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[Second Issue of the Day]
#6
Wall Street Journal
June 20, 2002
Editorial
Putin's Media Talks
Vladimir Putin has embarked on an impressive program of market liberalization, as evidenced by his tax and land reforms and his determination to create conditions in Russia that inspire growth and investment. But one vitally important industry in Russia has seen just the opposite -- a sharp increase in state interference under the Putin Kremlin.
With that in mind, it was encouraging to hear President Putin say this week that it is time to help the media industry become "a modern market-based branch of the national economy." Encouraging, but then we have to ask, what exactly does the president mean by this?
Ever since the battles to wrest independent television channels NTV and TV6 from their oligarchic owners, the government has been on the defensive against claims that it has undermined press freedom in Russia . Press Czar Mikhail Lesin has used every podium available to make his case that the Kremlin isn't afraid of opposition. The issues in both cases were not cut and dried, but much of the government's protests have reminded us of the character in the Tom Stoppard play "Night and Day" who declares "I'm with you on the free press; it's the newspapers I can't stand!"
What emerges from Mr. Putin's meeting with media executives Tuesday is a mixed bag -- a willingness to remove some of the obstacles to a functioning media market, but also a reluctance to acknowledge that the best guarantor of press freedom is not a slick government regulator but a pluralist media, warts and all, that the state allows to function in freedom.
Mr. Putin recognizes a good argument when he hears one, especially where investment and growth are concerned. The media execs told Mr. Putin that the system of selective federal and local subsidies were strangling competition and turning local media outlets into political pawns. Reported one participant afterwards, "he did not quite understand at first how distorted the market is as a result of state subsidies. We had to explain it."
To his credit, he expressed his support for eliminating the subsidies. He also reportedly backed privatizing the printing presses and spoke out against a monopoly on the advertising market (dominated by the company his press czar, Mr. Lesin, founded).
Unfortunately, Mr. Putin said nothing to suggest that he recognizes the chilling effect that state ownership and the heavy-handed use of state organs has on press freedom. Plans to scale back the state's media holdings remain vague. As bad in some ways, Mr. Putin still defines press freedom as independence from oligarchic owners who use their media holdings to pursue their political and other business interests.
Mr. Putin declared it "impossible to implement the constitutional right of the citizens for receiving authentic information without the economic independence of the media." In other words, the president paints the state as salvific to Russia's media rather than strangulating, an almost Orwellian inversion of reality.
Mr. Putin's underlying argument is flawed on several counts. It is false to assert a symmetry between a government owner and a private owner. No matter how irresponsibly a private owner behaves from Mr. Putin's point of view, the government has the unique power to revoke licenses, call out the tax police for invasive inspections, or send in FSB heavies to probe the divulging of "state secrets." The government has coercive powers that no private owner can match.
And oddly for a president who professes such faith in markets, Mr. Putin so far fails to understand that the best defense against what he calls "irresponsible journalism" is pluralism. The more choice given viewers, readers, and advertisers, the tougher the competition, the higher the standards. Of course, with that pluralism and with real press freedom, there is the potential -- the certainty, rather -- of real critical scrutiny, something this Kremlin has not yet faced.
President Putin's reform program suggest he understands the connection between low taxation and investment (and tax revenues), between streamlined bureaucracy and business confidence. If Russia's president truly wants to create a viable media market -- and remove one of the most persistent sources of investment-deterring criticism of his administration -- he must recognize the nexus between a truly free press and a vibrant media market. The recent climate of self-censorship, bureaucratic intimidation and licensing shenanigans aimed at delivering choice media into the hands of friendly parties is a sure way to scare off the kind of reputable investors Mr. Putin is otherwise doing much to entice.
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