COVID-19: Deep newspaper job cuts prompt rare plea for federal funding to news media; Reps, Senators want to help

[Editor: See also Blumenthal, Rosenthal Call For Supporting Local Journalism, The Newtown Bee.  – RS]

New closures, layoffs in already cratering industry lead to request for help from Congress

Two years ago, the Daily Guide newspaper closed for good in central Missouri. Now, newspapers across the country are cutting staff and closing due to coronavirus shutdowns. (Orlin Wagner/AP)
Washington Post, by Jonathan O’Connell, April 16, 2020

An economic free fall in the local news industry began long before the coronavirus started wreaking havoc on the national economy.

Since shutdowns to combat the virus began, things have gotten much worse, as advertisers halted spending and publishers slashed more journalists’ jobs and hours despite the public’s need for information on the pandemic.

Cuts to the industry have accelerated so greatly that groups representing journalists have taken a maybe unprecedented step and asked the government to help, by keeping the industry afloat financially during the pandemic and seeding its resurgence once the economy begins to recover.

“We have to treat this as an emergency,” said Jon Schleuss, president of the NewsGuild labor union. “There is a real interest in public health to keep people informed in this crisis.”

Staff at the guild, which was founded during the Great Depression, said they cannot remember asking for taxpayer support. The role of the Fourth Estate in covering the government makes such a request awkward.

But since the pandemic began, newspaper chains have instituted furloughs of 10 to 25 percent of their staffs. The Cleveland Plain Dealer, which covers a metropolitan area of more than 2 million people, lost 28 of its 32 union journalists this month due to new cuts. Papers in Seattle, Portland, Boston, Sacramento, Reno and elsewhere have suspended print operations and furloughed their staffs, according to Poynter.

In a span of two days, April 8 and 9, dozens of groups wrote to Congress asking it to support local news. The guild wrote congressional leadership seeking financial support as part of ongoing economic stimulus discussions. A long list of advocacy groups, led by Pen America and Common Cause, wrote their own letter. Industry groups led by the News Media Alliance and the National Association of Broadcasters wrote as well.

The cutbacks in advertising are “dealing a sharp and immediate blow to local news publishing,” said News Media Alliance president and chief executive David Chavern, in a statement. “If this continues, there won’t be local journalism in many communities.”

Although other industries have asked Congress for financial support due to the pandemic, requests from the news media raise numerous issues. Congressional leadership has not agreed on what another round of bailout money will look like, with some Republicans resisting policy changes that could benefit one industry or another.

Policymakers are also wrestling with whether aid that has already been approved, in the $2.2 trillion Cares Act, should go to companies that were already struggling. Retailers, for instance, have laid off hundreds of thousands of workers but may not be eligible for aid because of questions about their credit and viability. Many newspaper companies, such as McClatchy, which filed for bankruptcy in February, could carry similar concerns.

Policymakers have also resisted bailing out private equity funds, which have a habit of buying companies, including many newspaper publishers, and then siphoning off profits while cutting staff. Indeed, private equity firms have been behind many of the cuts that led to America losing an estimated one-quarter of its journalists from 2008 to 2018.

Some newspaper owners are likely to be eligible for aid from existing programs in the Cares Act aimed at benefiting workers in a wide range of industries. McClatchy, publisher of the Miami Herald, Kansas City Star and other regional dailies, declined to comment on what aid it might pursue, as did Tribune Publishing, owner of the Chicago Tribune, Baltimore Sun and other papers.

There is also the question of whether news publishers would sacrifice some of their independence in asking the government for a special carve-out the way hotels, airlines and other industries have.

Gannett, which recently combined with GateHouse Media in a $1.2 billion deal, announced last month that chief executive Paul Bascobert would stop taking a salary, that it would cut executives’ pay by 25 percent and that it would require most reporters and editors across the country to take week-long, unpaid furloughs on a rotating basis.

Gannett, based in McLean, Va., issued a statement saying it is considering some of the benefits provided to all U.S. companies through the Cares Act. However, the company said it has “no plans to pursue special relief from the government.”

“Maintaining our independence is critically important,” spokeswoman Stephanie Tackach said in a statement. “As a news organization, we play an essential role providing our communities with clear, up-to-date information.”

Schleuss said he understands why any publisher or journalist would be reticent to make such a request, but the pandemic created unique urgency to avoid what he called an “extinction-level event” for the industry.

The guild has called for financial support that requires recipients to remain independent from political influence, halt job cuts, provide board seats to employees and promote diversity and equity in newsrooms.

“In this moment especially, we have to keep journalists employed,” Schleuss said. “People are just hearing crackpot cures and ideas on Facebook because they have no other better source for information. And that’s a real shame for America.”

To address those concerns, members of Congress, who are focused on the issue, are highlighting the unique role that local news plays in society. Nineteen Senate Democrats, led by Richard Blumenthal (D-Conn.), wrote their own April 8 letter to congressional leadership, asking that any future stimulus packages related to the coronavirus contain funding to “support local journalism and media.”

“Such a provision should be tailored to benefit aid recipients who make a long-term commitment to high quality local news,” they wrote.

Other members of Congress are advancing more specific plans. Rep. Tim Ryan (D-Ohio) has drafted a bill that would require half of government advertising for things such as the census and military recruitment go to publishers of local news, rather than national outlets. It would also create a tax credit for publishers who hire local news reporters, a new loan program for publishers, and would encourage some publishers to become nonprofit organizations.

Ryan said he began focusing on the demise of local news when the 150-year-old daily paper in Youngstown, Ohio, went out of business last year. He said he hopes his ideas will be considered part of stimulus discussions. A dozen House Democrats have signed on to the idea, but no Republican has.

“Every politician has a complicated relationship with the media, but it is an essential component of democracy,” Ryan said in an interview. He said local city council meetings and decision-making often go uncovered.

“There is just a general concern that no one is keeping an eye on local government anymore,” he said.

Jonathan O’Connell is a reporter focused on economic development, corporate accountability and the Trump Organization.