Ominous Layoffs Hit the News Industry

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Brian Lehrer: Brian Lehrer on WNYC. Before we go on to our next conversation, I would like to invite a few of you to sign up for a short roundtable that we're planning for the show. This would be for some of you who live in the former George Santos congressional district where the special election to replace him is now underway between Democrat Tom Suozzi and Republican Mazi Pilip. You know who you are in those parts of Northeast Queens, the North Shore of Nassau County, and a few other Nassau towns.

We're hoping to put together a small group of you who are politically diverse to participate in a half-hour round table on the show on Monday, February 12th, the day before election day. Here's what we're looking for, voters who are definitely for Suozzi, voters who are definitely for Mazi Pilip, definitely want to hear from you, and some of you who are undecided as of now, definitely want to hear from you and include you.

What will we do in this roundtable? Well, we'll give you a chance to talk a little bit about the candidates but more about the issues that are important to you in deciding on who you would like to represent you in Congress right now. If I'm piquing your interest, Mazi Pilip voters, undecided voters, Suozzi voters. If you're interested in being considered for this February 12th roundtable, please go to wnyc.org/swingdistrictvoters. I know that's a little bit of a long URL, so I'll give it to you again, wnyc.org/swingdistrictvoters.

You know you live in a swing district, right? You know you live in a swing district that the rest of the country is watching as a bell weather for the whole congressional election year. Go there and you'll see a short form that you can fill out. Again, that's wnyc.org/swingdistrictvoters if you live in the former Santos District and would like to be on a roundtable on February 12th. The deadline to apply is the end of the day this Friday. Go take a look at wnyc.org/swingdistrictvoters.

Now, let's delve into the current state of the media landscape. The storied Los Angeles Times recently laid off 20% of its staff. Those cuts came shortly after layoffs at Time Magazine and National Geographic. They just keep piling up. In an essay in The Atlantic, Paul Farhi, former longtime media reporter at The Washington Post, reflects on the worrying trend of these cutbacks. Farhi writes, "The ranks of professional journalists keep declining even as overall unemployment stays low, incomes rise, and the stock market reaches new heights."

We'll discuss the headwinds in the media industry, the news industry, the journalism industry, in particular, so important to democracy, and their consequences for local journalism in particular, and for America. Paul Farhi joins us now. Paul, hi. Welcome back to WNYC.

Paul Farhi: Good morning, Brian. Thanks for having me.

Brian Lehrer: By way of introduction, you worked at the Washington Post for more than a decade until taking a buyout. Do you want to share a bit about the cuts at your old workplace and some of the industry-wide changes as you've experienced them throughout your tenure at The Post?

Paul Farhi: Well, yes. This is why, in part, I wrote about this topic. I covered it for The Washington Post, of course, for a number of years, but it's also personal. The Washington Post in October announced that it was going to cut about 10% of its newsroom through buyouts, fortunately, not through layoffs. Many of us with quite a bit of experience received several months or years even of salary to go away. That's exactly what I did.

I was at The Post since 1988, so it was 35 years, but this was both an opportunity and a sad moment in my life as well because it was the end of my journalism career. Again, it was voluntary, so that kind of lightened the blow a bit, but nevertheless, it was indicative of what's going on in the industry as a whole.

Brian Lehrer: Time, National Geographic, Condé Nast, owner of The New Yorker, among many other things. There were cuts at all these outlets recently, but you write that the grimmest of all these recently announced cuts were at the Los Angeles Times where they cut more than 20% of the staff. That's 115 people. For folks who aren't aware of the stature that paper held for such a long time both as an outlet for local journalism in Southern California and as a national news organization, tell us what it used to be.

Paul Farhi: Well, I grew up reading the Los Angeles Times. I grew up in Los Angeles. It was a great pillar of the establishment. In fact, David Halberstam and his really wonderful book, The Powers That Be, featured it as one of the pillars of the media. Southern California is effectively a country unto itself. It's huge, 20 million people. The Los Angeles Times is a giant in terms of the media in the Los Angeles area, but it's also nationally a formidable organization. It's the largest and still is the largest newsroom west of Washington, DC. It really is one of the best and one of the biggest and most important news organizations in America, and therefore, the world.

