Andy Martin launches a campaign to “Save the Chicago Tribune”
Martin says that asset stripper Sam Zell is systematically destroying the Chicago Tribune and may be looting the company’s assets. He suggests Tribune employees have a legal right to protect their savings in the company’s ESOP.
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BLOG ON THE 2008 CAMPAIGN
FOR IMMEDIATE RELEASE:
ATTENTION DAYBOOK/ASSIGNMENT EDITORS
ANNOUNCEMENT OF CHICAGO NEWS CONFERENCE JULY 8, 2008
ANDY MARTIN LAUNCHES A CAMPAIGN TO SAVE THE CHICAGO TRIBUNE FROM DEVASTATION AT THE HANDS OF SAM ZELL
CAN AMERICAN JOURNALISM BE SAVED?
FORMER NEWSPAPER DELIVERY BOY ANDY MARTIN TRIES TO SAVE THE TRIBUNE “BEFORE IT IS TOO LATE”
(CHICAGO)[July 8, 2008] Andy Martin asks: can the Chicago Tribune be saved? Can the Tribune Company newspapers in Los Angeles, Hartford (where he used to be a carrier boy), Baltimore, Orlando and Fort Lauderdale be rescued? Can American journalism survive? Martin believes a tragedy is unfolding in Chicago: an ignorant, arrogant, incompetent swindler has gained control of the Tribune Company and is systematically destroying the company’s assets, particularly its newspapers.
“The barbarians are not at the gate, they are inside the gate,” says Martin. “The Chicago Tribune is a great asset; the Los Angeles Times, Hartford Courant, Baltimore Sun and other Tribune newspapers have always been highly professional. Now an ignoramus has taken over with a 2% down payment and claims he knows more about journalism than the entire newspaper industry.
“Zell has decided that what people want is less news, lower quality news, more pretty pictures and less substance. So Zell is cutting news coverage, dumbing down the product and adding more advertising. Who is going to be left holding the bag? Why Tribune Company employees, of course; they are the majority owners of the post-public company. Zell only has a few hundred million dollars invested in a $13 billion enterprise. He can walk away at any time, leaving the employees with the results of his destructive policies.
“This week I am going to focus on the future of American journalism. Can it be saved? From itself? Through a series of news conferences and performance art we are going to try to get the public to focus on Zell’s acts of urban vandalism. Proud, profitable institutions across America are being destroyed by Zell’s larceny and infamy.
“There is no surprise that Zell is seeking to ‘strip’ the Tribune Company’s assets, no doubt with a healthy percentage being placed in his own family’s hands. I predicted this over a year ago. Zell has leased his daughter space in the Tribune Tower. Is she paying a market rent? Doubtful. Zell may be stealing from his own employees.
“Zell acts as though he owns the Tribune outright. But he doesn’t. The company is now owned by an employee ESOP, or employ stock ownership plan. Zell has an option to purchase a significant share of the company but employees are still the majority owners. Employees are being raped and robbed by Zell and his crew of pirates.
“Newspapers are undeniably facing a challenge. Marginal companies such as Knight-Ridder have been absorbed. But newspaper managements are largely the architects of their own demise. If you check what the Tribune charges for a classified ad, they want hundreds of dollars for something that others are giving away. The choice is no longer between a reasonably priced Tribune ad and a competitor, but between an outrageously overpriced Tribune classified ad and competitors offering similar products at lower prices. Right across the newspaper industry classified advertising rates have become a delusional operation in which papers are forfeiting revenue because they still charge monopoly prices for a competitive product.
”Long after their monopolies have dissolved, newspaper managers continue to believe they are entitled to a monopoly rate of return. That is no longer the case. Newspaper media dominance is dissolving.
“What solution do newspaper managements and asset strippers such as Zell propose? They constantly cut staff, cut the quality of the news they are providing, and cry about poor results when papers are still stuffed with ads. At a time when they should be rebuilding they are destroying. How long before Zell ‘discovers’ readers don’t want foreign news, and fires the Tribune’s foreign correspondents? Not long I suspect. Zell makes all kinds of ‘discoveries,’ and all of them are designed to cheapen his product and chase readers away.
