Forgotten Millions Still Matter

Divided families, dwindling finances, foreclosed homes, totally jobless – that’s what life has meant for millions of Americans from 2007 to today. Yet for the employed, especially politicians in Washington, not much has changed.

Turn on the TV news today and you see little about the jobless and underemployed – 13.7 million and 8.3 million Americans, respectively. It might be argued our leaders care more about the Mideast and the federal budget deficit.

The April edition of Reader’s Digest offers the ugly truth about the greatest economic collapse in United States since the Great Depression of the 1930s:

“More than half of all U.S. workers either lost their jobs or were forced to take cuts in hours or pay during the recession,’’ RD says. “The unluckiest suffered prolonged unemployment, bankruptcies, or foreclosures, which are now at 65-year highs.”

The icing on the cake, by way of New York Times Op-ed columnist Paul Krugman, is simply this:

“More than three years after we entered the worst economic slump since the 1930s, a strange and disturbing thing has happened to our political discourse: Washington has lost interest in the unemployed.

Difficult To Escape

“It might not be so bad if the jobless could expect to find new employment fairly soon, but unemployment has become a trap, one that’s very difficult to escape,’’ Krugman says.

“There are almost five times as many unemployed workers as there are job openings; the average unemployed worker has been jobless for 37 weeks, a post-World War II record.

Krugman, professor of economics and international affairs at Princeton University, asserts our nation is well under way to creating “a permanent underclass of the jobless.”

How can that be?

Krugman, a Nobel Prize winner in economics, says part of the answer may be that the jobless tend to stay that way, and those who still have jobs are feeling more secure than they did a few years ago.

Layoffs and buyouts spiked during the crisis of 2008-09 but have fallen since then, perhaps reducing the sense of urgency, Krugman says.

The U.S. economy now suffers from low hiring, not high firing, so things don’t look so bad — as long as you’re willing to write off the unemployed and underemployed, according to Krugman.

Closer To Home

Take, for example, a former employer of mine, Gannett Co. Inc., the largest publicly owned newspaper publisher in America.

Under CEO Craig Dubow, GCI has eliminated 20,000 jobs since 2005 -- nearly four of every 10 employees, according to the Gannett Blog, an independent daily journal about the company.

It’s not a stretch to believe a good number of those former Gannett journalists remain unemployed or underemployed. And keep in mind this is just one of many industries slammed by the recession.

The Great Recession was a cold slap in the face for many of us who enjoyed the 1990s boom, when technology advances and soaring stock prices offered unlimited potential – even a hint of early retirement, or at least a secure one.

The Bitter Pill

Today’s reality is quite another matter. Even so, millions of unemployed and underemployed should not simply be written off because it’s politically convenient to have them fade from the spotlight.

For those among us who survived the recession relatively unscathed, good for you and your family!

But while you continue to enjoy the fruits of your labors, please take a moment to remember the less fortunate, your former co-workers.

Urge your elected officials to do the right thing by enacting a “real” jobs bill that puts people back to work permanently, not in some temporary make-work (pork) project.

Stealing some lyrics from the Police song, “Invisible Sun,” nobody should be relegated “to play the part of a statistic on a government chart” and why should they?

Let's all keep that in mind as we move forward and out of this mess, together.

Ken Cocuzzo

Gov't Shouldn't Fix Newspapers

The U.S. government seems to be nearly everywhere these days – from health care reforms and tax gimmicks to automaker and bank bailouts. One area that should be off-limits is the newspaper industry.

Simply put, government intervention to prop up newspapers should not be a preferred option under any scenario. Anyone who has studied U.S. history knows the Founding Fathers wanted government and newspapers to operate independently of each other, with the latter in a watchdog role.

So that’s what so disturbing about the U.S. Federal Trade Commission looking for ways to “support the reinvention of journalism,” according a report by The New York Times.

Possible measures to help the troubled U.S. news business include public subsidies, charity and stronger copyright protection. The first two measures should be dropped; the third one merits some consideration.

