The economics of media integrity

Big money is about to descend once again upon the media industry, if it hasn’t already. Election campaign seasons always bring the industry a windfall, via both legitimate political ads and illicit payments to buy favorable coverage from members of the press. The magnitudes are now so staggering that in the last election year of 2010, the recreational services sector, which includes the broadcast industry, leaped from the previous year by a zooming 30.4 percent in our gross domestic product (GDP) accounts. To show how unusual this was, the growth rate stabilized back to 7.2 percent in 2011, and had ranged from only 3 to 11 percent in the past decade (with that previous peak also posted in the election year of 2007).

But it’s not only politicians who pay the media, legitimately or otherwise. Business interests promoting their particular product, or lobbying for or against a particular policy (sin taxes being the latest example), are known to pay big bucks to get their way. And like the handlers of politicians, their public relations units know the tricks of the trade only too well—including anything from free rides and trips, raffles where everyone wins a valuable prize, free product samples “for review,” lavish gifts, and up to regular deposits made to one’s ATM bank account (rendering the phrase “envelopmental journalism” passé, giving way to the new de rigueur tag of “ATM journalism”).

Last weekend saw media practitioners gathering in Tagaytay for the 9th Media Nation conference, which has become an annual occasion for self-examination. It was remarkable in its choice of the highly sensitive theme of corruption in the media. Together with transparency champion Vince Lazatin, I was tasked to trigger discussion on the question “How can we push media corruption out of the market?” We posited that media ethics and integrity (or lack of it) are basically a cost-benefit proposition. While usually an economist’s tool, cost-benefit analysis is a universal (often subconscious) principle that governs the choices all of us make—fully recognizing that not all costs and benefits are measured in pesos and centavos.

As for media ethics and integrity, the benefits and costs may be examined at two levels: the aggregate/public level and the individual/personal level. At the public level, what does it benefit society to have a professional, independent and honest media? I can think of at least three social benefits. First is upholding the truth—about public policy issues and about individuals or objects. This presupposes that upholding truth is a universally held value that everyone sees as a benefit, at least at the societal level. The truth, after all, guides us to the right choices in life.

A second benefit is that of having the “right” public policies prevail. To my mind, “right” policies are those that promote the greatest good for the greatest number (now also fashionably called “inclusive growth”), as against what I call—for lack of a better term—oligarchy-perpetuating policies. Sin taxes and the competition policy are examples that provoke intense debate and unleash substantial lobby money directed at both policymakers and opinion makers in media.

The third public benefit is attaining a level playing field, against gaining unfair market or electoral advantage that biased reporting can easily achieve for anyone willing to pay the price. Among other things, such level playing field in the economy is a basic prerequisite to providing an attractive investment climate for all enterprises—domestic or foreign, large or small—which in turn promotes wide job-generation. In the arena of politics, better governance will more likely emerge where a level playing field ensures that election results are not driven by money and access to media.

What are the public downsides of having media ethics and integrity? I see none. On the other hand, it is so much easier to list the downsides of having a corrupt media, as these are the exact opposites of what we have listed above: a society built on falsehoods, policies that perpetuate our unusually oligarchic economy and society, an investment-starved (hence job-starved) economy, bad leaders and bad governance, and so on.

Unfortunately, the cost-benefit balance is dramatically different at the personal level for the media practitioner. The benefits of maintaining one’s integrity include personal fulfillment and a clean conscience, uncompromised integrity and respect from others, high stature in the profession (perhaps), and (hopefully) greater marketability and with it, higher (formal) compensation. The last two are not even assured, and the first two, as they say, are hindi nakakain (cannot be eaten) when the media worker’s primary concern may be his/her family’s very survival. What are the costs of keeping clean? Media Nation participants attested to fabulous material benefits in various forms that one would have to trade off for integrity. They also mentioned losing access to valuable sources of information needed to perform well on the job. This comes with being ostracized by their peers, 85-95 percent of whom they estimate to be “playing along.”

What do we do, then, when the net social benefits of media integrity are so large, and yet the net private benefits for the individual media practitioner are so small (even negative)? For as long as media integrity is a public good that no one wants to pay for, we will never have enough of it. And herein lies the puzzle that even well-meaning media practitioners could not solve in one weekend in Tagaytay. The work, they agreed, will be long and hard. What heartens me is that the group vowed to take it on.

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