some support? it seems like a mixed message. >> well, not necessarily. one of the things that local broadcasters said to the fcc when it was going to the broadband process was we should not be treated as if this is just an economic equation. we are into these that have special relationships with the community. also county the local news. and i think that's great. i think the responses that the best way for broadcasters to make sure that they have all the spectrum they need is to fulfill their obligations to their community. so it could be a win-win. that broadcasters taken seriously they need to improve their local news or to offer local news and journalism will have a much stronger case in terms of spectrum, but more important it will help solve

this problem of the potential crisis in journalism in america. some portions of the spectrum that is presently being utilized by television will be rededicated to broadband purposes underscores the extraordinary benefits that television broadcasters are now getting free of charge and the responsibility that comes with that. i look forward to the day when we can develop spectrum sharing and other technologies that will change all this around great for the near term and midterm, this spectrum? television broadcasters are using is highly valued. it is reasonable for the public to expect public service in exchange for use of their spectrum. valued and it is reasonable for the public to expect public service in

exchange for use of their spectrum. more broadly, gene's concerns are certainly well placed. but i do think it's possible that as we've done in my opinion with broadcast regulation, to make these things viewpoint-neutral as well as platform-neutral. indeed, the traditional postal subsidies that we started talking about -- they didn't ask whether you were a republican or a democrat or a federalist or a whig. newspaper -- in a day when newspapers were frequently owned by political parties and were highly partisan, think fox news and msnbc is better analogs than cnn. it's possible to devise mechanisms including some voucher schemes that had been proposed that will free -- can free the government from any

notion about making a value judgment about the content. and, you know, it's tricky. but then again the goal here which is to preserve democratic processes is an important one and a tricky one. >> did you want to get into the spectrum discussion? >> well, actually i wanted to make a slightly different point. which is that, you know, the question of whether the government should fund journalism in any way, shape or form is at the heart of the first amendment that we've been discussing here. and i came across the other day a study of four argentinean newspapers. and this was a study that was conducted by a harvard business school professor and a northwestern business school professor. and they looked at the four argentinean newspapers over 10 years.

and looked at specifically the amount of coverage in those newspapers that was critical of the government. and then they looked at the amount of advertising that had been placed in those newspapers by the government. and indeed in argentina, unlike here, that's quite common. and it's done by whim. you know, the government can put any amount of advertising it wants. it's not public notice-related or anything like that. so surprise, surprise. there was a, quote-unquote, huge correlation between the amount of dollars that were spent in the newspapers by the government and the lack of coverage of government abuse. and so, you know, i think -- we have to -- whatever we talk about here today, has to be against that backdrop. that certainly if you're looking to the government to fund you or to another source if it's a private donor, you're not going to want to offend the source of your revenue. >> can i respond on that? >> yeah.

>> "the wall street journal"'s largest advertiser by column inch is the united states government. in the back of these wall street journal there's all these dea forfeiture ads. and federal notices and in the "usa today" as well. this is largely done by bid. and i don't think anybody can say that the "wall street journal" in either the news portion or the editorial portion pulls its punches. >> well, i don't want to belabor the point but public notices are not government subsidy of newspapers. public notices are published so that the government can take property away from individuals. and the only way they can do that constitutionally and legally is to give notice. and newspapers are still the best way to give that notice. so that's not a form of a subsidy. it's there for a completely independent reason. and because it is through bid

and a bross that involves no favoritism, maybe you're right. >> i'm sorry. go ahead. >> i just wanted to add one point and i'm not espousing government subsidies for news organizations. because, you know, at our march workshop we looked at a lot of other ideas that have nothing to do with that. but i do want to note that in surveys of audiences -- the corporation of public broadcasting the most trusted newspapers in the united states. so, you know, yes. yes. so, you know, it's not impossible. there's certainly have been bumps in the road there. but it's also true that in many, many countries, most countries in europe, there are government-supported news organizations like the bbc. and so there are ways -- i'm simply suggesting that there are

ways to construct chinese walls, et cetera, et cetera. now, does this country want to go in that direction a lot more? that's not my perception. that's a u.s. tradition. but it's simply -- to say that it's not -- not every government, quote-unquote, involvement necessarily implies entanglement. and i do think it's very important to make sure that's the case. that you've structured it properly. >> quickly. >> we had a session here a freedom of information day on march 13th. and i think that manipulation of government data to make it more accessible to anybody online but also some news organizations so that we can do the kind of investigative reporting, database reporting is a great example where government on its own can do what it does, free press can do what it does. and again not to be facetious but if you look back we had 1791, we have a first amendment along with the bill of rights. eight years later, seven years