Nobody can deny that Internet alternatives and the Great Recession have taken a huge bite out of advertising and readership for traditional print newspapers which, for the most part, continue to struggle as they seek viable business models for online publishing.

From 2007 to 2009, newspaper industry revenue fell 30 percent in the United States, though much less internationally. In 2008, advertising contributed 87 percent of newspapers’ revenues in the United States, compared with 53 percent in Germany, 50 percent in Britain and 35 percent in Japan, according to the Times.

Not surprisingly, some 15,000 U.S. journalists were either laid off or bought out by employers as the recession’s grip tightened on American consumers since late 2007. Almost one in five journalists working for American newspapers in 2001 is no longer there, according to a 2009 report by the Pew Research Center, an independent, nonpartisan public opinion research organization that studies attitudes toward politics, the press and public policy issues.

"Newspapers do not expect a whole lot of help from the government," John Sturm, CEO of the Newspaper Association of America, tells Bloomberg Businessweek. "We've never sought or asked for anything like a bailout."

In response to severe financial decline, many papers, especially the bigger metros, shrank the number of pages and sections, increased cover prices, and scaled back reporting.

Pick up your local paper today and it’s sure to be smaller, with less content for your interests than an edition from early 2007. Publishers were forced to dump many things over the side in order to survive. In some cases, what’s left is a mere shell.

Most publishers were content to sit back and let things unfold before the bust, with the notable exception of Gannett Co., America’s largest newspaper publisher, including USA Today.

While the average operating profit in 2009 for most papers was 12 percent, publicly-traded Gannett in the pre-bust days pressed for upper teens, depending on the paper’s market and demographics. Sadly, many of these “boom” profits came at the expense of employees and quality. (Disclosure: I once worked for a Gannett newspaper).

The fact is fewer than half of all American adults now regularly read a daily newspaper. Recession, lifestyle and generational issues all factor into the swift decline of print media. Plus, newspaper executives have a well-earned reputation for making poor or questionable management decisions.

Why would government intervention make a difference?

The one exception for government oversight might be in copyright protection, especially with the Internet changing the rules of the game. Newspapers, the Associated Press, and Google have locked horns over establishing a balance between aggregation of credited content and outright lifting of material.

As Times reporter Eric Pfanner points out: “So far, newspapers have moved only halfheartedly to defend their copyrights online under existing legislation, because they have been held in thrall to the idea that giving away their content would make new revenue appear. Fortunately, this is now being reconsidered.’’

Public subsidies and charity aren’t solutions to what ails the newspaper industry. It’s up to newspaper executives to get beyond the “Chicken Little” stage and embrace changes in all forms which serve older readers while attracting younger ones. They need recognize there’s lots of brain power in the newsrooms, not just in the offices.

News Corp. Chairman and CEO Rupert Murdoch in December warned against the "heavy hand" of federal intervention, saying newspapers could be harmed by over-regulation or efforts to subsidize the industry, reports Bloomberg Businessweek writer Olga Kharif. WMB agrees with Murdoch, whose Dow Jones & Company, a division of News Corp., publishes The Wall Street Journal.

If the U.S. government crosses the line between it and the Fourth Estate, through financial incentives to bail out a shaken industry, there’s no going back. An independent press, free to criticize, question and report, will be seriously hampered. Whose interests will be served? Not taxpayers, that much is certain.

Imagine if the U.S. government controlled reporting on the oil disaster in the Gulf of Mexico. Would the rest of the country fully grasp the scope of the crisis and its impact if it were not for the unfettered media, in all forms? Would we really know how helpless and clueless our big government is to manage affairs right here at home?

Newspapers will survive because most journalists are resilient, determined to get the full story and working to earn the public’s trust – despite stupid decisions by owners and executives, shifting public interest, and competing alternatives.

As someone once said, “The pen is mightier than the sword.” In many ways, that still holds true. Let’s not allow the ink to dry up with yet another “government solution” to a problem that can take care of itself, warts and all.

As for me, I practice what I preach at writenowworks.com.

Corporate 'Darth Vader' Revealed

The face of Corporate America can show many sides such as benevolence toward employees and generosity in humanitarian causes, but it also can reflect shallow goals and self-serving by those in positions of power.

