{"id":144506,"date":"2019-10-07T12:00:52","date_gmt":"2019-10-07T11:00:52","guid":{"rendered":"https:\/\/www.transcend.org\/tms\/?p=144506"},"modified":"2019-10-03T09:32:58","modified_gmt":"2019-10-03T08:32:58","slug":"wall-street-is-killing-local-newspapers","status":"publish","type":"post","link":"https:\/\/www.transcend.org\/tms\/2019\/10\/wall-street-is-killing-local-newspapers\/","title":{"rendered":"Wall Street Is Killing Local Newspapers"},"content":{"rendered":"

We can\u2019t put a price tag on our free press \u2014 but unless we stop them, predatory investors can.<\/em><\/p><\/blockquote>\n

\"\"<\/a>

Shutterstock<\/p><\/div>\n

2 Oct 2019 – <\/em>Though lacking the size and prestige of The New York Times<\/em> or The Washington Post<\/em>, The Storm Lake Times<\/em> is arguably just as important.<\/p>\n

Two years ago, the small, bi-weekly Iowa paper (circulation: 3,000) won the coveted Pulitzer Prize for taking on agricultural water pollution in the state<\/a>. If it weren\u2019t for vibrant local papers, stories like these might never come to light.<\/p>\n

Unfortunately, all over the country, private equity and hedge funds have been scooping up these cash-strapped papers \u2014 and looting them into irrelevance or bankruptcy.<\/p>\n

Here\u2019s how it works.<\/p>\n

Investors put down a fraction of the purchase price and borrow the rest \u2014 and then saddle the company with that debt. Layoffs and cutbacks follow, which leads to a shabbier product. Circulation and revenue decline, then more cuts, and the cycle accelerates.<\/p>\n

Eventually the paper is a shadow of its former self, or turned to ashes completely<\/a>. Wall Street wins, the public loses.<\/p>\n

Perhaps the most infamous recent example was the breakdown of the 127-year-old Denver Post<\/em>. Since private equity firm Alden Global acquired the paper, it has cut two out of every three<\/a> staff positions \u2014 twice the industry rate<\/a> for downsizing.<\/p>\n

To add insult to injury, the firm has been using staff pension funds<\/a> as its own personal piggy bank. In total, they\u2019ve moved nearly $250 million into investment accounts in the Cayman Islands.<\/p>\n

\"\"<\/a>Employees who remain grapple with censorship. Last April, Dave Krieger \u2014 editorial page editor of Alden\u2019s Boulder Daily Camera<\/em> \u2014 was fired<\/a> after self-publishing an opinion piece headlined \u201cPrivate Equity Owners Endanger Daily Camera\u2019s Future.\u201d<\/p>\n

In solidarity, Denver Post<\/em> editorial page editor Chuck Plunkett resigned<\/a>, complaining that his publishers were also censoring stories that might offend Alden.<\/p>\n

Alden\u2019s Digital First Media runs many other big papers, putting hundreds of newsroom staff at risk of censorship and layoffs. Millions of readers, in turn, may learn only what Alden deems fit for them.<\/p>\n

It\u2019s not a new pattern. In 2008, a year after billionaire Sam Zell bought the Tribune Co. \u2014 publisher of the Chicago Tribune<\/em>, Los Angeles Times<\/em>, and other venerable publications \u2014 the company filed for bankruptcy, saddled with $13 billion in debt<\/a> in what\u2019s been called \u201cthe deal from hell<\/a>.\u201d<\/p>\n

After it emerged from bankruptcy, the company was left in the hands<\/a> of \u2014 you guessed it \u2014 private equity.<\/p>\n

The march of these buyout barons continues. This summer, New Media Investment Group (owner of GateHouse Media) announced plans to buy Gannett. The $1.38 billion deal would unite one-sixth of all daily newspapers across the country<\/a>, affecting 9 million print readers.<\/p>\n

New Media anticipates cutting $300 million in costs each year<\/em>, suggesting layoffs comparable to those at The Denver Post<\/em> are in the offing \u2014 even as the company and its investor owners harvest profits.<\/p>\n

This is a crisis. This country lost more than a fifth of its local newspapers<\/a> between 2004 and 2018, while newspapers lost almost half<\/em><\/a> of their newsroom employees between 2008 and 2018.<\/p>\n

A few lawmakers are catching on.<\/p>\n

Sens. Elizabeth Warren (D-MA), Tammy Baldwin (D-WI), and Sherrod Brown (D-OH) recently introduced the Stop Wall Street Looting Act<\/a> to curb these abuses, with Warren specifically calling out private equity firms<\/a> for decimating local newspapers.<\/p>\n

Senator Bernie Sanders recently introduced an ambitious plan<\/a> of his own, calling for a moratorium on major media mergers and encouraging newsrooms to unionize nationwide.<\/p>\n

Newspapers have been critical to American democracy since its founding. By allowing huge corporations to gut newspapers in the name of making a buck, we\u2019re putting a price tag on that democracy when we need it most.<\/p>\n

_________________________________________________<\/p>\n

\"\"<\/a><\/em><\/p>\n

 <\/p>\n

Olivia Snow Smith is a recent graduate of Bard College and the communications intern for <\/em>Take On Wall Street. This op-ed was adapted from TakeOnWallSt.com and distributed by OtherWords.org.<\/em><\/p>\n

 <\/p>\n

Go to Original \u2013 otherwords.org<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"

We can\u2019t put a price tag on our free press \u2014 but unless we stop them, predatory investors can.<\/p>\n","protected":false},"author":4,"featured_media":144507,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[62],"tags":[232,120,354,378,234,109,287,985,70,126,172,75],"class_list":["post-144506","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-media","tag-capitalism","tag-conflict","tag-economics","tag-journalism","tag-media","tag-politics","tag-power","tag-social-justice","tag-usa","tag-violence","tag-west","tag-world"],"_links":{"self":[{"href":"https:\/\/www.transcend.org\/tms\/wp-json\/wp\/v2\/posts\/144506","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.transcend.org\/tms\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.transcend.org\/tms\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.transcend.org\/tms\/wp-json\/wp\/v2\/users\/4"}],"replies":[{"embeddable":true,"href":"https:\/\/www.transcend.org\/tms\/wp-json\/wp\/v2\/comments?post=144506"}],"version-history":[{"count":0,"href":"https:\/\/www.transcend.org\/tms\/wp-json\/wp\/v2\/posts\/144506\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.transcend.org\/tms\/wp-json\/wp\/v2\/media\/144507"}],"wp:attachment":[{"href":"https:\/\/www.transcend.org\/tms\/wp-json\/wp\/v2\/media?parent=144506"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.transcend.org\/tms\/wp-json\/wp\/v2\/categories?post=144506"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.transcend.org\/tms\/wp-json\/wp\/v2\/tags?post=144506"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}