POLITICS: Oregon SB 686 would Raise Taxes on Digital Services to Subsidize Newspapers – USSA News

Oregon is considering a bill that would tax digital services providers – including tech companies like Google, Meta, and X – to subsidize local news outlets. The tax would not only punish successful American companies but also use the money to turn local media that should investigate politicians’ corruption into compliant captured media.

The stated justification for the tax is that it is a fee for access to the content newspapers produce on these platforms. The state would serve as the intermediator exacting the pound of flesh from the independent platforms and showering the largesse on their pet newspapers. The legislation isn’t a new idea by any means. This has been seen before in Canada, Australia, and California.

If passed, this bill would effectively turn local newspapers into state-funded media. If the social media platforms are paying these taxes to the state and then these funds are distributed to local news, these newspapers will have a conflict of interest and be beholden to the state for a major source of their income. Even if tech platforms are the source of the funds the newspapers will receive, the government remains the delivery method of those funds to the newspaper. State-funded media corrodes at the fabric of our free democracy and will give an unfair advantage to these newspapers that qualify for this funding. No media outlet is immune to influence from their paymasters. 

The conflict of interest should be obvious – politicians would have leverage over what information flows on social media through the taxation power and over what journalists report through their subsidies. Anyone who values a free press should be against this.

The bill would also be counterproductive to its stated goal. By taxing these tech companies for their use of local news and media stories, their current mutually beneficial relationship will be upended, and the result will be an even faster decline of local news. If this bill were to pass, tech companies could easily choose to pull all local news from their platform and avoid the tax. What was intended to prop up the local news industry could easily turn into the vehicle for its demise. As a spokesperson for Meta said of the bill:

If faced with legislation that requires us to pay for news content that publishers voluntarily post and is not the reason most people come to Facebook and Instagram, we will be forced to make the same business decision in Oregon as we did in Canada and end news availability on these services.

Additionally, many members of the state legislature have raised concerns that this bill would violate the state constitution and are weary of the state leaping out into uncharted legal waters. Senate Minority Leader Daniel Bonham spoke out against the constitutionality of this bill:

It absolutely violates the Constitution, in my opinion. I am no constitutional scholar, but I’ve read the document, and I’ve read our oath of office. And I don’t see how we could put this forward with the explanation that we’ll let the courts decide with the evidence that we have from our own paid attorneys.

There is no doubt that local journalism is an important and irreplaceable institution. The decades-long decline of the industry will not be reversed by legislation like this which will penalize the very companies that promote their awareness and viewership. Large platforms offer a wider audience to local publishers and risking this relationship by trying to tax these platforms will not be what saves local news in Oregon.   The solution for local news will not come through taxation of the platforms that boost their viewership or being captured by funding from the state, provided by the very politicians they cover. It is imperative that Oregon reject Senate Bill 686.