|December 9th, 2008||#1|
Join Date: Jul 2007
How Jew Zell Killed Chicago Tribune, Once-Patriotic Paper
How Zell Killed Tribune
Stephane Fitch, 12.08.08, 07:42 PM EST
The ''grave dancer'' of real estate becomes the ''grave digger'' of the newspaper industry.
When Samuel Zell outbid two other billionaires, Eli Broad and Ronald Burkle, for Tribune Co. last year, he was hailed as a dealmaker.
For just thinnest possible sliver of equity--some $300 million--he landed an $8.2 billion empire featuring the Chicago Cubs, a host of television stations and two of the most important newspapers in America: The Chicago Tribune and Los Angeles Times.
"I am delighted to be associated with Tribune Company, which I believe is a world-class publishing and broadcasting enterprise," Zell said back in April 2007, announcing the deal. "As a long-term investor, I look forward to partnering with the management and employees as we build on the great heritage of Tribune Company."
Monday was a different story. Tribune declared bankruptcy in Delaware. Against assets allegedly worth $7.6 billion, Tribune Co. owes $13 billion. The "grave dancer" of real estate development was now the "grave digger" of the newspaper world.
Bad economy or not, if it wasn't for Zell and the enormous debt load he packed on the company, Tribune Co. would be trundling along profitably. It hauled in operating cash flow--which is net before taxes, depreciation, amortization and interest--of $90 million on $1 billion in revenue in the third quarter. In the six quarters before that, Tribune Co. was hauling in $200 million to $270 million per quarter in cash flow.
Sure, lots of that comes from the company's sports and broadcast arms. But even Tribune's publishing group, which includes those oh-so-old-fashioned newspapers, pulled in $13 million in operating cash flow on $654 million in revenues last quarter.
Zell blew it by treating the purchase of this august newspaper company like, well, like just another real estate development. There's an age-old strategy in development. Borrow every dime you can, build as high as you can and hope it's all sold by the ribbon cutting. It works brilliantly in a rising market. But as Donald Trump is demonstrating now in his lawsuits with the lenders who paid for his $750 million hotel-condo tower on the Chicago River, it gets ugly when recession hits.
|December 9th, 2008||#2|
Join Date: Jul 2007
Robert Rutherford McCormick (July 30, 1880 – April 1, 1955) was a Chicago newspaper baron and owner of the Chicago Tribune. A leading isolationist, opponent of United States entry into World War II and of the increase in Federal power brought about by the New Deal, he continued to champion a traditionalist course long after his positions had been eclipsed in the mainstream.
McCormick, born in Chicago to a distinguished family, was the grandson of Tribune founder and former Chicago mayor Joseph Medill, and his great-uncle was the inventor and businessman Cyrus McCormick. His elder brother Medill was slated to take over the family newspaper business but died early. From 1889 through 1893, he lived a lonely childhood with his parents in London where his father Robert Sanderson McCormick was a staff secretary to Robert Todd Lincoln, and attended Ludgrove School. On his return to the United States, he was sent to Groton School. In 1899, McCormick went to Yale College, graduating in 1903. He received a law degree from Northwestern University and served as a clerk in a Chicago law firm, being admitted to the bar in 1907. The following year, he co-founded the law firm that became Kirkland & Ellis, where he worked until 1920, representing the Tribune Company, of which he was president. In 1910, he took control of the Chicago Tribune, becoming editor and publisher with his cousin, Capt. Joseph Medill Patterson, in 1914, a position he held jointly until 1926 and by himself afterwards. A leading progressive during the Progressive Era, he opposed the New Deal. In 1904 a Republican ward leader persuaded him to run for Alderman, and he was elected, serving on the Chicago City Council for two years. In 1905, at the age of 25, he was elected to a five-year term as president of the board of trustees of the Chicago Sanitary District, operating the city's vast drainage and sewage disposal system. In 1907 he was appointed to the Chicago Charter Commission and the Chicago Plan Commission. However, his political career ended