A Secretive Hedge Fund Is Gutting Newsrooms

[Celerity]

https://www.theatlantic.com/magazine/archive/2021/11/alden-global-capital-killing-americas-newspapers/620171/



The Tribune Tower rises above the streets of downtown Chicago in a majestic snarl of Gothic spires and flying buttresses that were designed to exude power and prestige. When plans for the building were announced in 1922, Colonel Robert R. McCormick, the longtime owner of the Chicago Tribune, said he wanted to erect “the world’s most beautiful office building” for his beloved newspaper. The best architects of the era were invited to submit designs; lofty quotes about the Fourth Estate were selected to adorn the lobby. Prior to the building’s completion, McCormick directed his foreign correspondents to collect “fragments” of various historical sites—a brick from the Great Wall of China, an emblem from St. Peter’s Basilica—and send them back to be embedded in the tower’s facade. The final product, completed in 1925, was an architectural spectacle unlike anything the city had seen before—“romance in stone and steel,” as one writer described it. A century later, the Tribune Tower has retained its grandeur. It has not, however, retained the Chicago Tribune. To find the paper’s current headquarters one afternoon in late June, I took a cab across town to an industrial block west of the river. After a long walk down a windowless hallway lined with cinder-block walls, I got in an elevator, which deposited me near a modest bank of desks near the printing press. The scene was somehow even grimmer than I’d imagined. Here was one of America’s most storied newspapers—a publication that had endorsed Abraham Lincoln and scooped the Treaty of Versailles, that had toppled political bosses and tangled with crooked mayors and collected dozens of Pulitzer Prizes—reduced to a newsroom the size of a Chipotle.

Spend some time around the shell-shocked journalists at the Tribune these days, and you’ll hear the same question over and over: How did it come to this? On the surface, the answer might seem obvious. Craigslist killed the Classified section, Google and Facebook swallowed up the ad market, and a procession of hapless newspaper owners failed to adapt to the digital-media age, making obsolescence inevitable. This is the story we’ve been telling for decades about the dying local-news industry, and it’s not without truth. But what’s happening in Chicago is different. In May, the Tribune was acquired by Alden Global Capital, a secretive hedge fund that has quickly, and with remarkable ease, become one of the largest newspaper operators in the country. The new owners did not fly to Chicago to address the staff, nor did they bother with paeans to the vital civic role of journalism. Instead, they gutted the place. Two days after the deal was finalized, Alden announced an aggressive round of buyouts. In the ensuing exodus, the paper lost the Metro columnist who had championed the occupants of a troubled public-housing complex, and the editor who maintained a homicide database that the police couldn’t manipulate, and the photographer who had produced beautiful portraits of the state’s undocumented immigrants, and the investigative reporter who’d helped expose the governor’s offshore shell companies. When it was over, a quarter of the newsroom was gone.

The hollowing-out of the Chicago Tribune was noted in the national press, of course. There were sober op-eds and lamentations on Twitter and expressions of disappointment by professors of journalism. But outside the industry, few seemed to notice. Meanwhile, the Tribune’s remaining staff, which had been spread thin even before Alden came along, struggled to perform the newspaper’s most basic functions. After a powerful Illinois state legislator resigned amid bribery allegations, the paper didn’t have a reporter in Springfield to follow the resulting scandal. And when Chicago suffered a brutal summer crime wave, the paper had no one on the night shift to listen to the police scanner. As the months passed, things kept getting worse. Morale tanked; reporters burned out. The editor in chief mysteriously resigned, and managers scrambled to deal with the cuts. Some in the city started to wonder if the paper was even worth saving. “It makes me profoundly sad to think about what the Trib was, what it is, and what it’s likely to become,” says David Axelrod, who was a reporter at the paper before becoming an adviser to Barack Obama. Through it all, the owners maintained their ruthless silence—spurning interview requests and declining to articulate their plans for the paper. Longtime Tribune staffers had seen their share of bad corporate overlords, but this felt more calculated, more sinister.



