On the buying of the Washington Post

by Eric on August 5, 2013

The last time the Washington Post was suffering financial difficulties and looking for a buyer, the President of the United States took an interest in getting it a politically sympathetic owner. This was back in early 1933, during the last long lame-duck presidency, when Herbert Hoover was in the White House refusing his appointees’ entreaties to do something about the financial collapse. He claimed he wouldn’t do anything about the nation’s banks unless he had Franklin Roosevelt’s cooperation – and he wouldn’t have Franklin Roosevelt’s cooperation unless Roosevelt swore he would maintain the gold standard and forswear deficit spending.

But Hoover was willing to expend his presidential influence in trying to find the Post a buyer who wasn’t the Democrat and then-Roosevelt-backer William Randolph Hearst.

After talking about the Post with Hoover, newspaper owner Frank Gannett sent an auditor to look the paper over. He found that while the Post had made $23,907 in 1929, it had lost $117,335 in 1930; $140,364 in 1931; and an estimated lost of $275,000 in 1932. Ad revenues had dropped from $1.37 million in 1929 to $629,000 for the eleven months of 1932 with available information.

In consequence, Gannett wrote to Hoover, “the property does not present a very attractive picture.” He went on, “I hate to see the paper go to Hearst. Yet, he seems to be the only one who could afford it at this time, to make any payment for it.” Gannett concluded, “However, if support for the project could be developed, I would be glad to do my part in trying to get control of it and make it a forceful spokesman for the party.”

Notwithstanding his thrashing in the November elections, Hoover, even out of office, wanted the Post to go to “a strong man,” as he wrote on March 28. After leaving DC, Hoover tried to get his former Secretary of the Treasury, Ogden Mills, to join Senator George Moses and Post editor Ira Bennett in a group to buy the Post when it went up for auction on June 1.

Eugene Meyer was still running the Federal Reserve System, though not for long – Roosevelt had declared privately on March 25 that Meyer was on his way out. Meyer was a friend of Hoover’s – though like most of the country he was not, in March of 1933, much enamored of Hoover’s presidency. Nevertheless, he and his wife Agnes remained in touch with the former president.

Meyer bought the Post at auction on June 1, and made himself president, and his wife Agnes vice president. Hoover sent his congratulations. Agnes wrote back that she looked forward to “the opportunity to build up a really strong and independent paper in Washington under present circumstances seemed too important to be renounced.”

Eugene Meyer hired Ralph Robey away from the New York Evening Post “particularly to fight the inflationary policies of Mr. Roosevelt and his crowd, who” – Meyer said with evident annoyance – “thought they could cure the depression by raising the price of gold which was devaluating the dollar and repudiating the explicit contract of government to pay in dollars of the same weight of gold and fineness.” Meyer also objected strongly to the Agricultural Adjustment Administration, and other New Deal measures.

Post reporters complained afterward that Meyer “went over their articles and changed them so that their writers were all disgusted.”

Will we find someday that Barack Obama cared who the Post went to? Will Jeff Bezos take a role in determining the paper’s content? Stay tuned…

{ 83 comments }

1

Herschel 08.05.13 at 11:18 pm

Why on earth would Jeff Bezos, who I thought was no fool, think that the Washington Post is worth $250 million? To save time and effort, he could just set the money on fire.

2

Passing By 08.05.13 at 11:53 pm

“Will Jeff Bezos take a role in determining the paper’s content?”

“Rich men don’t buy toys for other people to play with”–M Kinsley (I think)

3

Witt 08.06.13 at 12:02 am

The question isn’t whether it’s worth $250 million, it’s whether it’s worth nine-tenths of a percent of his wealth. (Bezos is reputedly worth $28 billion).

I’d buy it for nine-tenths of a percent of my wealth, I tell you right now.

4

Herschel 08.06.13 at 1:03 am

If I owned the Washington Post of 1974, or even 1994, I might think that was pretty cool, and worth even more than nine-tenths of a percent of my wealth. If I owned the Washington Post of 2013, I’d feel so dirtied that $250 million worth of soap couldn’t make me feel clean again.

5

Barry 08.06.13 at 1:18 am

Herschel: “Why on earth would Jeff Bezos, who I thought was no fool, think that the Washington Post is worth $250 million? To save time and effort, he could just set the money on fire.”

By now he’s probably spent a quarter billion $$$ on a number of ‘what the heck?’ acquisitions and projects; if he lost 100% of the money he puts into the WaPo, that would probably not be the biggest loss in his career.

6

LFC 08.06.13 at 1:33 am

Herschel:
Why on earth would Jeff Bezos, who I thought was no fool, think that the Washington Post is worth $250 million? To save time and effort, he could just set the money on fire.

Nonsense. The Post has some of the best foreign and domestic reporting of any paper in the country. For a paper with its history and of its quality, notwithstanding the company’s current business problems, $250 million seems, frankly, like something of a bargain. (Looking from the outside, that is, w no particular knowledge of the balance sheets.)

7

Substance McGravitas 08.06.13 at 1:36 am

A very big questions around who gets to tax purchases made online have not been settled.

8

LFC 08.06.13 at 1:39 am

Herschel:
If I owned the Washington Post of 2013, I’d feel so dirtied that $250 million worth of soap couldn’t make me feel clean again.

You know, the op-ed page and the editorial page are not the heart of the newspaper. (I assume your objections are mostly there.) The reporting is the heart of the paper, and the Post’s reporting is — not all of the time and everywhere but in general — good. The foreign reporting is often excellent. The coverage of the US legislative process, not that I follow it that closely, is almost certainly among the best in the country.

9

parsimon 08.06.13 at 2:13 am

By now he’s probably spent a quarter billion $$$ on a number of ‘what the heck?’ acquisitions and projects

I suspect Barry gets it right. Bezos acquires things like there’s no tomorrow (often, where Amazon is concerned, to shut them down). Maybe he’ll form a soft space in his heart for the Washington Post, but from the sound of things, he may also just be doing Katherine Weymouth, apparently a personal friend, a favor.