abruptly when he took control of the Tribune. McCormick went to Europe as a war correspondent for the Tribune in 1915, early in World War I, interviewing Tsar Nicholas, Prime Minister Asquith, and First Lord of the Admiralty Winston Churchill. He visited the Eastern and Western Fronts and was under fire on both. On this trip, McCormick began collecting pieces of historically significant buildings which would eventually find their way into the structure of the Tribune Tower. Returning to the United States in 1915, he joined the Illinois National Guard on 21 June 1916, and, being an expert horseman, became a major in its 1st Cavalry Regiment. Two days earlier, the Illinois National Guard had been called into Federal Service along with those of several other states by President Woodrow Wilson to patrol the Mexican border during General John J. Pershing's Punitive Expedition. McCormick accompanied his regiment to the Mexican border. Soon after the United States entered the war, McCormick became part of the U.S. Army on 13 June 1917 again when the entire Illinois National Guard was mobilized for Federal service in Europe. He was sent to France as an intelligence officer on the staff of General Pershing. Seeking more active service, he was assigned to an artillery school. By 17 June 1918, McCormick became a lieutenant colonel, and by 5 September 1918 had become a full colonel in the field artillery, in which capacities he saw action. He took part in the capture of Cantigny, after which he named his farm estate in Wheaton, Illinois, and in the battles of Soissons, Saint-Mihiel, and the second phase of the Argonne. He served in the 1st Battery, 5th Field Artillery Regiment, with the 1st Infantry Division. His service ended on 31 December 1918, though he remained a part of the Officer Reserve Corps from 8 October 1919 to 30 September 1929. Cited for prompt action in battle, he received the Distinguished Service Medal. Thereafter, he was always referred to as "Colonel McCormick." A conservative Republican, McCormick was an opponent of President Franklin D. Roosevelt and compared the New Deal to Communism. For a period in 1935, he protested Rhode Island's Democratic judiciary by displaying a 47 star flag outside the Tribune building, with the 13th star (representing Rhode Island) removed... relenting after he was advised that alteration of the American flag was a legal offense. . He was also an America First isolationist who strongly opposed entering World War II to rescue the British Empire. As a publisher he was very innovative. McCormick was a 25 percent owner of the Tribune's 50,000 watt radio station, which was purchased in 1924; he named it WGN, the initials of the Tribune's modest motto, the "World's Greatest Newspaper". Decades after McCormick's death, WGN's television broadcasting operations were one of several national "superstations" that were on cable systems across America. WGN was the first to broadcast the Indianapolis 500, the World Series, and the Kentucky Derby, while the Tribune was the founder and sponsor of the Chicago College All-Star Game, which pitted the NFL champion against an all-star college team for more than 40 years. He also established the town of Baie-Comeau, Quebec in 1936 and constructed a paper mill there. In failing health since an attack of pneumonia in April 1953, McCormick nevertheless remained active in his work until the month before he died. He was buried on his farm in his war uniform. During his long and stormy career, McCormick carried on crusades against gangsters and racketeers, prohibition and prohibitionists, local, state, and national politicians, Wall Street, the East and Easterners, Democrats, the New Deal and the Fair Deal, liberal Republicans, the League of Nations, the World Court, the United Nations, British imperialism, socialism, and communism. Besides Roosevelt, his chief targets included Chicago Mayor William Hale Thompson and Illinois Governor Len Small. Some of McCormick's personal crusades were seen as quixotic (such as his attempts to reform spelling of the English language) and were parodied in political cartoons in rival Frank Knox's Chicago Daily News. Knox's political cartoonists derided McCormick as "Colonel McCosmic". In 1915, McCormick married Amy Irwin Adams, who died in 1939, leading to several years of his being a near social recluse. In 1944 he married Mrs. Maryland Mathison Hooper. He had no children.
