Do newspapers need government bailouts?

New Hampshire’s guarantee of a $250,000 line of credit for a local newspaper freshly emerged from bankruptcy is raising fresh questions about whether media outlets which receive government assistance can remain independent, and whether government should offer such assistance at all.

Last week the state’s Executive Council agreed without debate to a Business Finance Authority guarantee of 75 percent of the line of credit from Connecticut River Bank for the Claremont Eagle Times, which had closed in July as it went into bankruptcy and reopened October 12 after being purchased by Eagle Printing & Publishing LLC.

“Because the New Eagle Times is now beholden to government officials for what appears to be crucial financing, this could prove to be a conflict of interest for the newspaper,’ Claremont city councilor Jim Sullivan wrote on his blog last Friday. “Will Eagle Times reporters treat government officials with a velvet glove? Because so far that seems to be the case!’

The paper’s publisher, Harry Hartman, initially denied knowledge of the state guarantee, which the bank had applied for. Later he would say that concerns had been overblown by his competitors and that the paper may not even need the line of credit. He said he expects the paper to turn a profit this month.

“I’m hoping that readers understand that we’re not beholden to anybody,’ he told the Associated Press. “No one gets deferential treatment in our newsroom.’

Other states are considering similar guarantees or direct financial assistance to newspapers struggling to stay alive in an environment where people expect to get news online for free. Such deals may be attractive to politicians, who often have an adversarial relationship with the news outlets that cover them, but could result in readers losing trust in the bailed-out news outlet.

“Even if the paper covers government officials critically, readers may still have their doubts about whether they are getting the full story,’ Stephen Farnsworth, professor of communication at George Mason University, told the AP.

The deal is the first of its kind in recent memory, though the earliest American newspapers received government subsidies.

“The idea of subsidizing newspapers even though the words come off the tongue almost hesitantly is actually very well accepted in American historical tradition,’ Jack Lule, a journalism professor at Lehigh University, told the AP. “We’re at a point in our history now where it seems foreign to us but actually we can find a lot of examples of that, and I do believe it’s part of our future.’

I have a different theory. Let us remember that back then, journalism was something quite different. It looked, in fact, much more like today’s blogs: highly opinionated, often inflammatory, sometimes bordering on libelous. The colonies, then, were subsidizing the opinions they wanted printed, and often, shutting down the newspapers they didn’t like. Should this be our future, tomorrow’s journalism may look like yesterday’s.

As New York University associate professor Clay Shirky has said, the nature of journalism itself is changing, ad-supported print media was a historical accident which the Internet is about to destroy, yet investigative journalism of the type news outlets have been cutting lately is critical. He urges experimentation to see what works and what doesn’t.

Government bailouts certainly won’t work. No politician in their right mind is going to give tax money to a newspaper so that it can turn around and investigate him, and as we’ve seen with the auto bailouts, once government is giving you money, it tends to come with strings — or nooses — attached. If a newspaper wants to survive, it’s going to have to try new and different ways to monetize its content, not to mention provide content that people want.

Speaking of which, as of today the Eagle Times web site is still offline, a month after the paper restarted its printing presses.