It’s tempting to compare the stalwart behavior of the older generation with the madcap money grab that marked the Bancrofts’ sale in 2007 and see a sad commentary on the decline of the elite stewardship. After all, when Jane Bancroft told the Dow Jones executive, Casey Hogate, during the depths of the Depression to forget the dividend and do the right thing (See Tofel’s biography, page 72), the company was desperate. The WSJ’s circulation was a mere 30,00, down from 50,000 before the Great Crash, and the company even missed payroll. Dow Jones survived, mostly thanks to the brilliant Kilgore, and the Bancrofts were able to hand down to their heirs special “B” shares that gave the family the power, and responsibility, to protect the newspaper from unwanted suitors.
Ironically, as I argued back in ‘07, it was the excessive dividends, paid out year after year to a growing number of Bancroft heirs, that hamstrung the company during a time of media dislocation. Maddeningly, the family stood pat, collecting dividends, while turning away an array of suitable suitors (for background, see this Ken Auletta piece from ‘03). Finally, after the company was dead in the water, Murdoch’s bid came along, and it was a mad dash for gold.
It’s easy to say today, if we had known of rampant hacking and coverups, we would have done something differently. But of course, there was nothing short of a firestorm in 2007 (the best account is Sarah Ellison’s book, which also recounts the family’s bumbling response referred to by Natalie Bancroft above). There’s no need to cite chapter and verse, but no one was more eloquent than their fellow “B” shareholder, James Ottaway [UPDATING: Forgot to mention, he’s now on CJR’s Board of Overseers), who urged the Bancrofts to resist the Murdoch temptation:
I’m arguing that there’s a moral issue here. Rupert Murdoch…I admire his business skills, but I despise his journalistic practices, and even if I admire him, I’m concerned, and I think the Bancroft family should be concerned, about what kind of a home News Corp. makes for Dow Jones long-term.
It was because of these very concerns that the Bancrofts insisted, futilely, that the Journal’s editors be protected by that silly committee of luminaries, the agreement running 7,000 words and filed with the SEC. (Breaking Views thinks the committee might yet be a factor, but even it wanted to, and it doesn’t, its mandate is far too narrow—the protection of three Dow Jones editors, and that’s it.)
It’s too late for expressions of shock and regret now. But it is another reminder, if we needed one, how much news ownership matters.
It's even worse than you describe--the WSJ's 'story' on News Corp. buries the fact that it's a subsidiary.
And larger (in the scheme of things) and even worse realities: while arguably the country's largest financial story of the decade--the debt crisis--plays itself out in Washington, the online version of the WSJ leads with stories on--I'm not kidding you--a gun nut in Montana who is 'challenging' the federal government on interstate commerce and the day prior--I don't even remember--that's how ridiculous it was. I can tell you it wasn't about the debt crisis (What debt crisis? Is there a debt crisis? Who says there's a debt crisis? We're only the WSJ--why would we be interested in covering THAT???!!!)
#1 Posted by shwartzy, CJR on Fri 15 Jul 2011 at 11:25 PM
Compare a WSJ of January 2007 with a WSJ of 2011. A big picture paper slowly morphing to a general rag with the same insane editorialists and mostly mad columnists. Clearly story selection and placement based on the master's bent mind. I used to tolerate it because of the judicious reporting and general thoughtfulness in the pre-Murdoch days. Now it soils the breakfast table by its shabby presence. Cancelling today.
#2 Posted by Richard McDonough, CJR on Sun 17 Jul 2011 at 12:50 PM
You neglect to mention that Ottaway subsequently changed his mind, saying in 2008 "Things that I spoke about publicly that I feared Murdoch would do, that would be bad for Dow Jones and for the Wall Street Journal, have just not happened," Ottaway affirmed. "Yet, anyway."
He added:
"He has done more to keep it going as, what I think now is the best newspaper in America while other publishers have been cutting staff much more vigorously and reducing their coverage and quality." It is pretty dumb to argue that the WSJ would have somehow ferreted out the roots of the financial crisis early on, or made readers understand it better or worst of all, and what appears to be your real complaint, accomplished anything by using your preferred editorial slant of savaging Wall Street much more, all while you hand-wave away borrowers' roles, particularly considering the WSJ would be even smaller today if Murdoch hadn't tried to revive it. No existing newspaper or broadcast media business, including the WSJ and BSkyB and The Economist and the NYT, is going to survive the next 5-15 years, so it is particularly silly of you to bash Murdoch for investing in these failing and admittedly unprofitable operations, simply because he has a soft spot for his first business, just because he then tries to actually turn them into going concerns by adding some puff pieces here and there.
#3 Posted by Ajay, CJR on Sun 17 Jul 2011 at 03:37 PM
Takes about three generations to blow a business up, usually. First one founds and builds, second one expands to empire status, keenly aware that good fortune requires an industrious and dedicated partner. The third or fourth generation, with rare exception, is so entitled and myopic that crisis spells doom. This is a pattern you see in many times and places, so it's hard to blame the individuals or the specific circumstances.
Just something about inherited wealth and power.
#4 Posted by edward ericson jr., CJR on Mon 18 Jul 2011 at 07:27 AM