Damage Report

Linda Stewart Ball left The Dallas Morning News in 2006, and she couldn’t be professionally happier. “I’m extremely satisfied,” says Ball, forty-seven, a reporter at the paper for fourteen years who accepted a buyout and became a freelance writer. “I love being my own boss.” Reese Dunklin, who received a 2004 Livingston Award for Young Journalists, chose not to take the buyout. At thirty-three, Dunklin wants to remain at the Morning News but concedes he is worried about the paper’s future. “At times you wonder where it’s all headed,” he says, “because you sense this air of desperation.”

Management at The Dallas Morning News used a combination of layoffs in 2004 and buyouts in 2006, plus attrition, to slash some two hundred journalists—30 percent of the staff—from the newsroom. This kind of scenario has played out at metropolitan dailies across the country, from Long Island to California. But what happens afterward? What has been the result for those who left, for those who stayed, and for the Morning News itself as managers make cuts to try to maintain profitability?

What we found is that Ball and Dunklin are not atypical. We surveyed almost half of the two hundred who left the Morning News as well as dozens who stayed, and the findings are surprising. Whether they jumped or were pushed, most of those who left are more satisfied today than before they left. More than half managed to stay in journalism.

Those who remain, meanwhile, say the mood is uncertain at best. Circulation is in freefall. Readers increasingly are dissatisfied. Turnover disrupts stability. Many older staff members were pushed out in the layoffs; now some of the younger ones are leaving on their own. Brittany Edwards, a twenty-four-year-old feature writer who plans to try magazine writing, says many staff members do not believe that management can correct the paper’s problems. “People feel they are into quick fixes,” she says. “They don’t look at the long term.” Chris Borniger, a twenty-eight-year-old copy editor who is heading to law school, says he has lost faith in management. “It seems we are just grasping at straws,” he says. “It is incredibly disheartening.”

The Layoffs
Bill DeOre was stunned. He’d been at The Dallas Morning News for thirty-five years, including twenty-five as the sole editorial cartoonist. On October 27, 2004, DeOre’s boss told him management had eliminated his job.

That same day, editors told another sixty-five newsroom employees to pack their bags. Publisher Jim Moroney had warned the staff a month earlier that there would be a reduction in force, but the layoffs shocked them anyway. “Thirty-five years there and then nothing,” says DeOre, fifty-nine. “If they had taken me, stripped me naked, put me on a big white horse, and marched me down Main Street with a big sign that said, ‘Bill DeOre doesn’t work for The Dallas Morning News anymore,’ they’d be doing me a favor. People don’t know I left. They just airbrushed me out.”

Not so long ago, the Morning News had been at the top of its game. Between 1986 and 1994 the paper won six Pulitzer Prizes. A 1999 Columbia Journalism Review survey of more than a hundred editors ranked The Dallas Morning News as the nation’s fifth-best daily. Participants praised the paper for maintaining its commitment to editorial excellence after the Dallas Times Herald, its daily competitor, folded in 1991.

Then came a series of managerial fiascoes. Belo Corp., the parent company of the Morning News, invested $37 million in a company that produced a hand-held device called CueCat. To use it, a newspaper reader had to sit at a computer and scan bar codes on the page to visit Web sites for more information. The product proved to be a disaster, and in 2001 Belo was forced to write off its entire investment. Three local cable news partnerships with Time Warner that began in 2000 cost Belo $10 million a year before Belo withdrew in 2004. That same year, Belo revealed that the Morning News had overstated its circulation by at least 2.5 percent daily and 5.7 percent Sunday. The company agreed to reimburse advertisers $23 million, which Robert W. Decherd, Belo’s chairman and chief executive officer, called “an investment in the company’s future.”

Many at the paper began to worry, and their fears were well-founded. On September 29, 2004, the newsroom staff met with Moroney, who had been named publisher in 2001 by Decherd, his second cousin. Moroney had bad news. Revenue had been flat for four years. Newsprint costs had risen. Profit had dropped 35 percent in three years. Less than a month later management axed the sixty-six people; their median age was fifty-five, their median tenure fourteen years. (Eighteen former staffers, all over forty, filed an age-discrimination suit in federal court against the News and Belo in October 2006.)