later, alien sedition act. good intentions. in the broadest sense. we want to let this government survive against a hostile nation, dah, dah. for public interest we had a doctrine called the fairness doctrine. that grew. it was applied. some would say failed and drew broadcasters away from things like editorials online and a simple way of having a portion of your time was to have no political reporting. there's that criticism. those are both examples. one long ago. one most recent. where in the public interest, i think, ultimately we had a detrimental effect on a free flow of information. again, i'm not saying, you know, we live in a democracy. we have a government. there's a reason for that. and i acknowledge the beneficial aspects of the government doing its own thing. but i think we have some historical examples and there are other smaller examples on a local level where government acting in what it calls the public interest at the moment

really thwarted the free flow of information and again that's where my concern comes from. i think we're tremendously innovative people and i think there are plenty of journalists what government policies and practices are. and the public with the web has a marvelous opportunity to be that same sort of watchdog. but again, you know, history teaches us something about these early discussions. >> i'm going to ask another question now. but if you have a question yourself, we're ready to take those and there are two microphones here. and i'll be happy to call you as soon as i've asked this question, which is to steve. and that is -- i wanted to ask you what the relationship is between the study that you're doing and other things that are going on at the fcc, the localism investigation and the media ownership investigation. and, for example, in localism,

there's a discussion of possibly local news counselors and that kind of thing. how do you see all these pieces fitting together? >> a lot of them basically will get rolled up into the future of media report and we'll make recommendations on what should be the status of this -- of the previous localism proceeding that had happened. the ownership review is on a slightly different track because it has a different legislative history. and has a schedule dictated by congress. so we're coordinating. that's basically -- congress requires the fcc every four years to look at its rules and make sure that its rules on ownership still make sense. and by the way, i should say about the future of media project, we're looking at not only potential regulatory interventions but potential deregulatory steps as well. the idea right now is to look at the full slate of what the

government does to see not only are there things that the government can do and other things that the government should stop doing that should also might help. >> barbara, you want to suggest anything? [laughter] >> oh, we could go on. all day. and -- >> andy might want to jump in there, too. >> yeah. but let me just pick up on a point. when you talk about local jame. -- localism. and you had alluded to the local news councils that might be discussed. there's kind of a conflation of national news and local news. and everybody thinks it's all the same. when indeed it's quite difficult. -- different. and the european examples are primarily national news organizations that have been funded. i'm very close to the local news business. i mean, we have newspapers in big cities like phoenix and detroit. but we also have appleton and

oshkosh. and the thought that there would be a local news council in each of those communities that would somehow figure out what quality journalism was in an unbiased way. and give that money to the -- to the best -- to the best entrant is kind of ridiculous. i mean, who would be on that council? who would be judging the quality of the news? >> just to clarify one thing. there are two different local news council that have been talked about. the local news council that have been proposed as something -- is something in the downey report. >> right, right. >> what was in the fcc paper was something -- was a question of whether or not there were ways of getting local tv stations to do more aggressive outreach to find out what they should be covering. which is a little bit of a different thing. i can claim total ignorance on all of that 'cause i'm new at the fcc. i have no opinion on anything that happened more than three months ago. but i just wanted to clarify that there's never been any --

never been any attempts or interest at the fcc to establish local news councils of that sort. >> okay. good. i think we have a question here, yes, bob. >>io. -- yes. >> and if you could identify yourself. >> bob corn-revere. i want to pick up gene's point. i would never quote jerry falwell and address then a question to andy and the various examples he gave of postal subsidies and so on. starting with the quote from alexander michael john that government should get involved affirmatively with the press and i don't know anyone suggest government promoting first amendment values is itself a first amendment violation. first of all, i don't know anyone who would suggest for a local government to build a library is somehow a violation of the first amendment. but i want to go to the notion of the entanglement that comes

with subsidies. everyone has mentioned postal subsidies. andy, i know you know the long argument with postal subsidies that favor speech it liked and disfavor speeches it didn't like. and nea, for example, for journalism. and yet the supreme court has held that because of the nea subsidy it can demand conditions based on content. public broadcasters are a wonderful asset but they don't have the same editorial rights as commercial broadcasters. and, you know, if you have funding through the erate and you happen to be a library, you have to use content filters. whereas if you don't take the erate then it would be a first amendment violation to impose a content filter on internet terminals on libraries. i guess with those examples in mind, how would you respond to the entanglements and the first amendment problems that it's created. or alternately do you see subsidy as an opportunity to

impose conditions on media across platforms that you would be unable to do through direct regulation? >> your points are very well taken. and takes us down into the weeds, of course. i'm not saying it's easy. i'm not saying it's without difficulty. i am saying that we are facing a genuine problem going forward. and here i do want to note -- barbara is right. -- barbara wall is right. but barbara wall is right. that the journalism is a profitable business and an ongoing business. we're not talking about the death of it. there's undoubtedly a secular as well as a cyclical change going on. and only when we come out of the recession are we going to really know how much is one is how much is the other. but any way you look at it part of it is secular and there's some very fundamental change.

