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FTC Staff Discuss a Tax on Electronics To Support the News Business
dptalia links to this piece describing a staff discussion draft from the Federal Trade Commission, writing "The FTC is concerned about the death of the 'news.' Specifically newspapers. Rather than look to how old media models can be adapted to the Internet, they instead suggest taxing consumer electronics to support a huge newspaper bailout. Additionally, they suggest making facts 'proprietary' and allowing news organizations to copyright them."
Note, though, "The good news in all this is that the FTC's bureaucrats try hard to recommend little. They just discuss. And much of what the agency staff ponders are political impossibilities."
This would essentially put the government in charge of choosing which press agencies to sponser... Dangerous precedent...
There's a gorilla from Manilla whose a fella that stinks of vanilla and has salmonella.
Why are we always so concerned with keeping companies in business. We didn't try to artificially keep wagon wheel business alive when cars were invented. This is absurd, if a company can no longer sell something, sell something else, or die off.
unless congress passes a law i don't see this surviving a lawsuit. and with the clout of the electronics industry i doubt a law will pass allowing this
Go ahead, "copyright" your investigated information. Good luck suing the hundreds of thousands of blogs and websites that will still link to your info. And besides, if they provide a link to the news company's website as a way to cite a source (just like I do with my own webpage when I post about content I have read elsewhere), what's the problem? You still get credit, you still get the traffic.
Living With a Nerd
I am utterly blown away at hoe often the government is willing to step in and save failing business models. Car companies refusing to evolve, media companies failing to evolve, and more. Last time I checked, we live in a capitalist society where companies that succeed, in one way or another, are rewarded and companies that fail, for whatever reason, are supposed to go out of business. I can understand and be empathetic towards companies that have their business destroyed because of the actions of another, such as fishermen having their livelihoods wiped out because of BP's oil leak. Those businesses deserve some intervention to help them get through the rough time that is no fault of their own. Companies that fail to innovate, however, and end up watching their balance sheets shift more and more downwards? Nah. Sorry. You tried and failed. You don't have a right to be in business, just because. You have to work hard and succeed, just like the rest of us.
Failing businesses should be allowed to fail. Someone will figure out a successful business model and will fill the void or a market that no longer needs to exist (hello buggy whips) will fade into the history books.
It's frightening just how much modern American government has become like the nightmare Statist government in Ayn Rand's novels, constantly meddling with and attempting to control market forces that it and it's members are incapable of understanding or wanting to understand.
Regardless of what you may think of her personally, she was prescient.
Official Heretic from the "Church of Global Warming". Proven right thanks to whistle blowers. AGW = Flat Earth Theory
Dear Washington,
You're doing it wrong.
Thanks,
Everyone
Seriously what the hell? Stop giving our money to greedy corporations. Want us to buy a house? Spend more on crap? Buy new cars? HOW CAN WE DO THAT WHEN YOU KEEP TAKING OUR $?
OH wait. You'll just take it and give it to corps for free.
Now, I am not a tax hater. I am fine with taxes for things like emergency services, libraries, roads, schools. The difference is those services provide for the public good. Forcing me to hand money over to your buddies at the "too big to fails" is bullshit. You crooked fucks.
No sig for you!!
I mean, it's like totally unfair that PC manufacturers pulled the rug from under the typewriter business. I propose a tax on... let's see... yes! deodorants! and, uhhm, pipe wrenches! to save the typewriter business. And the monk scribes that used to copy books before that horrid man Gutenberg took their jobs away, they deserve some recompense. Let's tax... exotic pets.
Goddammit - why should newspapers have to change to suit the internet? Newspapers were here first! It's not fair - the internet should be the one that has to change!
(Isn't that the rationale of a four-year-old?)
Oh, this is where I laugh. I'm a socially conscious, progressive kind of guy. I believe in humanitarian capitalism, not social darwinism. But in a case like this, they're proposing a tax to support a business model that cannot support itself in light of other players able to make a living providing the same kinds of services.
I do support operating businesses with a social benefit at a deficit. Public transit does not usually support itself entirely from the fares collected but receives subsidies from the taxpayers because it's of social benefit to all. After all, how much money does the local fire department collect from you to provide emergency services? There's no fees, it's all direct 100% taxpayer support. But we all agree that this is something we need. Same with public schools.