Brian Lehrer: Biotech billionaire, Patrick Soon-Shiong bought the LA Times in 2018, and for a while, things look encouraging. Why was that, and then how did they go south?

Paul Farhi: The LA Times for several decades was owned by the company that owns the Chicago Tribune and a number of other regional papers. This sounds good because it's a newspaper company, but newspaper companies were cutting back effectively since the advent of the internet. The LA Times was subject to a thousand blows, that is to say, lots of cuts, little cuts here and there. Finally, in 2018, this local biotech billionaire, Patrick Soon-Shiong, took it off their hands, and for a while, as you point out, he was an effective owner.

He invested, by his count, something like $1 billion in building up the newsroom and improving its technology, all the kinds of things you'd hope a publisher and an owner would do. Then, he didn't do those things. He began to cut last year. I think it was 74, 76 people were eliminated from the newsroom. Then, this past week, the big blow, 115. All told, they built up a newsroom and then they cut it back now by about one-third. The outlook doesn't look great. It's unclear when things will turn around if they will turn around, and how we will begin to grow again. We don't know is really the answer.

Brian Lehrer: I guess it suggests a question of whether there's something inherently problematic, or if it's a solution to the current news business economics when there's this billionaire owner model of local and national journalism where presumably the owner is willing to take a loss in pursuit of having the news organizations survive. Have you looked at pros and cons with that?

Paul Farhi: Yes. For the most part, it's pretty positive. We don't have many examples, but The Washington Post is owned by Jeff Bezos, one of the richest men in the world, the LA Times by Patrick Soon-Shiong, The Boston Globe by John Henry, also a billionaire. There aren't a lot of examples, as I say, but for the most part, at least up until recently, this was a good thing. These were people who had some civic or national concern and wanted the news organizations to be robust and wanted them to reflect the variety and depth of America.

They invested in those news organizations. Then, well, things turned downward, and they're, I wouldn't say disinvesting, but they are certainly not pouring it on at this point, so they're turning on us. Listen, compared to the alternative forms of ownership, which was corporate and/or financial, but that is to say, hedge funds or investment funds, which own the majority of newspapers, the billionaire model was actually pretty good, an individual who had direct responsibility as opposed to a faceless corporation. Given the druthers, billionaires are not necessarily a bad thing.

Brian Lehrer: Although then, the news organization could be directed at the whims and political preferences of one individual. There's also the story recently of a wealthy individual who's known as a conservative activist, I think it's fair to say, just bought The Baltimore Sun, and people are wondering what's going to happen there. This can blow one way or another, whether the person is really civic-minded and doing it for that reason or whether they're doing it so they have a personal megaphone in a major local news organization.

Paul Farhi: Yes, and locally, you might want to focus on the New York Post, which is owned by Rupert Murdoch's Company, and some would say has been a megaphone for Rupert Murdoch's political views over the years. On the other hand, The Wall Street Journal is also owned by Rupert Murdoch's company or companies and has really not been exactly the same thing. Wall Street Journal is still a very good news organization. This blows hot and it blows cold, and it could go either way. We don't know what's going to happen with The Baltimore Sun, but the indications are that this could be a situation in which a very wealthy owner turns it into his own personal megaphone.

Brian Lehrer: I want to in a minute ask you the underlying question of why if the economy's generally doing well and is in a growth phase, why the news industry is shrinking. Listeners, we can also take your calls for Paul Farhi, former longtime media reporter at The Washington Post. His new essay in The Atlantic has the ominous headline. Is American Journalism Headed Toward an 'Extinction-Level Event'? Maybe if you're a recent laid-off media worker in the news industry or an adjacent field you want to call in or anyone else. 212-433-WNYC, 212-433-9692, call or text.

That underlying question, and I mentioned in the intro, the economy is generally growing right now. Jobs are being added nationwide in most industries in America. People certainly are using the media a lot, can't get people off their phones, and yet, journalists are being laid off all over the country. Where's the disconnect?

Paul Farhi: The disconnect is that the media has always had its own kind of economy. Sometimes, it reflects the national or international economy, and sometimes it doesn't. Right now, it's not reflective of the national economy. Within the media industry, advertising is declining, subscriptions are falling. Perhaps, there's subscription overload, so many streaming services, so little time.

