The Boston Newspaper Guild’s seemingly endless negotiations with Boston Globe management may finally be coming to a conclusion. According to an email I received from a trusted source, the two sides have reached a “full, comprehensive tentative agreement” that will most likely be put to a vote in mid-November. Union members have worked without a contract since the end of 2018; the proposed agreement would be for three years.
“This has been a long and difficult struggle,” according to an email sent to the membership. “Thanks in part to the vocal and active support we received from many of you, we have succeeded in holding onto some of the most important rights and protections the company sought to remove.”
I am not going to quote any further from the email. It’s a confidential document, and it’s newsworthy only to Guild members. Besides, it presents only one side’s assessment of the pros and cons of the agreement.
Nevertheless, this represents a huge step forward for Globe staff members and for the news organization itself.
Patrick Soon-Shiong. Photo (cc) 2018 by Steve Devol.
The New Yorker has published a long profile of Patrick Soon-Shiong, the celebrity surgeon who moonlights as the problematic owner of the Los Angeles Times. Most of Stephen DeWitt’s article focuses on how Soon-Shiong became a billionaire — which appears to be based on a combination of brilliance and shady business practices. DeWitt writes:
Few figures in modern medicine have inspired as much controversy as Soon-Shiong. “He gets very enthusiastic, and sometimes he might exaggerate,” Hentz said. “He can embellish a little.” [Kate Hentz is the daughter of Lee Iacocca, whose first wife died of Type 1 diabetes and who was an important backer of Soon-Shiong’s work.] Outcomes for his diabetes treatment were disappointing, and one case ended tragically. While pursuing this therapy, he also began researching chemotherapy. At the center of his fortune is a cancer treatment that costs more than a hundred times as much as another drug, available as a generic, that is prescribed for some of the same conditions. Soon-Shiong has been repeatedly accused of financial misrepresentation, self-dealing, price gouging, and fraud. He has been sued by former investors and business partners; he has been sued by other doctors; he has been sued by his own brother, twice; he has been sued by Cher.
There’s a little bit on Soon-Shiong’s ownership of the Times and The San Diego Union-Tribune. I love this quote from Norman Pearlstine, the editor Soon-Shiong brought on board to right the ship after years of bad ownership: “He made the acquisition with very little due diligence, because he thought that it had to be easier than curing cancer. I’m not sure whether he still believes that.”
To Soon-Shiong’s credit, he has made some investments in his papers, although his interest seems to have wavered from time to time. His choice of Kevin Merida, late of ESPN and The Washington Post, as Pearlstine’s successor was a good one. Soon-Shiong also enabled Alden Global Capital to acquire Tribune Publishing earlier this year, which is unforgivable. But he saved the L.A. Times — at least for now — and that’s an important legacy.
There are few local news start-ups that have received the kind of attention bestowed upon The New Bedford Light, which has been the subject of stories by The New York Times, “On the Media,”The Boston Globe and other outlets. With high-profile founders like publisher Stephen Taylor, of the Taylor family that used to own the Globe, and board member Walter Robinson of “Spotlight” fame, the Light is being watched closely across the country.
The nonprofit digital project also has a high-profile editor — Barbara Roessner, the retired editor of top Connecticut outlets such as the Hartford Courant and the state’s Hearst papers. Recently I had a chance to speak with Roessner as guest cohost the local cable television show “SouthCoast Matters” with Paul Letendre.
We interviewed Roessner for an hour. Her insights into the future of community journalism and what she hopes to accomplish at the Light were pretty interesting, and I hope you’ll agree.
The Boston Globe’s Jeff Jacoby devoted his Sunday column to laying out his case against the Local Journalism Sustainability Act, which is aimed at easing the community news crisis through a series of federal tax credits. Jacoby’s opposition was no surprise, but I think it’s worth taking a look at his two major objections. One of them ought to be taken seriously; the other is grounded solely in his own boutique political philosophy.
The act would become law if it is included in the final reconciliation bill now being considered by Congress, assuming that Sens. Joe Manchin and Kyrsten Sinema will allow it be dragged at long last across the finish line. Here is a good overview of the bill by Steve Waldman, a founder of the Rebuild Local News Coalition. It would provide three tax credits for a five-year period, giving local news organizations some runway as they figure out how to transition to the confounding economic realities of the digital era:
News consumers would be able to write off $250 a year that they spend on subscriptions or on donations to nonprofit news organizations.
