Journalists, even the good ones, are perhaps one of the last groups one should seek the counsel of in the debate over media regulation. It’s like asking a policeman about who should investigate wrongdoing in the law enforcement community.

Indeed, ever since the release in February this year of the independent media inquiry, commissioned by the federal government and headed by former Federal Court Justice Ray Finkelstein, journalists have been running around like headless chooks, doing everything but addressing the real issues.

And those issues are that trust in the media in Australia is amongst the lowest in the world; that journalists rank below s*x workers and lawyers in trustworthiness and that newspapers rate well below the ABC as a trusted source. (Essential Media, 2011)

Throughout the debate over Finkelstein, the media and individual journalists have rather dishonestly presented it as a choice between the current system of piecemeal, ad hoc and media-funded newspaper regulation and the full brownshirt model. The histrionics from the editorial writers, particularly against academics, are clearly self-serving. And the inability of many defenders of the  media to put this story in an international context is also telling.

To recap, the Finkelstein Report recommended the creation of an independent statutory body to oversee the enforcement of standards of the news media. The government-funded body would take over the functions of both the Australian Press Council and the news and current affairs standards functions of the broadcast regulator, ACMA.

“The News Media Council should have secure funding from government and its decisions made binding, but beyond that government should have no role. The establishment of a council is not about increasing the power of government or about imposing some form of censorship. It is about making the news media more accountable to those covered in the news, and to the public generally.” (Finkelstein)

In a free-wheeling debate this week on Twitter, I engaged with the widely respected News Ltd economics writer George Megalogenis about the issue  of regulation. His view, conveniently, reflects the House position – that regulation will be a lawyers’ picnic, a step down the road to the erosion of free speech and an opportunity for “vested interests” to “push barrows” (the media, on his view, is never a “vested interest”). Curiously, he also accuses serious critics of merely wanting regulation to silence their political enemies, which seems a rather patronising position to take.

Now debating George about journalism is a bit like undertaking hand-to-hand combat with Mother Teresa about poverty, such is his standing. But I was a journalist too, for 26 years no less. And my field, like his, was economics. So I know how the sausages are made. The difference is I’m outside the media now and I can perhaps see the issues a little more clearly than he can from inside the fence. At least my employment is not at stake.

Again and again in our debate, he talked about not trusting “the government” to regulate the media. To mind, this misconception seems to stem from a lack of understanding between the government of the day and the apparatus of government. Ultimately, the people make the laws through their elected representatives in parliament. (I don’t seem to recall voting for Rupert or Gina or Kerry.)

But put that aside for a  moment. For the most part, I agree with George that editorial independence must be preserved, that market-based solutions are often better and that the first instinct should be self-regulation. But this depends on the existence of a couple of things – firstly, that the market is functioning properly and, secondly, that self-regulation works. In both cases, the answer is negative.

On the first point, Australia has over the years become one of the most concentrated newspaper markets in the world. But it wasn’t always that way. In 1923, there were 26 capital city dailies and 21 independent owners. Today, a single company – News Corporation – controls 65 per cent of the total circulation of metropolitan and national daily newspapers. Fairfax Media has about 28 per cent.

The argument of George’s employer is that “the market” delivers accountability. If people don’t like how his newspaper deals with a subject, they can express their opinion by not reading it. But even those with a cursory understanding of economics know that in a highly concentrated market, these mechanisms do not work. There are few alternatives and consumers have little sway.

The second point is that in capitalism, newspapers are not so  much accountable to their readers as to their advertisers. The clients are the advertisers. The readers constitute the audience whose eyeballs are sold to advertisers. Most journalists find that fact uncomfortable to deal with. But it’s the truth. Just listen to Jack Cowin, the hamburger king whom Gina Rinehart has put on the board of Fairfax. His frank view (and it is a fair summation of how the system now works) is that the purpose of a newspaper is “to portray the facts in a manner that is going to attract readership”.

With the media’s business model busted, the commercial pressures on journalists to massage the facts in a way that panders to their established market’s prejudices are greater than ever. Any argument against regulation needs to take account of this. It is not good enough for George shut his eyes, put  his fingers in his ears and shout slogans about press freedom as an absolute.

