Thanks, but no thanks

Most of us have had the experience of declining assistance from well-intentioned, but misguided, friends. The American newspaper industry may need to include U.S. Sen. Benjamin Cardin on its no-thank-you list.

Cardin, a Democrat from Maryland, has introduced legislation that would allow newspapers to be classified as tax-exempt educational institutions. While thanking him for his good intentions, the National Conference of Editorial Writers also has urged him to withdraw the proposal, saying it would do more harm than good. We agree.

If you read anything about newspapers these days, you can't miss the drumbeat of pessimism. Readership and revenues are down and some are predicting the end is nigh (many of those prognosticators are bloggers wishing for a new media order, but that's a topic for another time).

Cardin's bill would help newspapers survive by exempting them from taxes and allowing individuals to receive tax write-offs by donating to newspapers.

That's the good news. The bad news is that the tax-exempt status covered by Section 501(c)(3) of the tax code administered by the Internal Revenue Service also comes with a leash that would seriously diminish an essential role of newspapers — the ability to weigh in on elections and political matters.

Section 501(c)(3) says tax-exempt organizations may not participate in activities that attempt "to influence legislation." It also says the tax exemption is open only to an organization that "does not participate in, or intervene in (including the publishing or distributing of statements), any political campaign on behalf of (or in opposition to) any candidate for public office."

We understand there are those (including some of you, dear readers) who would applaud that idea. But, tax exemption or no, there are few newspapers worth their salt that would sign on a dotted line that requires them to give up their First Amendment right.

It's important in the context of this issue to understand that most newspapers in the country are not failing. Most continue to make a profit — certainly not as much as they once did, but a profit nonetheless. The biggest problems lie with some of the nation's biggest newspapers, situated in large metro areas where there are more information sources and less interest in local news. Small- and medium-sized newspapers are holding their own in an economy that is tough on everyone.

Big, medium or small — we're hard-pressed why a newspaper of any size would agree to forego the right to comment on political issues and candidates on its editorial pages. The editorial writers group rightly points out that the restrictions could apply to news stories as well. At a minimum, newspapers would have to keep an eye on the IRS to ensure it did not cross a line.

We part company with the editorial writers in one regard: The group suggests that if the bill is moved forward, perhaps newspapers could apply for a separate tax-exemption that comes with no political restrictions. We disagree because we think that in general a newspaper should be an extension of the public, with no greater or lesser rights than the members of the community it serves.

Newspapers are going to have to figure out the best options for a secure economic future. Those options should not include intervention by the government, neither through tax favors nor editorial shackles.

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