal’s circulation grew by 5 percent between 2007 and 2012 to 2.1 million, making it America’s biggest-selling daily newspaper. Murdoch is currently in the process of splitting up his empire and in the process will silo his newspapers into a separate entity. Some media analysts argue that Murdoch’s newspapers are unprofitable, but for sentimental reasons he subsidises them out of the profits of his film and television interests. His latest move will test this theory and most likely show it to to be untrue. While ever there are owners like Murdoch who know how to run newspapers then, despite the difficulties thrown at them by spread of the internet and the contraction of most Western economies, the press will remain a viable business. It might change its technology drastically – and it is possible that printing on paper will die out in future decades in favour of electronic tablets – but the underlying business model that privileges quality journalism still seems viable for the foreseeable future.

The newspaper market in Britain, where the London newspapers are national newspapers, is different to both the US and Australia. British newspapers are deliberately politically biased but they keep rather than lose readers. This is because each appeals largely to specific political constituencies: the Daily Mail is conservative, the Mirror cheers for the Labour Party, the Guardian criticises all political parties from an ultra-left position. Because of their national dispersal, these constituencies contain audiences of sufficient size to keep their newspapers afloat. None of the morning papers dominate their market the way that American and Australian papers do in their home cities. So readers dissatisfied with one London paper have somewhere else to go. A crisis in a major English newspaper does not become a crisis for newspaper journalism itself, as it does elsewhere.

Nonetheless, there is a major threat looming for the British press in the form of the British government. Brian Leveson is due to bring down the report of his inquiry into the press as I write. He is always at pains to say he does not want to restrict the freedom of the press: "I have absolutely no interest in imperiling the freedom of expression or our free press. Absolutely none.”

Yet there are two facts that suggest otherwise. First, he has made it clear he thinks the media have too much power to influence politics and the government should set up a regulatory system to handle this. Indeed, at several points in his personal interrogation of witnesses, including former Prime Minister Tony Blair, he made it clear that the regulatory model that impressed him most was that governing the BBC, which stipulates that controversial subjects be treated with due accuracy and impartiality.

Second, Leveson’s own inquiry was hardly in a position to lecture anyone else about impartiality. His advisors included a number of left-wing media activists and academics from the Media Standards Trust and the Bureau of Investigative Journalism at City University, London. In November 2012 the Bureau of Investigative Journalism was joint producer of a story on the BBC’s Newsnight program that falsely identified the former Conservative Treasurer Lord McAlpine as a paedophile. The ensuing controversy led not only to the resignation of the report’s producer, Iain Overton, but also the resignation of the BBC Director-General George Entwhistle. The chairman of the BBC Trust, Lord Patten, accurately described the story as “unacceptable shoddy journalism”.

Now, it is right that publicly funded broadcasters and media outlets should be regulated for impartiality and accuracy. They are paid for by all citizens and they have a responsibility to serve them all. The fact that both the BBC and the Australian Broadcasting Corporation fail to live up to their responsibilities does not negate their moral and legal obligations to do so.

The issue that Leveson was obviously wrestling with is that of newspaper lies and deception, which the phone hacking scandal and the question of close ties between newspaper proprietors and politicians had opened up. In his ruminations during the hearings Leveson was asking whether the parliament and the law should provide some degree of protection for consumers and step in when the product they buy is defective.

However, there are serious questions about whether the state should venture further into this territory. When citizens suffer from media misrepresentations and lies, they already have the traditional laws of defamation to protect their reputations, as they did in the wake of the BBC’s slanderous accusation against Lord McAlpine. Moreover, the state, whichever party holds office, is not a disinterested participant in these matters. It is a major player in the game of news reporting, with big interests at stake, especially the pursuit of its own power. It can be relied upon to always put its own interests before those of the public.

The state is also the wrong instrument to rectify the faults of the press. In the case of lies and deception, the ultimate arbiter will always be the readers. In fact, a free press has some powerful built-in protections against dishonesty. Almost all people, whatever their political predilections, come to the daily news looking for reliable information. Newspapers that engage in lies and duplicity jeopardise the core value of their brand. If there is a competitive market, their competitors will expose them. If there is a monopoly market, consumers will simply refuse to buy the product. The fate of the New York Times, the Boston Globe and the Fairfax press is a far more effective punishment than anything Leveson could recommend.

If a newspaper that is funded by sales and advertising is politically biased, that is not the business of the state. If would-be purchasers don’t like what they are offered, they can go somewhere else. With the exception of defamation, the right of the independent press to say what it likes, to support whoever it pleases and to criticize anyone who takes their fancy should, in a liberal society, have nothing to do with the government.

Yet we are being asked to believe that the British press has generated a crisis in democracy that warrants drastic regulatory action. In fact, according to Tony Blair, the crisis spreads far beyond Britain itself. He told Leveson: “I mean, look, I think this is a very difficult task, and I think some of these questions are difficult – not just for our country, by the way, but as I say, I think this is a debate that increasingly will take place around certainly the democratic world, as to how you deal with these questions.”

In Australia, the report of a government inquiry, appointed in imitation of the British government’s own inquiry, has already delivered its verdict on newspaper regulation. It is a the worst-case scenario of what Leveson might advocate. The head of the Australian enquiry, former judge Ray Finkelstein, recommended the establishment of a government super-regulator, which he called the News Media Council, to enforce standards. These standards would be those the Council laid down itself. If complaints about reporting were made and then, after due process, editors and journalists found guilty refused to recant, they would face fines and, if they persisted, imprisonment. So far, the Gillard Labor government has not indicated whether it will accept these recommendations. Many in the Labor Party would like to, because Rupert Murdoch is probably despised even more by the Australian Left than the British Left – the head of the Greens party calls Murdoch’s newspapers “the hate media”. But the saner figures in the Labor Party would be worried about the timing in the lead up to the election next year.

In the Australian inquiry, it is worth noting that the strongest allies the chairman found were academics in media studies, who sent him submissions, became witnesses at his hearings, provided him with research, and wrote several lengthy passages of his report. In return, the final report proposed that appointments to the News Media Council would be decided by a committee of three academics nominated by the universities.

This recommendation would elevate to a position of power the one group of people most jealous of, and most hostile towards, real journalists. It is virtually impossible to find three academics in this field who are genuinely independent. Indeed, it is almost impossible to find three who are not firmly committed to the Left side of politics. The academic literature in the field, which these days is strongly influenced by the writings of the German neo-Marxist Jurgen Habermas, is essentially a political critique designed to show the capitalist media is at fault whenever it fails to support the Left’s own jaundiced view of the world. If academics from this field ever gained the positions Finkelstein envisages, they would ensure his council was composed of people exactly like themselves.

Finkelstein recommended that publishers and internet sites that generate certain specified volumes of readership and traffic would be subject to the dictates of his News Media Council. As it happens, Quadrant Magazine comes well within his scope. So I have gone on record as saying that if this scheme was ever implemented, our organization would feel compelled to defend the tradition of press freedom by engaging in civil disobedience. We would not recognize the News Media Council’s authority, we would not observe its restrictions, and we would not obey its instructions, whatever the price. So far, no other publishers have lent us any support. Most would, I think, be surprised if such a monstrosity as the News Media Council was ever implemented. My surprise, however, was that such a thing was ever recommended in the first place. It is very telling about the assumptions for an expanded role for the state, and about the indifference to traditional liberties, now taken for granted among our intellectual and political classes.

This was a paper given to a conference, The Pillars of Liberty, staged by New Criterion magazine (US) and the Social Affairs Unit (UK) at Winchester, England, in September 2012, and published in the New Criterion, January 2013.