There's news fatigue. That is to say, some people turning away from the news because it's depressing or because it's overwhelming them. There are other factors. We benefited for several years from something that's been called the Trump Bump, this fascination with or aversion to the last president, and we don't have the same factor right now. We know Trump, this presidential race is not really fueling a whole widespread interest, which it typically does, so that's hurting.

The other thing is, it's a really technical internal thing but very important, which is the digital duopoly of Google and Facebook have downsized their interest in and their feeds, their algorithms of news. That is to say, you're not getting fed a lot of news the way you once were. That drove a lot of traffic to our websites, and it's been reduced over time. You add up all these factors, and it's converging on one conclusion, which is we have less revenue, we have less traffic, and that's leading to the cutbacks that you're seeing.

Brian Lehrer: Melinda in Englewood wants us to mention a certain local news organization around here. Melinda, you're on WNYC. Hi there.

Melinda: Hi. I just was wondering how come nobody said anything about The New York Times. I'd like to know who owns it and about the corporate ownership as well as any private ownership. How does that affect what they put out?

Brian Lehrer: Thank you very much. What about The New York City Times? Is that the exception that proves the rule in almost everything we've been talking about so far?

Paul Farhi: It is a great question, particularly for New York. Yes, The New York Times is an exception. One of the few news organizations that's doing well. The New York Times is owned in two ways. Oddly, they have two classes of shares. One is the public, like any stock in any company, but also the Sulzberger family, which has owned them for over 120 years, owns a class of stock.

The New York Times is doing well because it is almost entirely supported by subscriptions. They have nearly 10 million subscriptions that they have built up through the years, not just from their news organization, which is a very good news organization, of course, but through cooking apps, through their games apps, through other means other than the straight up news, but all told, they're doing very well, almost self-supporting now. I think they are in fact self-supporting through their subscription revenue. They certainly like ad revenue, but subscriptions have really made them financially stable. That's an exception in the industry. No one really has a self-supporting business model like that.

Brian Lehrer: For you as a former Washington Post staffer, there was a moment at the beginning of the Trump administration where people were looking intensely to The New York Times and The Washington Post, I think those two news organizations in particular, to hold Trump accountable. I don't know if that's the exact moment that The Post took the slogan, Democracy Dies in Darkness. The fortunes of The Times went one way, and the fortunes of The Washington Post went another way. Why do you think because I feel like they were right there in the same category, let's say on Inauguration Day 2017?

Paul Farhi: We were in the same category, and we did benefit from this Trump Bump, the interest in all the scoops that you mentioned, and just the general interest. Our subscription base, when I say our, and now, I'm formerly a Washington Post reporter, our subscription base grew substantially. We grew close to three million subscriptions. That has come down to about two and a half million as people have drifted away from this Trump Bump. Our goal with a new publisher and CEO in place is to grow back to three million. We will do that through other means other than simple interest in Trump, but Trump was very beneficial to The Washington Post as he was to a lot of news organizations, including television.

Brian Lehrer: I want to make sure that we talk at least for a minute about the consequences of the decline in local journalism. I think the conversation we've been having assumes that it is a dangerous or threatening thing, but you use a New York area example in your Atlantic article. You write "A weakened local press corps is a gift to someone like George Santos." Want to take it from there?

Paul Farhi: Yes, certainly. That local example of George Santos really tells us where this could go and how badly it could go. There was some local coverage of George Santos' 2022 campaign, a little bit in a Long Island newspaper, a weekly newspaper. Beyond that, it didn't get constant coverage. It was assumed that, I guess, he had been a candidate before and he had been vetted, and no one paid much attention to him until The New York Times after the election discovered all of these fabrications and serial lies that George Santos told.

Then, what do you do about that? We know what you do about that. He became this cause celeb. He was driven out of Congress, and he's been indicted, but the question raised within the news media is where were the reporters before the election that could have warned off the voters in his district to point out what a liar this guy was. The press, the watchdog failed in this case. That's the nightmare scenario around the country, that if we keep cutting back reporters, we keep cutting back newsroom resources, we won't have the means to cover the George Santoses of the future.

Brian Lehrer: Sharon in Point Pleasant Beach in New Jersey, you're on WNYC. Hi, Sharon.