What I find especially amusing is the same free market evangelists who would huff and puff about how awful the fire department is would probably also line up behind the newspaper bailout, especially if they happen to be columnists. Socialism for the goose but show the door to the gander.
I do agree that competition is a good thing and a major problem with government-sponsored monopolies is that there's no competition, no choice for the customer if they don't like what they're getting. But there's not a whole lot of competition amongst "private" industry, either! Smaller competitors get gobbled up until we get too-big-to-fail companies every bit as broken and inefficient as the communist state-owned industries we were warned about in our economics textbooks. Oh, it's bad when they do it but ok when our guys are doing it? Riiiight.
I like what the brits have tone with the BBC. I could get behind that kind of government support. I don't want to see Ruport Murdoch sucking at the public teat while putting out his bullshit.
Kwisatz Haderach
Sell the spice to CHOAM
This Mahdi took Shaddam's Throne
Newspapers were subsidized by the Federal government until about 1840 or so, due to the founder's desire to make sure there were plenty of options for people to be well informed.
Link here.
Rhymes that keep their secrets will unfold behind the clouds.There upon the rainbow is the answer to a neverending story
Postponing the death of an industry with a huge influx of cash is not just illogical, it's such a stupid idea that only Washington could come up with it. For one, it does not fix the problem. People will still choose electronic media over paper. There is also something to be said for making the country's print media dependant upon the federal government. Print an article blasting the current administration? There goes your funding...
Does that mean I can blog about a sports game and claim copyright over the score?? Goodbye sports section.
I don't see a problem with brainstorming and discussing all possible options, no matter how bad they may eventually turn out to be. It's an important step in the decision-making process. You list all the ideas, good and bad, then start weeding out the obvious bad ones, then debating the apparently not-too-bad ones until you have it narrowed down to a few good options - then pick the best option. IMHO that best, last remaining option would be "let the newspapers try to figure out how to survive, and if they can, great. If they can't, the electronic media can report on their eventual demise".
Of course over the past few decades, there seems to be an increasing trend for the most idiotic, most obviously flawed ideas to float to the top and become law. I attribute that to voter apathy and a press (both print and electronic) that have for a very long time been reduced to pandering for market share to survive.
The thought of that cunt Murdoch getting money from me when I used none of his services and despise his existence would be far too much.
Put a tax on lying.
The automakers, yea they should have bailed them out, the got screwed because the banks screwed with their borrowing money.
The banks, well too big to fail is just full of fail.
No, the automakers are kind of strategic assets and the domino effect from their failure would have pushed the US and the industrialized world into a depression.
This combined with the "emergency powers" over the internet that are being given to the Department of Homeland Security mean that most of the media in this country can conceivably be taken over by the government. If they don't like what you have to say they aren't going to allow you to say it.
Here is a link to the text of the proposal: http://www.ftc.gov/opp/workshops/news/jun15/docs/new-staff-discussion.pdf
"I'm not a quack, I'm a mad scientist! There's a difference." - Dr. Cockroach
It's frightening just how much modern American government has become like the nightmare Statist government in Ayn Rand's novels, constantly meddling with and attempting to control market forces that it and it's members are incapable of understanding or wanting to understand.
Regardless of what you may think of her personally, she was prescient.
Regardless of the merit of this case, don't you think it's just a bit early to come with this magic market libertarian stuff as we are still in the midst of a major financial crisis caused by massive deregulation?
I am not bothered by the fact that you exist; I am seriously concerned, however, that there was one person to mod you insightful...
No, the automakers are kind of strategic assets
No, their plant and equipment are strategic assets. That equipment wouldn't have vanished if GM went out of business. It would have been bought up by more nimble competitors during the Chapter 7 proceedings.
I want peace on earth and goodwill toward man.
We are the United States Government! We don't do that sort of thing.
...constantly meddling with and attempting to control market forces that it and it's members are incapable of understanding or wanting to understand.
Back in the 1800s, our economy would oscillate between booms and busts. Depressions were the norm during the dips in the business cycle. Sure there were corresponding booms, but the crashes would wipe out most of the wealth created. Businesses wanted government intervention to flatten out the business cycle and make things more predictable.
