Washington Post Sale to Amazon’s Bezos Brings Up Questions About the Future of America’s Great Institutions

Newhouse Update Included

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The Big Picture –
By Glynn Wilson –

What will become of America’s institutions, great and not so great?


That’s a subject that has been on my mind some of late, even before the surprise announcement that Amazon.com’s Jeff Bezos will buy the Washington Post for a mere $250 million. The Huffington Post online news site sold for $315 million two years ago, with no print shop attached.

The Post only became a great national institution starting in the 1960s and early ’70s due to the Graham family’s support and editor Ben Bradlee’s courage in the Nixon years on the Pentagon Papers story and Watergate. But it was probably worth 20 times that sale price as recently as 1999, the year before George W. Bush captured the presidency and the dot com bubble’s first big burst.

It’s been interesting following the early, sensational coverage of the sale in publications such as Politico in addition to the Washington Post itself, where we found out some interesting things about the background and politics of Bezos, even though he is anything but a media hound.

In the first big story about the sale published by the Washington Post itself, we find out that Bezos started Amazon with a $300,000 loan from his parents in Washington state, for example.

I didn’t know that. Did you?

From other coverage in Politico, we hear from Bob Woodward, who says Bezos isn’t Murdoch, and from Dan Rather, who calls it a “great day” for American journalism.

Bezos is painted as socially liberal with a libertarian, ant-tax streak, a familiar profile many Baby Boomers will relate to. He has contributed small amounts of money to both Republicans and Democrats, but the one thing that will get him bashed on conservative radio faster than anything else will be the $2.5 million he contributed to help pass a referendum to legalize same-sex marriage in Washington state, which the Post claims catapulted Bezos and his wife MacKenzie to the “top ranks of financial backers of gay rights in the country.”

Oh, the right-wing blog comments are already all atwitter about that. But Jeff Cohen of Fairness and Accuracy in Reporting and other commenters on Democracy Now pointed out that the right-wing Koch brothers have also contributed to gay rights initiatives, and they may have even more in common. No love of labor unions. It is understandable that Bezos fought taxes on Internet sales for many years, since the technology was so new and needed some early breathing space to develop. That’s a policy I have agreed with as a Web publishing innovator myself.

Amazon has even been accused of bad labor practices, harsh working conditions and slim employee benefits, not a good thing. But he has come around on paying sales taxes, at least in states where Amazon builds warehouses. President Obama recently visited a new distribution center in Chattanooga, Tennessee, a move that did not come without criticism, although it fits in with the president’s plan to create domestic middle class jobs rather than overseas.

Only time will tell if Bezos will prove to be competent as a newspaper publisher and shepherd the institution into a new profitable era, or if he will just use it to buy himself more leverage in Washington for his other creative and financial endeavors. The guy is apparently a science fiction freak who has invested in some hair brain plans to save humanity by exploring outer space.

At the same time, the Post has been one of the most important voices in the Amerian press on the subject of saving life and planet earth by factually covering stories on global warming and climate change probably with even more credibility than the New York Times. The Times coverage, it seems to me, actually helped create an overblown reaction to some scientists e-mails a few years back and gave fodder to critics of science, who used that story to try to discredit the argument and push for more exploration and development of fossil fuels.

Speaking of great American institutions and the New York Times, the Sulzberger family put out a quick press release in the wake of the Washington Post sale insisting that the Times was not for sale. Some critics, including me, think the Sulzberger’s should have taken the Times private 10 years ago and removed the pressure of the stock market from business and news decisions. It has become obvious in recent years that the Times has succumbed to the pressure to try to make more money for shareholders at the expense of the news product. No decision made that more obvious than a recent decision to get rid of all seven of the reporters charged with covering the environment as a beat.

The science section has also gone down precipitously over the past decade as coverage of sports, popular culture, crime and business have gained a growing influence in the paper and online, and the coverage of civil rights in the South has pretty much disappeared.