I’m enjoying a terrible schadenfreude, though, from the thought that George Will now gets to tell himself that he works for Jeff Bezos.

10

Dan 08.06.13 at 2:47 am

Heck Bezos donated $42MM to develop a clock that would run without human assistance for 10,000 years. http://en.wikipedia.org/wiki/Clock_of_the_Long_Now

Plus Blue Origin and his space travel dreams.

In the words of Mel Brookes as LouisXVI “Its good to be the King.”

11

Herschel 08.06.13 at 3:15 am

Sorry, I don’t buy the apologies for the Post. The news section is riddled with stories that state as fact that Social Security is driving the long-term budget imbalance and push other tendentious claims that spill over from the gruesomely odious editorial page. Dean Baker does a good job policing these things; if I had to read that paper every day, I’d kill myself, so I owe Dean a debt of gratitude. And then there was this lovely story on the front page in 2007: Many believe Obama is a Muslim; Obama denies it:

http://www.washingtonpost.com/wp-dyn/content/article/2007/11/28/AR2007112802757.html

Great reporting. Oh, and try to find out what’s actually happening in my home town in my supposed home-town paper. Good luck.

When the Washington Post Co. unloaded Newsweek onto Sidney Harmon, it was reportedly for $1. I think the late Mr. Harmon struck a more realistic bargain than Mr. Bezos. I don’t expect there will be a Washington Post ten years hence, and good riddance to bad rubbish.

12

KT 08.06.13 at 3:19 am

“Why on earth would Jeff Bezos, who I thought was no fool, think that the Washington Post is worth $250 million?”

Why does Rupert Murdoch own so many loss-making newspapers? Because they buy him influence to protect the profit-making parts of his business. (Also to spread his ideology, of course).

Bezos has bought the most important media outlet in the most important city in the most important country in the world, and he has done it for peanuts.

13

Satan Mayo 08.06.13 at 4:36 am

Has there ever been a newspaper that you thought was not a pile of gruesomely odious filth and rubbish, Herschel? What qualities would such an idealized newspaper possess?

14

Herschel 08.06.13 at 4:55 am

I’m not really interested in “idealized” newspapers. The Washington Post was a pretty good paper 20 years ago, as I think I suggested above. The New York Times, infuriating as it can sometimes be, is a pretty good paper today. Among the qualities I prize in a newspaper is actual reporting of news uninfected by special pleading and Pete Peterson blowjobs. What do you like in a newspaper?

15

john b 08.06.13 at 7:44 am

KT/12 – Bezos has also bought the People’s Daily? I’m surprised the Party were willing to sell, to be honest.

16

Martin Bento 08.06.13 at 8:23 am

Political fights in which Bezos has a dog:

1) Retailer or producer sets prices for electronic media? Currently, the subject of 2 lawsuits. He wants retailer, which could give him monopoly power over e-books and perhaps other things.

2) The legitimacy of anti-trust generally, as Amazon is trying to monopolize much of retail. It wants into the home delivery business. While established players are skeptical that money can be made from this, Bezos doesn’t care about money in the sense of making a profit. Wall Street smells monopoly in his socks, so his stock is worth a fortune whether he makes money or not. He is out to conquer the world.

3) Taxation of online purchases.

4) Privacy issues related to cloud computing. Here there is a government division, a commercial division, and possibly a contraband division, in that info gathered for “legitimate” commercial or government purposes could be compromised. In many situations, privacy is also security.

5) Privacy issues related to anonymous publishing. There is a long tradition of writers and artists presenting their work under pseudonyms, sometimes for effect, but sometimes for serious reasons. One could see such reasons now. Gay literature out of Iran. Exposes of the Zetas from Mexico. Amazon prohibits this for self-published books, and it may be that self-published will become the norm.

7) Whether it is legitimate to protect “downtown”, meaning local retail – like all retail, undermined by Amazon.

I’m sure there are others I’m not pulling off the top of my head.

Unlike say Google or Facebook, Amazon does not seem a terribly creative company and seems unlikely to contribute valuable “new media” ideas to the post either.

17

Martin Bento 08.06.13 at 8:24 am

Oh, I forgot,

8) legitimacy of denying access to the financial system for political reasons as happened to wikileaks.

18

KT 08.06.13 at 8:26 am

john B, the Chicoms will sell anything to anybody if the price is right.

Back on topic, the Huff Po was sold for – what was it? – $350 million a couple of years ago. The Washington Post is not what it used to be substantively, but it still has the brand name. There’s no reason why it can’t be a success along the Huff Po model, and Bezos knows a thing or two about making online businesses work.

19

Trader Joe 08.06.13 at 11:10 am

The two great tools of any “Robber Baron” are newspapers and banks. For Bezos, one down, one to go.

I can’t see him ever making an ROE on his price tag….he may find a way to better monetize an on-line/hard copy presence since he has people who know a thing or two about on-line marketing, but there’s little chance of making an actual return on the direct investment. The benefits have to be indirect.

It may be a small portion of his wealth, but rich people get rich and stay rich by not losing money as much as they do by making more.

20

bill benzon 08.06.13 at 11:29 am

Tyler Cowen now has a post where he observes that this sale is a step along a road he’d pointed out in a post from Nov 2012 which closed with the observation: “There is this funny thing called antitrust law, but I think these companies [Amazon, Google, Apple, etc.] are popular enough, and associated closely enough with cool products — and sometimes cheap products — to get away with this.”

That observation is pointing in the direction of something I’ve been thinking about recently.

