Wednesday, July 30, 2008

Journalism As Social Business?

What a month--nothing but travel and work, work, work. Now I am in Laguna Beach, California, working with a team of four authors on their business book. (Never worked with four authors on a single project before--quite a job to reconcile all their different viewpoints and styles. I've more or less decided that the solution is to let them fight everything out among themselves and then pick up the pieces.)

Anyway, this is a moment of lull while the group of us eat leftover Chinese food and read my draft of chapter 2, so I thought I would catch up on a little of my long-overdue blogging. Here's an item I've been meaning to write about for the longest time. After discussing how much trouble newspapers have been having making a profit in recent years, Ezra Klein writes:
. . . the news, like other things in life, should not be seen as a straight commodity. It is not there to turn a profit. It is there to keep our democracy healthy and our public informed. If that means it can't be appropriately subsidized through advertising, and needs public subsidies in a blind trust, or some sort of philanthropic revenue scheme, then so be it. Other countries do this, and do it well. But either the way, the bottom line should be that if it turns out that responsible news reporting isn't profitable, then we should sacrifice the profitability, not the responsible news reporting.
I think this is about right. In fact, I've saved this passage to quote because it ties in with a pet idea of mine, which is that executives in the newspaper business ought to be looking at Muhammad Yunus's social business as a financial model.

The idea behind social business, as you may know, is that a company could be run so as to be self-supporting, generating enough income to cover costs and support expansion (if any), but not throwing off profits. Being set up in this fashion reduces the financial pressure on social business managers and allows them to focus on their primary mission, which is to provide some product or service that benefits society. (In the case of newspapers, that service would, of course, be providing honest information about local, national, and world events that helps readers be better and more powerful citizens.)

If implemented properly, this business model also frees managers from the different pressures they'd be under if they were running a traditional NGO or charity--especially the pressure of raising funds through donations, foundations grants, and the like.

In our book Creating a World Without Poverty, Yunus assumes that the primary purpose of social business would be help the poor--the purpose, of course, for which his Grameen Bank (itself a kind of social business) was founded. But it seems clear to me that honest journalism also offers a social benefit that deserves and needs to get out from under the burden of profit-making. I'd love to see someone with the power to implement this idea starting to think about it.

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