Should newspapers be nonprofit?
The Wall Street Journal reported yesterday on commentary this week from Warren Buffet and Charles Munger. The investor Mr. Buffett stated “For most newspapers in the United States, we would not buy them at any price…They have the possibility of going to just unending losses.”
Mr. Buffet explained that newspapers were no longer essential to people as people have other options for obtaining news.
Mr. Munger called the decline of major newspapers “a national tragedy….These monopoly daily newspapers have been an important sinew to our civilization, they kept government more honest than they would otherwise be.”
Newspapers that have failed or are failing include The Seattle Post-Intelligencer, The Rocky Mountain News, The Baltimore Examiner, and the San Francisco Chronicle. The Philadelphia Inquirer and Atlanta Journal-Constitution posted double-digit percentage circulation drops. Many of these newspapers and other newspapers are in bankruptcy protection.
Some people are suggesting that newspapers seek nonprofit status to survive.
Senator Benjamin Cardin of Maryland has introduced The Newspaper Revitalization Act as a bill to Congress. The legislation would “allow newspapers to operate as nonprofits for educational purposes under the U.S. tax code, giving them a similar status to public broadcasting companies.”
Senator Cardin stated, “We are losing our newspaper industry. The economy has caused an immediate problem, but the business model for newspapers, based on circulation and advertising revenue, is broken, and that is a real tragedy for communities across the nation and for our democracy.”
Newspapers would still be able to obtain advertising revenue with nonprofit status, but they would not be able to endorse specific political candidates.
What do you think? Should newspapers be accorded nonprofit status if they seek it? Comment below.