“Today we launch a campaign to alert the good citizens of Chicago to the threat facing their media. I may not like the odd Trib employee but I have no hesitation in declaring that the company’s newspapers are outstanding products. Now that Gerald Spector, the quality-cutter-in-chief, has demanded that Tribune employees cut back on paper and paper clips, the time is right to sound the alarm. Spector’s actions are ridiculous, a parody of a Gilbert & Sullivan operetta. His save-the-clips memo is cut straight from Dilbert.
“I am launching ‘Save the Chicago Tribune, Stop Sam Zell’ week. We kick off the campaign with Tuesday’s news conference, and Wednesday and Thursday’s performance art.
“What’s the bottom line? If Zell is not stopped, the Tribune Company’s newspapers are gong to be destroyed. The destruction will not be long in coming. The public will abandon the deracinated remnants of Tribune products. Ironically, by virtue of his destruction Zell will claim a new mandate to keep cutting until the Tribune suspends publication or goes bankrupt.
“Reports that Zell is now using receivables financing are a warning sign of impending bankruptcy. Zell’s ‘asset-backed commercial paper’ borrowing confirms in my mind that he is driving the company into the grave. His receivables ‘factoring’ is recourse to a desperate form of borrowing that is usually a refuge for endangered enterprises.
“There is a world of difference between redirecting a strong institution facing temporary challenges and stripping a moribund enterprise. Zell is treating the Tribune Company as dead meat. His actions will ensure its demise. But that’s what the old buzzard has done his whole life, eat what he kills. He obviously knows nothing about journalism. Journ students take notice: journalism schools are an endangered species if Zell succeeds. Northwestern University’s decision to rename its journ school may be a harbinger.
“Mr. Zell and his confederates may yet get their comeuppance. He is still a fiduciary. He owes the shareholders—his own employees—a fiduciary duty. He owes his employees, whose own lifetime savings are the bulk of the company’s capital, a fiduciary duty not to slash away at a successful company. The fiduciary duty he owes his employees is a legal duty, one that is enforceable by his employees in a court of law. He can be prevented from stripping away the company’s assets and transferring them to his own wolf pack of real estate speculators.
“Right now I am fighting this campaign alone. But Tribune employees need to wake up. The stench emanating for Zell’s abattoir is overwhelming. He has brought with him a bunch of small bore asset strippers to dismember the Tribune company. The Trib is a complex communications conglomerate that needed more focused management. But the company will surely perish from the depredations of Zell and his predators.
“In my characteristic way, composed partly of legal arguments and plenty of tongue-in-cheek activity, maybe more cheek and less tongue, I am focusing attention on Zell’s vandalism of the Chicago Tribune and, by implication, on the endangered future of American journalism. If Zell is not stopped, and if incompetent newspaper management is not replaced, the bell will toll for the First Amendment; newspapers and journalism as we know them will cease to exist” Martin says.
NEWS CONFERENCE DETAILS:
WHO: Internet Columnist/media critic Andy Martin
WHERE: Southeast corner of Huron and Wabash Streets, Chicago
WHEN: Tuesday, July 8, 4:00 P. M.
MEDIA CONTACT: (866) 706-2639
[WEDNESDAY/THURSDAY/FRIDAY NEWS CONFERENCES TO BE ANNOUNCED]
Andy Martin is a legendary Chicago muckraker, media critic, author, Internet columnist, radio talk show host and broadcaster. Andy is the Executive Editor and publisher of http://www.ContrarianCommentary.com. © Copyright by Andy Martin 2008. Martin covers regional, national and world events with over forty years of experience. He holds a Juris Doctor degree from the University of Illinois College of Law. Columns are also posted at ContrarianCommentary.blogspot.com; contrariancommentary.wordpress.com. Andy is the author of Obama: The Man Behind The Mask, being published in July 2008, see http://www.OrangeStatePress.com. MEDIA CONTACT: (866) 706-2639 E-MAIL: AndyMart20@aol.com [NOTE: We frequently correct typographical errors and additions/subtractions on our blogs, where you can find the latest edition of this release.]