Saving newspapers

New media tax code may rescue newspapers and open dialogue

Editorial pages in newspapers and newsmagazines have become a wealth of oncoming Armageddon-type pontification in the past few months. There have been buyouts, layoffs and complete closures of uncountable American newspapers; journalists everywhere are looking for an answer to the question, âÄúHow can the news media survive in âÄòthe digital age?âÄôâÄù Recognizing the desperate search for solid ground in a shifting media landscape, one senator introduced a bill last month that provides a possible answer. The Newspaper Revitalization Act, written by Sen. Benjamin Cardin (D-Md.), proposes to modify the IRS tax code to allow âÄúqualified newspaper corporationsâÄù to restructure as nonprofit organizations. The ability to make ad and subscription revenue tax-exempt and public contributions tax-deductible would help newspapers stave off the market pressures that are eroding the industry; CardinâÄôs bill promises to help newspapers in this way. Such a modification to the tax code would provide newspapers eligibility for these tax breaks âÄî as long as they are regularly published, educationally valuable and contain local, national and international news. Aside from having to prove that they are educationally valuable, newspapers wanting in on this new format will also have to make a sacrifice. To be tediously specific, the IRS tax code says that nonprofit organizations cannot âÄúparticipate in, or intervene in âĦ any political campaign on behalf of âÄî or in opposition to âÄî any candidate for public office.âÄù Put more broadly, âÄúUnder this arrangement, newspapers would not be allowed to make political endorsements,âÄù according to a press release issued by CardinâÄôs office. Ah, therein lies the semantic sinkhole: What are the parameters of âÄúparticipation,âÄù âÄúinterventionâÄù and âÄúendorsements,âÄù and who will be deciding these parameters? It is impossible to pack the true complexity and numerous implications of these questions into a 600-word article, and it would take much finer a person than this barely novice journalism student to pick out the important nuances of such an issue. But as far as we can tell, the positive aspects of this change would be a move from the âÄúthis-is-the-only-choice-if-you-want-to-avoid-complete-destructionâÄù type of editorial grandstanding to a more tempered and issue-based debate. And with the expansion of the nonprofit sector to the newspaper industry, readers would have a clearer choice and greater amount of options among partisan blogs, middle-ground newspapers and endorsement-free nonprofit newspapers. The possible negative end of this change, however, would be the uninhibited ability of interested parties to loosely interpret the regulation and sue newspapers for subliminal participation and endorsement of political candidates. It seems that plaintiffs would be able to file claims stemming not only from damages resulting from the publication of certain stories, but on violations of a vaguely worded part of the U.S. tax code as well. Still, doesnâÄôt this have the potential to be both positive and negative for the philosophy of journalism? If such lawsuits were to end up on court dockets, we could see a real debate of what is and what is not for the objective âÄî educational newspapers during political campaigns. This is an issue with a pressing need for real discussion following the recent presidential election. Hypothetically, these lawsuits could turn ethics into law for nonprofit news organizations and allegations of bias would actually gain precedent. Either way, the billâÄôs introduction will help those concerned with the state of the newspaper industry move away from stagnant panic and towards productive debate. This column was originally published in the Cal State Daily 49er. Please send letters and comments to [email protected]