We’ve all grown up seeing various visions of the future depicted in the media. I was a kid in the 50s and on into the 60s. I saw Walt Disney’s vision of the future, with an endless supply of cheap nuclear power, and I saw The Jetsons on TV, which high-tech conveniences everywhere. At the end of the 60s, when I’d become a young adult, there was Kubrick’s 2001. Well, the real 2001 wasn’t very much like Kubrick’s film. No HAL, nor anything remotely like it, and space travel to earth orbits had not become routine, much less a moon colony.

But, here’s the thing: These visions of the future were about technology, but tacitly assumed that society was organized by the same social institutions. Along comes Blade Runner (1982) and those institutional structures have changed at bit.

It’s institutional structures I’m thinking about. Are they changing, have they changed, for better or worse? The absorption of old media by new (e.g. Washington Post being bought up by Amazon) isn’t quite there. Nor, for that matter, is the encroaching security state with a prison-industrial complex, and the privitization of public schools along with the rise of for-profit higher ed, the insulation of investment banking from political regulation and social accountability, but we’re getting uncomfortably close to a rather nasty restructuring of basic social institutiona.

Heck, maybe we are there, and we’re doomed.

21

Harold 08.06.13 at 11:52 am

@16 “I’m sure there are others” –
In case nobody said it: unionization of warehouse workers. http://www.nytimes.com/2013/08/05/business/workers-of-amazon-divergent.html?_r=0

22

PJW 08.06.13 at 12:03 pm

I’ll be interested in seeing what Warren Buffett has to say about the sale. He has a long history with the paper, had enjoyed strong personal ties to the Graham family, and owned a big chunk of it through Berkshire Hathaway. He recently purchased his hometown paper, the Omaha World-Herald, which had been employee owned for decades, and says he has no interest in dictating the content of the paper, an assertion I believe since Buffett lets good managers run his businesses. “Give me the bad news,” he’s been quoted as saying, “the good stuff I can figure out for myself.” It’ll be interesting to see how hands-on an owner Bezos wants to be.

23

pedant 08.06.13 at 12:43 pm

I realize that the past is a different country, but sometimes I’m struck at my inability to understand their foreign language.

“thought they could cure the depression by raising the price of gold which was devaluating the dollar and repudiating the explicit contract of government to pay in dollars of the same weight of gold and fineness.”

1) by “fineness” does he mean something like carat? I.e., if you agree to pay me 5 pounds of 24 carat gold, then you have not met your agreement if you pay me 5 pounds of 12 carat gold? Maybe, but why would that be a relevant thought here? (Nobody was contemplating melting down ingots or species and alloying them with baser metals–not the ingots and species that underlay the gold system. Were they?)

2) by “fineness” does he mean something like the value of the gold, as denominated in some other currency or commodity? If you promise to pay me 5 pounds of gold when it’s worth $100/pound, then you have not met your agreement if you pay me 5 pounds when it’s worth $50/pound? Maybe, but that would be crazy: the whole point of speculating in metals (and other commodities) is that one can make money from inter-temporal differences in price, and that was no less true then.

Maybe this is all transparent to those who know more about gold-standard systems. I’d be grateful for help.

24

Ralph Hitchens 08.06.13 at 1:05 pm

As the Post is a leading culprit in the “moral equivalency” posture, enabling right-wing outrages to go unremarked, any involvement by Bezos in the paper’s editorial slant can only be for the better.

25

Barry 08.06.13 at 1:17 pm

Herschel 08.06.13 at 3:15 am

” Sorry, I don’t buy the apologies for the Post. The news section is riddled with stories that state as fact that Social Security is driving the long-term budget imbalance and push other tendentious claims that spill over from the gruesomely odious editorial page. Dean Baker does a good job policing these things; if I had to read that paper every day, I’d kill myself, so I owe Dean a debt of gratitude. And then there was this lovely story on the front page in 2007: Many believe Obama is a Muslim; Obama denies it: “

Herschel, the dishonesty and lies are the *reason* for buying the newspaper. He wants to affect policy related to Amazon, and the truth is only occasionally useful, and very likely it’s generally harmful.

Let me phrase it in a work-safe manner – when you buy ‘certain institutions’, the fact that everybody who works there are ‘entertainers’, is a feature, not a bug.

I imagine that anybody on their editorial page who wants to stay will review their politics.

26

LFC 08.06.13 at 1:24 pm

Herschel @11
Sorry, I don’t buy the apologies for the Post. The news section is riddled with stories that state as fact that Social Security is driving the long-term budget imbalance and push other tendentious claims that spill over from the gruesomely odious editorial page. Dean Baker does a good job policing these things; if I had to read that paper every day, I’d kill myself, so I owe Dean a debt of gratitude.

I was thinking more of (1) the reporting on foreign-policy and ‘natl security’/defense-related issues, by such as Joby Warrick, Robert O’Harrow, Pamela Constable, Rajiv Chandrasekaran, Walter Pincus, to mention a few names that come to mind; (2) the country-specific reporting from the paper’s foreign correspondents and bureaus; (3) the reporting on environmental issues, by e.g. Juliet Eilperin. The reporting on the Supreme Ct and other federal cts (by Robert Barnes) seems pretty good. Also some of the paper’s blogs do analysis/reporting. (The arts coverage is spotty, though, and the Style section can be little more than an annoying mishmash of recycled gossip etc.)

I’m certain there are people who read the Post considerably more closely than I do who are better positioned to defend the reporting or debate it, but in the above-indicated areas the reporting is not bad, afaict (as an admittedly rather casual reader).

27

LFC 08.06.13 at 1:29 pm

Barry @25
He [Bezos] wants to affect policy related to Amazon

Could be, I suppose. OTOH, he may see this, as someone suggested on the NewsHr last night, as an opportunity to resuscitate, in business terms, a venerable paper and thus become (lastingly) known for something other than just being a v rich businessman.

28

H.P. Loveshack 08.06.13 at 2:37 pm

I, for one, welcome our new nerd overlords.

29

Tim Worstall 08.06.13 at 2:48 pm

“by “fineness” does he mean something like carat?”

