In an interview with the editors of the Pittsburg Post-Gazette and Toledo Blade, President Obama indicated his willingness to “look at” bills before Congress that would give tax breaks to struggling news organizations if they restructured as non-profits.

Sen. Ben Cardin (D-Md.) has introduced S. 673, the so-called “Newspaper Revitalization Act,” that would give outlets tax deals if they were to restructure as 501(c)(3) corporations. That bill has so far attracted one cosponsor, Cardin’s Maryland colleague Sen. Barbara Mikulski (D).

“Journalistic integrity, you know, fact-based reporting, serious investigative reporting, how to retain those ethics in all these different new media and how to make sure that it’s paid for, is really a challenge,” Mr. Obama said. “But it’s something that I think is absolutely critical to the health of our democracy.”

True, fact-based reporting is absolutely essential to our democracy. Newspapers in particular are in trouble. Many people get their news from television, radio or the web. Most all newspapers have followed this trend by moving part of their operations to the web The Toledo Blade reports in its web article that

“Across the country, newspapers are struggling to maintain readership and advertising revenue that has been lost to the Internet. Thousands of journalists have been laid off, and over the last year several newspapers have closed.

“The Rocky Mountain News in Denver ceased operations, the Seattle Post-Intelligencer now publishes only on the Internet, and several large newspaper corporations have filed for bankruptcy, including the Tribune Co., owner of the Chicago Tribune and the Los Angeles Times.”

So, the solution floating around Congress is to have the newspapers restructure as non-profits? The tax breaks would help them survive in economic tough times, maybe. But there is much more at stake here. The IRS rules for 501c(3) corporations clearly state:

Organizations described in section 501(c)(3) are prohibited from conducting political campaign activities to intervene in elections to public office.[19] The Internal Revenue Service website elaborates upon this prohibition as follows:

“Under the Internal Revenue Code, all section 501(c)(3) organizations are absolutely prohibited from directly or indirectly participating in, or intervening in, any political campaign on behalf of (or in opposition to) any candidate for elective public office. Contributions to political campaign funds or public statements of position (verbal or written) made on behalf of the organization in favor of or in opposition to any candidate for public office clearly violate the prohibition against political campaign activity. Violating this prohibition may result in denial or revocation of tax-exempt status and the imposition of certain excise taxes.

“Certain activities or expenditures may not be prohibited depending on the facts and circumstances. For example, certain voter education activities (including presenting public forums and publishing voter education guides) conducted in a non-partisan manner do not constitute prohibited political campaign activity. In addition, other activities intended to encourage people to participate in the electoral process, such as voter registration and get-out-the-vote drives, would not be prohibited political campaign activity if conducted in a non-partisan manner.

“On the other hand, voter education or registration activities with evidence of bias that (a) would favor one candidate over another; (b) oppose a candidate in some manner; or (c) have the effect of favoring a candidate or group of candidates, will constitute prohibited participation or intervention.

“The Internal Revenue Service provides resources to exempt organizations and the public to help them understand the prohibition. As part of its examination program, the IRS also monitors whether organizations are complying with the prohibition.”

If newspapers or other news outlets re-form as 501(c)(3) corporations, the above rule could severely inhibit their reporting of news regarding candidates for elected office at any level. This could be the beginnings of State-run news agencies. While the rule apparently would allow reporting on a non-partisan level, who will be deciding what is non-partisan? The current administration considers any dissent by the people as racist, mob mentality, and un-American, to name a few. Given this climate of disregard for the peoples’ opinions and wants, it isn’t hard to believe that state-controlled media is but a short step away.

 

 

 

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