Vox Media Criticizes Government Subsidies — But Took Them
‘Media on a government dole’ raises questions about independence and more
Vox Media, the new media company that owns progressive news outlets Vox and Polygon, has accepted taxpayer-funded business subsidies from the state of New York.
The subsidies were authorized under something known as the Excelsior Jobs Program. Payments to a firm can extend for up to 10 years, and companies must meet specified job and investment thresholds. Once a company meets the threshold, it can claim refundable tax credits equal to 6.85 percent of the wages paid for each new job created.
To qualify, a company must be deemed by state economic development officials to be a strategic business that is located in or plans to locate to New York state. According to a quarterly report from the program, Vox was offered $120,000 in refundable tax credits, which generally amount to cash handouts, for 80 net new jobs in the 2016 tax year.
That Vox accepted government largesse is ironic given that the left-leaning outlet has a history of challenging and questioning business subsidies elsewhere. Last year, Vox and its subsidiary news site The Verge questioned subsidies approved by the state of Wisconsin for Foxconn, a Taiwan-based company. Another Verge story from February 2019 was titled, “Google is reportedly hiding behind shell companies to scoop up tax breaks and land.” A subhead read: “Stealthier than Amazon, but similarly disquieting.”
Whether Vox continues to receive its own subsidies may be in doubt following substantial job cuts it made early in 2018. Around 50 employees, or 5 percent of the company’s workforce, received termination notices. At the time, Vox CEO Jim Bankoff blamed the pink slips on “industry changes over the past few months,” according to Variety.
Vox’s New York subsidies have raised questions about whether government should offer financial support to media operations and whether those that accept the money can maintain their independence.
“Putting the media on a government dole threatens both the integrity and freedom of the press,” writes Cato Institute senior fellow Doug Bandow in an email. “In general, such subsidies are bad economics. In this case, the undermine our democratic system.”
Other voices have noted that direct and indirect government support for media is nothing new. This history was described in a 2010 study from the University of Southern California’s Annenberg School for Communication and Journalism. A report on the study from a Nieman Foundation for Journalism at Harvard listed some of the various types of government support, which include “tax breaks, postal subsidies and public notice requirements,” valued at billions of dollars.