Case in point was the behaviour of the  News Ltd papers in their coverage of the federal  government’s carbon pricing scheme. This took the form, particular in the popular tabloids, of a deliberate scare campaign that  misrepresented the facts for both the commercial and ideological interests of their proprietor.

An example, quoted in Finkelstein, was a Daily Telegraph story from May 11 last year, purporting to show the impact on a family’s budget of the carbon pricing scheme. This was before its consideration in parliament and before a carbon price had been set. “The item contained estimates of the extra annual cost of food ($390), power ($300) and petrol ($150) to the family in question. Since the carbon price was at that stage unknown, there was simply no basis for assessing the cost impacts on food, power or petrol. Also the story omitted any reference to the widely mooted income tax cuts.”

The story wasn’t just wrong. It was a fabrication. And a deliberate one. But what recourse has the public when misreporting of this nature is so widespread? The Press Council is widely known to be a lapdog for the newspapers. Its funding is regularly cut and its adjudications are not binding.

The media inquiry listed a number of reasons why self-regulation isn’t working. It divided these two categories. The first was structural  – commercialisation of news, concentration of ownership and the shift to ‘infotainment’. The second category was behavioural – violations of privacy, injuries to the reputations of individuals and institutions, and political partisanship.

My view and the the view of many other serious critics of the current regulatory regime is that it lacks transparency, justice and accountability.

The proposed News Media Council of the Finkelstein report is designed so that it provides “redress in ways that are consistent with the nature of journalism and its democratic role. Like the APC, its members should be comprised of community, industry and professional representatives. It should adopt complaint-handling procedures which are timely, efficient and inexpensive. In the first instance it should seek to resolve a complaint by conciliation and do so within two or three days. If a complaint must go to adjudication it should be resolved within weeks, not months.”

Against this background, it simply will not do for the press to merely shout Abbott-like slogans about “freedom” and reject the ample evidence  that public confidence in the  media is low, that our market is overly concentrated and that self-regulation has failed us.

As a former journalist myself, I recognise all too well the condescension of many journalists such as George to the wider public. It is as if they see themselves as both above it all and separate from the issues that surround the media. And this is part of the problem with the media – their refusal to see their own agency; that their own behaviour is the issue.

That the outwardly most reasonable member of the News Ltd machine should so thorougly refuse to engage with the arguments for more effective media regulation and public accountability speaks volumes in my view.


30 Comments

Alan Sunderland · August 29, 2012 at 3:25 AM

I participated in a forum on this issue recently, and put the view that the LEAST likely outcome was that regulation would create a politicised censor of the media. But sadly, I think the NEXT least likely outcome is that it will actually achieve anything.
Only a media genuinely facing up to its own responsibilities to be ethical will do the trick, and fortunately market forces will increasingly compel the media to do that if it wants to remain relevant and necessary.

Jason · August 29, 2012 at 3:54 AM

Would it be fair to say that the ownership concentration is due to the policy that has allowed it? So instead of focusing on regulation, the focus should be on an overhaul of the media ownership laws, to reduce concentration of ownership and a reduction in overall influence of News Ltd, thereby allowing self-regulation to hopefully become more effective.

Mr D · August 29, 2012 at 4:09 AM

It's chick and egg, Jason. It's hard to unscramble to the concentration omlette when a single company has so much power. But, yes, ideally with a market constituting far more voices, normal mechanisms and self-regulation might work.

Anonymous · August 29, 2012 at 4:15 AM

You have nailed it. The end of the age of the information overlords

Anonymous · August 29, 2012 at 4:21 AM

The most effective solution would be to simply lock up Rupert end of problem , no need for the new rules.
We all know he has been running most of the western economies thru the Limited news system of control & propaganda for years. Treat him like he treats anyone who's personal(illegally obtain)story earns him money, so just do it.