A larger-than-life character whose staunch isolationism grew more anachronistic as time passed, those who knew him little or only as a public figure thought of Colonel McCormick as a "remote, coldly aloof, ruthless aristocrat, living in lonely magnificence, disdaining the common people...an exceptional man, a lone wolf whose strength and courage could be looked up to, but at the same time had to be feared; an eccentric, misanthropic genius whose haughty bearing, cold eye and steely reserve made it impossible to like or trust him." McCormick was described by one opponent as "the greatest mind of the fourteenth century" . He did consider himself an aristocrat, and his imposing stature–6'4" tall, with a muscular body weighing over 200 lbs, his erect soldierly bearing, his reserved manner and his distinguished appearance–made it easy for him to play that role. But if he was one, he was an aristocrat, according to his friends, in the best sense of the word, despising the idle rich and having no use for "parasites, dilettantes or mere pleasure-seekers", whose company, clubs and amusements he avoided. With an extraordinary capacity for hard work, he often put in seven long days a week at his job even when elderly, keeping fit through polo and later horseback riding. In his seventies, he could still get into the war uniform of his thirties. The giant convention center McCormick Place on the near South Side of Chicago is named after him. Today, the Engineering School at his alma mater, Northwestern University is named in his honor. McCormick was also used as the inspiration for one of Ayn Rand's characters in The Fountainhead
|December 9th, 2008||#3|
Join Date: Dec 2003
Location: Missouri, USSA
The Tribune site http://www.tribune.com/about/index.html says it is "America's largest employee-owned media company."
That sounds very similar to how the banks and insurance companies owned their assets and their risks -- until lately that is, when their liabilities became greater than their assets, in which case the taxpayers became the unwilling new "owners" of the debt.
The Tribune group also owns the LA Times, which rarely, but sometimes, will publish an article that could be accused of being "racist" (that is, insufficiently anti-white) and they also own the Baltimore Sun, which as I learned on VNN's main page, was just recently guilty of telling way too much truth about Morris Dee's S.P.L.C. http://www.baltimoresun.com/news/opi...,504953.column
Produce good men -- the rest follows.
--William G. Simpson
The Morality of Survival
|December 9th, 2008||#4|
Join Date: Oct 2008
Jews do this to every business that gets fairly large, they simply have some rich, swaggering guy, as a front man go around and buy them up in 'leveraged' buyouts, but they are simply frontmen for the Jews, and they immediately fire all the white males, ship the factories to Mexico, start importing all their parts from Asia, begin using the corporation to hire niggers and hot white women and put them in the same room all day, and they slap their occult satanic logos all over the company.
John McCain's wife said her favorite show is the X-files. This show is mind scrambling non-sense that has very little plot continuity, soon we will have female governors and senators who can't figure out that the show doesn't actually make any sense.
|December 9th, 2008||#5|
Leaving a bruise
Join Date: Mar 2004
Location: Land o' Bears, PA
It probably wouldn't have been much better off had jew business partners Eli Broad and Ronald Burkle purchased it.
I'd have liked to have known Mr. Robert McCormick, though.
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|October 7th, 2010||#6|
Join Date: Jul 2007
At Flagging Tribune, Tales of a Bankrupt Culture
By DAVID CARR
Published: October 5, 2010
In January 2008, soon after the venerable Tribune Company was sold for $8.2 billion, Randy Michaels, a new top executive, ran into several other senior colleagues at the InterContinental Hotel next to the Tribune Tower in Chicago.
Mr. Michaels, a former radio executive and disc jockey, had been handpicked by Sam Zell, a billionaire who was the new controlling shareholder, to run much of the media company’s vast collection of properties, including The Chicago Tribune, The Los Angeles Times, WGN America and The Chicago Cubs.
After Mr. Michaels arrived, according to two people at the bar that night, he sat down and said, “watch this,” and offered the waitress $100 to show him her breasts. The group sat dumbfounded.
“Here was this guy, who was responsible for all these people, getting drunk in front of senior people and saying this to a waitress who many of us knew,” said one of the Tribune executives present, who declined to be identified because he had left the company and did not want to be quoted criticizing a former employer. “I have never seen anything like it.”
Mr. Michaels, who otherwise declined to be interviewed, said through a spokesman, “I never made the comment allegedly attributed to me in January 2008 to a waitress at the InterContinental Hotel, and anyone who said I did so is either lying or mistaken.”
It was a preview of what would become a rugged ride under the new ownership. Mr. Zell and Mr. Michaels, who was promoted to chief executive of the Tribune Company in December 2009, arrived with much fanfare, suggesting they were going to breathe innovation and reinvention into the conservative company.
By all accounts, the reinvention did not go well. At a time when the media industry has struggled, the debt-ridden Tribune Company has done even worse. Less than a year after Mr. Zell bought the company, it tipped into bankruptcy, listing $7.6 billion in assets against a debt of $13 billion, making it the largest bankruptcy in the history of the American media industry. More than 4,200 people have lost jobs since the purchase, while resources for the Tribune newspapers and television stations have been slashed.
