Wordyard

I see that the Washington Post’s new publisher, Katharine Weymouth, says the following in a memo: “We must focus better on what the consumer indicates they want, and be less quick to emphasize only what we think is important.”

These are words that most journalists have conditioned themselves to grimace at. To the old-school reporter, “listen to the customer” is assumed to be code for one of the following: (a) cave to the politician; (b) coddle the advertiser; (c) pander to the ignorant; or (d) give credence to the crazies. Customer research is for the marketing guys on the other side of the wall; here in the newsroom, we chart our own course, and we must stuff our ears and tie ourselves to the mast any time our ship passes close enough to readers for us to hear what they’re saying. Otherwise, we might betray our values.

To those of you in businesses outside of professional journalism, where listening to the customer is simple common sense, I realize that this sounds nuts. But it’s true. Here is a very amusing statement of it from one of the most successful journalists of our time:

At the Post I learned how to cruise the newsroom from the master, Michael Specter, who is now the Moscow correspondent for the New York Times… Michael also taught me how to deal with angry and rude readers, which is a major occupational hazard in the newspaper world. I used to get all flustered and apologetic and depressed when people called up to yell at me. But Michael would just listen for about 10 seconds, roll his eyes, and say: “You seem to have forgotten one thing. I DON’T WORK FOR YOU!” Michael is my idol.

This is Malcolm Gladwell, writing in 1996 in Slate. He is recording what a surprising number of journalists believe: They do not work for their readers. This is a fine thing to say, until the person they do work for turns out to be a profit-hungry capitalist less interested in the values of journalism than in boosting shareholder value (or, today, avoiding bankruptcy). At that moment, suddenly, the journalist becomes a convert to the notion of Serving the Reader. Only the commitment is an abstract one; it is made to The Reader, not to specific readers, and so defining its specific meaning remains in the journalist’s hands.

I am writing harshly here because a profession that I love is falling apart. Once upon a time I, too, would have heard a line like “we must focus better on the consumer” and rolled my eyes. Today? I wish the Post luck in figuring out who those consumers are, what they want, and how to get it to them.

The Tribune Company bankruptcy is a sad thing, but it cannot be said to be a surprising thing. Sam Zell’s purchase of the company was a heavily leveraged deal — that means he borrowed a ton of money to pay the previous owners/shareholders and figured he’d pay off the debt with the profits of the newspapers. Only now those profits are tanking (although in fact we’re told that every single Tribune paper is still in the black for the moment) and the credit markets, as you may have heard, are suddenly much less, er, forgiving.

Of course, as some are speculating, Zell may have figured all along he’d end up needing to take this route, and he may not view it with horror. One of the things he can presumably do in Chapter 11 is renegotiate all the painful labor deals that newspaper owners have always chafed at. Bankruptcy can deal you a “get out of contracts free” card.

Still, it’s a mess, and one that can’t really be laid at the feet of the new-media iceberg that the entire newspaper industry is cruising towards, except in the broadest of ways. If you trace the lines of responsibility for this train-wreck you find they all point back to that sacred cow of the newspaper industry — the Caretaker Family.

In the newspaper biz there is a lot of mythology around family ownership. The idea is that the proprietors’ descendants understand the sacred trust that is journalism and will serve as a strong protection for both newspaper employees and the public that depends on quality news sources.

The problem is that these families are just normal human beings who like to earn money. Over the past decades many or most of them decided — accurately, at least in the short term — that they could make a lot more money by selling shares to the public than by running their firms as private companies. Many newspapers created a dual ownership structure, so that even though the public was buying shares, the families retained effective control of the companies through preferred stock with special voting privileges. That’s how, for instance, the families that owned both the New York Times and the Wall Street Journal set up their stock structures. But control turns out to be effective only when the money’s rolling in. When it slows or stops, the family members get restive.

The Bancrofts, who owned the Journal, sold out to Rupert Murdoch with barely a whimper the moment it looked like the Journal was no longer going to line their pockets. They proved faithless protectors of tradition. Of course, sometimes a family will make a smart (or lucky) move. Consider that, as I understand it, the Washington Post owes its relative financial stability to its purchase, in 1984, of the Stanley Kaplan SAT testing outfit, which — unlike the reporting of world and national news — turns out to be a pretty lucrative line of business.

In the case of Tribune, I don’t know how much of the company the family still owned by the time Zell acquired it. But if they weren’t directly responsible for selling to him, then they had bailed some time before. Either way, they hardly protected anything.

