There has been considerable discussion in the US this week about the financial health of newspaper publishers. Suffering fron significant advertising and circulation declines, the Newspaper Association of America told Congress yesterday that publishers may need government assistance. President Obama has bought into the discussion. Newspapers are covering this story widely, as you’d expect.
While I don’t live in the US, my view is that the government ought not bail out newspapers or other businesses in hard times unless they are prepared to do this across all business sectors. The cherry picking by governments for bail out funds over the years has led to inefficient industries. Look at the auto sector around the world. Look at banks even here in Australia and the support they received over the last year yet the massive profits they continue to report.
Small businesses, like newsagencies, are never on the bail out radar. We are too small and insignificant to be of interest yet we punch above our weight in terms of economic contribution.
So, my view is that governments should stop bailing out businesses, even newspapers if it comes to that. We are in the free market economy which big business wants after all.