The new management did transform the work culture, however. Based on interviews with more than 20 employees and former employees of Tribune, Mr. Michaels’s and his executives’ use of sexual innuendo, poisonous workplace banter and profane invective shocked and offended people throughout the company. Tribune Tower, the architectural symbol of the staid company, came to resemble a frat house, complete with poker parties, juke boxes and pervasive sex talk.
The company said Mr. Michaels had the support of the board.
“Randy is a tremendous motivator, very charismatic, but he is very nontraditional,” said Frank Wood, a member of the Tribune board. “He has the kind of approach that motivates many people and offends others, but we think he’s done a great job.”
The company is now frozen in what seems to be an endless effort to emerge from bankruptcy. (The case entered mediation in September after negotiations failed, and a new agreement between two primary lenders was recently announced.) But even as the company foundered, the tight circle of executives, many with longtime ties to Mr. Michaels, received tens of millions of dollars in bonuses.
Behind the collapse of the Tribune deal and the bankruptcy is a classic example of financial hubris. Mr. Zell, a hard-charging real estate mogul with virtually no experience in the newspaper business, decided that a deal financed with heavy borrowing and followed with aggressive cost-cutting could succeed where the longtime Tribune executives he derided as bureaucrats had failed.
And while many media companies tried cost-cutting and new tactics in the last few years, Tribune was particularly aggressive in planning publicity stunts and in mixing advertising with editorial material. Those efforts alienated longtime employees and audiences in the communities its newspapers served.
“They threw out what Tribune had stood for, quality journalism and a real brand integrity, and in just a year, pushed it down into mud and bankruptcy,” said Ken Doctor, a newspaper analyst with Outsell Inc., a consulting firm. “And it’s been wallowing there for the last 20 months with no end in sight.”
Mr. Zell has acknowledged that the deal has not turned out how he hoped. But noting a recent upturn in results, he said through a spokesman, “Tribune has made significant strides in becoming a current, competitive and sustainable media company. The measure of management’s performance is reflected in the increased profitability of Tribune’s media properties.”
An Innovative Deal for Little Cash
When Mr. Zell purchased the Tribune Company in December 2007, he bought into an industry desperately in need of new ideas. And Mr. Zell, a consummate deal maker, had a barrelful.
Tribune, home to some of the most important newspapers in the country — The Baltimore Sun, The Hartford Courant and The Orlando Sentinel as well as The Chicago Tribune and The Los Angeles Times — had been battered by big drops in advertising and circulation. According to Mr. Zell, the company was also suffering from stodgy thinking and what he called “journalistic arrogance.”
“There’s a new sheriff in town,” he said, in speeches that were peppered with expletives, as he toured the Tribune’s offices.
It was a message that some within the company initially welcomed.
“Sam Zell was sort of a rock star when he went around and toured the various properties,” said Ann Marie Lipinski, the former editor of The Chicago Tribune who left less than a year after the takeover. “People had been living with uncertainty for so long and they hoped something good would come from an owner with a proven track record of success in other businesses.”
Mr. Zell’s first innovation was the deal itself. He used debt in combination with an employee stock ownership plan, called an ESOP, to buy the company, while contributing only $315 million of his own money. Under the plan, the company’s discretionary matching contributions to the 401(k) retirement plan for nonunionized Tribune employees were diverted into an ownership stake. The structure of the deal allowed Tribune to become an S corporation, which pays no federal taxes; its shareholders are responsible for all taxes.
The $8 billion in new loans used to finance the deal left the company with $13.8 billion in debt. But Mr. Zell was convinced that by quickly selling the Chicago Cubs and other assets while improving operating margins, the company could emerge as a valuable property. It was typical Zell: a risky approach to gain control over a large, distressed asset while minimizing his own exposure, something he acknowledged in a company newsletter:
“I’ve said repeatedly that no matter what happens in this transaction, my lifestyle won’t change,” he wrote to his combination employees/shareholders. “Yours, on the other hand, could change dramatically if we get this right.”