Some of the laid-off staff members remain angry and hurt. Larry Powell spent twenty-nine years at the paper, including twenty as a columnist, and he still misses the newsroom. “What it felt like to me was the end of a love affair,” says Powell. “You keep thinking, ‘If I say this, maybe she’ll take me back.’ You still have this great love, but it is unrequited.”

But as it turns out, most of the ousted staff people seem fine now. We received responses from thirty of those who were laid off. Only three said they were dissatisfied with their new jobs. Most, in fact, said life after the Morning News was better. Doug Bedell, fifty-five, a former technology columnist, now handles public relations for a Dallas law firm. “This company is lean, has smart people running every department, and is collegial and team-oriented,” he says. “That’s far from the atmosphere of The Dallas Morning News in 2004.”

Scott Farrell, forty, had spent two years helping to develop a high school sports Web site for the Morning News when he was laid off. He was bitter then, but the bitterness is gone. “Losing your job, even a job you love, is not the end of the world,” says Farrell, who covers sports and business for a group of community newspapers. “I recovered.”

A majority of those who were laid off found jobs in journalism. Schulyer Dixon, forty, a former assistant sports editor, is a desk editor for The Associated Press in Dallas. Gary Stratton, fifty-nine, a copy and layout editor for three decades, is news editor at the Longview News-Journal. The former books editor Cheryl Chapman, sixty (who separately sued the newspaper for age and gender discrimination), became a wire editor at the Anchorage Daily News. She feels reinvigorated. “The Anchorage Daily News is a paper run by journalists who care about two things—solid reporting without fear or favor, and memorable writing,” says Chapman. “It’s a great place for a serious journalist.”

It took some journalists a while to find quality journalism work. Gregory Katz, fifty-four, had covered six wars as a Morning News foreign correspondent. It took him fourteen months to land his current job covering the Middle East and Europe for the Houston Chronicle. Ricardo Sandoval, forty-nine, spent four years in the Morning News Mexico City bureau. After eighteen months of freelancing, he became an assistant metro editor at The Sacramento Bee. But Gary West, fifty-four, landed his new journalism job in two hours. West, who covers horse racing, says the Morning News fired him at 8 a.m. By 10, the Fort Worth Star-Telegram had offered him the same position.

The layoffs eliminated slightly more than one of every ten journalists at the Morning News. They had an average of thirty years of experience. Sports lost seventeen, the metropolitan desk eight. The newspaper shuttered its Cuba bureau, technology section, and the weekly science section, edited by Tom Siegfried, fifty-six, one of the country’s most respected science writers and editors. Now living in Los Angeles, Siegfried writes for magazines and recently published his third book. Management argues that the quality of the paper improved after the layoffs. But Siegfried worries that The Dallas Morning News, like many newspapers, is committing slow suicide. “By the time I left, the paper had abandoned the desire for excellence that I had seen there in earlier years,” he says. “Journalism was no longer the top priority.”

The Buyouts
Dwayne Bray did not want to leave The Dallas Morning News, and the editors at the Morning News did not want to lose him. It’s easy to understand why. Before turning forty, Bray had been named editor of the Morning News sports section, considered one of the nation’s best. Later, as deputy managing editor over the metropolitan desk, he became the highest-ranking member of a minority group in the newsroom. He oversaw more than a hundred reporters and editors. More than a few said they would go through walls for him. Like many regional newspapers, the mantra of The Dallas Morning News in recent years has been “local, local, local.” Bray supervised local coverage. He was on the fast track.

But when the newspaper offered buyouts in 2006, he took the deal. Bray, forty-two, says he did not leave because he saw newspapers as a dying industry (“I wanted to be part of the solution,” he says). Bray did see ESPN, where he now works, as an opportunity, but there was another factor: he objected to the leadership of the Morning News. “I put so much into motivating and inspiring employees,” he says. “When I get to the point where people are not motivated and inspired, I get frustrated.”