Anonymous · August 29, 2012 at 4:41 AM

It is interesting that you accuse the Daily Telegraph of a fabrication in a carbon tax story. Do they deny it? Have they ever tried to justify the report, or do they just shrug their shoulders and say never mind. The Leveson inquiry in the UK has heard a lot of evidence from people about the tabloids publishing stories that are simply not true. The usual response is to print a tiny correction on page two and move on without a backward glance. They should be ashamed but must have hides like elephants. Because we don't have the same celebrity culture here telling lies about people's private lives isn't such a big deal, but every time I see a story “government sources say” I immediately think “parts of this are made up” The editor of the Financial Times told Leveson that every story needed two sources and in most cases named sources. He was only half joking when he said that even a scoop from the Prime Minister might need confirmation. Try applying that test to just about every story you see in an Australian newspaper.

Anonymous · August 29, 2012 at 4:52 AM

Twitter is the last venue you'd want to conduct any sort of debate in. Impossible to convey complex ideas or develop themes when confined to 140 characters. You end up sounding like an Abbott: communicating in a few syllables per 'over'. Hopeless.

The Australian media is in chronic need of regulation. When partisans can get away professionally unscathed with calling (not once, but five times) for the Prime Minister and others to be put in a chaff bag and drowned at sea, something is terribly, terribly wrong. You wouldn't find that virulent a hate media in Somalia!

Give ACMA real teeth. Teeth to enforce the Commercial Radio Code of Conduct. Change the way ACMA operates so it does not have to wait for unresolved complaints from the public before acting. Give ACMA the powers to initiate inquiries off its own bat for inciteful rhetoric, broadcasting lies and unreasonable partisanship. And make penalties such as suspension of licence available for serious offenses. The idea of ACMA “negotiating” with offenders (as currently) amounts to no more than an exercise in mutual back-stroking. It's a farce.

Rewrite the ABC Charter locking in actual penalties for breaches of impartiality provisions. Too often the ABC fobs off complaints of bias, and the ACMA similarly useless. The ABC should be apolitical and non-partisan, not just in claim but operation.

Aidan · August 29, 2012 at 5:14 AM

“But, yes, ideally with a market constituting far more voices, normal mechanisms and self-regulation might work.”

Didn't work in the UK. The intensity of the competitive tabloid market was given as the reason for their appalling behaviour.

The other problem is profitability. Breaking up the newspapers and other media will just lead to them failing sooner.

Ironically regulation might be News Ltd's saviour, by increasing the trust in which they are held by the community they could potentially have a long term future. Try telling them that.

George has an oft expressed opinion that “journos talking about journos is pointless”. In some circumstances this is true, and if it is done to death doubly so. But I think he is a bit disingenuous in that regard. It is a convenient way for him not to deal with the fact that the editorial position of his paper and many other News Ltd titles has gone a bit loopy and rabidly anti-ALP. They seem to feel like they are in a state of siege and are the loan truth-tellers left. It is a dangerous position to be in, as evidence to the contrary for their world view will just push them further and further into la-la land.

Zvyozdochka · August 29, 2012 at 5:32 AM

Ltd News have discovered that they can create any controversy they want, manage any blow back and people will be back for more.

If fact, the more you attack them, the more rabid their supporters/readers/viewers/reporters/writers appear to become. The only parallel I can think of is that of a cult, and it's a terrible sickness.

We're following behind the USofA by about a decade I reckon and I'm convinced there is no cure for the current generation.

We have to start with the children and teach them Critical Thinking skills. Who benefits from what I am being told?

wilful · August 29, 2012 at 6:03 AM

I don't know if George M is particularly guilty of this, but certainly a lot of finance writers working for News Ltd provide highly biased coverage of their employers parent company shenanigans. Highly unethical.

Also, I assume you've told George about this column, he will get a right reply such as it is?

wilful · August 29, 2012 at 6:03 AM

I don't know if George M is particularly guilty of this, but certainly a lot of finance writers working for News Ltd provide highly biased coverage of their employers parent company shenanigans. Highly unethical.

Also, I assume you've told George about this column, he will get a right reply such as it is?

Fran · August 29, 2012 at 6:32 AM

I'd be pretty happy with a model that focused on the following

a) accuracy — are the empirical claims accurate and presented in a way that is unlikely to mislead?
b) is the story a comprehensive account of all the salient information people need. If space is too short to permit that, does the story confine itself to a non-misleading account of the events, discarding what is impossible to properly explain?

c) have conflicts of interest bearing upon contested claims been fully disclosed?