His second innovation was bringing in a new management team, largely from the radio business, that, like Mr. Zell, had little newspaper experience, which constituted more than 70 percent of the company’s business.
Mr. Michaels, who was initially in charge of Tribune’s broadcasting and interactive businesses as well as six newspapers, was a former shock jock who made a name for himself — and a lot of money for Mr. Zell — by scooping up radio stations while at the Zell-controlled Jacor Communications. Jacor was later sold to Clear Channel Communications for $4.4 billion.
In turn, Mr. Michaels remade Tribune’s management, installing in major positions more than 20 former associates from the radio business — people he knew from his time running Jacor and Clear Channel — a practice that came to be known as “friends and family” at the company.
One of their first priorities was rewriting the employee handbook.
“Working at Tribune means accepting that you might hear a word that you, personally, might not use,” the new handbook warned. “You might experience an attitude you don’t share. You might hear a joke that you don’t consider funny. That is because a loose, fun, nonlinear atmosphere is important to the creative process.” It then added, “This should be understood, should not be a surprise and not considered harassment.”
The new permissive ethos was quickly on display. When Kim Johnson, who had worked with Mr. Michaels as an executive at Clear Channel, was hired as senior vice president of local sales on June 16, 2008, the news release said she was “a former waitress at Knockers — the Place for Hot Racks and Cold Brews,” a jocular reference to a fictitious restaurant chain.
A woman who used to work at the Tribune Company in a senior position, but did not want to be identified because she now worked at another media company in Chicago, said that Mr. Michaels and Marc Chase, who was brought in to run Tribune Interactive, had a loud conversation on an open balcony above a work area about the sexual suitability of various employees.
“The conversation just wafted down on all of the people who were sitting there.” She also said that she was present at a meeting where a female executive jovially offered to bring in her assistant to perform a sexual act on someone in a meeting who seemed to be in a bad mood.
Staff members who had concerns did not have many options, given the state of the media business in Chicago, the woman said. “Not many people could afford to leave. The people who could leave, did. But it was not in my best interest to have my name connected to an E.E.O.C. suit,” she said, referring to the Equal Employment Opportunity Commission. (Indeed, there are no current E.E.O.C. complaints against the Tribune Company.)
There have been complaints about Mr. Michaels in the past, however. In 1995, Mr. Michaels and Jacor settled a suit brought by Liz Richards, a former talk show host in Florida who filed an E.E.O.C. complaint and a civil suit, saying she had been bitten on the neck by Mr. Michaels and that he walked through the office wearing a sexual device around his neck.
“They were like 14-year-old boys — no boundaries at all — but with money and power,” Ms. Richards said in an interview.
During and immediately after Mr. Michaels’s tenure at Clear Channel, three lawsuits were filed contending sexual harassment at the company. One plaintiff, Karen Childress, a senior executive, said she was fired after complaining about receiving lewd e-mail from senior company executives. In her complaint, Ms. Childress also stated that women who slept with male executives at the firm were promoted. The cases were settled out of court. Clear Channel declined to comment on the lawsuits.
On Dec. 11, 2008, the Tribune board was made aware that not everyone appreciated the new cultural dynamics at the company. The board received an anonymous letter detailing a hostile work environment and a pattern of hiring based on personal relationships and suggested that the company was leaving itself open to “potential litigation risk.”
The letter also suggested that a senior executive and a female employee had been discovered by a security guard engaged in a consensual sexual act on the 22nd-floor balcony. The board took the allegation seriously enough that it hired an independent law firm to investigate it. A company spokesman said the investigation found that the executive and the woman denied the incident and the inquiry could find no evidence that such an incident had occurred or that any harassment had taken place. But a person who worked in security at the time confirmed to The New York Times that a security guard reported seeing the incident. That person declined to be identified because of the sensitivity of the issue.
By September 2008, the historic Tribune Tower had someone new in charge of security: John D. Phillips, a former traffic reporter who had previously worked for Mr. Michaels. In June 2009, a party for management was held in the former office of Col. Robert R. McCormick, the newspaper baron and grandson of the founder, on the 24th floor of the Tribune Tower. Smoke detectors were covered up and poker tables were brought in.
