The End of the New York Times? And Other Comments About Greedy and Stupid Media Management

By Joe Rothstein
Editor, USPolitics.einnews.com

January 14, 2009

The current edition of The Atlantic magazine has an article that sounds jarringly implausible...until you read it. Writer Michael Hirschorn forecasts the end of the New York Times as we know it. In a worst case scenario, he spells out how that could happen as soon as May. Read the article at TheAtlantic.com

Hirschorn cites two reasons for the Times' current financial difficulties. One is obviously the technology revolution that is changing the game for all media. The other, which he touches on only lightly, is the stupidity and greed of Times ownership and management. Media ownership stupidity and greed is the issue I'd like to explore here. It's not limited to the Times, and it's putting the future of responsible journalism at great risk.

I first ran into media management's stupidity and greed as a young print reporter in Alaska. I soon realized that the largest, most profitable newspaper in the state (which I didn't work for) had no bureau in the state capitol, never sent anyone to cover the state legislature, seldom did any enterprise reporting and worked in bad faith with its unions. The owner had a virtual monopoly on Alaska news, raked in his profits, paid minimum wages to his reporting staff, protected the business community and his personal friends, and gave little back in the way of serious journalism.

In those days I had to work closely with the Associated Press. I was awe-struck that the AP writers in New York who turned out news for radio broadcasts were the newest, least experienced journalists in the organization---and invariably made errors and distorted content when they condensed stories. One example of an AP rewrite had to do with a space probe. The writer's lead was something like this: “NASA successfully launched a satellite today, far up into the heavens, where even the stars refuse to twinkle.”

Consider now that most radio stations and TV stations use AP wire copy verbatim, which means that whoever rewrites stories for broadcast reaches more people than any other writer for any other publication in the U.S. And these are the least experienced journalists on the AP staff.

Which brings me to the subject of TV and radio news. Except for a few all-news radio stations in very few markets, radio has abandoned all pretense of doing any independent journalism.

In fact, since Congress essentially deregulated radio in 1996, radio has consolidated into just a handful of huge chains. The Sinclair Broadcast Group, outside Baltimore, beams "localized" weather and sports segments from its Maryland headquarters to stations around the country. A few years ago a train carrying dangerous chemicals derailed in Minot, North Dakota. Local authorities tried to call the radio stations to issue a warning about the threat, and discovered that all local stations were operated remotely by a Clear Channel mothership located in Texas---with no local news personnel.

TV news coverage is even worse, since the stations pretend to be journalists. One of the reasons you see so much weather reporting on TV is because, according to the old saying, everyone talks about it---and it's relatively cheap and easy to cover. The reason you see so much crime, fire and accident reporting on local news stations is because reporters need no particular background or journalistic skills to cover them. Unlike, say, complex local government issues, auto accidents are discreet events. The reporter doesn't need to know anything more than where to find the wreckage, and the right end of the camera to point for pictures.

After the 2004 elections the Norman Lear Center at the Annenberg School for Communications of the University of Southern California found that 8 times more local TV coverage went to accident injuries and 12 times more to sports and weather than to coverage of all local political races combined. The coverage results aren't in yet for 2008, but we do know that in 2008 TV stations reaped a bonanza of more than $3 billion in political ads.

Can TV afford to do a better job of journalism? From 2000 to 2007 the average gross profit of local TV stations was more than 40%. As you might expect, the profits were highest in the biggest markets.

Now let's get back to print journalism. Until recently, most major newspapers were racking up profits of from 25 to 30%. Yet, since 2000, most major newspapers have been relentlessly cutting newspaper staffs and dumbing down content. There's hardly a newspaper left in the U.S., except for the New York Times, Washington Post, and the McClatchey chain that still has a permanent bureau in Iraq, where 140,000 U.S. troops are still stationed. Most newspapers have eliminated foreign bureaus. Many have consolidated coverage from Washington, D.C. and state capitals.

Why? For one thing, most large newspapers and newspaper chains are publicly owned, and under the same pressure for big quarterly profits as most public companies.

The Knight-Ridder chain folded two years ago when it was still grinding out 20%+ profits, because big investors didn't feel the returns were high enough. The Tribune company sold itself to Sam Zell largely for the same reason. Zell (and the major newspapers in Los Angeles, Chicago and Baltimore) are in financial trouble now, not because of anything journalists did wrong, but because Zell loaded the company with a mountain of debt. The selling shareholders walked away with big profits.

And that gets us back to the New York Times. There is much to commend the owners of the Times, the Sulzberg family. But until the last quarter, they took huge dividends from Times operations and ran up a billion dollars in debt---which is why the company is shaky. The Times has bungled its financial management and put the entire company at risk.

In a country that asks voters to periodically decide on its leaders and direction, it's imperative to have good, responsible journalism. How else can voters know what's really happening? How can they make reasoned judgments? Certainly not by a heavy dose of weather and accident reporting, or by trusting venerable media institutions to stupid and greedy financial management.

I worry a lot about the future of journalism in the U.S. Never more so than after reading Michael Hirschorn's article in The Atlantic.

Joe Rothstein, editor of US Politics Today, is a former daily newspaper editor and long-time national political strategist based in Washington, D.C.

See all previous articles by Joe Rothstein here.