Now that it has been firmly established that this is A Sort of New Age of Greed, it's fascinating to recall avarice observations of two highly disparate personalities whose comments bracket the period we're in.
Greed has been around a long time but the current roaring American version that threatens the financial foundations of this country had a warning shot fired in 1987 with the release of "Wall Street," Oliver Stone's take on matters as told through the craven adventures of Gordon Gekko, played by Michael Douglas. At least half the Gekko character was based upon Michael Milken, the "Junk Bond King" who eventually went to prison. Gekko's signature line, "Greed, for lack of a better word, is good" paid homage to the robber barons of 100 years past while providing inspiration for current financial world players to turn Wall Street into a very ugly gambling casino with one notable exception for losers: Las Vegas' blackjack "house" edge of .5 - 1.5% must now look like one of those forks in the road not taken. Wall Street continues to play recklessly with other people's money as the exceedingly ruthless run little risk of going to prison.
Twenty-five years after Gekko's pronouncement, we are, perhaps, equally affected and decidedly frightened by the words of Warren Buffett explaining that "there's class warfare, all right, but it's my class, the rich class, that's making war, and we're winning."
Greed is everywhere and often explained as a natural outgrowth of globalization. Laws, and clever interpretations of them, are in the books for those inclined to squeeze every ounce possible of financial nourishment. It's all done in the name of stockholders who hold CEO's feet to the flames of "productivity." When the CEOs do a good job or even a bad one, they are rewarded by hand-picked board members with rewards now averaging $13 million, up 14% over the prior year. Actually, 2011 was a disappointing one for CEOs who received 22.8% more in 2010 than over the preceding year. You win some, you lose some. Worth pointing out is that CEO compensation last year was 380 times the average worker's pay, the kind of increase that makes possible the purchase of yet another home.
There are many rationales for overpaying CEOs. One of them is successful outsourcing by the Walmarts, GEs and, yes, Mitt Romney, now threatening to become the Bain of our existence as his past unfolds. Although corporate America is inclined to sit on such figures, GE admits its percentage of U.S. employees has been reduced from 54% in 2000 to 46% in 2010. The multinationals cut 2.9 million U.S. jobs the past decade while adding 2.4 million overseas. Interesting enough, even journalism is being impaired in the name of outsourcing. More about this in a few paragraphs.
As readers of this space may recall, I retired from the Chicago Tribune in 1989 having worked in public relations for eight years. I enjoyed toiling for a newspaper that had been retreating from a well-earned reputation for conservatism in a highly liberal community. It was Col. Robert R. McCormick, editor/publisher from 1910-1955, whose penchant for a variety of hatreds had made the newspaper a worldwide symbol of reaction, isolation and prejudice. It took an editorial, written by executive editor Clayton Kirkpatrick who dramatically reduced the imagery by calling for the resignation of Richard Nixon.
Admittedly fond of my association with what McCormick insisted was The World's Greatest Newspaper, I must confess embarrassment and anger upon reading very recent on-line stories dealing with Journatic, a firm devoted to outsourcing news stories for major U.S. papers including the Tribune.
First, a little background. Major American newspapers have, until recently, observed the high walls that separate editorial and advertising departments. Advertising is sold on the basis of a publication's circulation plus a lot of intangibles including marketing conditions, reader profiles and the skills of salesmen. Gone are the days when a reader, hearing the friendly "plop" of a newspaper landing on the front porch, would regard what the newsboy had tossed as "his" paper. We were very possessive then regarding our best connection to a distant world.
Advertising departments, being understandably aggressive, would occasionally veer from established tradition (front page placement was always coveted), editorial would scream, and the publisher would side with editorial. It was not long after Tribune Company purchased the Los Angeles Times in 2000 that the paper's advertising department sold a special section highly commercial in nature. Advertisers were told the paper's editorial department was on board to supply feature stories. Advertising never told editorial until a couple days before publication. Top Tribune editors, sent to manage the wily beast, failed to do so. They included: Dean Baquet, now with the New York Times as Managing Editor for News after refusing to make one more staff cut; and James O'Shea who eventually wrote The Deal From Hell about the Tribune screw-up leading to Tribune Company bankruptcy.
