Earlier this year, the union that represents editorial workers at the Baltimore Sun launched an effort to wrest control of the paper from its owner, Chicago based Tribune Company.
Now, that movement has spread to nine other Tribune-owned papers in six states because the journalists at those papers fear the influence of a New York hedge fund.
The journalists had been frustrated for years as newspaper staffs continued to shrink through repeated buyouts and corporate cutbacks. But when Alden Global Capital, a New York hedge fund with a reputation for buying and gutting newspapers, entered the picture they decided to do something.
“One of the biggest problems we have in journalism right now, is hedge funds are bleeding newsrooms dry,” said Jon Schleuss, president of the News Guild International, the union that represents reporters at The Sun and other papers.
The funds treat “newspapers and news publications as distressed assets,” he said. They cut a much as they can over a few years, "extract all the money and then leave them for dead."
Alden oversaw a 70% reduction in the work force at the Denver Post and carried out similar purges at other papers it has taken over. The fund has cut the staffs at the Pottstown (PA) Mercury and the Times-Herald in Vallejo, Calif., to one reporter.
Schleuss says that has “serious ramifications” for democracy.
“When we lose local publications, corruption goes up, taxes go up, partisanship goes up and people’s ability for fact-based news is diminished,” he said.
Alden bought 32% of Tribune’s stock last year and now has three seats on its seven-member board.
Sarah Harvey, a Chicago based designer for Tribune, says corporate executives pursued aggressive cuts to the work force while paying huge dividends to stockholders for years before Alden arrived.
And as much as she says she believes those cuts are a threat to the papers, “the biggest threat right now is Alden,” Harvey says.
Alden’s website is a single page with a picture of trees and the legend, "Alden Global Capital is an investment manager based in New York, NY." But it has no contact information.
Schleuss says he met with Sun reporters in January to talk about getting local ownership for the paper. That morphed into discussions with foundations who wanted to buy the paper and turn it into a non-profit.
The Goldseker Foundation and the Abell Foundation have taken the lead. Ironically, the Abell Foundation was established by a former board chair of The Sun's original owners, the A.S. Abell Company.
Matt Gallagher, Goldseker's president, says interest in the paper goes beyond those two foundations.
“We’re very confident that if a window opens up to acquire The Sun at a fair price that we’re going be in a position to be able to put together a very diverse ownership group that would be able to pull this off,” he said.
Gallagher says his group has been in contact with Tribune but can’t talk about their conversations. Schleuss says he’s sent letters to Tribune but has not received a response.
WYPR also has reached out to Tribune for comment..
Union leaders at Tribune papers who have joined the effort haven't gotten as far as The Sun in looking for buyers.
Ryan Murphy, who covers Norfolk City Hall for the Virginian Pilot, says they have “some people we’re very hopeful for, but we don’t have anybody sort of on the hook, so to speak, right now.”
And Monivette Cordeiro, who covers courts for the Orlando Sentinel, says they haven’t talked to anybody yet.
“But we definitely do have a lot of deep pocketed people in our community that we think could be our friends,” she said. “It’s just a matter of reaching out to them.
But with these other papers coming late to the game and Alden gaining power in Tribune, the question becomes can they pull this off?
Lucy Dalglish, dean of the Philip Merrill College of Journalism at the University of Maryland, says individual papers have been turned into non-profits—the Philadelphia Inquirer, the St. Petersburg (Fla.) Times and the Salt Lake Tribune in Utah, for example--but never a whole block of newspapers from one chain.
“They’re going to have to depend on some steady philanthropy,” she said, “steady and guaranteed philanthropy.”
The money will have to come from individuals with deep pockets who are “interested in an informed electorate” and “willing to support it regularly for a period of time because it would require some pretty significant investment that you could depend on before until you could get the thing up and running," she said.
