Is it fair to say that the report’s attitude towards that sector is to free things up, allow more movement and innovation, and to just get out of the way of change there?
That is fair. We started off with the premise that the nonprofit sector really is going to be an important element. That, I think, is one of the more important conclusions. Then we go, okay, well, what can we do about that? We first look at obstacles, the low-hanging fruit. People are trying to do incredible, creative things, and we should at least not make it harder for them.
There are a couple of things here. There is the big one: universal broadband and an open Internet. You have to get that right and you have to keep pushing ahead on that if you want to have digital news models to work. That’s important despite being obvious.
Then there is the tax issue. One of the things we tried to be careful about relates to a joke you’ve probably heard. A drunk is looking for his car keys under a street lamp and someone asks why he’s looking for it there. He says, “That’s where the light is.” You don’t want to assume that FCC solutions are the answer to all problems just because that’s what you have handy. If it turns out that tax issues are actually the bigger obstacle than FCC rules, rather than pretending that it’s really FCC rules, we just thought, “Let’s talk about tax rules.” [One recommendation is for changes or clarifications to the US tax code to streamline donations to nonprofits and make it clearer what qualifies as a nonprofit.]
We had enough people tell us there were these inconsistencies that it made us worry. We felt like it was a little outside of our expertise to get all the way granular, to say, “Okay, change section XX ” But it was clear that the tax issues were important, it was clear that they were potentially an obstacle to innovation and that we needed to get to the next level. (You might have seen that the Knight Foundation and Partners have announced a task force to figure out the tax issue and make recommendations, which is great. That’s exactly the right next step.)
Hopefully, that will lead to clarifications from the IRS or maybe legislative changes if that’s necessary. It’s a little hard to know. It’s like a slow-motion recommendation where it could end up being anything from a minor thing to a hugely important recommendation, but we won’t actually know for six months or something like that. We’ve sort of launched a process that could lead to something important but we won’t really know.
Another obstacle was revenue. It doesn’t relate only to nonprofits but the solutions are slightly different with the nonprofits than they are with commercial guys. There is some disappointment that we didn’t come out with a recommendation for a big new national government spending fund that would give grants to nonprofit news websites, the way the Downie-Schudson report did. But I think we came up with some ideas that could achieve some of the same goals and potentially actually happen.
It’s a fair question to ask: Aren’t reports supposed to plant a flag all the way out here, and not worry too much about what’s achievable right now? I think the answer is that there are different kinds of reports. There are some reports that should do that, particularly if you’re independent and not really worried about what you’re going to achieve this year or next year, you’re more trying to establish an argument for a long-term change in thinking. We were more focused on pragmatic solutions that could have an impact soon, and could have a chance of happening.
One of the big lines of the report is that “Government is not the main player in this drama.” Is that concept a core philosophical belief or is that something driven more by pragmatism?