Tax on Consumer Electronics Could Help Bail Out Newspapers

As preposterous as it sounds, you, the consumer, could be tasked with bailing out the newspaper business by way of a tax implemented on electronic devices.

A Federal Trade Commission (FTC) look into “Potential Policy Recommendations to Support the Reinvention of Journalism” (PDF, thanks Kotaku) addresses the “challenges faced by journalism in the Internet age.” Noting that “The news is a ‘public good’ in economic terms,” the report adds that “it is often difficult to ensure that producers of public goods are appropriately compensated.”

In addition to proposals that include providing a form of “hot news protection,” introducing an “industry-wide licensing agreement,” debuting a content license fee of $5 to $7 to be paid by an Internet Service Provider for every one of its accounts, and providing tax credits to news organizations, another suggestion recommended the formation of a “Citizenship Media Fund” by the government.

Such a fund could have its coffers filled by a tax on consumer electronics.  “A 5 percent tax on consumer electronics would generate approximately $4 billion annually.”

Another suggested way to fill the fund would be to introduce a tax on the broadcast spectrum, which would free commercial broadcasters from obligations to provide public-interest programming.

The FTC does note that all the proposals put forward are merely that, just proposals. These matters will be discussed in a roundtable meeting held later this month.

Somewhere, Rupert Murdoch just might be smiling.

Update: Entertainment Consumers Association (ECA) VP and General Counsel Jennifer Mercurio offered this take on the proposals, "Taxing online goods serves to chill commerce at exactly the time we need to encourage shopping. It’s anti-consumer, bad for economic growth and bad public policy."

Disclosure: GamePolitics is a publication of the ECA.

Thanks PHX Corp!

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  1. 0
    ScotlandTom says:

    When an old tree dies and falls over naturally in the jungle it leaves a nice gaping hole of sunlight that a host of other plants can suddenly compete for.  Eventually a few of those plants grow bigger and stronger than the others and fill the gap again.

    That’s how business works.

    Why should my tax money be used to shore up an old dead tree?  I didn’t like it when it happened for the airline industry; I certainly didn’t like it when the same happened with the auto companies; and I really don’t like the idea of continuing the trend with the newspapers.

    Let dying companies die.  New ones will take their place.

  2. 0
    jedidethfreak says:

    Considering RM’s holdings are actually making money, versus bleeding it like a stuck pig, I doubt you can lay this at his feet.

    With the first link, the chain is forged.

  3. 0
    King of Fiji says:

    "If you are a print newspaper and you haven’t moved to digitial yet, then you are a fucking retard.  You deserve to fail." 

    A local weekly newspaper near me in the past year had a school district’ board start threatening its advertisers because they uncovered the fact that they were spending budget money on pointless shit like fancy 50k desks and chairs.

    Not the daily newspaper with its online website but the 50 cent weekly analog newspaper.

    Yes they will eventually have to go digital but they seem to be doing a better job that the non "fucking retard" of a digital newspaper so please quit making assumptions as it makes you seem like a "fucking retard"

  4. 0
    Kojiro says:

    Why can’t we just let failing business fail?  If you are a print newspaper and you haven’t moved to digitial yet, then you are a fucking retard.  You deserve to fail.  Let someone with some business sense do the job.

  5. 0
    Neeneko says:

     I guess the question then becomes, what is a good way to do it?

    There is also the even more contentious issue of access.  As more sources move on-line, we forget that many people do not have the economic resources to afford the hardware and connections that we take for granted.  As it stands, about 25% of the US population is completely off-line.

    While this might not sound like ‘our’ problem, think of it this way… every time we complain about ‘idiots’, do we really want to encourage a situation that results in more people being ignorant of even basic events?

    This unfortunately touches on the whole issues of direct benefit vs indirect benefit, which is something pretty deeply tied up in our current round of culture wars, so any discussion is quickly going to get drowned out by that larger philosophical debate. 

  6. 0
    Neeneko says:

    I think people tend to fail to realize that much of the news they consume every day comes from these ‘failing organizations’ but get reprinted elsewhere.  Just look at how many stories on GP come from various news sources around the world.  Sites like GP repost a lot (for free) of news material that cost someone somewhere else real money to produce.

    I am not sure that this is the right solution, but we do have to find some way to keep journalism profitable otherwise the people actually doing the legwork that we depend on every day will stop doing it, and that will be a very bad thing for all of us.  

    Seeing originator sources like AP or Reuters vanish would have a crushing effect on propagation of information. Blog reporters are no where near up to snuff when it comes to the rather expensive field of investigative journalism.

  7. 0
    King of Fiji says:

    "I haven’t printed up much of anything since the iPad came out, and it creates far less waste than newspapers do."

    Right because as we all know all electronics are propely recycled and don’t end up ($%^ing up thrid world countries…….right?

    It just seems like trading one form of waste for another.

  8. 0
    Zerodash says:

    News outlets paid for by tax money?  Sounds like a firm step into state-run media to me.  This kind of stuff was discussed quite a bit last year, and it fits with the current (Socialist-leaning) political establishment quite well. 

    But why the hell is saving an out-dated media important anyway?  All the government bailouts in the world still won’t win over any readers from the internet and mobile devices.  Plus, the move to digital content surely reduces the need for and use of paper.  I haven’t printed up much of anything since the iPad came out, and it creates far less waste than newspapers do.

  9. 0
    King of Fiji says:

    I would just like to pont out ShadowDragon that even though it only makes alittle more than 1% of total music sales vinyl did make a comeback……so anything is possible.

  10. 0
    King of Fiji says:

    Daily newspapers are on their way out but I hope to god weekly 50 cent local newspapers don’t fail.  They are actually relevant.

    But yeah even so they as well shouldn’t be bailed out by taxing other crap.

  11. 0
    Thomas McKenna says:

    There’s a reason newspapers are failing.  They sucked before, and now that the internet is providing competition it can’t keep up. 

  12. 0
    axiomatic says:

    Ummmmm no?

    I didn’t read the newspaper when I was a kid and there was no internet yet. Why again should my CE purchases be taxed for something I have never read nor ever plan to read?

    Can we tax newspapers to save PC gaming? Because I hear thats in decline as well?

    How about we tax automobile sales because no one in America rides bicycles anymore?

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