Media Policy and Government Failure

Recently, I had a conversation with a liberal law professor about government policy and bias in the media.  I argued that there was government failure.  The media was dominated by liberals and the government supported liberal public television and radio, which reinforced that domination.  This could not be justified.  Instead, it was an example of the dominant group exercising their power in both the private and government sphere.

The professor countered that while public broadcasting was liberal, the private media was capitalist, implying that public broadcasting was providing something that was missing from the private sector.

I thought of this conversation the other day when I read the New York Times the morning after Hillary Clinton’s acceptance speech at the Democratic National Convention.  During the entire Republican Convention, including after Donald Trump’s acceptance speech, the Times had negative headline after headline.  I should have taken a screenshot of it, but did not think to do so ahead of time.  But after Clinton’s acceptance speech, I did take a screen shot.  The stories were uniformly positive, and in some cases triumphant.  The titles: “Clinton Declares Election a Moment of Reckoning,” “Nomination Claimed and a Barrier Falls,” “Clinton Makes History, and Wears It, Too,” “Writing Her Own Story,” and on and on and on.  No one could reasonably claim that the Times was impartial about these matters. 

Was the New York Times just being capitalist?  I suppose one could argue that the Times readership, especially in New York, is liberal and therefore it benefits from such bias. And a similar story might be told about the big cities where the Washington Post, the L.A. Times, and other liberal newspapers reside.  But that hardly explains why the television networks, which broadcast news to the country, are liberal.  Nor does it explain why Fox News, the only conservative news network, has such high ratings, but fails to attract competitors for that conservative audience.  In my view, the better explanation is that elites in broadcasting and the media as well as reporters are liberal and therefore push that agenda as much as they can.

But even if I am mistaken, that still does not justify public broadcasting.  Suppose there is something of a market anomaly, if not market failure, in both the print and broadcasting media.  Perhaps big cities are liberal and therefore big newspapers reflect the politics of those cities.  Perhaps something else explains the liberalism of the networks.  Still, we have government failure in the form of the public broadcasting subsidy.  If there is a market anomaly or failure, the government ought to be subsidizing, if anything, conservative views, not reinforcing the liberal ones.  It is as if there were a market failure from businesses polluting, and then the government stepped in and required additional pollution.  The obvious explanation would be that pollution interests were dominant.  That explanation applies here as well: liberal interests are dominant.

Reader Discussion

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on August 01, 2016 at 10:39:02 am

Interesting viewpoint your Professor friend has: Print media is capitalist.

It strikes me as an odd form of capitalism that willfully *p*sses* off 50% of its potential client base as appears to be the case with print media.

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on August 01, 2016 at 12:06:27 pm

I’m curious about Rappaport’s “market failure” thesis. What is the mechanism for this failure?

1. Clearly where government licensure exists, we can spot a mechanism.

For example, in Metro Broadcasting v. FCC (1990), the Supreme Court upheld Congressional policies favoring minority ownership/management of radio/TV stations because benign race-conscious policies promote important governmental policies. But it was a Democratic congress that adopted these policies. And racial minorities tend to favor the Democrats. So was this really a policy to promote the interests of ethnic minorities, or to promote the interests of a political majority? (Compare to the recent court decisions finding Republican-backed voting restrictions to reflect racial animus. Republicans respond that their policies don’t reflect racial animus; they reflect political animus, which courts often find unobjectionable in the context of gerrymandering.)

For what it’s worth, courts struck down the FCC’s rules requiring broadcasters to engage in race- and gender-based affirmative action. So the FCC has adopted rules requiring broadcasters to solicit job applicants broadly within their broadcast areas, and fining broadcasters who do not comply.

2. Rappaport makes an interesting observation that Fox News does not seem to have attracted many competitors for the conservative news consumer. I also find this remarkable. But is it market failure?

Perhaps, in that it may reflect monopolistic behavior on the part of Fox News. Fox’s broadcasters had been giving Trump a pretty hard time for not being sufficiently conservative. Then Trump started saying that if he didn’t become president, he might launch his own broadcast network. Guess whose market Trump would take? And miraculously, Fox suddenly became much more supporting of Trump’s campaign.

Still, I’m surprised that we don’t see more competition. And indeed, we do—in radio.

Since the FCC abandoned the Fairness Doctrine in 1987, talk radio has been overwhelmingly conservative, and has launched the careers of Rush Limbaugh, Glenn Beck, Sean Hannity, Michael Savage, Mark Levin, and others.

Progressive talk radio has no comparable following. True, “community radio” tends to be run by hippies, for what that’s worth; you can still find them on the “far left of your dial.” (For you whippersnappers, that pun is a double anarchism: A dial is a round plate involved in rotation. Early radios would be tuned with the aid of a knob attached to a disk on which wavelengths might be written. This was replaced with a knob that would cause a marker to move left or right on a spectrum on which wavelengths would be written, but the name “dial” was retained. Thus we could make jokes about something being on the LEFT of a dial, which presumably merely rotates. Today we have digital tuning, yet old farts still refer to the “radio dial.”)

3. What accounts for the ideological slant of newspapers? What mechanism would lead to market failure here?

True, newspapers benefit from economies of scale. True, you find these economies in cities. True, cities tend to be more liberal than rural areas. But could you characterize this as a market failure, or rather as a successful manifestation of reality?

4. So perhaps Rappaport is simply butting his head against Colbert’s observation that reality has a well-known liberal bias. That is, perhaps conservatism/libertarianism makes sense in a relatively rural world, and makes less sense in a more urbanized one.

Again, let’s return to radio: ClearChannel (now iHeartMedia) owns 800+ US radio stations, but only one “flagship” station (in LA). Most of these stations are in rural/small markets. Where you aggregate sufficient rural/small markets, promoting conservatism is a viable business model. But as the world grows more urbanized, and old notions about maintaining a sphere of autonomy grow ever harder to maintain, the world will naturally shift away from those paradigms.

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on August 01, 2016 at 12:51:47 pm

"Progressive talk radio has no comparable following."

Certainly not for lack of trying - they have all failed. This may counter to some extent the colbert construct - don't know! Then again it could be simply be that "left side" of the dial has reached a saturation point via print and visual media.

On the other hand, the rural - urban thesis may be more on point. Perhaps, we now know "What is wrong with Kansas?" - they don;t get MSNBC! - Ha!

"But could you characterize this as a market failure?" -

Only if one believes that the *market* (remember People make up the market) has an obligation to provide all viewpoints. while an economic case could presumably be made that revenues may be greater if the print media were not so "left dial" , neither the times nor the individuals comprising the media market are under NO obligation to serve all viewpoints.

I don't like leftist dominance in the media - but here is the simple solution. You don't like it - go and buy or start a newspaper of your own - and then you may decide to ignore the other 50% of your potential client base much as the current media does with the conservatives within their area of dominance.

Seems more like a marketing choice rather than a market failure!

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Image of gabe
on August 17, 2016 at 19:07:58 pm

For example, it was argued that government failure occurs when government intervention causes a more inefficient allocation of goods and resources than would occur without that intervention.

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Vern Sockalosky

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