Many others would join Bray in heading for the door. In 2006, when Belo ordered up more newsroom cuts, the question was how to do the job. Moroney did not like buyouts; he believed they often meant a newspaper lost its most valuable journalists. But the impact of the 2004 layoffs—the pain of those forced out and the shattered morale afterward—convinced him to offer buyouts this time around.

Meanwhile, Moroney and Mong were dealing with another critical problem. Beginning in 2003, they had made a series of moves aimed at attracting younger, “casual” readers. Among other changes, they remade the broadsheet features section into a lifestyles tabloid and discontinued several community sections, replacing them with weekly tabs filled with reader-generated content about events such as middle-school projects or youth-group trips. Results were disastrous. From 2003 to 2005, the Morning News’s daily circulation declined 15 percent and its Sunday circulation 20 percent—the biggest drop of any U.S. paper with a circulation of more than 100,000.

In 2006, Moroney and Mong adopted a new strategy: focusing on the newspaper’s “core readers,” people who had subscribed to The Dallas Morning News for at least five years. They included older people, middle-aged news junkies, and people who love reading. They are wealthier and better educated than the general population.

To determine what those core readers wanted, the Morning News hired The Modellers, a Salt Lake City firm whose clients have included Burger King, Disney, Toyota, and the Department of Defense. The Modellers assembled a survey. More than 3,000 core readers completed it. In June, Mong and George Rodrigue, the managing editor, began meeting with the staff to explain the results, spelling out the newspaper’s future in a series of slide presentations.

Core readers, they said, prized the work of the metropolitan desk, the investigative staff, and local education and cultural coverage. Conversely, they said, core readers did not mind if the Morning News relied on wire services to provide national and international coverage of news and culture.

Management saw the meetings as informational. The staff had a different view. “People called it the color-coded terrorist alert,” recalls Alan Goldstein, then an assistant business editor. For example, Mong and Rodrigue met with the arts and features staff on July 7. When the meeting ended, many who attended said they felt angry and demoralized. “Management was making it plain how little it valued cultural coverage, and how the depressing rounds of cutbacks would only continue,” says Jerome Weeks, fifty-three, who had been the newspaper’s book critic since 1996. Several interpreted the presentation as a push out the door. “It would just be a matter of time before they got rid of people like me,” says Ed Bark, fifty-nine, who had been the newspaper’s television critic for twenty-six years. “Management would have you believe all the buyouts were voluntary, but in reality that is simply not true.”

On August 10, Moroney and Mong announced details of the buyouts. They described them as voluntary. Mong wrote in a memo to the staff, “This world of continuous change is not for everyone, and for those of you who feel this way, the voluntary buyout may be a very attractive choice.” For some, that memo crossed a line. A number of editors and reporters said they felt insulted that management portrayed the buyout as an option for those who could not adapt.

The buyout offer, in fact, sparked a stampede: 112 reporters, editors, photographers, and artists, almost one-third more than management’s initial estimate, took the offer. They were a far different group from those who had been laid off. They were younger. They included a significantly higher percentage of women, including the second-highest-ranking woman in the newsroom as well as the highest-ranking woman in sports. They included more minority group members, including the paper’s only full-time Asian American columnist. The newspaper’s only three-time Pulitzer Prize winner hit the road. So did the projects editor. Many said the Morning News had lost its commitment to journalism. Among them was Steve Davis, forty-one, a sports reporter who began his journalism career at the paper in 1990. “I no longer truly believed in our product,” Davis says, “and was feeling increasingly dishonest about continuing to take a paycheck given my reservations.”

Gretel Kovach, thirty-one, joined the paper in 2003 and served as an embedded reporter in Iraq. The circulation scandal, the layoffs, and the bureau closings convinced her to take the buyout. “Even in just three years, The Dallas Morning News had changed so drastically that it was almost unrecognizable,” says Kovach, who still freelances for the paper.