News organizations would receive tax benefits for hiring or retaining journalists.
Local small businesses would receive tax credits for advertising in local newspapers and news websites and on television and radio stations.
Jacoby’s argument is that tax credits amount to government subsidies, and even though these would be indirect, they could still be wielded by government officials to reward their friends and punish their enemies. “Government subsidies, almost by definition, are antithetical to the spirit of an independent press and the First Amendment,” Jacoby writes. “A newspaper that takes money from the government is apt to pull its punches when it covers that government — especially if it grows addicted to tax breaks that will have to be renewed every few years.”
There’s no question that could be a problem. The optimistic view is that the tax subsidies will end after five years, so there’s not much incentive for news organizations to soft-pedal their coverage. But I can easily envision a lobbying effort to extend those tax breaks, and then you end up in exactly the situation that Jacoby warns against.
There’s also the possibility that news organizations, especially those owned by corporate chains and hedge funds, will not use the five years wisely by making the kinds of investments that might move them toward financial sustainability, like customer-focused digital products, seamless payment systems and newsrooms robust enough to be produce journalism that people will be willing to pay for. (All steps, by the way, that Jacoby’s employer has taken to good effect.) Instead, they’ll just pocket the savings and ask for more. These are real concerns.
Here Jacoby has identified what many of us would regard as the flaw in his argument, because the tax credits envisioned in the Local Journalism Sustainability Act are not materially different from those granted to nonprofit news organizations in general. From PBS to nonprofit hyperlocal websites, nonprofit status enables donations to be tax-deductible and enables the news organizations themselves to avoid paying taxes.
Jacoby appears to be taking a more extreme position now than he has in the past. In his current column, he writes that he opposes tax credits for public broadcasting, which seems to go a step beyond his previous position: In 2011 he called for an end to direct government payments to public broadcasting, arguing that the system would do fine without such payments. There is nothing in that column to suggest he opposes the indirect government benefits that public media receive as a consequence of their nonprofit status.
As I’ve written before, I think it’s worth taking a chance on the Local Journalism Sustainability Act. Although there are some hazards, a few of which Jacoby has identified, overall it strikes me as a worthwhile response to the decline of community journalism.
Last week I received some very good news — Jim Haggerty, the editor of The Daily Times Chronicle in Woburn, had been selected to receive the Bob Wallack Community Journalism Award from the New England Newspaper and Press Association. I worked for Jim from 1979-’89, and I was delighted that I was asked to say a few words. Here’s the text of my remarks:
Congratulations to Jim Haggerty for winning the Bob Wallack Community Journalism Award. The award “recognizes an individual who has an exceptional record of commitment to community journalism.” Through his work at The Daily Times Chronicle and through his years of mentoring young journalists, Jim, along with the entire Haggerty family, have shown that they are committed to the highest ideals of local news.
I first met Jim in 1979, when I began working as a part-time reporter covering the town of Winchester. A few months later, after I graduated from Northeastern, Jim hired me. I learned from him and his family what community journalism was about — telling tough stories when they need to be told, but doing it with compassion and with an understanding that holding local government officials, business people and others accountable is not incompatible with treating them like human beings. It’s a lesson I’ve tried to carry with me throughout my own career.
During my 10 years at The Daily Times Chronicle, the paper covered the years-long story of Woburn’s toxic waste tragedy comprehensively and courageously. Families in East Woburn claimed that contaminated drinking water had resulted in their children contracting leukemia and other illnesses. Several of them died. The pressure on Jim and his family from city officials to tone down the coverage must have been overwhelming. But that never trickled down to those of us who were covering the story. Jim’s dedication to journalism and truth-telling during those years was inspiring.
These days, local news is in crisis, as the internet has undermined advertising revenues while corporate chains and hedge funds are slashing the newspapers that they own. The residents of Woburn and the surrounding communities are lucky that The Daily Times Chronicle is still family-owned, still doing good work and still dedicated to the principles that have sustained it for the past hundred years. Best wishes to you, Jim — and good luck to you and your family as you embark on the next hundred.
The Devil Strip, a pioneering cooperatively owned magazine in Akron, Ohio, has closed its doors. More of an arts and culture outlet than a news organization, the operation has nevertheless stood as a successful example of an independent project owned by its employees and the community.