Yes. Roughly speaking “fineness” with precious metals is equivalent to talking about the level of purity of other metals.

You can have 99.7% aluminium for example (this is the standard industry stuff) or 99.9%, 99.95%, 99.99% and so on (the higher purities tend to be used in chip making).

This is the same idea as talking about carats or fineness in gold etc. It’s just that we started talking about the purity of gold a long long time ago (that leaping out of the bath and shouting Eureka! was about being able to work out how much silver had been added to a piece of gold) and we’ve just ended up using different words to describe it all.

30

mistah charley, ph.d. 08.06.13 at 2:52 pm

definition fineness gold, when put into a search engine, answers pedant‘s question

31

Jonathan 08.06.13 at 2:55 pm

“I’m enjoying a terrible schadenfreude, though, from the thought that George Will now gets to tell himself that he works for Jeff Bezos.”

Maybe Bezos will fire him. And Fred Hiatt. I can dream…

32

Toddm 08.06.13 at 3:08 pm

Please add sources for this article, Eric. It’s fascinating stuff, but that you don’t even provide a source for the direct quote that Meyer “went over their articles and changed them so that their writers were all disgusted” is ridiculous. Do you want to spread the information or not? If so, then source your stuff for us so we can spread it intelligently.

33

Barry 08.06.13 at 3:13 pm

Barry @25 “He [Bezos] wants to affect policy related to Amazon”

LFC: ” Could be, I suppose. OTOH, he may see this, as someone suggested on the NewsHr last night, as an opportunity to resuscitate, in business terms, a venerable paper and thus become (lastingly) known for something other than just being a v rich businessman.”

True – there are a number of reasons which make sense, and I and all others should really start with reason #1 – compared to his personal wealth, it’s pocket money, so he doesn’t *need* any other good reasons.

34

ajay 08.06.13 at 3:18 pm

Further to 23, I think you are very slightly misreading it: by saying “repudiating the explicit contract of government to pay in dollars of the same weight of gold and fineness” he’s not implying that they instead wanted to pay in dollars of the same weight of gold but a slightly different fineness. They wanted to get rid of the explicit contract altogether, he’s saying.

35

William Timberman 08.06.13 at 3:35 pm

As with the Wall St. Journal, so also with the Post. Given the Sulzberger family’s reputedly feudal internal defenses, the NYT may take a while longer, but I suspect that in the end, it too will go. Objective journalism was on occasion a bit more than a myth, but never very much more, especially when the chips were down — and the chips are most definitely down now. As far as I can tell, the Sulzbergers no longer have any real interests to defend that can’t be measured in dollars. Bezos does. Clearly, he can accomplish that defense with the wrapper alone; he doesn’t need the content at all — not the present content, anyway.

36

pedant 08.06.13 at 3:49 pm

Thanks, mistah charlie. I’ll have to look into this google thing.

Unfortunately, knowing that “fineness” means fineness answers only part of my question, namely “why would it be at all relevant to mention fineness in this context? Who in this debate had brought fineness into question, or raised the possibility of altering fineness as a live issue?”

The same goes for ajay’s reply–you may be right that the stress lies on “contract” rather than on “weight” or “fineness”, but then why mention fineness at all? (Or is it just an instance of that stylistic trope of parroting technical jargon even when it is not strictly relevant, e.g. “he proposed a meal at the nearest restaurant, but on requesting more and better particulars I discovered that I would have some trouble providing the ways and means.”)

37

Tim Wilkinson 08.06.13 at 3:53 pm

The reporting is the heart of the paper – says who?

and the Post’s reporting is — not all of the time and everywhere but in general — good. Is that like ‘with notably rare exceptions’?

Bounded probity, a bit like bounded freedom of speech and bounded due process, is not really probity at all. If it were just a matter of a randomly distributed imperfection, it might make sense to settle for second best, but it’s not is it. The cases in which the usual standards suddenly cease to apply are generally the ones which actually matter.

38

Barry 08.06.13 at 4:49 pm

pedant 08.06.13 at 3:49 pm

” Unfortunately, knowing that “fineness” means fineness answers only part of my question, namely “why would it be at all relevant to mention fineness in this context? Who in this debate had brought fineness into question, or raised the possibility of altering fineness as a live issue?””

For the obvious reason that one way to welch on the gold standard while keeping to the appearance would be to exchange dollars for a certain weight of gold, but to dilute it with other metals – debasing the currency. In fact, that’s the standard method of doing it.

39

LFC 08.06.13 at 4:57 pm

TWilkinson @36
I don’t really have much of an interest in dragging this out, since the people who think WaPo is entirely worthless are not going to change their minds. Attitudes are fixed here and that’s that.

KT @18
One diff from the HuffPo model — WaPo has a print edition, not just an online, and even though the print edition no doubt loses money it’s important symbolically, imo, and Bezos wd be well-advised to keep it. It’s a part of the ‘brand’ — the hard copy is still what makes the paper “the paper.”

40

slavdude 08.06.13 at 5:29 pm

Pedant @35:

I think what is meant here is debasement of the currency, specifically the replacement of precious metals with “base” metals such as copper. In this case, this would mean paying the same price for a quantity of a precious metal (by weight) that has been alloyed with a certain percentage of a base metal that one would pay for the same quantity that is either 100% pure or alloyed with a smaller percentage.

You might also want to look up Gresham’s Law.

41

Theophylact 08.06.13 at 5:47 pm

If the dollar is backed by gold, raising the dollar price of a troy ounce of .999 fine gold is exactly the same as devaluing the dollar. Physical dilution is totally unnecessary.

42

Barry 08.06.13 at 6:10 pm

But possible.

43

Rmj 08.06.13 at 7:03 pm

LFC: ” Could be, I suppose. OTOH, he may see this, as someone suggested on the NewsHr last night, as an opportunity to resuscitate, in business terms, a venerable paper and thus become (lastingly) known for something other than just being a v rich businessman.”

