Bankruptcy

The Sky is Falling on Newspapers. Sorry, Dad.

By Angie Littwin

?Nobody outside the newspaper industry really understands just how bad things are.?  For over a decade I?ve heard this statement and others like it everywhere ? at the dinner table and on family vacations, over the telephone and in the grocery store on trips home.  I?ve heard them from my father, a newspaper journalist of 40 years, and from his friends, most of whom also began their reporting careers in the late 1960s and early 1970s. 

As of today, nobody in or outside the business can deny the sad reality.  The Tribune Company, which owns two of the nation?s great newspapers ? the L.A. Times and the Chicago Tribune ? as well as six others, has filed for bankruptcy.  Sam Zell, the chain?s controversial CEO, insists that the bankruptcy is simply a way of restructuring the company's debt and not a catastrophe, but it?s hard to see how this could be true.  Even if he?s right in about the outcome of this one bankruptcy ? which I doubt ? he?s wrong in the more important sense.  Newspapers are dying.

I should know. Less than a week ago, my father?s current paper, the Rocky Mountain News, was put up for sale.  In the current climate, with credit scarce and other papers on the brink (including the New York Times, which is ? incredibly ? offering its legendary office building as collateral for an operating-expenses loan), this almost certainly means that the paper will fold.  Probably the best that the employees can hope for is that the process of folding takes long enough for them to find other jobs.  The Tribune bankruptcy adds another layer of financial anxiety.  Nineteen years of my father?s pension ? from seven years at the L.A. Times and twelve at the Baltimore Sun ? are now tied up in Chapter 11.

Something has to change.  No matter how hard or well reporters work, there simply isn?t enough money to support them anymore.  Truth-seeking (for better or worse) has never been a for-profit activity.  Newspapers have just been lucky in that they found a way to subsidize this high-cost endeavor ? classified ads.  That subsidy is fast disappearing with the Internet in general and craigslist in particular.  If we as a country want to continue having a written representative in the ?fourth branch? of government, we?re going to have to come up with another one.  The fifty cents or so we pay for a printed paper isn?t enough to pay for things like foreign bureaus or investigative reporting.  (Expenses like these are why blogging is no substitute.)  And of course, these days many people read the paper on the web and don?t even pay that fifty cents anymore.  (My dad jokingly lays the blame on me and my online reading habits in his column about the Rocky going up for sale.)

Those of us who write for this blog talk a lot about families who work hard, play by the rules, and still find themselves in trouble.  But until recently I?ve had the luxury of not thinking about my own family in this light.  I don?t want to exaggerate.  My dad will land on his feet; he always has.  But it?s excruciating that he?s facing a layoff less than six months before his sixtieth birthday.  This is someone who?s worked his way up from the lowest echelons journalism, covering high-school basketball games when he himself was still in high school, to the very top of his profession.  (Not that I?m biased.)  My dad believes that he will be one of the last people to turn out the lights in the newsroom.  I just hope the newsroom has more than five years of light left.
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Full post as published by Credit Slips on December 09, 2008 (boomark / email).