CNNMoney / Fortune recently released their 2010 World’s Most Admired Companies – 50 regarded as having the best reputations. The survey asked businesspeople to vote for the companies that they admired most, from any industry. Below are the top 10 from the list.

1. Apple
2. Google
3. Berkshire Hathaway
4. Johnson & Johnson
5. Amazon.com
6. Procter & Gamble
7. Toyota Motor
8. Goldman Sachs
9. Wal-Mart
10.Coca-Cola

Each of these companies has had ups and downs (Toyota and Goldman Sachs on the latter side lately), but they are resilient and remain key players on the big stage. They are not perfect; they have detractors as well as admirers.

A good corporate reputation can be put to the test during trying times, yet if the company is well-structured, financially and culturally, it can not only survive a severe crisis but emerge stronger for it.

Gannett Co., Inc., one of America’s largest media empires and publisher of USA Today, has been enduring hardship from a combination punch of the Great Recession (which sharply cut advertising revenue) and free electronic competition from the Web (the print industry, especially newspapers, got pounded).


Gannett, which owns newspapers, Web sites and television stations, told its employees sacrifices were needed – unpaid furloughs, salary freezes and cuts, increased health care costs. It then laid off thousands of employees, many of them senior staffers at local community papers.

What the publicly-traded corporation did not do is spread that pain among its CEO and executive officers.

A departure from the Virginia-based company would bring Gannett Chairman and CEO Craig A. Dubow some $19.3 million, as of Dec. 31, 2010, with nearly half – $9.5 million – from his pension, reported Footnoted.org in a recent piece headlined: “An oddly placed reward at Gannett ...’’ Footnoted is part of Morningstar.

Footnoted reporter Theo Francis wrote that “much of the rest comes courtesy of a feature triggered just this year: All stock options and restricted-stock units granted since mid-2005 vest and become Dubow’s the day he walks out the door for the last time, as long as he isn’t fired for ‘good cause’ (specifics include misappropriation of funds, persistent neglect of duties or a felony conviction). His options then remain exercisable for as long as four years.”

Francis also reported, “Gracia C. Martore, Gannett’s president, COO and CFO, gets a similar deal, with equity grants since early 2005 vesting on departure and options remaining exercisable for as long as three years. Her take: $10 million.”

MediaJobsDaily reported that the Gannett Blog by Jim Hopkins, a former USA Today editor and reporter,
reviewed some details about salaries of the media company’s top execs, culled from a regulatory filing. Dubow was paid $4.7 million last year, which included a $1.5 million bonus. He made $3.1 million the year before.

Dubow, 55, and Martore, 58, implemented layoffs last year that resulted in the loss of 6,000 jobs at the corporation, which was near bankruptcy, according to Hopkins' blog. Martore’s salary last year for her duties as CFO amounted to $4 million.

Under Dubow and Martore’s watch, Gannett stock bottomed out in 2009 at $1.85 a share and is now trading around $17, which some applaud as a turnaround while others criticize as poor stewardship. (Disclosure: This author, a journalist employed by a Gannett newspaper for six years, no longer has any financial ties to the company).

Gannett stock traded between mid-30s and mid-50s in the early 2000s; at the stock’s peak in the booming late 1990s, it was consistently in the 70s and 80s.

The debate over executive compensation has raged for years across many U.S. industries, so Gannett enriching those at the top is not unusual. What is disturbing is the level of sacrifice demanded of its rank-and-file employees while its executive officers were blanketed with handsome financial incentive packages.

What message does it send?

Top Gannett leadership sees little value in building a solid reputation with its hard-working employees,
who receive the company’s embattled stock as part of their 401k participation match, and savvy investors who desire shares of a well-run, responsible and solid-performing corporate leader.

The list of most admired companies shows a corporation can be successful on many levels, not just the bottom line. Some companies, including Gannett, apparently didn’t get the memo that the “greed is good” business model is out of style everywhere, especially these days on Wall Street.

As for me, I practice what I preach at writenowworks.com.