Which makes him Charles Foster Kane, who already had a fortune and sank it into newspapers even as the papers lost money (he had a fortune, what did he care?)

And, of course, Kane was modeled on…Hearst.

Life imitates art. History repeats itself. Something happening here, what it is ain’t exactly clear….

Curiouser and curiouser.

44

LFC 08.06.13 at 7:20 pm

@rmj
fyi – I was drastically compressing an interview w Tom Rosenstiel, i believe it was, on the NewsHr last night. will be available at their site. he made the pt., iirc, that ownership of newspapers is reverting to rich individuals rather than publicly traded corps. — in that sense the Kane/Hearst comparison might be apt, i’m not sure. the implication seemed to be that Bezos had some public-spirited motivation — I have absolutely no idea whether that’s true or not.

45

LFC 08.06.13 at 7:29 pm

Btw this is different from owning an opinion magazine (Nation, New Republic, Weekly Standard, whatever) — they’re *never* going to make money, and in that sense (at least in the case of NR and WS) could be seen as an indulgence by a wealthy owner of some ideological or other ‘high-minded’ whim. Whereas WaPo *can* be profitable, I wd think — it’s a matter of getting the business model right and taking enough time and having enough patience, which the chatter is that Bezos has…

46

Barry 08.06.13 at 7:31 pm

A comment from Brad Delong’s blog:

“Jeff Bezos is majority shareholder in AWZN. The Department of Defense (CIA) and NASA have chosen AWS for their multi-billion dollar cloud contracting, earlier this year. Amazon will be benefiting shortly from the Dept. of Justice’s decision to penalize Apple and traditional publishers, so that they cannot be competitive in e-books for the next 5 years. Jeff Bezos is a strong advocate of CommonCore curriculum in the U.S.A., thus has major influence on education policy. What else? He bought an interest in Business Insider! No, more relevant, his company, Amazon, dominates ecommerce.”

47

Hidari 08.06.13 at 7:48 pm

” What does this mean for the Future of Journalism? Journalism is decidedly not saved, I can tell you that much. It’s still pretty much doomed. In a sense the survival of the Washington Post should be a much lower priority, for righteous journalists, than the survival of the hundreds of smaller-market papers dead or dying as we speak. Washington is quite well covered, and will remain so as long as it is our nation’s capital. It is the city halls and state legislatures of the hinterlands that grow more corrupt and extreme when the citizenry no longer stumble upon important local news on the road to the sports page. (Normal people used to read newspapers for comics, crosswords, classifieds, ballgame scores and and movie listings. Perhaps the strangest aspect of the slow death of the print newspaper is that the comics-allergic New York Times is the last national paper standing, though it does have a very good crossword.) It would be nicer to see Bezos rescue the New Orleans Times-Picayune, or have him free all the Gannett papers from their coldblooded corporate parents. The Post would’ve survived as a “brand” without his assistance. The Louisville Courier-Journal may not be so lucky.

But billionaires don’t buy newspapers to run them as public goods, and smart billionaires don’t buy newspapers to make money. Billionaires buy newspapers for influence. That is the point. The Post is among the most influential in the nation. Second- or third-most, depending on which party is in power. Buying the Washington Post is sort of like retaining the best-connected lobbyist in Washington, in a parallel world in which lobbyists are universally praised for their value to functioning democracies. Bezos needn’t even exercise his influence in the vulgar fashion of a Murdoch. He can merely staff the paper with people attuned to his worldview and allow the opinion page to evolve to reflect his interests naturally….

The very reasonable fear isn’t that Bezos will fire all the reporters — he’s a “long-term value” guy, not a cost-slashing Sam Zell — but that Bezos will use his newly bought influence to lobby for federal policies that align with his financial interests. He does not particularly want to pay taxes, and he’d strongly prefer it if his cheap labor remained cheap, which is to say non-union.

When newspapers are only owned by the rich they rarely argue for the interests of the poor.”

http://www.salon.com/2013/08/06/billionaire_buys_toy_the_real_bezos_washington_post_story/

48

Paul Davis 08.06.13 at 7:56 pm

I have no illusions about what the acquisition of enormous wealth will do to anyone. And yeah, I only worked with Bezos for the first 15 months of Amazon’s existence, in the proverbial converted garage where it was just the 3(.5) of us. But if anyone really thinks that Bezos himself is motivated by venal greed and a petty desire to increase his own personal wealth … I can’t prove you wrong, but I will say that I think that you’re deluded. It could be that nearly two decades of astounding richness have warped his underlying motivations and morals, but I suspect that they are still pretty much what they were in 1994 – phenomenally driven, able to shrug through moral ambiguity, and always fixated on the big goals and the grand schemes.

49

casino implosion 08.06.13 at 9:15 pm

“Why on earth would Jeff Bezos, who I thought was no fool, think that the Washington Post is worth $250 million?”

“The accredited worthy form of self-assertion is contest, and useful articles or services obtained by seizure or compulsion serve as a conventional evidence of successful contest,”-Thorstein Veblen

50

garymar 08.06.13 at 10:27 pm

“shrug through moral ambiguity” — what a great phrase! A Godwin moment just waiting to happen.

51

Tim Wilkinson 08.06.13 at 11:13 pm

Hidari – a very minor point: He can merely staff the paper with people attuned to his worldview and allow the opinion page to evolve to reflect his interests naturally he can, but I don’t think any proprietor ever actually does limit themself to such indirect methods. Leader writers work to the paper’s ‘line’ on various issues (this was illustrated in some detail in http://www.bbc.co.uk/blogs/radio4/posts/leader_conference_what_will_th ), and proprietors are in a position to dictate what that line will be – on those rare occasions when their minions fail accurately to anticipate their preference.