I took a look at the company’s proud corporate history here and found an account of an upward march of progress and profits under the wise stewardship of various McCormicks and Medills. Then in 1983 the company goes public and begins aggressive expansion, acquiring a bunch more broadcast outlets and boosting revenue to new heights. In 2000 Tribune acquires Times Mirror (another newspaper empire abandoned by another clan, the Chandlers). By 2002 Tribune has become a true Goliath, with more than $5 billion in revenue. Only here, strangely, the history goes nearly blank. A bland “Tribune returned to private ownership in December of 2007” is the only mention of the firm’s recent troubles; its new private owner is not even named. Where were those McCormicks and Medills now?

Newspapers, as a business, are simply a huge mess today. For a long time they blamed TV, and now of course they blame the Web. Let us also not forget to blame the families.

I worked for an exemplar of those families myself once, and saw the good and the bad. Our publisher at the old Examiner was Will Hearst, scion of the Hearst clan. He was responsible for a wavering but heartfelt effort to shake some life into the old paper in the 1980s, when I joined it. But after a decade he’d had enough, and moved on (to Silicon Valley). Once he left, I knew it was time to jump ship too. The iceberg was visible enough then. So was the evidence that families were never going to save the newspaper industry.

A couple weeks ago, Peggy Noonan had a hilarious column in which she noted the strange (to her) disconnect between the depressing economic information in the news and the apparently unchanged commercial bustle of her Upper East Side neighborhood, where “nothing looks different.” My friend Andrew Leonard eviscerated her for her “let ’em eat cake” obliviousness.

There’s a slightly different species of cluelessness at work in the premise behind David Carr’s New York Times column this morning, in which Carr muddily hypothesizes that the speed of new-media information transmission has accelerated the current economic downturn.

The piece is the sort of chin-scratcher that never sums up its thesis because it doesn’t quite have one. But the heart of it seems to be something like this: Things are bad, but even people who haven’t been directly hurt by the recession are cutting back on spending because they’re being bombarded by bad news in new, faster, more enveloping ways. “This recession got deeper faster,” Carr says, “because we knew more bad stuff quickly.” He describes the result as a sort of “emotional contagion” or “neurosis” that is fueling further economic slowdown.

I had my eyes glued to the screen during the last recession at the start of this decade, which was centered on my industry, the Internet. So the idea that there’s something new going on seems hard for me to buy. But the more significant mistake Carr makes is to suggest that the choices people are making to scrimp and scrub their budgets are “emotional,” “neurotic” — irrational. And that’s dead wrong.

What does it take to feel that a recession is real? Carr, like Noonan, seems to be waiting for the appearance of Hoovervilles. There are millions of lost jobs, and many more whom the labor statisticians miss whose hours have been cut back involuntarily. One in ten U.S. mortgage holders is a month or more behind in their payments. Any rational person ought to look at this situation and feel that things have indeed changed.

Yet the question keeps arising: For people who haven’t actually been laid off, “nothing has changed,” so why are they going all Scrooge-like on the economy?

What has changed, for everyone, is our picture of the future. For years we made our economic choices based on one set of assumptions. Even those of us who didn’t take on loads of credit card debt or leverage our homes or otherwise turn ourselves into family-sized debtor nations made assumptions when we looked at our financial plan for the next year or decade or retirement: our homes would grow in value, our 401(k)s would appreciate at a certain rate, we could send our kids to college if things kept going the way they were.

And of course now they are not. So any rational person is having those hard family conversations and scrubbing the personal budget. This is not acting on fear. It is neither “emotional” nor “neurotic.” It is acting rationally, the way economists expect us to act. Much as I am a lifelong skeptic of the classical economists’ hyperrational model of human behavior, in this case, the real world behavior fits the model pretty perfectly.

That it is deepening the recession is to be expected, not the fault of some new-media dynamic of hyperactive blogging but a sign that the signals we are receiving about the economy are strong enough today to shock us back into the “rational actor” mode. Carr implies that the Web jumped the gun on the recession: “The recession was actually not officially declared until last week, but the psychology that drives it had already been e-mailed, blogged and broadcast for months.” But the official declaration noted that the recession actually began a year ago. Of course we have all been talking about it for a year: We weren’t premature, we were reflecting the real-time event. It was the officials who lagged.

Watching your spending? Cutting out what you can? You aren’t being neurotic or irrational. The irrational behavior, it turns out, was what so many Americans were doing previously in this decade — cruising along obliviously and piling up debt while Wall Street concocted escalatingly baroque financial engineering schemes that exponentially inflated the risk at the root of our economy until the whole thing went bust. If a scary market has shocked such irrationality out of our system, let’s hope the effect is long-lasting.