(Post Soviet Media Law and Policy Newsletter, Cardozo School of Law, New York, April 1999)

Have Strategic Objectives Been Achieved — And What Should Be the Next Step?

By William Dunkerley

In the wake of last year’s economic collapse, and in the face of calls for reimposing press censorship in some areas, it is apropos to examine how efficacious American media assistance has been and where future priorities should be placed. To date, training programs for journalists and media managers have been hallmarks of the U.S. initiatives.

Most assistance efforts ostensibly have been aimed at fostering the emergence of a free press, i.e., a media with the strength and independence to be able to tell the truth. If you look at today’s landscape with that in mind you will find considerable variance in results across Eastern Europe and the former Soviet Union. Interestingly, there does not seem to be a close positive correlation between the amount of assistance that has been given and the degree of press freedom. Indeed, there is probably a negative correlation.

That is not to disparage the effectiveness of the assistance programs that have been carried out by the myriad of organizations that have received U.S. funding. Certainly, many of them have been quite successful in their own right.

The fault lies with the U.S. government and its failure to sponsor a cohesive array of programs that could synergistically attack the core problems. There has needed to be a serious, strategic plan having a realistic chance of fostering press freedom. Some of the Washington program planners apparently believe what they have been doing was aimed at fostering press freedom. I find it hard to fathom how they could, however. Maybe they simply do not understand media economics, strategy development, or the dynamics of change. But from what I have seen, the needed strategic plan has been absent. A recent promise by Secretary of State Madeleine Albright of $10 million to support the Russian media by, among other things, paying stipends to out-ofwork Russian journalists is testament to how radically off-base things have gotten. Creating just another dependency is certainly no way to encourage the emergence of an independent and self-sufficient media!

What then is the core problem with the CEE/FSU media? It is economic. Consider who pays for the media, anyway. Generally, media operations cost too much for the end users, the consumers, to pay all the costs through subscriptions or fees. Additional revenues must come from somewhere. When a government provides money, office space, etc., the media organizations acquire an indebtedness to something other than truthfulness and other than the interests of their readers/ viewers/listeners. The same thing happens if major sponsorship comes from commercial, industrial, or political organizations. Press freedom becomes a casualty to such forms of support. The media becomes subjugated by its financial overlords. At best, any pretense of press freedom is merely at the largess of those who are paying the bills.

There may be no perfect way to support the media, but advertising revenue seems to provide the best alternative. That is because no single advertiser is consequential enough to seriously sway a media organization from a position of editorial integrity. In a typical Western newspaper, for instance, no more than about five percent of revenues come from any single advertiser. This multiplicity of revenue sources is what gives media organizations the strength to resist requests for coloring the news, and to see their readership/audience as their primary constituents.

But if media organizations are to be supported by advertising revenue, where is all this advertising money going to come from in many of these CEE/FSU countries? That question brings us close to the heart of what media assistance efforts should have been concerned with all along.

A free press is a creature of a free economy. When people are free to make economic choices, like choosing from among fairly competing products and services, a need for advertising arises. That in turn gives rise to an economic need for the media. Therein lies the best means for supporting a free press. And therein are created the circumstances, the primordial soup if you will, from which a free press can emerge. In economies where there is still an overabundance of state ownership, where legal structures oppose or retard economic freedom, where there are disincentives to advertising, and where the existence of monopolies (state or private) is perpetuated, there simply is no economic basis for a free press.

In Russia, for example, tax law limits the amount any enterprise can spend on advertising to five percent of its turnover. Expenditures beyond that limit are not tax deductible. This has a depressing effect on advertising expenditures, and thus on media revenues as well. Newspapers are limited to forty percent advertising content. Otherwise they face higher taxes and distribution expense. That limitation in itself makes profitability hard to attain. Laws like those create a legal framework that is very hostile to press freedom.

Without the essential environment for a free press, no amount of training journalists will serve as a substitute. All of the media’s problems are not economic. But without a resolution of the economic problem, there can be no real resolution to the media’s problems at all.

There is a new media assistance proposal I would like to call attention to that really represents a breath of fresh air. Recently I had a chance to read a document entitled Russian Newspaper Crisis Recovery Program authored by the National Press Institute in Moscow./1 This plan is brilliant. It explains clearly why the media’s problems must be solved at a sectoral level, and it proposes a collection of initiatives that could make a real difference. With little modification, the plan could serve as the basis for making considerable headway toward press freedom in Russia and can be a blueprint for what to do elsewhere, as well. Now, it is up to the United States to support it. Lamentably, I do not predict an enlightened approach, however. To be truly effective, the plan must be implemented in its entirety, and not in a disjointed, dismembered, piecemeal fashion that would be all too typical.

The last thing that is needed is more unorchestrated programs that do not add up to a solution. Initiatives need to have an honest chance at bringing about fundamental change. Otherwise they are counterproductive in the long run. The inappropriate aid that has been offered to date has simply given opportunity for forces that oppose press freedom to take hold and has disheartened the real reformists who have tried the mistaken advice we have offered only to find success ever so elusive. It seems to me that if we cannot get it right, it would be better if we just got out of it. However, I hope we will get it right . . . finally.

Note: /1. National Press Institute (Moscow) & The Center for War, Peace and the News Media, Russian Newspaper Crisis Recovery Program (1998).