While news gathering in journalism's Golden Age was gained face-to-face or by phone, the brave new world of communications has made such basics sometimes obsolete. Journatic, co-founded by CEO Brian Timpone, was created to provide content in TribLocal's 90 town websites and 22 weekly print editions. Two points: Chicagoland is no longer a viable description of Tribune's huge coverage area and Journatic is so new a title that its use on a computer will produce a red underline.
Ryan Smith, who worked 10 years for smallish newspapers in Missouri before moving to Chicago in 2007, eventually joined Journatic to work for a publication called Blockshopper. Smith was ecstatic about the copy editing offer having supplemented his writing with such gigs as office temp work. Journalism jobs were, as he puts it, "drying up and blowing away like tumbleweed."
What he quickly learned was that many stories, positioned under phony bylines, "originated" in developing countries including the Philippines and African nations. Writing stories under aliases is a breach of journalistic ethics. The copy, paid for in paltry wages reflecting the country's economy, provided proof that basic rules of spelling and grammar were not understood. Smith was offended, among other things, by his pay: $24 for an 800 to 1,000 word news story and $12 for 500 words. Sad as it is, a Filipino can make as little as 35 cents for a story. Smith worked from mangled press releases culled from retyped police blotters, reformatted public records and other data gathered thanks to the reach of the internet.
Worst of all, Journatic Chicago hires since this spring number about 75 freelancers plus 20 full-time editors and writers to cover TribLocal. Losing their jobs were half of the Tribune's 40 TribLocals including copy editors, designers and web producers. Based in Chicago, Journatic employes 140 overseas contract workers whose squat work is fed to more than 200 U.S. based writers and editors who include 60 full-timers.
Smith, having decided to become a whistle blower, first approached Michael Miner who writes about the media for Chicago Reader, one of the best alternative publications in the country. Miner made a few calls, nothing developed, and Smith approached "This American Life," produced by Chicago by public radio station WBEZ-FM. Out of Smith's anger came "Forgive Us Our Press Passes." Produced by Sarah Koenig, the 23-minute feature immediately prompted investigations by newspapers using Journatic. Among them: the Tribune, Chicago Sun-Times, Houston Chronicle, Newsday and the San Frnacisco Chronicle. The Sun-Times fired Journatic while Gate House Media, a publisher of 28 Chicago area publications, is reconsidering its contract with Journatic and contemplating hiring their own reporters. This past Friday the Tribune suspended Journetic indefinitely while admitting being an investor in the service. Mike Foucher, head of editorial at Journetic, quit Saturday.
Contacted by the Columbia Journalism Review, Timpone admitted making a mistake "in allowing some of these stories to go to our clients. But these stories really don't deserve bylines at all because they are compiled from six or seven sources." Tribune now believes plagiarism also is involved.
Another challenge to journalism's ethics occurred recently when Atlantic editor Megan McArdle admitted outsourcing her opinion of global warming. "Providers" include Jonathan Adler, Ron Bailey and Pat Michaels--all Cato Institute connected. As pointed out by Joe Romm of "ThinkProgress," the Cato Institute, originally the Charles Koch Foundation, is being taken back by the founders, Adler is a law professor funded by the Charles Koch Foundation, Bailey is a Cato Institute Media Fellow, while Michaels (also on the Cato payroll) has admitted that 40% of his work is funded by the petroleum industry. The game is called Follow the Money and it's a media stunner when the senior editor for a major magazine would outsource her thinking on one of today's major issues, then admit it. McArdle continues to post pieces on climate science in spite of outsourcing her expertise.
Journalism junkies are fascinated by Journatic's sudden aggressiveness in Chicago. It came on the heels of an announcement by the New York Times that it was folding the Chicago News Cooperative. That was in mid-February of this year and the decision was a disappointment to those who care about such things; created in October of 2009 by old Tribune hand O'Shea, CNC was kept alive by funding from such deep pockets as the MacArthur and Knight Foundations, George Soros' Development Loan Fund and the financially-challenged New York Times. The latter was paid back via four pages a week of Chicago stories produced by former Tribune editors and writers working out of WTTW offices where I once worked (1972-75) for the public television station.
When O'Shea started CNC three years ago, he described it as a "fresh, innovative approach" to reversing "the news industry's precipitous decline." Now, it is no more.
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