Capitalist Finance Is Incompatible With a Free Press

With the Chicago Tribune's publishing company on the verge of being swallowed up by the hedge fund industry, capitalism’s ongoing destruction of the free press through downsizing and asset-stripping has become the number one threat to American democracy.

Newspaper giant Tribune Publishing is merging with hedge fund Alden Global Capital. Tribune Publishing owns many newspapers across the country, including the Chicago Tribune, the city’s most-read daily paper and the country’s eighth biggest by circulation.

Anyone who cares about press freedoms and the future of journalism should be sparing with their sighs of relief since Trump was removed from power. This is not just because President Joe Biden has chosen to continue Trump’s project of seeking Julian Assange’s extradition to the United States — though of course, that is easily the greatest threat to the First Amendment under either Trump or almost any modern president before that.

Rather, the sad fact is the Fourth Estate revered in liberal thinking continues to be threatened by something unrelated to whether a Democrat or Republican happens to sit in the White House: Wall Street.

Last Tuesday, the news came down that newspaper giant Tribune Publishing was merging with hedge fund Alden Global Capital. Alden’s 31.6 percent stake already made it the company’s biggest shareholder, but the $630 million deal will see it take full ownership of the struggling firm — if, that is, it gets the go-ahead from regulators and Tribune’s other shareholders, including Patrick Soon-Shiong, the biotech billionaire and LA Times owner who owns 24 percent of Tribune’s stock.

To understand why this is such a big deal, you have to get a sense of how sprawling Tribune Publishing’s ownership is. Tribune owns:

  • the Chicago Tribune (the city’s most-read daily paper and the country’s eighth biggest by circulation)
  • the New York Daily News (New York City’s fourth most popular news outlet and the thirty-fifth most popular news site in the country)
  • the South Florida Sun Sentinel (Florida’s second-largest newspaper)
  • the Orlando Sentinel (its third-largest)
  • the Hartford Courant (Connecticut’s top newspaper by unique visitors per month)
  • the Morning Call in Allentown (Pennsylvania’s eighth biggest paper by audience)
  • and the Virginian-Pilot and Daily Press (Virginia’s second and eighth biggest daily papers by circulation, respectively)

It also owns the Baltimore Sun, but that will be sold to a public charity as part of the deal.

In other words, Tribune doesn’t just own a few of the biggest newspapers in the country. It also owns some of the most widely read papers in some of the biggest metropolitan areas, in a geographical area spanning the South, Northeast, and Midwest.

The other thing you have to understand is what Alden Global Capital is. Through its publishing arm, MediaNews Group, or Digital First Media, Alden now owns around two hundred newspapers, around double what it had in 2018, making it the third-largest newspaper company in the country. It’s done this not because of any concern for the press’s critical role in a democracy — by all accounts, its president Heath Freeman is a numbers-driven finance shark who couldn’t care less about newspapers — but because print media, even as it’s slowly dying, is still worth hefty profits in the short term.

That means Freeman ends up operating like a reverse King Midas, turning every media enterprise he and Alden touch to utter shit. The trail of destruction left in their wake is as vast as it is well-documented, using mass layoffs, cost-cutting, and asset-stripping (like selling off printing plants, offices, and land) to suck out as much profit from struggling newspapers, which they then reinvest into more newspaper takeovers, or pump into various risky, scandal-ridden business ventures. A 2018 lawsuit alleged Alden had done this to the tune of hundreds of millions of dollars, even investing employees’ pension assets into its own hedge funds, while hiding the movement of money from shareholders.

For the newsrooms unlucky enough to be ensnared, the result has been devastating, leaving markedly shrunk teams of reporters to somehow maintain the same level of quality and output of reporting. In the worst cases, like the Pottstown Mercury and the Denver Post, what can generously be called a bare-bones staff of a handful and a few dozen were tasked with covering cities of tens of thousands to several million, respectively. Often, the cuts send the papers into a slow-burning death spiral: cutbacks mean a drop in quality, which means continually declining revenue, which leads to more cutbacks, and so on.

Not content with merely operationally crippling newspapers, Alden has also directly intervened in their reporting. In 2018, as disgruntlement toward Alden’s parasitic business model came to a boil in the Denver Post newsroom, staff revolted, publishing a string of op-eds exposing what the company had done to the paper and calling on neighboring Alden-owned papers to do the same. Before long, directives came down from Alden executives ordering a gag on reporting on the issue, which soon escalated into the firing and resignation of editorial page editors at the Post and Boulder’s Daily Camera.

But Alden, and its acquisition of Tribune, is just one player making one move in this game. Hedge funds and private equity firms have been gobbling up newspapers in recent years, with similarly detrimental, profit-driven results. The consolidation of mass media many feared for decades would snuff out free inquiry is happening, it seems, only combined with twenty-first-century-style Wall Street predation. And as these finance firms grow their control of the news industry, there is a real risk that Alden’s treatment of the Denver Post becomes the future of the industry: a widespread hollowing out of newsrooms coupled with heavy-handed censorship of what’s left.

This is bad for everyone. On the local level, it means people losing touch with what’s happening in their communities, while shady corporate and political actors have freer rein than ever to get away with criminality and misconduct, now there’s no well-resourced team of reporters breathing down their necks.

On the national level, politics is also heavily informed by local reporting. Think back to last year’s Democratic primary, where everything from Pete Buttigieg’s troubles with the police and gentrification to Cory Booker’s absentee governance to Kamala Harris’s appalling political record was built on the groundwork laid by great local reporting.

Consider, too, the still-unfolding story of the life, arrest, and eventual death of billionaire sex offender Jeffrey Epstein, a globally significant series of events that wouldn’t have happened had the Miami Herald not broken the story of Epstein’s original sweetheart deal. Or consider that Trump’s 2016 victory saw him outperform his Republican predecessor in counties with lower local news subscription rates. These are just a few of the many examples of the way local reporting reverberates well beyond its city limits.

Tyrannical governments can be a threat to press freedoms, as Trump and now Biden have shown us. But so can a rapacious finance sector in an era of runaway corporate greed. I seem to recall a public figure who had some pretty good ideas to prevent these kinds of megamergers, spur the creation of civic-focused reporting, and break up media concentration. Maybe it’s worth giving them another look.