The E-mail Commentary from Eco-Justice Ministries
Murder in the Newsroom
My hometown newspaper is being murdered. Slowly, methodically and intentionally murdered.
What is being done to the Denver Post -- and the other 96 newspapers owned by Alden Global Capital LLC -- is a vivid and tragic case study of capitalism that has no values, that seeks only profit, and which displays no concern for the community it serves.
This plundering of newspapers is astonishingly blatant and egregious, but it is not unusual. Similar exploitation is going on in other industries -- I'll point to the oil and gas industry in particular. Even more worrisome, it appears to me that the trajectory of US government policies is grounded in the same mindset of short-term gain without consideration of the broader community or future generations.
It is important to expose this perversion of our economic and social systems. Democracy and healthy communities cannot survive when the drive for profit displaces all consideration of the common good. God's creation is at risk when people and nature are seen only as resources to be exploited for financial gain.
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In 2010, Alden Global Capital LLC acquired MediaNews Group, Inc. The news company was in bankruptcy, as newspapers struggled with the double whammy of a deep recession and the shift of news from print to digital platforms. The Denver Post was one of several prominent regional newspapers that was bought out. The company, now known as Digital First Media (DFM), now owns 97 newspapers.
DFM had weathered the difficult years fairly well. Last year, the media group's chief executive sent a company-wide email saying that the company was "solidly profitable" and that "advertising revenue has been significantly better" than its competitors. You'd think that would be good news for Alden Global -- and maybe it was, but not in the way that you'd expect.
The operating strategy of Alden's president, Heath Freeman, is not to build strong companies that are profitable for the long haul. Rather, the profits and resources of those newspapers are plundered for the benefit of investors. Staff is cut from the papers, weakening the business, and boosting cash flow to the holding company.
In a scathing editorial -- printed in April one day before a 30% cut in journalistic staff was imposed by Alden -- the Denver Post described their own situation.
Here in Colorado, Alden has embarked on a cynical strategy of constantly reducing the amount and quality of its offerings, while steadily increasing its subscription rates. In doing so, the hedge fund managers -- often tellingly referred to as "vulture capitalists" -- have hidden behind a narrative that adequately staffed newsrooms and newspapers can no longer survive in the digital marketplace. Try to square that with a recent lawsuit filed by one of Digital First Media's minority shareholders that claims Alden has pumped hundreds of millions of dollars of its newspaper profits into shaky investments completely unrelated to the business of gathering news.
The editorial board closed out their statement by saying, "The smart money is that in a few years The Denver Post will be rotting bones. And a major city in an important political region will find itself without a newspaper."
In May of 2013, an already-diminished Denver Post had 142 people working in the newsroom. Five years later, there are just 66. One of the former staff -- Jason Blevins, who did great environmental reporting -- wrote that Freeman "squeezed $36 million in profit from his 11 Colorado newspapers, an absurd 19 percent profit margin that was not fueled by innovation or growth, but by firings." At the end of Blevin's excellent column about the devastation of the Post, published in High Country News, he says,
It's not just that journalists are out of jobs. It's that they are not telling the stories that we all need to hear. As the nation withdraws into echo chambers and filtered news, Freeman and his ilk are not just cutting budgets, they are severing the connections between us, the very stories that unite us. And that is something every citizen should fight to prevent.
To be clear, Alden Global Capital is not owning newspapers to strengthen a financially struggling industry. It is not seeking to impose a political message through the papers (as we see with Sinclair Broadcasting's purchase of TV stations). Alden buys and destroys newspapers simply to rake in as much money as possible.
In May, employees of the Post protested Alden's policies with simultaneous rallies outside the firm's New York headquarters and the Post's Colorado offices. But, as Dave Krieger documents in the Boulder Free Press, the protests were ignored.
A normal company even tangentially concerned about its public image would have arranged a simple public relations reception for the protesters. ... This is because most companies report to a public constituency. It might be their stockholders, it might be their customers, it might even be their employees. A private equity firm doesn't have a public constituency. It has no exposure to what the world thinks. It is not publicly traded. It has no customers, other than a small number of wealthy investors granted admission based on a single factor: how much money they have.
Without any form of public accountability, without any commitment to journalism, Alden is plundering institutions which provide essential journalism to their communities.
The Denver Post is being murdered. A newspaper with a 126 year history of serving the city and the state is being destroyed. Its lifeblood is being sucked out so that investors can increase their wealth. Those investors simply don't care what happens to Colorado, or to journalism.
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The murder of newspapers for short-term profit is an exceptionally clear-cut example of corporate greed without public accountability that damages the community. But it is not unique. I see strong parallels in the unapologetic behavior of oil and gas companies.
Pope Francis, you'll recall, recently took global oil executives to task for continuing to search for new fossil fuel reserves, when science and international agreements recognize that 80% of those fuels have to stay in the ground. The Pope's challenge to the industry sees a moral failure in the search for profits which degrades the global environment.
With the newspaper depredations of Alden Global Capital in mind, look for the clear parallels in this recent analysis of the oil industry by sustainability expert Jeffrey Sachs:
The US economy and politics are in the hands of corporate lobbies, including Big Oil. Resources are relentlessly allocated to developing more oil and gas fields not because they are good for America or the world, but because the shareholders and managers of ExxonMobil, Chevron, Conoco Philipps, and others demand it. ...
It is easy to see the moral failure in Alden Global Capital's exploitation of newspapers. The oil industry's moral failure is of the same kind. Their knowing, intentional damage of communities and Earth's biosphere places profit as the ultimate goal.
I won't belabor the fairly evident extension of this analysis to the Trump administration's policies. The administration's stated policy of "energy dominance" places the production, sale and use of fossil fuels as a national priority, and explicitly turns away from concerns about effects on human health, environmental health, and climate stability.
But it isn't just fossil fuels that are seen from a financial perspective, to the exclusion of environmental factors. Yesterday's news tells of a new Trump policy reversing Obama-era initiatives on ocean health. Trump said he was "rolling back excessive bureaucracy" and focusing on "growing the ocean economy." NBC News reported that the policy "depicts the world's oceans as a resource ripe for expanded business opportunities, reversing the Obama administration's emphasis on protecting 'vulnerable' marine environments." The report noted that "environmental organizations said it continues a pattern of Trump supporting industry over long-term protections for the environment."
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Vulture capitalists kill off major newspapers to make a quick buck. The global oil industry, by refusing to change course toward carbon-free energy, is killing off the planet for the sake of their corporate profits. And the Trump administration sees fossil fuels, public lands and oceans as resources to be plundered, and refuses to see the need for environmental care to ensure sustainable uses and public health.
The murder of the Denver Post which is now taking place is a blatant and shocking example of capitalism without a conscience. The other examples display the same qualities of exploitation that ignores the common good.
We are the public constituency that must hold business and government accountable for these misdeed. We must not be silent in the face of these moral perversions.
Eco-Justice Ministries * 400 S Williams St, Denver, CO 80209 * Home Page: www.eco-justice.org
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