• by Erik Sass  @eriksass1, July 6, 2012

While Rupert Murdoch may be distancing himself from his newspaper properties to avoid charges of undue political influence, the general trend is actually heading in the opposite direction. The wave of acquisitions sweeping the beleaguered newspaper industry threatens the editorial independence of some publications.

It’s not news that newspapers are in a fairly desperate state in the U.S. and some other parts of the world. From 2005-2011, total U.S. newspaper advertising revenues plunged 52% from $49 billion to $24 billion, and the medium is headed for another round of losses in 2012. In this dire financial situation, many corporate owners are eager to divest themselves of properties whose diminishing profitability could vanish altogether in the not-too-distant future. That opens the door to potential buyers with motives that are less than noble.

Of course, newspapers have always influenced business and politics.

In the 19th century, most U.S. newspapers were founded as mouthpieces for political parties, a history that is still reflected in names like the Tallahassee Democrat or The Republican of Springfield, MA. Well after the professionalization of journalism and enshrining of objectivity in the early twentieth century, most big newspapers still have an opinionated editorial board that airs their views in the op-ed pages. Nor is it uncommon for supposedly objective reporting to carry an ideological tinge.

But the latest round of deals, with newspapers going for rock-bottom prices to buyers with overt political agendas, represents a new level of adulteration.

The most prominent example of this is the recent acquisition of The San Diego Union-Tribune by real estate developer Doug Manchester, who has openly stated that he intended the newspaper to be a “cheerleader” for a new downtown stadium, which would also “call out [opponents] as obstructionists.” The paper’s new CEO, John T. Lynch, told The New York Times: “We are doing what a newspaper ought to do, which is to take positions. We are very consistent -- pro-conservative, pro-business, pro-military -- and we are trying to make a newspaper that gets people excited about this city and its future.”

Since Manchester took ownership of the newspaper it has investigated public agencies that get in the way of the stadium project, including the Port of San Diego. In early June, it fired Tim Sullivan, a longtime sports columnist who had criticized the stadium plans, on the flimsy pretext that he wasn’t on board with the publication’s new media strategy.

Indeed, the real threat to editorial independence doesn’t come at the national level -- where overt meddling is likely to attract unwanted attention, but at the local and regional level -- where real vested interests are at play and newspapers are simultaneously at their most vulnerable.

On the other side of the political spectrum, despite his protestations to the contrary, it's not hard to imagine Warren Buffett’s oft-stated views trickling down into some of his newly acquired properties. His decision to buy the Omaha World-Herald was widely lauded as civic-minded hometown boosterism, but the fact remains that the city’s daily paper is now owned by the city's richest businessman -- who appears in its pages with some regularity, occasionally in connection with local policy debates.

The phenomenon is not limited to the U.S. Australia's largest newspaper publisher, Fairfax Media, is fending off a takeover bid by Gina Rinehart -- the scion of a mining dynasty who is also the country's richest woman, with a fortune of $18.6 billion. Critics are afraid that Rinehart could turn Fairfax properties -- including the Sydney Morning Herald -- into corporate mouthpieces in her fight with the Australian government over mining regulations, especially its planned carbon tax.

Fairfax has been afflicted by the same technological and financial forces that humbled its U.S. counterparts over the last decade. in June, the company announced it would cut 22% of its staff, trim its newspaper sizes, close some production facilities, and begin charging for digital access. The company predicts an 8% drop in revenues in the second half of the year.