and i do think we need to look at ways to do it. and there are better ways and there are worse ways. for example, a voucher system has been suggested that would give every american 100 or $200 to allocate towards any journalistic venture of his or her choice as a platform-neutral -- content-neutral for funding journalism. if you believe journalism especially local journalism is essential to democracy. i'm not endorsing that. i'm just pointing there is a way to skin this cat and we need to look at this. and look at it fresh. and we want to avoid the mistakes of the past. and nothing is perfect. again, i point to the example for all of the problems -- occasional problems that there are, the cpb model with nps and npr has worked remarkly well. and that's a mixed system.

and also i think the tax laws to permit public-spirited investors to sacrifice some rate of return in exchange for assisting local journalism in their communities has great promise. and these are -- these are platform-neutral, viewpoint-neutral things. so i do think we need to design them. i do think that you make very, very important warnings about the kinds of problems that can arise. and we need to design around them. >> okay. there's a question here. >> we heard on the earlier panel that broadband internet is a disruptive technology and we've clearly seen its effects on the newspaper industry. does it pose the same risks for broadcasters, local broadcaster journalism? how about national news networks? and if so, are we going to be back here in five years talking about subsidies for those news-gathering efforts?

>> do you want to answer that? >> well, again, i think it's too soon to say. we own broadcast stations. and it's been a trying time over the last couple of years. but there have been again, you know, bright spots on the horizon. for one thing, the citizens united case is going to benefit local stations. in the upcoming election cycle. and i really don't want to go there. [laughter] >> but, you know, i do think, though, you're right. that it's all part of a very long-term secular change. and both newspaper and broadcast will be impacted. >> steve, have you formed any views about that at this point? >> i think the short answer is that it's not quite as bad as newspapers for the simple reason that tv stations were never as dependent on classifieds so that

whole leg of the stool, when it disappeared for newspapers, it didn't rack tv stations the same way. but the other factors that affected newspapers are also affecting tv stations, the drift of audience online. the lower ad rates online. versus what you can get on-air. so there's no question that some of the challenges. and i don't mean to be a downer. but on the one handsome things will get better. there's great innovation going on. the economy is going to get better. on the other hand there are some ways in which this -- the negative parts of this haven't fully played out yet. we do not yet have universal broadband. and for all the benefits that broadband will bring, it actually will exacerbate some of these problems in certain pockets. one of the reasons that community newspapers are doing relatively well is craigslist hasn't gotten there yet but he will. >> maybe not. >> ande of theewspapers will have some of those problems

as well. >> susan, have you found anything so far in your study that would be a response to that question? >> i think steve summarized it very well. >> okay. good. this microphone. >> thank you. i think this is addressed to anybody who wants to take it. six months ago i think my thinking on these issues would have been very close to gene's. and i think today it's probably a little bit closer to andrew's. it was formed a little bit by a book that i'm not endorsing but i think people should take a look at. it's called "the death of life of american journalism" and there's been references and a lot of did based on the research on the historical role of government indirectly subsidizing the press. and some of the ideas that were talked about here -- talked about in this book as well. but it did cause me to think about this issue in a much different way than i ever had before. as i said, my own view has probably shifted. as a result of that. i'm also in a sense a child of

the '60s and the '70s and the fear is could this -- are we in danger of losing the capability of this happening again. and that word and a lot of people can guess it is watergate. and how journalism in some respects journalism saved the reluctant. and if investigative journalism is going to be harder and harder to maintain because of these economic problems, what are we putting at risk? even though i'm concerned about the first amendment side and the entanglements if the lesser of two evils is having some form of subsidy but preserving what investigative journalism did in the past isn't that price worth paying? >> if i could, i see what you're saying in terms of moving from me to maybe more of the middle of the panel as it were. but let me just say as i said at the beginning. i think these are robust times.

i think that investigative journalism is going on in so many different ways. in community levels and national levels from groups that are internet-only. and come around single-issue groups. there's a model in all places in china. where localities hire investigative reporters to report on certain government corruption, tolerable reporting, i guess, if you're not attacking the larger party. if you're go to a manager of a wastewater plant that's not doing its job, you can investigate that. i don't see that in the same fashion. i think there's a commercial viability. that still exists. i think, again, news organizations that have been with us for a long time still have, which i think was talked about in a number of reports and i think have come up in all of your panels, which is that the found of trust despite the alleged conservatism. -- skepticism. as trustworthy venues.