Paul Davis – so people are deluded are they? Let’s cut the mood music, and replace the strawmannish ‘motivated by venal greed and a petty desire to increase his own personal wealth’ with ‘likely to run the paper as a means of furthering his business interests’. Better still, translate this into the language of a tycoon’s internal monologue and replace ‘furthering his business interests’ with ‘building a successful business empire’, or some such. Now tell us what part of ‘phenomenally driven, able to shrug through moral ambiguity, and always fixated on the big goals and the grand schemes’ does anything but support that picture. (In other words, despite yourself you haven’t really got beyond the second of Barry’s ‘biggest lies’ as stated at http://crookedtimber.org/2010/01/15/is-there-an-european-economic-model/#comment-301708 : ‘I’ve met him, and he’s a nice guy’). Not to say that his caprice might not run to being a philanthropic patron in the mythic Hayekian mould – but you haven’t given any particular reason to suppose so. Now if you were to reveal that he’s a Quaker or otherwise motivated by high principle, that might have some relevance. But you appear to have said quite the opposite.

btw, LFC (#39) – I at least don’t have any special animus against WaPo, and have found some of its coverage of military/intelligence issues of some use. My programmatic remarks about bounded probity and the non-random distribution of poor reporting nonetheless apply. As a proud wearer of the improvised Faraday cage, I take a distinctly un-Pollyannaish approach to news outlets and am willing to engage in ‘adversarial epistemics’, that is trying to make rationally-grounded inferences about what (or what kind of thing) is likely to have been suppressed or distorted. This approach is not, I don’t think, typical of the general readership of US newspapers.

52

Tim Wilkinson 08.06.13 at 11:15 pm

garymar made the key point

53

Salient 08.06.13 at 11:25 pm

Worldbuilder buys worldbuilding engine.

54

Paul Davis 08.07.13 at 12:03 am

@garymar: moral ambiguity is a tricky thing to face. Are you so confident of your own ability to turn the ambiguous into a clear cut right and wrong, so that you can always do the right thing?

I’m certainly not, and most of the people I know who I consider better than me don’t seem to be any better at facing down this particular conundrum. I watched Bezos in the very earliest days of Amazon tackle the basic questions of what kind of company he wanted to build. I didn’t agree with his answers, but it was clear to me that there was, even from the beginning, some fairly unquestionable ambiguity about what was the right thing to do. Whose interests are you rooting for? Over what time period? With what kinds of assumptions? If I had actually been the founder of the company, and as consumed by the vision as he was, I think it is possible that I might have made the same choices as he did (choices that I still don’t really agree with). But I had the luxury to just bail out and go raise my daughter – my decision was largely inconsequential for the other people involved. So I don’t try to judge too quickly. Bezos is obscenely wealthy, but I still strongly believe him to be motivated by things other than wealth, and I still believe that his moral compass comes with an ample, deep and sophisticated philosophical underpinning that even though I might ultimately disagree with how it leads him out of some particular moral ambiguities, I can still respect.

55

Paul Davis 08.07.13 at 12:24 am

Tim Wilkinson: sometimes, a cigar is just a cigar, and “I’ve worked with him, and he’s a good guy” is nothing more than what it looks like – neither a lie nor a claim to understand the universe, merely an observation, perhaps combined with a statement of hope.

When I said that I don’t believe Bezos to `motivated by venal greed and a petty desire to increase his own personal wealth’, what I meant is perhaps best illustrated by a contrast with another tycoon. Perhaps someone like Murdoch, who I certainly do not know but judge to be someone whose business decisions are based on very little other than the question of whether or not he believes that a particular choice will increase his own personal wealth. I doubt if Murdoch has had a vision of “what would be awesome” in quite a long time, if indeed he ever had one that was more complex than “I am obscenely rich and own an appallingly large fraction of important world media”.

My reading of Bezos (based on a two decade-old short-but-intense experience that can’t be considered utterly reliable), is that he is much more motivated by the goals of the ventures he has been involved with than he is by the question of whether doing X will increase his own wealth, or even be conventionally financially successful (at least, post-amazon). My sense is that he wants to see them succeed, but less because they will make money than that he thinks they are awesome goals. I’d rather live in a world where nobody would be as rich or powerful as people like Bezos are in ours.

But if I have to choose between obscenely wealthy tycoons with debatably awesome visions of what is possible and those who simply want more power and more money, I know which I’d opt for and which one I think is closer to Bezos than it is to Murdoch.

56

Tim Wilkinson 08.07.13 at 12:47 am

Paul – In response to #52, I’d written: “I’m not trying to be unduly dismissive or question your bona fides, but I have to say that the praise you’re offering is so faint that it reads like one of those carefully worded but unmistakably negative employment references.”

#53 gives a better idea of why you think this guy might turn out to be a hands-off patron aiming to sponsor a decent newspaper. (Though actually come to think of it, even keeping hands off isn’t likely to be adequate given that the default – and possibly ineluctable – market logic dictates that an editor must please the advertisers as well as avoiding certain other kinds of controversy).

I don’t know anything about the guy apart from what I’ve seen here, so who knows; these things can happen. On the other hand, power corrupts, there are always further and grander projects for which more money and influence are always useful, and I’m not encouraged by your slightly cryptic remarks about the guy’s dubious opinions – which he won’t see anything wrong with promoting via his paper unless he has a strong grasp of and commitment to the self-denying ethics involved.

But you’ve provided some substance, and your contribution isn’t without evidential value, even though as you say it’s far from dispositive, so thanks for it. Time will tell, I suppose.

57

Passing By 08.07.13 at 1:11 am

“the praise you’re offering is so faint that it reads like one of those carefully worded but unmistakably negative employment references.”

Actually, the praise he’s offering seems about as positive as one can get about the people who build–or clamber to the top of–large organizations.