Mr. Phillips posted pictures of the party on his Facebook page, showing Mr. Michaels and Mr. Chase, along with Lee Abrams, a former radio programmer who had joined Tribune earlier that year, playing poker and drinking in the ornate office. The Chicago media writer Robert Feder first reported about the Facebook photographs.
“We are in the office of the guy who ran the company from the 1920s to 1955,” Mr. Phillips wrote on his Facebook page. “It’s normally a shrine. We pretty much desecrated it with gambling, booze and cigars.”
A New Culture
Staff Cutbacks and Promotions
While the new owner and managers went about changing the corporate tone at Tribune, they were also under pressure to service the enormous debt. In his initial tour of the company, Mr. Zell promised there would be no job cuts. But like other media companies caught in the downdraft of advertising revenue, the company was forced to cut staff and slash budgets. Elsewhere, the company introduced promotions that seemed to have been drawn from the radio playbook. At four of the company’s television stations, an event called “CA$H GRAB,” in which a viewer was led into a bank vault and allowed to scoop up dollar bills, was inserted in the middle of the station’s newscasts. At WPIX-TV in New York, the viewers were cheered on by clapping Hooters waitresses, giving the station the appearance of televised shock radio.
Mr. Abrams, who describes himself as an “economic dunce,” was made Tribune’s chief innovation officer in March 2008. In his new role, he peppered the staff with stream-of-consciousness memos, some of which went on for 5,000 typo-ridden, idiosyncratic words that left some amused and many bewildered.
“Rock n Roll musically is behind us. NEWS & INFORMATION IS THE NEW ROCK N ROLL,” he wrote in one memo, sent in 2008. He expressed surprise that The Los Angeles Times reporters covering the war in Iraq were actually there.
James Warren, the former managing editor and Washington bureau chief of The Chicago Tribune, said: “They wheeled around here doing what they wished, showing a clear contempt for most everyone that was here and used power just because they had it. They used the notion of reinventing the newspapers simply as a cover for cost-cutting.” (As a contributor to the Chicago News Cooperative, Mr. Warren writes a column that appears in the Chicago edition of The New York Times.)
In Chicago, Ms. Lipinski said, it became clear that Mr. Zell was not above using the newspaper as a tool for his other business interests. In June 2008, Mr. Zell approached her at a meeting, saying that The Chicago Tribune should be harder on Gov. Rod Blagojevich. She reminded him that the newspaper had aggressively investigated the governor and that its editorial page had already called for his resignation.
“Don’t be a pussy,” he told her. “You can always be harder on him.”
In a news meeting later the same day, she found out that Mr. Zell was in negotiations to sell Wrigley Field to the state sports authority.
“It was hard to avoid the conclusion that he was trying to use the newspaper to put pressure on Blagojevich.”
Through a spokeswoman, Terry Holt, Mr. Zell denied he used the newspaper to business ends. “From Day 1, Sam vowed never to interfere with the editorial content at any of Tribune’s media properties, and he has always honored that commitment,” Ms. Holt said.
In a criminal complaint, federal authorities accused Mr. Blagojevich of trying to trade public financing of the stadium for the dismissal of some members of the Tribune’s editorial board. An aide to the governor charged with pursuing the matter reported back that Mr. Zell “got the message and is very sensitive to the issue,” according to a criminal complaint filed by the United States attorney’s office for the Northern District of Illinois. (In August, Mr. Blagojevich was convicted on one of the 24 felony counts he faced, lying to F.B.I. agents about his involvement in campaign fund-raising.)
Ms. Lipinski said it was that episode and other conflicts with management that prompted her resignation in July 2008, just one month after Scott Smith, the paper’s longtime publisher, left.
“I was plenty used to crisis, in many ways thrived on it,” said Ms. Lipinski, who had joined the newspaper as an intern in 1978. “But this nonsense was a form of intentional man-made distraction that made the work impossible. I couldn’t protect my staff from what they could see plainly with their own eyes.”
Mr. Zell’s various approaches didn’t slow the company’s decline. In the third quarter of 2008, the company posted a loss of $124 million, and the recession made it difficult to sell the Cubs. His purchase of Tribune became, as even he described it, “the deal from hell” and the company filed for bankruptcy on Dec. 8, 2008.