It seems to me that one approach might be for complaints, when upheld, to be graded in terms of seriousness and for each journalist with a byline to get a running score of upheld complaints weighted by their seriousness over a 3-year rolling timeline. An offence more than 3 years old could be discarded. The same could be done for the journal and the stable. Links to online records of findings, reasoning and the weighting system could be published. Those that went 3 years without a complaint being upheld could get a single star. Each subsequent year they kept their slate clean they'd get another until they got to five stars. If a minor one was upheld they'd lose a star. and this would be recorded by placing a cross through it.

Publications could elect to exclude parts of their copy from review — which would require a special “wash” (perhaps light yellow or blue). A disclaimer would appear saying that the journal offered no warranty as to the integrity of any claim made in this section.

I see no problem at all with such a system as it merely allows for people to make an informed choise as to how much weight to attach to the words of a journalist of commentator.

Fran · August 29, 2012 at 6:32 AM

I'd be pretty happy with a model that focused on the following

a) accuracy — are the empirical claims accurate and presented in a way that is unlikely to mislead?
b) is the story a comprehensive account of all the salient information people need. If space is too short to permit that, does the story confine itself to a non-misleading account of the events, discarding what is impossible to properly explain?

c) have conflicts of interest bearing upon contested claims been fully disclosed?

It seems to me that one approach might be for complaints, when upheld, to be graded in terms of seriousness and for each journalist with a byline to get a running score of upheld complaints weighted by their seriousness over a 3-year rolling timeline. An offence more than 3 years old could be discarded. The same could be done for the journal and the stable. Links to online records of findings, reasoning and the weighting system could be published. Those that went 3 years without a complaint being upheld could get a single star. Each subsequent year they kept their slate clean they'd get another until they got to five stars. If a minor one was upheld they'd lose a star. and this would be recorded by placing a cross through it.

Publications could elect to exclude parts of their copy from review — which would require a special “wash” (perhaps light yellow or blue). A disclaimer would appear saying that the journal offered no warranty as to the integrity of any claim made in this section.

I see no problem at all with such a system as it merely allows for people to make an informed choise as to how much weight to attach to the words of a journalist of commentator.

Johnny Come Lately · August 29, 2012 at 6:46 AM

I think that any journalist (particularly a News Ltd one) who thinks that there is no conflict of interest in reporting on the NBN (which will significantly alter the media landscape and challenge existing business models/power structures) is dreaming.

johnny karas

Anonymous · August 29, 2012 at 8:50 AM

Not true!..If one is to believe the rumours, The Australian is constantly losing money but is propped up by the proprietor to use as a political mouthpiece to support the coalition. This relegates the paper to the status of a political rag and should be judged and censured on that basis!
jaycee.

Anonymous · August 29, 2012 at 8:50 AM

Not true!..If one is to believe the rumours, The Australian is constantly losing money but is propped up by the proprietor to use as a political mouthpiece to support the coalition. This relegates the paper to the status of a political rag and should be judged and censured on that basis!
jaycee.

Shervin · August 29, 2012 at 8:51 AM

The idea that Australians will continue to read their news from traditional media companies is flawed. The internet and blogs will continue to provide an alternative news source. Just like YouTube is competing with Ch 7, 9 ,10 etc.

Just because you have a concentrated market doesn't mean there is a lack of competition. There are always substitutes and people will always be in control of the media they consume.

Shervin · August 29, 2012 at 8:51 AM

The idea that Australians will continue to read their news from traditional media companies is flawed. The internet and blogs will continue to provide an alternative news source. Just like YouTube is competing with Ch 7, 9 ,10 etc.

Just because you have a concentrated market doesn't mean there is a lack of competition. There are always substitutes and people will always be in control of the media they consume.

Notus · August 29, 2012 at 9:38 AM

“the purpose of a newspaper is 'to portray the facts in a manner that is going to attract readership'.”

So the front page nude pictures that were supposed to be Pauline Hansen are OK because the paper made more money than the payout to Hansen (market forces perhaps).

Notus · August 29, 2012 at 9:38 AM

“the purpose of a newspaper is 'to portray the facts in a manner that is going to attract readership'.”