“phenomenally driven, able to shrug through moral ambiguity, and always fixated on the big goals and the grand schemes” seems like a fair description of leaders in politics [Jefferson, Lincoln, both Roosevelts], the military [Grant, Sherman, Eisenhower, King], or business [Carnegie, Ford, Jobs]

58

Lee A. Arnold 08.07.13 at 1:16 am

If Bezos stays smart, he can transform the WaPo into the paper of government record, simply by tracing down the vast bowels of Washingtoon, updating looming science issues like the climate constantly, profiling every Congressperson with a separate page, etc. There is a long way to go to bring newspapers into the 21st century, and adding more information functions is a distinct possibility. It is not something Murdoch could would do with the Wall Street Journal, for example, because beyond financial and business data, he is not particularly interested in having people learn more about the world.

59

Lee A. Arnold 08.07.13 at 1:26 am

Basically just go from a front page, to millions of pages, each one set up on a different news item. News items as separate pages each: including the reporter’s straight shot; the identified parties making statements if they want; links to concerned NGO’s; links to ancillary essays even off-site; etc. — all of these in separate boxes so the type of input is identified and understood. Every news item could be like an Amazon page that included a box by an Amazon staff reporter. You could update boxes separately and try to make pages into semiwiki issue clusters that invite future readership. We need something like this to keep track of governance.

60

Paul Davis 08.07.13 at 1:28 am

Tim, just to clarify: my “praise” is ambiguous. What my feelings about Bezos as an individual, I’m no fan of Amazon’s labor practices, both in the fulfillment centers and back in good old days when it would just suck in success-seeking young folks and burn them out with promises of stock option riches. I’m no fan of their 1-click patent (and likely others that I am not aware of). I’m not a fan of the general model of a single vast online retailer that threatens the long term economic diversity that I think societies need. I’m not a fan of the personality-free tone that amazon.com has had from day one. There’s more … I don’t know how many of these things are his own personal design, but I suspect that Bezos would offer a defense of all them if he ever offered any opinion on them at all.

It could be that amazon’s (and by extension, Bezos’) success and whatever will happen to the WashPo hinge on doing the kinds of things that I don’t like. Or it could be that these were indicators of an approach that wasn’t strictly central to that success, and that can (and perhaps will) be improved or redeemed in time. As you said, time will tell.

61

LFC 08.07.13 at 2:15 am

TW:
… I take a distinctly un-Pollyannaish approach to news outlets and am willing to engage in ‘adversarial epistemics’….

I endorse an ‘unPollyannaish approach’ to reading of news outlets (and much else), so at least to that extent we agree.

62

anon 08.07.13 at 2:17 am

Love the way you diss Herbert Hoover.

You should read some history. During WWI he was responsible for making sure Millions of Belgium’s citizens didn’t starve. After WWI he was responsible for making sure Millions of Europeans didn’t starve. After WWII he was responsible for making sure that Millions of Eastern Europeans didn’t starve.

Please tell us about all the Millions of people you helped stay fed by working for free and organizing vast groups of people to send aid various places.

Just how ignorant ARE you Eric?

63

Chris Mealy 08.07.13 at 4:03 am

I don’t know a lot about Bezos’s current politics, but way back when it pretty much tracked whatever was in the Economist. Standard techno-libertarian stuff, like this:

I think people should carefully reread the first part of the Declaration of Independence, because I think sometimes we as a society start to get confused and think that we have a right to happiness, but if you read the Declaration of Independence, it talks about “life, liberty and the pursuit of happiness.” Nobody has a right to happiness. You should have a right to pursue it, and I think the core of that is liberty.

Here in Washington State he’s backed charter schools and fought a state income tax (we don’t have one).

64

Walt 08.07.13 at 5:23 am

anon: You missed the part of his career where he was a disaster as President of the United States, utterly helpless in the face of the Great Depression, which nearly destroyed Western civilization, both directly and indirectly through Hitler.

65

NomadUK 08.07.13 at 5:35 am

Standard techno-libertarian stuff

God, I get so tired of those people.

66

Ronan(rf) 08.07.13 at 8:46 am

“I know which I’d opt for and which one I think is closer to Bezos than it is to Murdoch”

I must say, if had to choose, Id choose Murdoch. All he aspired to was money and publicly settling personal grudges. This other character, like all tech utopianists, is far more perfidious. He seeks to run our lives. He wont stop until he controls everything. And has us working on the weekends. And speaking with US converstational norms. And reading glossy puff pieces about fellow tech utopianists. At least Murdoch’s papers were fun, to a degree
We’re being nudged towards dystopia by this coterie

67

Alex 08.07.13 at 9:59 am

I must say, if had to choose, Id choose Murdoch. All he aspired to was money and publicly settling personal grudges

And, you know, infiltrating his staffers into No.10 Downing Street and Scotland Yard, making sure literally all his papers worldwide demanded war with Iraq, constantly sponsoring horrible climate-denier quacks…nothing serious.

68

Ronan(rf) 08.07.13 at 10:08 am

The News of the World et al sponsoring climate deniers is merely high jinks. I’ll agree with you on Iraq. The inflitration was surely an editorial decision? But at least you knew where Murdoch is starting from, subtle he wasn’t

69

NomadUK 08.07.13 at 10:54 am

bill benson@20: Really, I think Rollerball is a lot more apropos than Blade Runner.

70

ajay 08.07.13 at 11:05 am

I must say, if had to choose, Id choose Murdoch

Ooh, how daringly contrarian. Excuse me, but your bold opposition to conventional wisdom has left me feeling all wobbly.

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Ronan(rf) 08.07.13 at 11:56 am

What ‘conventional wisdom’ would that be ajay? By all means make the argument against Murdoch if you like. I don’t really see how his newspapers behaviour differs all that substantially from the British tabloid press/press tycoons historically?
Murdoch has no respectability, Bezos does. Bezos is substantially wealthier, has investments in more relevant areas etc 70-80% of Murdochs output was clownishness and was easily ignored
Perhaps you have an argument?