We surveyed fifty-one journalists who accepted the buyout offer. Just three of them said they were dissatisfied with their new jobs. Those forced out in 2004 and those who chose to leave in 2006 seem to generally agree on one point: Life after The Dallas Morning News can be very good.

Pete Slover, forty-seven, spent seventeen years with the paper as a beat and investigative reporter. A lawyer, he is now special counsel to the state comptroller. Karen Thomas, forty-seven, was a thirteen-year veteran who specialized in narrative writing. She now freelances and teaches college journalism. Beatriz Terrazas, forty-four, a Nieman fellow who began as a photographer and became a features writer, co-owns a production company with her husband. All enjoy what they are doing.
Then there’s Michael Precker, fifty-two. For years, he wrote features. Before that, he was the paper’s Middle East bureau chief. Now Precker is a day manager at The Lodge, an upscale Dallas gentlemen’s club, making sure no one harasses the pole dancers. “If you’re going to leap out a window,” he says, “you might as well have a mattress.”

Rick Holter, forty-five, is content for different reasons. He was the arts editor for nine years. Today he is supervising senior editor for National Public Radio’s Day to Day news magazine, based in Los Angeles, where he appreciates NPR’s emphasis on journalism and storytelling. “I loved my job at The Dallas Morning News,” Holter says, “but more and more it became about rearranging deck chairs on the Titanic.”

The Aftermath
The Dallas Morning News’s elimination of two hundred jobs affected more than those who left. It also fundamentally changed the paper’s content. Reese Dunklin joined the staff in 1999. Like many of his peers, he was attracted by the newspaper’s outsized ambition. Then management slashed the news staff, eliminated most foreign bureaus, and essentially abandoned national coverage. Dunklin and other young reporters are still adjusting. “You feel like a child in the middle of a divorce—life as you knew it is gone,” he says. Among other things:

– The paper had published a stand-alone weekly religion section since 1994. In March, the Religion Communicators Council named it the best U.S. religion section for the tenth time. But management had eliminated it in January.

– The nationally recognized Discoveries section folded in 2004 when the paper laid off three of its five staffers, including its editor, Siegfried.

– The Morning News once had bureaus in Europe, Asia, the Middle East, Cuba, and South America. Today, Mexico is the only international bureau. The paper also shuttered its Houston and Oklahoma City bureaus.

– The Washington bureau once had a staff of eleven. Today, it has two reporters, a columnist, and a vacant reporter’s job. They are supposed to cover national issues involving Texas, the nation’s second most populous state, with an economy nearly as big as Canada’s. Carl Leubsdorf, sixty-nine, has been bureau chief for twenty-seven years. Does he have the staff necessary to cover capital stories with a Texas angle? “That decision was not up to me,” says Leubsdorf.

– The paper has no architecture critic, television critic, or book critic. David Dillon, fifty-nine, the paper’s architecture critic for twenty-three years, took the buyout. So did Bark, one of the nation’s most respected television critics. The paper has not had a full-time editorial cartoonist since laying off DeOre in 2004.

“Look at the talent that has walked out of that place and hasn’t been replaced,” says the former assistant national editor Mike Weiss, a twenty-six-year Morning News veteran, now an editor at Bloomberg News in New York. “I think the sad thing is that Dallas is becoming very much like any other paper. Nothing distinguishes The Dallas Morning News.”

Mong says the Morning News remains attractive to job seekers. “This is one of the best, maybe the best, place for a young journalist to work in the country,” he says. Nevertheless, the exodus continues. During two weeks in April, a dozen newsroom employees—including seven in their twenties—announced plans to leave. Among them is Chris Borniger, the copy editor heading to law school. Borniger says many staff members believed Moroney and Mong when they vowed in 2004 to do everything possible to avoid another round of staff cuts. “How can you trust people like that when they say we’re never going to do that again and, eighteen months later, they are doing essentially the same thing?” he says. The mood of younger staff people, he says, is “cynical.”

