Paul Starr, the Stuart Professor of Communications and Public Affairs at the Woodrow Wilson School, testified to the Joint Economic Committee of the U.S. Congress September 24 during a hearing titled, "The Future of Newspapers: The Impact on the Economy and Democracy."

Representative Carolyn Maloney (D-NY), Chair of the Joint Economic Committee, convened the hearing to examine contraction in the newspaper industry, the economic impact of the changing media landscape, as well as the future of the industry at large.  Expert witnesses called to testify discussed funding alternatives for print media, and the outlook for the industry.

Starr testified that, “chiefly because of [the internet’s] indirect effects on newspaper advertising revenue, the internet is also undermining the financial basis of the press. The question that we now face is whether there ought to be changes in law and policy to provide support for journalism not as a special favor to the news media, but to advance the general interest in an informed public.” (The text of Starr's complete prepared testimony is available here.)

As part of his prepared testimony Starr explained, “Ever since the founding of this country, newspapers have been Americans’ principal source of news. After broadcasting developed—and even as new media have emerged in recent years—newspapers have continued to do most of the original reporting in states and cities around the country.”

The press, Starr asserted, should not be regarded “just another industry.” Rather, he stated, since the founding of the United States the government "has sought to advance it because a democratic political system cannot function without diverse, free, and independent sources of news.”

Because of the decreasing sources of advertising revenues for newspapers, increasingly, Starr told the Committee, “the production of news will require subsidy, and the question is really from where and under what conditions that subsidy will come. The problems that this challenge raises are difficult because of the legitimate concern that any subsidy, whether from government or private philanthropy, may induce subservience and dependency in the press.”

To maintain the freedom of the press, Starr said, “any public support for journalism in the United States must be approached with great caution, and it seems to me at least three principles ought to be kept in mind.”

First, Starr asserted, “any subsidies must be viewpoint-neutral; they cannot favor one viewpoint over another. Second, they should be platform-neutral—they should not favor print media over online media, for example. And, third, they should be neutral or at least reasonably balanced as to organizational form.”

In other words, subsidies “should not favor for-profit over nonprofit organizations, or vice versa,” Starr told the Committee. “To be sure, some policies by their nature may benefit one type of organization, but the sum total of policy should be indifferent as to whether news is provided via a for-profit or nonprofit enterprise.”

As a caution Starr noted that direct grants “might allow for political manipulation of the flow of funds, unless there was some intervening, professionally run organization strongly insulated from political control. The public broadcasting system offers a model, and rather than create an entirely new structure, Congress might simply broaden the mandate of the one that exists.”

Starr also pointed out that “Indirect forms of subsidy through the tax system also ought to receive consideration,” such as, he said, “an exemption from the payroll tax. To be platform-neutral," Starr stated, “this tax exemption would have to apply not just to newspapers, but to journalistic organizations more generally.”

The Joint Economic Committee is a bicameral Congressional committee composed of 10 members from each the Senate and the House of Representatives.  There are 12 Democrats and eight Republicans on the Committee.  The Committee was established by the Employment Act of 1946, and its main purpose is to study of matters relating to the U.S. economy.