72

Rmj 08.07.13 at 12:40 pm

I can see I need to clarify myself to LFC @44:

I have no idea why Bezos bought the WaPo, except that he had the money and clearly wanted to spend it on something. The comparison to Kane was mere fancy: a rich man buying a paper so he can pour money into it for…what? Does Bezos have a girlfriend/wife he wants to make into an opera star?

Both Kane and Hearst were interested in the public good as they defined it, but those definitions often turn out to be quite narrow.

Not that the definition upheld by the Graham family hasn’t been narrow, too.

What will Bezos do with it? I dunno. Gotta admit, don’t really care, either.

73

LFC 08.07.13 at 12:53 pm

@Rmj
clarification taken

74

Walt 08.07.13 at 1:13 pm

Ronan, you’re not actually familiar with Rupert Murdoch and his media properties, are you?

75

Ronan(rf) 08.07.13 at 1:26 pm

In what sense?
If you’re talking about the various scandals that have plagued them, then I’d probably agree with the hostility directed towards him..if it’s an argument about the ‘influence’ he could exert as a result, then I would (personally) be more sceptical, but open to disagreement

76

Tim Wilkinson 08.07.13 at 2:24 pm

At the risk of adopting ‘the Bleedin obvious’ as my specialist subject: the clownishness (and the soft porn) sell papers and get them read. Read it at lunch, repeat it in the pub that evening when you need to display clear, simple, ‘hard-headed’ opinions on political topics.

The Sun has indeed been hugely influential and has been churning out right wing propaganda at least since the Wilson-Callaghan government. Everyone remembers its iconic headlines: ‘Crisis? what Crisis?’, ‘Gotcha’, etc – and its constant highly duplicitous campaigning against the ‘loony left’/political correctness, EU regulation and ‘Health ‘n’ Safety, scroungers, clueless po-faced lefties, unions, the BBC, etc etc. And this stuff has a far wider influence – politicians see it as not only an influence on, but to a large degree an encapsulation of, ‘blue-collar’ attitudes, and the great skill of its staff in producing ‘viral memes’ means it has influence far beyond its readership. I could go into the various psychorhetorical techniques that make said memes so viral, but won’t just now.

And that’s not even to mention Sky, whose programming brings us such delights as the extended subliminal elaboration of the ‘ticking time bomb argument’ that is 24, nor to look outside the UK.

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Ronan(rf) 08.07.13 at 2:37 pm

I agree that papers can be influential at specific time, (generally not of their making), and it’s difficult to divide out how newspapers shape opinion/are shaped by it. I also acknowledge the Murdoch press ability to influence specific politicians, bureaucrats etc

So my first point was overly flippant, and I apologise for that. I still dont think it’s objectionable though to find Bezos the greater threat*, (and more subtle – look at how Amazon tried to capture the e book market by selling at a loss) and more relevant to the world as it is now, and also more unlikely to become an easily definable hate figure as Murdoch was

*I dont know how you define/measure that, so it’s shorthand really

78

Barry 08.07.13 at 2:59 pm

Paul Davis: “Bezos is obscenely wealthy, but I still strongly believe him to be motivated by things other than wealth, and I still believe that his moral compass comes with an ample, deep and sophisticated philosophical underpinning that even though I might ultimately disagree with how it leads him out of some particular moral ambiguities, I can still respect.”

Coming in as the official judges of the two biggest lies in the world, I direct you and others to the conditions in Amazon’s warehouses, as proof of Bezos’ character.

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Lee A. Arnold 08.07.13 at 3:40 pm

Having worked in large warehouses of a multinational corp, it is always the same. But if Bezos is another “makers vs. takers” anti-welfare-state libertarian nutcase, and hopes to impress these ideas upon others, then the new Washington Post will fail. The idea that the “makers” are going to create lots of high-paying jobs is disproven in his case. (Merchandising rarely created many high-paying jobs anyway, even before computers started to make people unnecessary.) Many businesspeople think, that the way in which they themselves think, is the same way in which the world system should be compelled to work properly. Not so; although the reality of “capital-biased technological change” has barely permeated the noggins of some of our leading boffins. We are in the long era of the last thrashing throes of this dinosaur idea.

80

anon 08.07.13 at 4:06 pm

#64 – Walt suggested “…utterly helpless in the face of the Great Depression”

You may want to study something called the “Reconstruction Finance Corporation” and see who was President when it was established by
Congress.

I guess YOU missed THAT part of his career.

You may also wish to study the effect of the next Presidents response to the Great Depression. Seems like he had a bit of a struggle getting the economy to respond until massive defense spending kicked it.

Of course Walt, in your mind, keeping millions from starvation means nothing at all.

Herbert Hoover wasn’t perfect. No one was or is. His response to the world’s economic downturn doesn’t make current economists feel warm and fuzzy.

But ignoring the fact that he relieved untold suffering of millions of people for many years to score some sort of ‘political point’ makes YOU the smaller person. Not HH.

81

Barry 08.08.13 at 5:44 pm

“You may also wish to study the effect of the next Presidents response to the Great Depression. Seems like he had a bit of a struggle getting the economy to respond until massive defense spending kicked it.”

For anybody who believes this, please google a chart of the US GDP/GNP in the 1930′s. There’s a massive trend upwards starting in 1933, with a blip in 1937-8.

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Barry 08.08.13 at 5:47 pm

“You may also wish to study the effect of the next Presidents response to the Great Depression. Seems like he had a bit of a struggle getting the economy to respond until massive defense spending kicked it.”

What I find especially irritating about this zombie lie is that even if it were true, ‘massive defense spending’ is actually ‘massive government spending’.

83

Nathanael 08.11.13 at 5:18 am

Worth noting. Amazon’s big push for several years has been “cloud services”.

The deranged, unconstitutional, illegal antics of the NSA just destroyed that entire business line.

Jeff Bezos, founder of Amazon, may be just a little bit ticked off about that and may wish to counter the lying propaganda being put out by the military-industrial complex.

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