It wasn’t simply the huge debt that burdened the company; the performance under new management continued to slide. While its television division has since done well in the advertising rebound — over all, the 23 stations are on track in 2010 to pass $1 billion in revenue for the first time since 2007 — Tribune’s newspapers have continued to underperform the rest of the industry.
Advertising has been inserted into The Los Angeles Times in new and unsettling ways. In March, an ad mimicking the front page for Disney’s “Alice in Wonderland” was wrapped around the first section and in July, a fake version of the newspaper’s section for late breaking news, called LATExtra, was wrapped around the real one, promoting Universal Studios’ King Kong attraction, with a lead “story” that read “Universal Studios Partially Destroyed.” In April 2009, an advertisement posing as a news article about NBC’s new show “Southland” appeared on the front page.
In July, the Los Angeles County Board of Supervisors, the governing body of the county of Los Angeles, sent a letter of protest, saying that the use of advertising disguised as news “makes a mockery of the newspaper’s mission.”
The ads do not seem to have helped. The Chicago Tribune’s circulation continues to slide, with weekday circulation down 9.8 percent in the first half of 2010. The Los Angeles Times is in worse shape, having lost 14.7 percent of its weekday circulation in the period. (Over all, the industry lost 8.7 percent weekly circulation in the period.)
Radio, which was the core expertise of the management, has had a mixed record since the takeover. After bringing in many longtime associates of Mr. Michaels, WGN-AM, the company’s well-known talk radio station in Chicago, lost market share in 2009. The station manager sent a note last month to Tribune managers, asking them to call in to one of the new hosts, because few actual listeners were. But a company spokesman said that ratings in the morning were up 20 percent for the month of August.
In an effort to shake up the station, the management jettisoned a sports talk show at night and installed someone with no radio experience, Jim Laski, an Illinois politician who had been convicted of a felony.
Steve Cochran, a longtime midday host who has said he was dismissed as he was walking out of the bathroom this summer, said the changes seemed aimed at destroying WGN.
“This was supposed to be their comfort zone, what they were good at, and they have ruined a radio station that has had an 80-year relationship with its listeners,” he said.
“This is a collection of carnival workers who are only looking after their friends, giving jobs to their buddies. Blagojevich is on trial and you bring in a politician who has done time in jail?”
Creditors Lose, as Do Workers
More than the Tribune’s creditors took a haircut: the shares that about 10,000 nonunion employees received in the ESOP deal are now worthless as a result of the bankruptcy, although at the beginning of this year, the company replaced the ESOP plan with a cash incentive contribution. But if and when the Tribune exits bankruptcy, the value of the company will be worth substantially less than when Mr. Zell bought a controlling interest. Under a proposed settlement filed recently with the court, senior lenders, including the Angelo Gordon hedge fund and Oaktree Capital Management, would receive $5.5 billion, while other lenders with less priority would receive far less. The case is in mediation.
“How can anybody say that they have done a good job?” said Henry Weinstein, a former Los Angeles Times reporter who filed a lawsuit, still pending, that contends that the use of employee pensions to finance the deal was illegal.
“Anybody can make money when you are not servicing the debt and cutting people. Zell and the people he brought in had no idea what they were doing.”
And Mr. Zell? On Aug. 13, his lawyers suggested that if other junior creditors were paid, he should get his money back as well.
Until the bankruptcy is resolved, Mr. Zell’s handpicked team will continue to run the company, but it is frozen out of any large strategic alliances or purchases. The issue of who will run the company will remain unsettled until the bankruptcy is resolved. Mr. Zell remains the chairman of the board and is no longer involved in the day-to-day operations of the company.
Despite the company’s problems, the managers have been rewarded handsomely. From May 2009 to February 2010, a total of $57.3 million in bonuses were paid to the current management with the approval of the judge overseeing the bankruptcy. In 2009, the top 10 managers received $5.9 million at a time when cash flow was plummeting.
Mr. Wood, the board member, said, “We think they earned those bonuses. They’ve done a fabulous job in very difficult circumstances.”
At the time, the court-appointed trustee in the bankruptcy case filed an objection, writing that while the current owners argued for “shared sacrifice,” they “fail to understand what the concept means when it comes to compensating their management,” and then added, “now is not the time for yet another round of bonuses.”