“It’s not as if the Tribune is just withering on the vine despite the best efforts of the gardeners,” Charlie Johnson, a former Metro reporter, told me after the latest round of buyouts this summer. “It’s being snuffed out, quarter after quarter after quarter.” We were sitting in a coffee shop in Logan Square, and he was still struggling to make sense of what had happened. The Tribune had been profitable when Alden took over. The paper had weathered a decade and a half of mismanagement and declining revenues and layoffs, and had finally achieved a kind of stability. Now it might be facing extinction. “They call Alden a vulture hedge fund, and I think that’s honestly a misnomer,” Johnson said. “A vulture doesn’t hold a wounded animal’s head underwater. This is predatory.” When Alden first started buying newspapers, at the tail end of the Great Recession, the industry responded with cautious optimism. These were not exactly boom times for newspapers, after all—at least someone wanted to buy them. Maybe this obscure hedge fund had a plan. One early article, in the trade publication Poynter, suggested that Alden’s interest in the local-news business could be seen as “flattering” and quoted the owner of The Denver Post as saying he had “enormous respect” for the firm. Reading these stories now has a certain horror-movie quality: You want to somehow warn the unwitting victims of what’s about to happen. Of course, it’s easy to romanticize past eras of journalism. The families that used to own the bulk of America’s local newspapers—the Bonfilses of Denver, the Chandlers of Los Angeles—were never perfect stewards. They could be vain, bumbling, even corrupt. At their worst, they used their papers to maintain oppressive social hierarchies. But most of them also had a stake in the communities their papers served, which meant that, if nothing else, their egos were wrapped up in putting out a respectable product.

snip

[yonder]

1. "Slats Grobnik and Other Friends"

are spinning where they rest.

[jimfields33]

3. I'd like to see papers stop printing and go exclusively online

It’s absolutely a disgrace to cut down trees for news most know already.

[OldBaldy1701E]

4. True

Especially when we can make something similar without wiping out our means of carbon dioxide conversion. That and, as you mention, almost all of it is online now. There are a few pockets out there who like a physical copy to hold in their hands, but most would be content with it. Just make it so those outlying areas have access to the internet. (WHAT WHAT WHAT!?!?! 'Giving' those people internet? Of course, the companies won't do it because they won't get a 1000% return on the few thousand dollars it would cost them to extend a few lines, but that is another story for another time.)

[empedocles]

2. . . . and sell the real estate - key

[Lonestarblue]

5. I believe that hedge funds and private equity companies should be regulated more closely.

Both seem have one business model: buy a company that is making money but needs help, fire a bunch of employees, and then strip the assets until not much is left, and either close it or sell it for whatever they can get. By going all digital, the Tribune could have been saved. Now it may die entirely. The US has a lot of rapacious capitalism that destroys companies, and people’s jobs, rather than building them—and the owners get richer and richer.

[mopinko]

6. 1st, the trib is rightly placed w the rest. they championed every war since day 1.

but it was a hollowed out hulk long ago.
during the raygun years they started closing foreign bureaus because they didnt want to report how the rest of the world saw their hero.

and replacing mike royko w john kass was clearly the end of the beginning of it's slde back into the yellow journalism of the colonel.

[mikeysnot]

8. The K in kass is silent

I would post that to his columns for years trying to get the first one… then they shut down the comments. Just go there for the weather now..

[mopinko]

9. at one time i liked him. he was on wbez for years.

back then he was a tough reporter who said shit outloud that others didnt.
but he quickly learned the whole- gin shit up to get a reaction- schtick.

[Champp]

7. This is an intentional strategy

Republi-think for billionaires: keep the people dumb (screw over public schools and libraries), and uniformed (kill local newspapers, or shrink them to impotence).

Republican billionaires then have less to worry about having their evil shit come to public attention.