Economics and the Press

Mr. Summers is a graduate student in mathematics at the State University of New York at Stony Brook.

Most people agree that a free press is a vital component of a humane society. Yet many of these same people assert that the free enterprise system is not only superfluous to achieving and maintaining a humane society, but is, in fact, the one great obstacle to its fruition. That is, they believe that freedom of the press can somehow be preserved while economic freedom is being destroyed. Let us give this matter a little thought.

A good place to begin is the question of property. Who is to own the printing presses, buildings that house the presses, and land on which the buildings are situated? If the institution of private property is abolished, then they must be owned by the state. Human nature being what it is, it is extremely doubtful that government presses in government buildings on government land would print much copy that displeased the government. This alone is probably enough to ensure that publications like Pravda will never be anything other than state propaganda sheets.

Even if a socialistic government decided that publishers are somehow different from everybody else and granted them the exclusive right to own property, this would by no means guarantee journalistic independence. Where are the publishers to get their supplies? Who is to manufacture and distribute the newsprint, ink, spare parts, and all the other paraphernalia needed to keep the presses running? As publishers in Chile have recently found, government control of these supplies can be an effective lever against dissent.

As these examples show, constitutional guarantees of press freedom can prove meaningless if the state has some control over the economic factors of publication. To pursue the matter further, let us consider the publisher’s sources of revenue. If he does not want to find himself beholden to the state, his sources had best not include the government. In capitalistic countries the two main sources are private in nature: sales and advertising. In fact, some publications are free — they exist entirely on their advertising revenues. Without such privately financed advertising, numerous independent journalistic voices would be stilled.

In socialist countries there is little need for advertising because there is little or no competition. The government manufactures the only products being offered on the market, aside from whatever imports it may permit. Being a monopolist, the state has little or no reason to place advertisements. If the government does buy advertising space, publishers are well aware of where the money comes from.

Even in a mixed economy, such as we have in the United States government advertising can have a chilling effect on journalistic independence. Many newspapers operate on the border between profit and loss. To more than one small paper a contract for legal advertising for the county has meant the difference between red and black ink.

The free enterprise system is important to the publisher for more than just maintaining his journalistic integrity. Even if he maintains his integrity, he must still deal with a problem facing all entrepreneurs: staying in business. Government interventions in the economy often make this problem insurmountable. To cite just three examples, the publisher must contend with government inflation of the money supply, rising taxes, and laws that prohibit the hiring of nonunion workers. The last have been particularly damaging, for they have not only increased overhead, but they have also led to lengthy strikes that have temporarily, and sometimes permanently, put newspapers out of business.

As even this cursory examination reveals, freedom of the press, which so many Americans hold as sacred, is not an isolated freedom. Rather, it is based on the economic freedoms which many Americans, particularly members of the press, view with disdain.