Completely free markets do not work. They eventually break down and we end up with a crash and an aristocracy. Start reading 19th century American business history (Rockefeller, Morgan, Vanderbilt, etc... ) and see what it was like when the Government was completely hands off.
On the other hand, it is possible to go too far, as in this case with the news or with the airlines, GM and Chrysler, the big banks - those should have been allowed to fail or in the case of the big banks, broken up so that they aren't such a threat to the financial system.
I say let the news organizations fail and the Government step in and create protections for the citizen journalist.
Rand over simplified things - she was speaking from a system and human ideal that is not attainable. Humans are just too frail, self centered, small minded, shallow and cruel for a World like Ayn Rand's to exist.
RIP America
July 4, 1776 - September 11, 2001
There is good reason to worry about the loss of an independent source of information to an otherwise uninformed electorate. So all the comparisons to capitalism "we didn't bail out the wagon-wheel, buggy-whip, ...has-been technology" are a bit shoot from the hip.
How is it an independent source of information if it needs to rely on money from the government to stay in operation?
I want peace on earth and goodwill toward man.
We are the United States Government! We don't do that sort of thing.
How about we create a tax on video games to support the failing board game industry? Or 20% tax on fuel injectors to subsidize the failing buggy whip market? Give me a friggin break people. It was NEVER the government's responsibility to support failing market initiatives, or outdated technology. The need creates the market. If the market isn't buying it, then the need has moved elsewhere. Imagine this: We let the newspapers die. There are no longer major news websites associated with those papers to provide material for pseudo news groups to link to for free. Other new sources will spring up, and the more legitimate and satisfying of those will flourish, and grow to become larger news sites. Those new sources of news will decide how best to be profitable, either by charging a fee for access to their service, or by using the free popularity model to drive the desirability for advertising space within their site. How do you think all these "Free" sites became popular, and then desirable, and finally powerful? (Google, Myspace, Facebook, Yahoo, etc.) Let the genre evolve how it will. Stop squeezing more money out of our @$$E$ by trying to reverse time and evolution already!
Newspapers aren't, for the most part, loosing money. They're becoming less profitable. Historically, newspapers have enjoyed fantastically high profit margins. Due to a falloff in revenue from shrinking circulation and less interest in print classifieds, those margins have shrunk to being merely moderate.
Back in the days when newspapers were run by private companies or wealthy families most papers probably could have weathered these leaner times, these days most major papers are held by big public media companies. These companies can't tolerate a drop in profits, so they are firing reporters and closing beuros in order to maintain those margins.
What do you mean, "without someone to sell to"? Do you think the demand for automobiles would have disappeared just because GM went under? Ford, Toyota, Honda, etc. would have had to expand their capacity to meet increased demand. The easiest way for them to do that would have been to start purchasing parts from GM's now idled suppliers. There was no reason to bail them out other than as a gift to labor. Look at the way the administration abused the bankruptcy code. The bankruptcy code said that the bondholders were secured creditors and should have been repaid first -- but they got screwed while the unions got most of what they asked for.
Beware the Government that can't even be bothered to follow it's own laws.
I want peace on earth and goodwill toward man.
We are the United States Government! We don't do that sort of thing.
I would much rather see America turn to public funding for public domain news, instead of trying to let businesses copyright facts. One of the best news organizations in the world is funding by a TV license fee.
Here's one clip from the first proposal:
Some stakeholders have proposed amending the Copyright Act to specifically recognize hot news protection. Advocates argue "the copyright act allows parasitic aggregators to 'free ride' on others' substantial journalistic investments," by protecting only expression and not the underlying facts, which are often gathered at great expense...
Hot news advocates are divided, however, on whether federal law should be revised to encourage state law development of hot news doctrine or to provide uniform, statutory federal hot news protection... The likely effects of a more vigorous hot news doctrine are controversial. For example, on eworkshop participant noted that New York's hot news doctrine was important to the AP's efforts to protect its intellectual property, but recognized that any "federalization" of the doctrine would need to be very carefully drafted to avoid unintended costs... Others also have argued that expanded IP protections for the news would be too costly. News organizations and writers, including print, broadcast, op-ed writers, and other commentators, routinely borrow from each other. One panelist suggested that "[m]uch of what is done by newspapers with each other is actually problematic under existing hot news doctrine."