The Bush Great Recession

As the horrific Bush years came to an end with election of President Obama in 2008, Americans and our allies abroad were literally on the verge of losing all trust and hope for many of our major institutions, including the banks and the federal government and the presidency itself. That trust has at least partially restored abroad and to some extent at home, although Congress is still rated the lowest of the low. While this new class of tea party Republicans have blocked any attempt to provide jobs or protect the environment and gone on a killing spree of unions across the country, in spite of even a lot of criticism from the left the Obama administration is what’s holding this place up and preventing an utter collapse of our hopes and dreams and way of life.

All it will take is one more laissez-faire Republican in the White House and this house may come crumbling down. People do not realize how close we came to going back to eating shoe leather during the Bush Great Recession of 2007-2008.

The press as an institution in this country is as critical to making democracy work as the government itself, as Thomas Jefferson knew and wrote about so eloquently in the late 1700s.

The Post has done yeomen’s work in that regard over the past 50 years. It has certainly not gotten every story right. Both the Times and the Post got Iraq wrong in the run-up to Bush’s war. But the Post rallied with its coverage of the abuse of detainees at Abu Ghraib and other stories, recently even rivaling The Guardian‘s coverage of domestic spying.

Here’s to hoping Bezos will keep the Post going, at least online, for another 50 years, and figure out a way to make it profitable. Hey, he might just be a good guy to work for. Some of these newspaper managers who have been at it for maybe too long tend to make bad hiring decisions, as we saw at the Times with Jayson Blair.

The Newhouse Chain

Now one final note on another media institution that also holds a major influence in huge swaths of the country, including the critical electoral state of Ohio as well as Oregon, Louisiana and my home state of Alabama.

The Newhouse empire is struggling to maintain its monopoly on the news around here by closing down daily print publication and ramping up its Web operation, with mixed results.

In New Orleans, sources say Newhouse is pumping money into the online operation there while one trend has been drastically reversed. When Newhouse first put up its nola.com, al.com and other Websites more than a decade ago, chain managers dictated that the print shops simply dump all their content for free digitally to the Web shop. The print shop never got any of the revenue in return to help pay for reporting, which is one of the main reasons the daily newspapers had to be curtailed in the wake of the Bush Great Recession.

Now I’m told that the process has been reversed. That is, the print shop folks simply have to pull whatever content they need from the Web sites to fill the space between the ads in the newspaper. That’s an interesting shift in technology and power, don’t you think?

Also, there is a rumor going around over the Internet that Bishop State Community College is eyeing the new Mobile Press-Register building on Water Street for a fire sale price of $15.9 million. The building, which opened in 2002, plus the presses and equipment, cost $65 million. The debt service on that building and the one in Birmingham are among the main reasons Newhouse decided it could no longer afford expensive local publishers and daily circulation.

The original asking price for that building was $21.8 million. The Birmingham News building is still up for sale for an asking price of $21.4 million, but as far as I know, there are no potential takers around here.

These colossal decision-making failures by Newhouse may cost the markets it controls any kind of daily news source, unless the people in those places get wise and help some independent Web publishers develop new outlets online. If not for the heavy-handed dealings on the part of The Birmingham News to kill the Post-Herald, there could have been another daily news chain still in business in my home town. But they never saw the Bush Great Recession coming, believing — like the Republicans they endorsed — that hands off corporate capitalism is the best way to run a democracy.

When will people learn that regulation is a good thing?

Meanwhile, it is becoming obvious that some unions are taking their personal conservatism seriously and “going in a different direction” and not heeding the lessons we have been talking about here for the past few years. Their backwardness is going to aid the Republicans in putting them out of business. I honestly hope these good working folks don’t lose not only their livelihoods but their pensions as well. The Web Press can only help so much by itself. Even Jesus said God helps those who help themselves — not those who shoot themselves in the foot.

© 2014, Glynn Wilson. All rights reserved.