Belo was less frugal with its chairman and CEO. In 2006, Decherd received more than $2 million in salary and cash incentives and almost $3 million in stock and option awards. The total exceeds $5 million—a 50 percent increase over Decherd’s 2005 compensation and the second year in a row he received such an increase. Asked what message his pay package sends to the newsroom, Decherd said in an e-mail that the Belo board determined his compensation “based on the overall performance of the corporation.” Belo investors suffered a 12 percent drop in total shareholder return in 2006 after a 17 percent drop in 2005.

Decherd and Moroney also face a legal challenge from several Belo stockholders who are seeking to turn their 2004 suit into a class action. They charge that between May 2003 and August 2004, Belo overstated the Morning News’s circulation in order to fraudulently inflate advertising revenue and stock value. This May, a federal judge ruled that the lawsuit could proceed after finding a “strong inference” that Decherd and Moroney “were severely reckless . . . in reporting substantially inflated DMN circulation figures that caused Belo to report artificially inflated financial results to investors and the market.” The two men declined to comment on the suit.

The Future
Philip Meyer has been a reporter, editor, corporate officeholder, and pioneer in computer-assisted reporting, and is one of the country’s most respected journalism scholars. Meyer understands why managers at The Dallas Morning News eliminated two hundred newsroom jobs. He only wishes they would look at the long-term implications.

“It seems to me that papers that do what Dallas just did have decided to liquidate the business and get as much money out of it as they can,” says Meyer, who holds the Knight Chair in Journalism at the University of North Carolina. “That’s not crazy. It’s a rational strategy if you only care about what happens on your watch as a manager because it takes a long time for a newspaper to die, and, while it’s in its death throes, it can still be a pretty good cash cow. But it’s really bad for the community and for the business in the long run.”

Meyer and other researchers have published more than a dozen studies over the past ten years exploring newsroom staffing, journalistic quality, and profitability. A recent study by Esther Thorson, an associate dean at the University of Missouri’s School of Journalism, examined four years of financial data from hundreds of newspapers. Thorson, who has studied media for twenty years, says those who try to cut the newsroom to maintain profitability are doomed to failure. “That’s not a business model,” she says. “That’s a death model.” Thorson found that larger newsroom investments would translate into greater profits. “A newspaper is a rich environment of information and entertainment,” she said. “That makes it a fabulous locale for advertising. But if your product is degraded and circulation plummets, why would advertisers want to invest in that?”

Belo is investing in the future, Moroney and Mong contend, by spending hundreds of thousands of dollars on Web training and video equipment. “We’re the most progressive newsroom in the United States in terms of shooting video,” says Moroney. The result, they insist, is a first-rate Web site, DallasNews.com. But a recent survey by Nielsen/NetRatings of the nation’s thirty most popular newspaper Web sites ranked DallasNews.com twenty-eighth by number of visitors. John Banks, the former news and sports editor for DallasNews.com, says he left in 2006 because he felt the newspaper refused to invest sufficiently in the Web. “The Dallas Morning News is moving too slowly in new media and that’s one of the reasons I decided to leave,” he says.

The paper unveiled a redesigned site in November. Mindy McAdams, who helped pioneer The Washington Post’s Web site and holds the Knight Chair in Journalism Technology at the University of Florida, examined DallasNews.com in May for CJR. Her verdict: “They have a bad Web site.” McAdams says the site features too much advertising and too little news at the top of the home page, miniscule headlines, and a lack of photos and graphics. She concludes that the site does not serve the local community. “This is a failure of their mission,” she says.

Moroney and Mong are confident they have the Morning News on the right track. For one thing, they say, their newsroom—which still has some four hundred journalists—remains one of the largest in the country. “I defy you to find many other newspapers in the country with a staff that size,” Mong says. He notes that the paper has won several national awards over the past year, including a 2006 photography Pulitzer for Hurricane Katrina coverage. (Two of the photographers involved in that award, Smiley Pool and Barbara Davidson, have since left the paper.) A story by the investigative reporter Brooks Egerton recently won a National Headliners Award. In February, The Associated Press Sports Editors recognized the paper’s sports section with a Triple Crown award for the seventeenth year. And in June, Paul David Meyer, twenty-nine, and Stella Chavez, thirty-four, won the Livingston Award for national reporting, for a series on the abduction and abuse of a young Mexican girl in the U.S. “Overall, I believe it is a better paper today than it was three or four years ago,” says Moroney. Mong agrees.