WKYC reports that the end came over the weekend — staff members were told on Friday that the money had run out, and on Monday they received layoff notices. The station adds:
Founded in 2014, The Devil Strip was a community-owned magazine that focused on music, arts, news, and culture in Akron. For as little as a dollar a month, readers had the opportunity to become members of the co-op. An investment of $330 allowed you to become a co-owner.
In March 2020, I spent a week in Northern California reporting on The Mendocino Voice, a for-profit news site that was converting to cooperative ownership. At that time the founders, publisher Kate Maxwell and editor Adrian Fernandez Baumann, told me that The Devil Strip was one of the projects they had studied.
I hope The Devil Strip might be able to reorganize and come back, though the tweet makes it sound like they’ve hit the end of the road. Founder Chris Horne has not tweeted about it except for a cryptic reference to a “sabbatical.” I’m sure he’ll have more to say soon.
Among those of us who have obsessively followed Alden Global Capital’s destruction of newspapers over the years, there was very little that was new in McKay Coppins’ 7,000-word magnum opus that The Atlantic published this week. Still, Coppins is a gifted writer, and he’s pulled together the full story in a manner that is both elegant and comprehensive.
The arc of Coppins’ narrative is familiar. Alden, a hedge fund, got into the newspaper business about a decade ago. At first, Alden indulged the chief executive it inherited from one of the chains it acquired, John Paton, and then turned on him when he wasn’t willing to go along with the drastic cost-cutting they insisted on. I imagine Alden co-founder Heath Freeman was initially impressed with the blunt, profane Paton, who was not averse to slashing expenses to align them with revenues. The problem was that Paton actually cared about journalism and was not on board with Freeman’s insistence on endless rounds of cuts in order to enrich himself and the other co-founder, Randall Smith.
One fact I hadn’t known previously is that Randall Smith, secretive and a generation or so older than Freeman, is the brother of Russ Smith, founder of the now-defunct New York Press. Russ also founded the Baltimore City Paper, the Washington City Paper and now runs the website Splice Today.
The New York Press was a big deal in the 1990s, as Coppins notes, publishing 10,000-word columns by Smith that attacked the elite media establishment. Smith also once published a lengthy takedown of The Boston Phoenix by another writer that infuriated all of us. I wish I still had a copy. No complaints by me about Smith, though — he wrote a favorable review of my first book for The Wall Street Journal, and I enjoy bantering with him on Twitter about music and baseball.
But back to our story. Coppins’ description of Freeman, the more active and public of the two partners in running Alden’s newspapers, is priceless:
People who know him described Freeman — with his shellacked curls, perma-stubble, and omnipresent smirk — as the archetypal Wall Street frat boy. “If you went into a lab to create the perfect bro, Heath would be that creation,” says one former executive at an Alden-owned company, who, like others in this story, requested anonymity to speak candidly. Freeman would show up at business meetings straight from the gym, clad in athleisure, the executive recalled, and would find excuses to invoke his college-football heroics, saying things like “When I played football at Duke, I learned some lessons about leadership.” (Freeman was a walk-on placekicker on a team that won no games the year he played.)
And Coppins’ description of Alden’s business model is right on target:
What threatens local newspapers now is not just digital disruption or abstract market forces. They’re being targeted by investors who have figured out how to get rich by strip-mining local-news outfits. The model is simple: Gut the staff, sell the real estate, jack up subscription prices, and wring as much cash as possible out of the enterprise until eventually enough readers cancel their subscriptions that the paper folds, or is reduced to a desiccated husk of its former self….
Alden’s calculus was simple. Even in a declining industry, the newspapers still generated hundreds of millions of dollars in annual revenues; many of them were turning profits. For Freeman and his investors to come out ahead, they didn’t need to worry about the long-term health of the assets—they just needed to maximize profits as quickly as possible.
Where I have a bit of a problem with Coppins is that though he credits some of the earlier reporting he relies on, he’s haphazard about it. I winced at his sole reference to Julie Reynolds, whom he quotes indirectly a single time and identifies only as a former reporter for the Monterey Herald in California. In fact, since leaving the paper Reynolds has been indefatigable in reporting on Alden. It was because of her 2017 cover story for The Nation, for instance, that we know Randall Smith used his ill-gotten newspaper gains to buy 16 mansions in Palm Beach, Florida. Just recently she reported for Nieman Lab that Alden’s acquisition of Tribune Publishing was tainted by dubious gamesmanship of the sort that should have prompted a do-over.