So the front page nude pictures that were supposed to be Pauline Hansen are OK because the paper made more money than the payout to Hansen (market forces perhaps).

sue · August 29, 2012 at 10:59 AM

With George M working for News Ltd, did he believe the “lone reporter” assurance that News gave, readers, regulators and government?
And can George M assure Australia's readers, regulators and governments that the same has not happened here.

Anonymous · August 29, 2012 at 12:00 PM

George M suffers from Stockholm Syndrome.
fred

Ben · August 29, 2012 at 1:19 PM

Hi Mr D,

I greatly enjoyed this post. I'm a regular commenter on George's blog, although we don't always see eye to eye – my knee jerk response is usually liberal (in the american sense), and frankly the amount of power that is now vested in these large media companies frightens me at times. I live in rural Queensland, and it's impossible to get a non-Murdoch paper, and most of it is rubbish; sometimes I think of the coalition as the political wing of NewsCorp, and it seems Fairfax is going the same way. The value of media companies is now not in profit but in ability to sway the political process.

BUT. To play devil's advocate, why would an external regulator help in this regard? If the editors for either commercial or political reasons choose to heavily editorialize the news, how would a regulator prevent them? It is entirely possible to create a news story or a spread of news stories that while *technically* factually accurate don't accurately portray realities, but no amount of regulation would prevent that.

Take for instance climate change. It is trivially easy to have a spread of articles factually reporting talks by 'sceptics', with no reporting of the views of climate scientists. The articles would be accurate, so couldn't fall foul of any regulator.

I suspect here that unfortunately, the medicine won't cure the disease.

Anonymous · August 29, 2012 at 1:51 PM

Yep.
Ownership is the key and until that issue is addressed all else is irrelevant fluff. Mere window dressing.

The oligoply must be dismembered.
That is a necessary, an absolutely necessary, first step.
Anti-trust laws.
Some of the bits have to have a different form of ownership.
Not owned by capitalist corporations as is the present case, or by govt as in the ABC which has become effectively an echo chamber of the other.
A third, or fourth way.
Publicly funded NGOs executive oversight?
The Credit Union concept?

Whatever.

The present system is sick, it requires remedial surgery.

The form of that surgery is where the discussion should be centred, the need for it been long established.

fred

Anonymous · August 30, 2012 at 6:28 AM

If journalists' opinions are ones to be avoided in the regulation debate, you'd be well advised to look at the credentials of those responsible for the “Finkelstein Report”. It was in fact co-written by a journalist, Matthew Ricketson. The other two people with significant input into it were Denis Muller, a journalist, and Rodney Tiffen, a political scientist with considerable journalism experience. By the Denmore rule, we need to ignore the “independent media inquiry”.

One other point: the Press Council funding is not “cut regularly”: it was cut once, during the GFC, and had returned to the pre-GFC level of funding by 2011. Its funding was recently doubled.

Mr D · August 30, 2012 at 8:23 AM

Anonymous, on your two points:

1/ Ricketson is an academic now, not a working journalist whose income is dependent on a media company. Dennis Muller left newspapers in 1993. Tiffen is an academic. My point was about working journalists such as Megalogenis whose arguments bear a striking resemblance to those of his employer.

2/ In March this year the Press Council president Julian Disney said the constant threat of funding withdrawal was a “spectre hanging over the organisation”.

Anonymous · September 3, 2012 at 7:49 AM

Given the circulation figures I'd say the readers are voting with their feet.

Perhaps the point George Megalogenis is failing to see, is that Finkelstein might save the media from itself.

Anonymous · September 4, 2012 at 11:05 AM

It's not necessary for the two sources to be printed. It means that at least two sources for every fact should be found — that's part of professional journo training, in NZ, and in Australia, as well as in the UK. Of course, there are also journalists working who unfortunately have never been properly trained.

Anonymous · September 4, 2012 at 11:06 AM

And you know this how?

Anonymous · September 5, 2012 at 10:32 PM

“I see no problem at all with such a system”

Apart from it being completely impractical and hideously expensive to implement at a time when media organisations are under intense financial pressure, no problem at all.

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