Crushing Newsprint Tariffs Threaten Newspaper

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By Reed Anfinson
Publisher, Swift County Monitor-News

Newspapers in America are under assault, but the assailant this time isn’t the one you would think. Yes, the internet continues to take away advertising dollars without giving anything back to citizens in the form of community reporting. But it isn’t the internet we are talking about this time; it is Wall Street.

It is the big money hedge fund players who care about one thing and one thing only –profits. They could care less about the impact of their actions on communities throughout America that rely on their newspapers for information about local governments, their sports teams, their community events, the challenges they face, or the triumphs they achieve.

This hedge fund culprit we refer to owns Washington State newsprint manufacturer North Pacific Paper Company or NORPAC. It is upset because it isn’t making the returns it seeks on the newsprint plant, so it went to the Trump Administration’s Department of Commerce and demanded a tariff be placed on its major newsprint competitors just to our north in Canada. It complained to the International Trade Commission (ITC) about unfair trade practices and dumping of newsprint on the U.S. market lowering prices.

Those Canadian newsprint makers are allegedly receiving government subsidies through government loan assistance and permission to harvest trees on government land. NORPAC says this allows them to sell newsprint too cheaply in the U.S., injuring American firms.

Commerce accepted NORPAC’s complaints and quickly followed with tariffs aimed at addressing both its claims. The result will be a 43 percent increase in the cost of newsprint between October 2017 and this coming May for the Swift County Monitor-News and thousands of other community newspapers in America.

The impact of that substantial increase, our second largest cost of business next to wages, will run deep. What business can handle a 43 percent increase in one of its key costs of operation in eight months? And, the price could go higher. The forecast is for prices 50 percent higher if NORPAC gets what it wants.

Newspapers around the country are looking at reducing the number of pages they print, laying off staff, cutting coverage of their community, and some even face closing. Daily newspapers in smaller markets may go to three days a week.

You may think the internet will provide the news you will miss in the printed newspaper. You would be wrong. For most community newspapers in America, the internet provides less than 10 percent of their gross revenue. At many smaller publications, it’s more like 0 to 3 percent revenue. Take away the printed edition and thousands of community newspapers would disappear. We wouldn’t be here.

We don’t face a situation you typically see in a trade war over unfair trade practices where an entire industry is under threat and thousands of jobs at stake. NORPAC is the only U.S. paper mill making the complaint. It employs fewer than 300 people.

 “We recognize that market erosion, not unfair trade, has caused more than a 75 percent decline in North American newsprint consumption since the year 2000,” Seth Kursman, of Resolute Forest Products, said in a statement. His company is the largest producer of newsprint in America. The American Forest and Paper Association, a trade group representing paper and wood products in the U.S., is against the tariffs.

As the internet has made deep cuts into newspaper advertising, large daily newspapers in big cities have made significant reductions in their pages and newsprint consumption. Fewer pages printed means less demand – 75 percent less in just 17 years. That has caused more than a dozen paper mills in America to close. It wasn’t unfair trade practices causing the plants to shut down; it was the internet’s impact on the market.

If NORPAC could stop all Canadian newsprint from coming into the U.S., it would not magically rejuvenate American production. Further, current domestic plants can’t meet U.S. demand alone. Paper mills cost hundreds of millions of dollars to build and face strict air and water environmental standards. In today’s newspaper world, few investors, if any, are going to back bringing new plants online.

Canadian newsprint makers do have some advantages. Hydroelectric power, ready access to forest products, and lower shipping costs all help them compete. These advantages have helped them meet America’s demand for newsprint for years. Does America trade policy attack every country that has built-in advantages in the production of its goods? Certainly not.

What we have learned from communities that have lost their newspapers is that fewer people vote. Citizens know less about who is running for office and what direction those in office are taking their community. They don’t know the details of why the county is bonding and raising taxes by $10 million over the next five years. They don’t know why the school district has had to cut course offerings in foreign languages, music, and art. They don’t know about the challenges that face their local hospital. They don’t know why one entrepreneur is given a $200,000 economic development loan, but another business was denied help.

When a reporter isn’t sitting in on the meetings of public bodies, it is easy for a sense of privilege and corruption to seep in.

Without our newspaper, we don’t have the stories that draw us together as a community with a shared sense of responsibility and purpose. We become more isolated. We are less likely to volunteer for city boards and commissions. We are less likely to know about and help out with community projects. Fewer people run for office and incumbents find it easier to get re-elected.

We know these things happen because communities that have lost their newspapers are experiencing them.

The Stop Tariffs on Printers and Publishers coalition has been formed representing 600,000 workers in businesses being devastated by the tariffs on Canadian paper products. But it can’t fight the tariff battle on its own. It needs the voices of citizens from communities throughout the country to contact their U.S. senators and representatives to urge they work to see the tariffs overturned.

A final decision in the investigation may come around Aug. 2. But meanwhile, the sudden imposition of crippling tariffs is damaging community newspapers throughout America.

Sen. Amy Klobuchar: 202-224-3244
Sen. Tina Smith: 202-224-5641
Rep. Collin Peterson: 202-225-2165

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