The paper does include a number of possible direct revenue sources from the government as possibilities, such as tax breaks or increasing punding of the Corporation for Public Broadcasting. However, it also includes the following:
Representative Waxman noted in remarks to the FTC workshop on December 2, 2009, that those advocating for public funding "need to articulate the scope of such support, in terms of the activities to be supported and the dollars required. They need to respond to the concern that government support of journalism would lead to government control of content. And they need to explain the source of revenues."
Most of the paper goes on like this, presenting different sides of each proposal. Which is to say that unlike what the commentator in the OP states, this isn't so much the FTC dictating that the government deliberately save the news industry in any one particular way, but is more a roundtable discussion about different ways that it might occur. If you disagree with what's discussed, you might want to leave your Congressman a call.
Libertarians somehow believe that private businesses should be stronger than governments but weaker than individuals.
Do you think the demand for automobiles would have disappeared just because GM went under? Ford, Toyota, Honda, etc. would have had to expand their capacity to meet increased demand.
And with the country going into a recession, a certain proportion of the workforce being laid off, and the sudden downturn in sales for their suppliers, all reducing the amount of available consumer resources - where is the increased demand supposed to come from?
Libertarians somehow believe that private businesses should be stronger than governments but weaker than individuals.
From the millions of people that would have otherwise bought GM automobiles? You can't have such a bad understanding of economics as to believe that GM's demand comes entirely from employees of GM and GM suppliers.
I want peace on earth and goodwill toward man.
We are the United States Government! We don't do that sort of thing.
The repeal of Glass-Stegall, the lowering of capital ratios needed to maintain leverage, the deliberate understaffing of the SEC as seen as an unnecessary vehicle, the maintenance of fed interest rates near zero during the last decade, these are all notions of deregulation. If we were standing back and letting the banks support their own ratings boards and believing that mortgage brokers could police themselves and would be natually trustworthy, how is that an argument against government intervention in those cases? I'm not sure what you mean by lots of "bad regulation"** - what we had was weak regulation that was powerless to stop any issues that could have potentially occurred.
Hell, you make Atlas Shrugged sound like an almost progressive book - it sounds like you're saying that the government should have been stronger than the corporations rather than the other way around. The idea that government should have no intervention in business whatsoever is a pipe dream, right up there with the idea that government should facilitate a society where everyone receives exactly equal pay and benefits. In a society where government stands back and allows profit-driven corporations to police themselves, then eventually you will have corruption as those corporations recognize the profit value in bribing and maintaining control of government, just as communist governments tend to become corrupt as officials recognize their special privileges. The "it was deregulation" rhetoric is a notion that government has a role to play in facilitating a free market, and that the extreme opposite of that is not a system in which the government goes completely hands-off - the extreme opposite is a government dictated by the whims of the corporations.
** "I don't give a damn about my bad regulation! You're living in the past, it's a new generation!" And now that will be stuck in my head all day.
Libertarians somehow believe that private businesses should be stronger than governments but weaker than individuals.
You've got it backwards. Media consolidation was a consequence of the collapse; as circulations fell, newspapers had to merge to survive. This is easily seen by simply observing that the decrease in circulation started happening *before* the consolidations.
Wrong.
GM deserved to die because it was mismanaged for decades. Their products have been crap for a long time, they haven't made a decent car in decades, and it shows in the sales figures. The only reason they were profitable before was because of the SUV craze. However, GM pissed away this opportunity, and instead of using the temporary windfall from the sale of highly profitable SUVs to build a "rainy day" fund or otherwise make the company strong for the next recession, they were completely caught with their pants down when gas prices rose and then again when the recession hit, killing the SUV craze suddenly. With no more cash cow to abuse, GM had no more money left.
Ford, OTOH, managed to manage their company well enough that they avoided this fate, even though they were profiting off the SUVs alongside GM, and had all the same issues with union work and costs.
So, in the end, instead of Ford being rewarded for their superior business acumen, they got to watch stupid, mismanaged GM get an unearned bailout.
GM should have been allowed to die. It could have been split up and sold off to Ford, Honda, Toyota, and the other automakers. That "vast system of suppliers" should have been able to hang on until then, as they would have been needed to supply these other companies who would now be selling more cars. Any company that can't handle a temporary disruption to their sales has no business staying in business.