and sources of information. so i don't think necessarily this innovation and move and again change from the mechanics of how journalism is practiced is what we're talking about. we talked a little bit about the mechanics of saving entities here. >> and i'm going to also give a response even though i'm the moderator to that question because i'm one of the people who was actually working in journalism in washington when the watergate story was being investigated. and we can't forget the fact that even in those good old days there was still tremendous pressure placed on the "washington post" company because they also owned television stations that had to be licensed. and that was used specifically as a threat. and the reason watergate was successfully investigated by the "washington post" was because of a courageous owner who saw her duty. and also had some very good

people working on the story who were able to begin to unravel it. for my money it will always depend on the commitment of the owner, ownership. and what barbara said about a commitment to watchdog journalism, that is what is going to distinguish journalism in the future. i think that's very, very helpful. >> i just want to pointe out there are six state capitals that have no reporters covering them. yes there's a lot of innovation going on and we're not talking about every newspaper in the country dying tomorrow. there is a significant loss of journalistic capacity. and i do think -- that's what we're really talking about here. we're not talking about particular entities. we're talking about the journalistic capacity. in particular with respect to public affairs journalism. and i think, you know, in that -- that combined with the local nature is really where the

most concern is and where, in fact, economic theory would suggest there should be the most concern. >> just to highlight that point. the pew's state of the media report which came out a couple of weeks ago said that there had been a $1.6 billion contraction in what newspapers spent on editorial matters. then they did something interesting is they went around foundations and said how much money do foundations put in to adjournlistic start-ups. tremendous innovation. it looks like a ton of money. 1.6 billion contraction. 150 million put in to counteract it. and, you know, that still leaves a gap. >> yes. last question. >> this is picking up, i think, on the last conversation. when i hear discussion business how expensive it is to print and mail newspapers. and the failure of classifieds and horoscopes and what have you. it seems to me like you're talking to business models, okay? and you're not talking about

journalism. so are we really talk about saving the newspaper business model? i think mailing newspapers to people -- i think you shouldn't be thinking about that. >> we're not mailing newspapers. >> that's what the discussion -- let me just finish. >> let me make my point, gigi. we're not mailing newspapers. we're mailing advertising to people. that's what i was saying. we don't mail newspapers. maybe some very small communities do. we deliver them. and we do that because people want it. and there are still many, many people who want that newspaper there. so, yes, we are looking for a business model. we're looking at ways to tweak our business model to save money in ways that doesn't inhibit the journalism. i mean, for example, it's been widely reported that our newspaper in detroit, the detroit newspaper -- actually there are two newspapers there. we reduced home delivery to three days a week. now, we're still printing newspapers seven days a week.

but the delivery costs being so high we're just delivering three days a week. and it's been a tremendous success. so there are ways that we can look at saving journalism and saving our business. and the two aren't mutually exclusive. >> just to finish my thought. my concern is -- and i've said this to steve personally. is that my concern is that a lot of the discussion is about preserving business models. steve, you told me that a lot of the -- a lot of the folks have come up to you and talked about, well, how do we save our copyright. how do we make sure google doesn't link to us. how do we get google to pay us for it. i'm concerned if we're really talking about saving journalism, let's talk about that. let's not talk about preserving business models because business models have to change when you have disruptive technologies. >> i have to say i didn't hear anyone say that they didn't think business models should change. i think there was a real connection here. anybody else want to respond to that? >> i just think that you can't

talk about how you're going to maintain journalism without talking about what's the business model going to be? for how you maintain journalism? okay? so that's why people are talking about business models. they're not talking about business models in the sense of, oh, we need to save every single newspaper that's out there. at the moment, however, newspapers -- and i believe this was in the latest state of the media report unless it's changed. but it's currently the case that newspapers get 90% of their revenues from their print versions, you know. and so although, yes, they're facing competition now from online news organizations that don't have those fixed costs, they're not at liberty at this point to just say, oh, well, we're all going to go online. that's not going to work. and so there is a big transition going on. and the whole question is, to

how do you save journalism, is where are you going to get the money to save journalism? and then -- so that's why we're talking about all of these different sources which are a potential new business model, lowering costs. how else could you get revenues from foundations and there are government policies that could -- that would help us, you know, with the funding for journalism broadly conceived against across all platforms. >> steve? >> another way of looking at this, there's no shortage of demand for news now. there's traffic for news online as booming. so the problem is not that people have decided oh, american journalism is uninteresting or unreliable or something like that. the problem is the business model collapse. that is what's caused the collapse of journali