CN Oct. 17, 2013


In our democracy, Bob McChesney says, “the range of debate goes from GE to GM.”

In Dollarocracy, a new book written with his colleague John Nichols, there’s a direct line from Citizens United to the just-ended government shutdown. People who contribute a few hundred bucks or perhaps a thousand to their candidate can still do so, but now billionaires can, and do, “invest” hundreds of millions in their favorite politicians. And the politicians the rich folks like best are the ones who vote to cede more and more power to corporations.

It’s not new. These battles between common folk and big business were waged in the nineteenth century. But much of the 20th century was different, McChesney says.

“From 1900 to 1970…there were pitched political battles in the progressive era, the New Deal, the Great Society of the 1960s. And democracy actually won a lot of these fights. We made this a better country. We made it possible for there to be Social Security and unemployment insurance. We had the right to have trade unions. We expanded public education so that working class people in many cities in this country could get decent, sometimes even first-class free education. We expanded higher education so that we had a larger percentage of our younger people going to four-year colleges than anywhere in the world. These were great victories. These were difficult fights. These came through the expansion of the vote, from people organizing, the civil rights movement, the voting rights act, and by 1970 America was a very different country than it is today, or than it had been fifty years earlier.”

But this didn’t go unnoticed, McChesney says. “There was one group of Americans who hated that. And that was corporate America.” The book covers in detail a memorandum written for the fifty top corporate leaders in 1971 by Lewis Powell, who would later become a Supreme Court Justice.

“His memo said basically to corporate CEOs, we have to take over the government again. The problem with American democracy is there’s too much democracy…and so after that memo we saw a ten-times increase in corporate lobbying in Washington within two decades.”

A major part of our discussion centers around how big money is changing, and limiting, the Internet.  Internet advocates insist that it will continue to change everything. That the change will not only be profound, but profoundly good for us all. It will transform us all into journalists and allow us to feed from an unprecedented cascade of wisdom and enlightenment. As McChesney sees it, some have benefited, but it’s the usual beneficiaries.

“If you look at the Internet, it’s produced a tremendous amount of wealth, but it’s concentrated in a small handful of companies. And what the Internet does, unlike other industries, is it’s winner-take-all economics. If you get the lead in a network, likeGoogle Search, or Apple or Amazon, you tend to have complete market domination. So of the thirty largest, most dominant companies in the country today, twelve of them are Internet monopolies.”

And the wealth they’ve amassed, he says, is staggering. Most of the companies we associate with Internet success – Apple, Amazon, Microsoft, Google, Facebook, eBay, AT&T, Verizon and Comcast – most of those companies have market share in their core area equal to or greater than John D. Rockefeller had with Standard Oil in the late nineteenth century.”

These companies, he says, “seem like such great guys because they don’t charge you a lot. The problem is that if you get something for free on the Internet, you’re not the customer. You’re the product.”

At Chicago Newsroom, we care deeply about journalism. The kind of journalism that changes laws, that gets wrongdoers indicted, and that shines light where light is decidedly unwelcome. And it’s that kind of reporting and editing that, because of the economic consolidation gripping the Internet, has become even more vulnerable today.

“The most important thing I think anybody who cares about journalism has got to understand is that the advertising foundation that was the basis of commercial journalism’s success for the last century is dying rapidly,” he explains. “Because advertisers have discovered they no longer need to buy advertising on a web site to reach the audience. They now go through these networks  that find you wherever you are on-line. They don’t care if you’re on the NYT website or the Best Buy website or a sports website. And because of that the revenues that go to support journalism on line have pretty much disappeared.”

In 2003, a newspaper website kept 100% of whatever advertising revenue it could attract to the site, he explains. But today, because of the middlemen, it probably gets about ten cents on the dollar.

“And that means that the commercial model of journalism is actually more alive in the old media – which still sells ads, which still generates resources – and a lot of the journalism we associate with the Internet today is being subsidized by old media. And when that old media declines and goes under there will be no media on-line.”

But doesn’t news want to be free? Won’t a new model of journalism simply replace the old? Here’s what McChesney and Nichols say in Dollarocracy: “We are sometimes told that a world with no paid journalists is a world where we are all journalists, as if this were some sort of great revolutionary accomplishment. Wrong. It’s a world where there are no journalists, or at least not one where that anyone in power has reason to fear.”



About Ken

Ken's the host of Chicago Newsroom. A former news director, reporter and radio program host, he's also a past Vice President of the Chicago Headline Club.
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