Then there’s the Baltimore hotel magnate Stewart Bainum, whose bid to buy Tribune fell short this past spring. In August, Rick Edmonds of Poynter reported that Bainum was launching a well-funded digital news nonprofit in order to compete with Alden’s Baltimore Sun. Coppins writes about that without giving any credit, and it’s being repeated in media circles as though it was his scoop.
But these are quibbles. Coppins is a gifted writer and has done a prodigious amount of reporting of his own.
Recently The Atlantic published an essay by Elaine Godfrey about the damage done to her hometown newspaper in Iowa by Gannett, the country’s largest newspaper chain. (Alden’s holdings come in second.)
The Atlantic deserves credit for using its prestige to focus on the local news crisis, and on the Wall Street greed that has transformed it into a catastrophe.
Update II: And the paragraph has been restored. I’m told there was nothing nefarious about its disappearance.
Update: Oh, my. The nutty last paragraph that prompted this post has been deleted. Not a good look, Harvard.
***
In an otherwise unremarkable story from Harvard Business School about a study into the effects of local newspaper closures on corporate wrongdoing, I ran into this bizarro closing paragraph. The story quotes Professor Jonas Heese, a co-author of the study:
Saving local newspapers isn’t Heese’s specialty, but he points to a recent trend of hedge funds buying up distressed local media outlets as having the potential to stabilize the market and resurrect local news. And that makes him wonder: “Is this a reason to be hopeful?”
No, Professor Heese. It is not a reason to be hopeful. I suggest you stick to statistical analysis, which you seem to be pretty good at. Here’s the abstract, from the Journal of Financial Economics, titled “When the Local Newspaper Leaves Town: The Effects of Local Newspaper Closures on Corporate Misconduct”:
We examine whether the local press is an effective monitor of corporate misconduct. Specifically, we study the effects of local newspaper closures on violations by local facilities of publicly listed firms. After a local newspaper closure, local facilities increase violations by 1.1% and penalties by 15.2%, indicating that the closures reduce firm monitoring by the press. This effect is not driven by the underlying economic conditions, the underlying local fraud environment, or the underlying firm conditions. Taken together, our findings indicate that local newspapers are an important monitor of firms’ misconduct.
Reading this leads me to think about our work at The Daily Times Chronicle in Woburn, when we uncovered a massive toxic waste problem in the early 1980s that may have led to an outbreak of childhood leukemia and other illnesses. Charlie Ryan’s reporting was crucial to breaking the story wide open. In 1998, he recounted in The Boston Phoenix the sequence of events that led the world to understand that Woburn had an environmental and public health disaster on its hands:
Ryan’s most important story came in December 1979, on a development he thought he’d been beaten on. The state’s Department of Public Health was about to release the results of a study on Woburn’s leukemia rate, and Ryan arranged to interview DPH officials. That morning, the Boston Herald American published a front-page story reporting that the leukemia rate was within the normal range for a city of Woburn’s size.
“I was a little pissed,” Ryan remembers, “but I went in there anyway.” He sat down with a DPH statistician, who explained the results to him: essentially, the DPH had taken the number of leukemia cases and divided it by the total population of Woburn, based on the 1970 census. Ryan stopped him. 1970? The population of Woburn, Ryan knew, had fallen from 40,000 to around 36,000. Ryan asked a simple question: What would happen if the lower figure were used? The statistician recalculated the numbers — and, all of a sudden, the number of leukemia cases appeared to be “statistically significant,” the bland-sounding phrase used to describe what was obviously a very real problem.
“That story drastically changed everything,” says Ryan, who got out of journalism a few years ago and now helps run the computers for Essex County Newspapers. “To that point, everyone had considered Anne Anderson to be just a hysterical mom. I think without that story, the Centers for Disease Control, the Environmental Protection Agency, and the state never would have pushed that hard.”
Yes, local journalism is crucial in holding corporations to account, just as it is in keeping an eye on government and other large institutions. But no, hedge funds are not the solution. They’re the problem.
Meaningful participation in civic life isn’t possible without access to high-quality news and information. Consider the most fundamental aspect of community engagement: voting in local elections. If prospective voters lack the means to inform themselves about candidates for the select board, the city council, the school committee and the like, then it follows that they will be less likely to vote.
