The overwhelming bulk of Canada’s media is bought, and paid for, by the federal government. In particular, by the Liberal Party which has extended generous taxpayer subsidies to outlets that comply with its diktats.
In its 2019 budget, the federal government rolled out nearly $600 million in subsidies for select media outlets that obtain the federal government’s approval. The latest $600 million cheque is meant to fill a blind spot in exerting government influence over the Canadian print and online media.
This was a ‘blind spot’, because most of the rest of the Canadian media is already on the take.
Magazines receive large subsidies to defray the costs of printing, and mailing. Massive “regulatory subsidies” give a cornered market to the government’s favoured broadcasters, and make entry by competitors (like the late Sun News Network) virtually impossible.
The elephant of government media control is obviously the CBC, with an annual bill to taxpayers well in excess of $1 billion.
By handing nearly $600 million directly to select newspapers, the government isn’t doing anything new. It’s just extending the control that it had over other mediums, to traditional mainstream newspapers.
To dole out the cash, the Liberals created a handpicked panel, giving the bailout an appearance of distance from direct partisan intervention. Unsurprisingly, the panel was stacked with Liberal allies, some quite openly so.
In August, Winnipeg Free Press Publisher and Liberal media panelist Bob Cox, awarded himself a large grant from the $50 million Local Journalism Initiative. He cut himself the cheque to hire two new reporters, including a “climate change correspondent”. What that reporter does all day is anybody’s guess, but that “reporter” owes his or her own job directly to the Liberal government. Can we expect that person to do anything but toe the party line? For all intents and purposes, this person is an employee of the federal government. And not a reporter.
Even those not directly hired with a large grant in the print business will owe a large portion of their take-home pay to the federal government. The Journalism Labour Credit allows the orwellianly-named “Qualified Canadian Journalism Organizations” to apply for a 25 per cent refundable tax credit, with a cap of $13,750 per employee.
This puts even credible and reputable reporters, columnists, editors, and publishers in a massive conflict of interest.
MacLeans and iPolitics columnist Stephen Maher wrote in June 2019 that since everyone else is getting bailout out, why not the media?
“The public policy argument for some kind of measure to shore up public interest journalism is clear as day. For good or ill, the federal government has long been in the bailout business. Taxpayers spent $3.5 billion bailing out automakers.”
The auto bailout was actually $17 billion, but he has a point. In crony capitalism, every rent-seeking business needs to get their hands in the pie or risk paying the bill for it. But he is wrong on the necessity of.
“Federal governments routinely act to protect important parts of the economy. When an industry is important enough to our society, Ottawa is forced to act. Banks. Farms. Airlines. Airplane manufacturers. Oil companies. Every significant sector is subsidized or bailed out in one way or another. Few industries are as important to our society as the news media, but so far the government has done nothing but consult.”
The Liberals cut a $595 million cheque soon after, but I can’t recall an oilfield bailout.
The media is important. Without it, the only voices would be the official government line, and Karen on Twitter. But at what cost are we willing to keep the legacy corporate media afloat?
“Andrew Coyne and Paul Wells argue that if the government starts to pay our bills, we will inevitably start to suck up to governments, or at least to government,” said Maher. “I’m not so sure…An awful lot of our media is already subsidized, either directly by government, like news magazines, or through CRTC-mandated cable fees and industry funds, like TV news.”
Again, Maher is correct in that most of the other mediums of media are propped up by the government. His case that all of these other mediums are objective, fair and non-partisan is a bit flimsier.
Most of the media miss the point in boiling media objectivity down to a matter of partisanship. Whether a media outlet is Conservative, Liberal, or NDP is only semi-relevant. Where a media comes down on issues, policy, and ideology, is much more so.
Liberal media outlets like the Toronto Star were glowing of Stephen Harper’s Conservative government when it enacted ideologically liberal, interventionist policies like the auto bailout. Their only criticism was that it wasn’t enough. Similarly, conservative media outlets praised the Chretien Liberal government in the 1990s when it slashed spending to slay the deficit, as conservatives wanted.
Where a media outlet stands on the issues is a lot more important than where it stands on partisanship.
When every major media outlet in Canada is directly on the government take, this cannot help but to influence their coverage toward issues. Can the National Post credibly make the case against the next Bombardier bailout if it is receiving an annual, guaranteed bailout of its own?
And are the media organizations that are already receiving government-backing (like CBC, CTV and Global) immune from the influence of being on government support? Name one of them that is even mildly conservative or libertarian.
When Stephen Harper cut the CBC’s $1 billion budget by 5 per cent, the network launched a holy war against him. When Justin Trudeau promised a massive increase to their budget, they hailed him as the Second Coming (which, in a sense, he was).
There is a small but growing list of upstart alternative media entering the market. Most will not qualify for government funding, likely by design. The Liberals tied themselves into pretzels to prevent Ezra Levant’s Rebel News from qualifying. This was a bad idea for several reasons.
First, if Rebel News did qualify, and did accept the money, it would have blown its reputation as an outsider media outfit, righteously blasting the mainstream media for its complacency. In all probability, Rebel News would have refused the money if it was available for that reason. Much the same as the Western Standard.
Second, by creating a regulatory rat’s nest to exclude Rebel Media, they made it much more difficult for other up-and-coming alternative media sources to compete with the big, dying, legacy media sources. By advantaging the media outlets whose business models are failing them, the government gives them a massive competitive edge over their new challengers in the market.
The Liberals tweaked this a bit by giving themselves an even greater latitude in selecting which favoured media outlets qualify, by creating a government media licensing program. Only “Qualified Canadian Journalism Organizations” get in on the good times.
In addition to creating artificial advantages for some media sources over others, they have also gone down the dark, authoritarian road of deciding who is a “real journalist”, and who is not.
For our part, the Western Standard will not be registering for a government media license, and we will not be accepting bailout dollars. This puts us at a legally designed, permanent competitive disadvantage with our competitors. But as the publisher and primary owner, I would rather go bankrupt than corrupt ourselves for thirty pieces of silver.
Trudeau’s media bailout will not save the newspaper business. It will put it in a complacent, comatose state on life support, fearful that if it acts against its master, that the plug could be pulled at any time.
Derek Fildebrandt is Publisher of the Western Standard and President of Wildrose Media Corp. firstname.lastname@example.org