Sharon: Hi Brian. How are you? I just wanted to find out from your guest as a production person for a large publishing company, Condé Nast, for over 20 years. I was laid off during COVID. Basically, I wondered if the fragmentation of all of the news that we hear and that we see, it's coming at us from so many different points, as before the internet or before smartphones actually came about where you only got your news on ink, on paper delivered to your door. If that didn't skew everything, and everybody has too many places to look right now. I wanted to know if your guest had any insight on that.

Brian Lehrer: It relates to the actors and writers strikes we saw in the entertainment industry. A million years ago, there were just three major television networks, and that was the industry. There were huge audiences for each show. People could get paid more easily. Are we looking at a parallel there in addition to Sharon's exact question?

Paul Farhi: That's absolutely the case. There are many, many sources which you can now access, and their barriers to entry, so-called, are very low to be in the news business. Back when 25, 30, 40, 50 years ago, it was very expensive to be a publisher, to be a broadcaster. Now, I'm a broadcaster just by picking up my smartphone. I can write, I can publish, anybody can, and so we have fragmented the audience.

Brian Lehrer: Yes, but who pays you?

Paul Farhi: Who pays me is the real question, but by spreading this competition far and wide, who pays the existing news organizations? Fewer and fewer people do.

Brian Lehrer: Before we run out of time, I want to ask you about one potential model that could help save local journalism. I think you're right about this. In the article, it's called Media Bargaining, which sounds like it's a negotiation with a union, but it's different. It's more like news organizations bargaining with Google, right?

Paul Farhi: That's it. In Australia in 2021, they passed this law that enables the publishers of news content to bargain directly with Google and Facebook for compensation when Google and Facebook use news content on your feed. This has resulted in about $130 million being passed from Google to publishers to compensate them for the use of their content. Canada also passed a law.

There is a proposed similar law in America in the Senate. Amy Klobuchar and John Kennedy of Louisiana have co-sponsored this bill. It's going nowhere, but nevertheless, this is held up as one model, transfer some of the revenue that has flowed to Google and Facebook back to the publishers to compensate them for the use of their news.

Brian Lehrer: That sounds fair and also foundational at the moment. As you say, this is a bipartisan bill. It's not every day we see Amy Klobuchar and Republican senator from Louisiana, John Kennedy's name on the same bill, and yet, it's not going anywhere.

Paul Farhi: It's not going anywhere. It was introduced in March, and here we are in January, and it doesn't seem to be real momentum to take this up. The Senate, as one person told me, seems to have other things to do.

Brian Lehrer: On tomorrow's show, our guests will include Craig Newmark, who founded Craigslist and then eventually bought the naming rights to the Graduate School of Journalism at CUNY. You may have heard that he recently announced that his foundation is making a huge grant so that CUNY's graduate School of Journalism can go permanently tuition-free. There's at least one example of lowering the bar of entry to journalism for lucky applicants who get accepted. I wonder if there are any other strategies as we run out of time or policies that you think could help sustain quality local journalism in the face of this potential extinction event that your Atlantic magazine headline suggest.

Paul Farhi: There are many. Many of them involve the government stepping in to encourage tax credit write-offs for those who hire journalists. There are private sector solutions as well, mainly philanthropic. The MacArthur Foundation just led a coalition of 20+ charities that is raising $500 million to be distributed for local news to improve local news. There's a whole lot of rescue attempts. Whether they will beat back the tide is another question.

Brian Lehrer: By the way, some listeners are texting about Santos. One says a local paper exposed Santos. The New York Times didn't break the Santos story. The Oyster Bay Herald did before his election. I don't know if that's true, but maybe that's true and nobody noticed.

Paul Farhi: It is true.

Brian Lehrer: Then afterwards, The Times broke it, and then, of course, everybody noticed.

Paul Farhi: That's absolutely true

Brian Lehrer: Someone else is saying, "Oh, that paper was actually the North Shore Leader." Just to say that somebody out there did that, and yet another example of the importance of local journalism. There we leave it with Paul Farhi, former longtime media reporter at The Washington Post. He has a new essay in The Atlantic whose headline asks, is American Journalism headed toward an extinction-level event? Paul, thank you very much.

Paul Farhi: Thank you, Brian.

 

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