But is the reverse also true? Does the presence of a reliable news source result in a higher level of voter participation? To find out, I compared two towns, Bedford and Burlington, both northwest of Boston.
Providence, R.I. Photo (cc) 2017 by Kenneth C. Zirkel.
My research work on the local news crisis often feels like a race against time. On the one hand, I try to highlight independent community journalism projects that are keeping their heads above water or, in a few cases, are actually thriving. On the other hand, chain owners like Alden Global Capital and Gannett keep hollowing out the hundreds of newspapers they own across the country, not because they’re not making money but because they want to make more.
Last week came the odd news that Gannett is seeking to sell The Providence Journal’s printing plant for $8 million, as well as several other plants that it owns across the country. The story was broken by Alexa Gagosz of The Boston Globe, a former student of mine. What struck me as odd is that the Journal isn’t outsourcing its printing; rather, it intends to lease the plant back for a period of five or 10 years.
No doubt Gannett executives are thinking ahead to the day when the Journal goes all-digital. But the sell-and-leaseback provision seems hard to explain, especially for a paltry amount like $8 million. That doesn’t put a dent in the massive debt that Gannett is struggling with.
Also last week, The Atlantic published an essay about The Hawk Eye, of Burlington, Iowa, the oldest paper in the state, which was acquired several years by GateHouse Media — the predecessor to Gannett — and is now being dismantled. Written by Elaine Godfrey and photographed by KC McGinnis, it is a lovely piece, haunting and elegiac, conjuring a lost way of life as much as a newspaper that’s been hollowed out. But Godfrey has a keen sense of Gannett’s business model as well. This gets right to the heart of it:
Readers noticed the paper’s sloppiness first — how there seemed to be twice as many typos as before, and how sometimes the articles would end mid-sentence instead of continuing after the jump. The newspaper’s remaining reporters are overworked; there are local stories they’d like to tell but don’t have the bandwidth to cover. The Hawk Eye’s current staff is facing the impossible task of keeping a historic newspaper alive while its owner is attempting to squeeze it dry.
None of this was inevitable: At the time of the sale to GateHouse, The Hawk Eye wasn’t struggling financially. Far from it. In the years leading up to the sale, the paper was seeing profit margins ranging from the mid-teens to the high 20s. Gannett has dedicated much of its revenue to servicing and paying off loans associated with the merger, rather than reinvesting in local journalism. Which is to say that southeastern Iowans are losing their community paper not because it was a failing business, but because a massive media-holding company has investors to please and debts to pay.
So what’s lost? Consider the experience of Tom Courtney, a former state senator, who lost his re-election bid after he discovered that his constituents, lacking any reliable local news, were judging him on the basis of national stories instead:
In the absence of local coverage, all news becomes national news: Instead of reading about local policy decisions, people read about the blacklisting of Dr. Seuss books. Instead of learning about their own local candidates, they consume angry takes about Marjorie Taylor Greene. Tom Courtney, a Democrat and four-term former state senator from Burlington, made more than 10,000 phone calls to voters during his 2020 run for office. In those calls, he heard something he never had before: “People that live in small-town rural Iowa [said] they wouldn’t vote for me or any Democrat because I’m in the same party as AOC,” Courtney told me. “Where did they get that? Not local news!”
Also last week, the trade magazine Editor & Publisher ran a story about Gannett papers that have actually been bought back by local owners. Written by Gretchen A. Peck, the story looks in on four people who’ve acquired former Gannett papers and are now reinvesting in news and in their communities.
Still, it hardly looks like a trend. Peck spoke with newspaper broker Sara April, who said Gannett is selling just a few papers here and there. “All the markets are typically smaller. Look at the size of the towns. That has been the charge: To find quality local companies, with high regard for journalism, to take ownership of these newspapers so they can continue to serve their communities,” April was quoted as saying. No doubt the papers don’t fit with Gannett’s current strategy, which seems to be filling up its papers and websites with regional news so it doesn’t have to put too much into local coverage.
The good news — and there’s always good news — is that local independent journalism is thriving in many parts of the country. The bad news is that the corporate chains and the hedge funds continue to strangle news organizations that would otherwise be doing much better.
An earlier version of this post was part of last week’s Media Nation Member Newsletter. To become a member for just $5 a week, please click here.