Other proposed bonuses on the table for 2010 could bring the figure for management pay enhancements to more than $100 million, and those bonuses are heavily weighted to top management. (Earlier this week, management announced that beginning in 2011, it would begin awarding merit raises to nonunion employees of about 3 percent.)
“You have advertising wrapping around sections and being disguised as news and empty desks all around you, and then you read about these ridiculous bonuses and feathering their nests with severances, you want to scream,” said Steve Lopez, a longtime columnist at The Los Angeles Times.
The creditors, which also include JPMorgan Chase and the Deutsche Bank Trust Company, have acquiesced to the lucrative bonuses in part because they fear that antagonizing management could further hold up the company’s emergence from bankruptcy, according to two lawyers representing creditors who did not want to be quoted publicly during bankruptcy negotiations.
“No one is in charge there,” said an adviser to one of the senior creditors, who declined to speak on the record because it was not in his business interest to be in conflict with the current board or management.
Mr. Michaels suggested in public statements that his current team was very much in charge. According to the company’s monthly statements, cash flow is on the rise and the company has $1.6 billion in cash on hand, about half of it from the sale of the Cubs, which Mr. Zell eventually managed to sell. “We are just getting started,” he said in the announcement.
And management still is confident that the new thinking has Tribune on the right track. The company recently announced the creation of a new local news format in which there would be no on-air anchors and few live reports. The newscasts will rely on narration over a stream of clips, a Web-centric approach that has the added benefit of requiring fewer bodies to produce.
“The TV revolution is upon us — and the new Tribune Company is leading the resistance,” the announcement read. And judging from the job posting for “anti-establishment producer/editors,” the company has some very strong ideas about who those revolutionaries should be: “Don’t sell us on your solid newsroom experience. We don’t care. Or your exclusive, breaking news coverage. We’ll pass.”
|October 7th, 2010||#7|
Join Date: Nov 2005
My dad has a subscription to the Tribune and I can assure you it was one of the worst anti white newspapers long before Zell took it over. It used to be run by swindling jew David Radler, who actually won the Zionist of the Year award from his fellow tribesmen. He also ran the Jerusalem Post.
Not a week goes by(sometimes a day) where there isn't a prominent story about the holocau$t. It's a paper that endorsed all the major Illinois crooks from Blago, Ryan to Daley then tried to recast itself as being some champion against corruption.
One might make the argument that the Tribune is more responsible for Obama becoming president than any other individual or group.
The reason being that when Obama was running for the vacated senate seat his popular opponent was a handsome white guy named Ryan who had been married to an attractive tv actress from Star Trek.
The couple had gone thru a bitter divorce and the Tribune spent a ton of money on lawyers to have their sealed divorce records opened in order to cast Ryan as a pervert. Turns out he and his wife were swingers.
Well, Ryan quickly quit the race amidst the scandal and the Republicans brought in Alan Keyes as a token challenger who had no chance because the election was only a few weeks away plus Keyes wasn't even a resident of the state and was too strident. This all but assured Obama coasting into office.
The irony of course is that the Tribune is very pro fag and has always taken the position that, "whatever two consenting adults do in the privacy of their bedroom is nobody's business." UNLESS it's a conservative politician.
I don't think anything is likely to keep newspapers like the Tribune afloat once people of my parent's generation are gone. The overhead to running a newspaper is huge and young people get their news of the internet...or from the likes of Jon Stewart.
Even with the non stop liberal propaganda of the Tribune most men read it for the sports scores and women for clipping coupons.
|October 8th, 2010||#9|
Join Date: Nov 2003
Blog Entries: 34
McCormick was also the man who employed Donald Day, whose "Onward Christian Soldiers" provided the grist for some of my radio. Day was perhaps the only honest reporter covering Eastern Europe in the first half of the 20th century. He put out unjewed reports on the jewish criminals who took over Russia and mass-murdered Aryans.
|October 8th, 2010||#10|
Join Date: Nov 2003
Blog Entries: 34
I highly recommend this book:
Amazon.com: Onward Christian Soldiers: An American Journalist's Dissident Look at World War II (9780939482627): Donald Day: Books
|chicago tribune, financial leverage, jewish innovation, knockers, sam zell|