Audit Notes: Plain Dealer, Silicon Valley openness, debt and borrowing

Cleveland execs trot out the Advance Publications talking points

The Cleveland Plain Dealer, whose slogan not so long ago was “Miss a day, miss a lot,” will go to three days a week home delivery and slash its newsroom by a third. Like the Newhouse papers in Syracuse, Pennsylvania, and most of Michigan, it will still print copies for the newsstand on non-delivery days and will send out an e-edition to subscribers. It remains to be seen whether that will mean much.

In Syracuse, on days with no home delivery, the Post-Standard prints just 12,000 copies, its publisher told the Syracuse New Times in February. Its daily circulation before the change was more than six times that. And those non-delivery papers are a paltry 16 pages.

While New Orleans and Alabama didn’t even get that, some things are similar. Like the corporate-speak from its executives announcing the changes. The Plain Dealer’s letter from the publisher and editor is headlined, “Adapting to better serve our community: a letter to readers.”

Saying the changes are to “better serve our community” is insulting to readers and to the 53 journalists the paper is about to fire.

This line is also reminiscent of the misleading public relations we saw in New Orleans: “The formation of a new, digitally-focused company is a significant investment for the future.” Naturally, the paper’s executives don’t mention a word about their plans to gut their newsroom.

The Plain Dealer, a paper with 220,000 print circulation, will soon have a newsroom of just more than 100 journalists, its union told the NYT.

The Wall Street Journal reports that Silicon Valley tech companies are lobbying against a home-state bill that would force them to tell users what they know about them and how they exploit that knowledge.

The industry backlash is against the “Right to Know Act,” a bill introduced in February by Bonnie Lowenthal, a Democratic assemblywoman from Long Beach. It would make Internet companies, upon request, share with Californians personal information they have collected—including buying habits, physical location and sexual orientation—and what they have passed on to third parties such as marketing companies, app makers and other companies that collect and sell data…

This past week, Will Gonzalez, a Facebook lobbyist based in Sacramento, aired concerns in a meeting about how the bill would hurt Facebook’s business, according to a legislative aide.

“Openness” for thee, but not for me.

And speaking of corporate-serving openness, read Evgeny Morozov’s brilliant Baffler takedown of the Web evangelist Tim O’Reilly.

— Read this J.W. Mason post on how levels of borrowing don’t necessarily dictate indebtedness over long periods—for households or for governments.

Mason writes that “changes in government borrowing have not been the main factor in the evolution of debt-GDP ratios,” finding that it only accounts for only one-quarter of the change in debt to GDP historically:

The point of Arjun’s and my paper on debt dynamics was to show that for household debt, borrowing and changes in debt don’t line up well at all. While some periods of rising household leverage — like the housing bubble of the 2000s — were also periods of high household borrowing, only a small part of longer-term changes in household debt can be explained this way. This is because interest, income growth and inflation rates also affect debt-income ratios, and movements in these other variables often swamp any change in household borrowing.

As far as I know, we were the first people to make this argument in a systematic way for household debt. For government debt, it’s a bit better known — but only a bit. People like Willem Buiter or Jamie Galbraith do point out that the fall in US debt after World War II had much more to do with growth and inflation than with large primary surpluses… But while many of the people making it are hardly marginal, the point that government borrowing and government debt are not equivalent, or even always closely linked, hasn’t really made it into the larger conversation.

Mason’s blog Slackwire is worth following.

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Ryan Chittum is a former Wall Street Journal reporter, and deputy editor of The Audit, CJR's business section. If you see notable business journalism, give him a heads-up at Follow him on Twitter at @ryanchittum. Tags: , , , ,