We interviewed more than a hundred current and former Morning News people for this article. None agree with that assessment. They say the Morning News remains a first-rate daily but that the elimination of two hundred reporters, editors, photographers, and designers hurt its quality. “I don’t think anyone could deny that,” says Egerton, forty-eight, a fifteen-year veteran at the paper and one of its most respected reporters. “I’ve heard people try to spin it to say that it’s all still there, but that’s clearly not true.” Cheryl Hall, fifty-five, a business columnist and thirty-five-year Morning News veteran, says she has not seen quality improve over the past three years: “We cover less.” Dunklin, a member of the paper’s investigative team, says that, “If you are honest, you have to say it has slipped. You cannot lose the quality and number of journalists we had and not see an impact on the product.” Sherry Jacobson, fifty-six, a metro reporter and former columnist who has worked at the Morning News for more than twenty years, has seen the change. “It had been a journalists’ paper for so long,” Jacobson says. “Now it’s so much more bottom-line driven. But so is the rest of the industry.”

The paper certainly carries more wire-service stories than in the past. We analyzed two weeks of front pages in March 2007. One-third of the stories were wire copy. The trend is particularly noticeable when big national and international news breaks. Take the third week in April: a gunman killed thirty-two students and professors at Virginia Tech; Attorney General Alberto Gonzales, a Texas native, faced harsh criticism for firing U.S. attorneys; U.S. troops in Iraq died at the highest rate of the war; the Supreme Court issued a landmark abortion ruling. Every story on the front page of the Morning News about those events came from the wires. Indeed, of the stories on page one that week, half were wire copy. While the paper often lacks staff-generated national and international stories, Mong and Moroney say readers care more about local news, and that the Morning News excels at local coverage. Mong cited local cultural coverage as an example, saying that readers “expect us to cover the symphony—that is first and foremost a local story—to cover the museums, cover local architecture, cover local theater.”

But the evidence suggests that the sharply reduced staff, working with a smaller newshole, has a difficult time accomplishing that. For example, the daily arts section, Guide Live, used to run a minimum of eight pages. Now it often contains four pages including TV listings and gossip. Freelancers regularly cover concerts and art exhibits and provide architectural reviews. Other newspapers provide many of the Morning News movie reviews. That is not surprising. Between 2004 and 2006, the arts and features sections lost thirty-nine of eighty-three staff members.

What do readers think? In April, the Audit Bureau of Circulations released figures for the country’s twenty-five biggest newspapers. From October 2006 through March 2007, the daily circulation of the Morning News was 411,919, a decline of 14.3 percent compared to a year earlier, more than twice the decline of any other large newspaper. Moroney attributes half of that decline to planned reductions in the newspaper’s circulation area and in the sale of discounted papers. Yet the remaining half —at 7 percent—would still exceed the circulation declines of the other twenty-four top newspapers.

According to surveys taken in the summer of 2004 by Scarborough Research, 79 percent of readers were satisfied with The Dallas Morning News. That number has fallen. A survey of a thousand readers during the first five months of 2006 found that the proportion of satisfied readers had dropped to 60 percent. Moroney and Mong say they are unsure what caused the decline. “I would say that there’s no silver bullet explanation,” Mong says. More recently, Scarborough Research surveyed readers from September 2006 through February 2007. This time Moroney and Mong decided not to ask readers if they were satisfied.

Craig Flournoy & Tracy Everbach are professors of journalism at Southern Methodist University and University of North Texas, respectively. Flournoy reported for The Dallas Morning News from 1979 to 2000; Everbach from 1986 to 1998.