Author Archives: Sheila

The Bar Is VERY Low

A journalist friend recently posted an article to Facebook with data that confirmed my periodic complaints about Gannett. Nieman Journalism Lab is a site supported by the Neiman Foundation, which describes itself as devoted to the elevation of journalism.

This particular report falls into the “I told you so” category. The lede really sums it all up:

Gannett, America’s largest newspaper chain, should wake up each morning thankful for the existence of No. 2 Alden Global Capital.

After all, who could ask for a better point of comparison? Alden is the perfect industry villain, a faceless private equity fund dedicated to nothing but cost-cutting and cashflow-draining. Its corporate website contains a total of 21 words, nine of which are “Alden,” “Global,” or “Capital.” It’s run by a secretive billionaire who last gave an interview in the 1980s — the sort of person who can own 15 mansions in Palm Beach and still think: I could really use a 16th.

If Alden is the “bar,” Gannett clears it. After all, as  a century-old newspaper company, we do expect Gannett to give a rat’s patootie about journalism. On the other hand, as the article notes,  Gannett has rarely been considered a good newspaper company:

its reputation for cheapness and cookie-cutter products go back decades. (As The New York Times described it in 1986: “a chain of mostly small and undistinguished, though highly profitable, newspapers.”) But it was at least a familiar name, run by news people and with at least some dedication to its civil role in hundreds of communities….

But “we’re better than Alden!” has its limits as a brand promise, and Gannett’s most recent annual report drives home the fact that no company has done more to shrink local journalism than it has in recent years. Let’s total up the damage — in raw numbers, if not in stories unbroken and facts not uncovered.

When Gannett merged with Gatehouse–another “vulture” company–the search for “efficiencies” deepened–and the number of employees tanked. At the time of the merger, early in 2019, the two companies had a total of 27,600 employees.

By December 31, 2019, the combined company was down to 21,255. By the end of 2020, that had dropped to 18,141. A year later: 13,800. And its most recent SEC filing reports that, as of the end of 2022, Gannett had just 11,200 U.S. employees remaining (plus another roughly 3,000 overseas, mostly in the U.K.).

In other words, Gannett has eliminated half of its jobs in four years. It’s as if, instead of merging America’s two largest newspaper chains, one of them was simply wiped off the face of the earth.

One reason for the precipitous decline was the debt Gannett assumed in order fund the merger. (A similar problem drove the decline in reporting staff when Gannett acquired the Indianapolis Star.) Taking out a giant loan at a high interest rate meant that  “hundreds of millions in revenues have had to be redirected to debt payments.”

The most jaw-dropping information in the linked post, however, was a graph showing the declines in circulation experienced by newspapers acquired by Gannett. 

The total drop reported was 66.8%–an average that our local Indianapolis Star has exceeded; Star readership has declined by a whopping 74.5%. A similar chart, tracking non-Gannett papers facing many of the same challenges, showed far less decline. As the article noted,

“There are plenty of explanations for the gap — but it’s hard not to believe that Gannett’s gutting of their editorial products hasn’t been a driving factor.”

Ya think?

Bottom line, adequate credible information about the community it serves is a newspaper’s product. When drastic cuts in newsroom personnel make it impossible to provide that product–when residents of an area can no longer turn to local journalism to find out what their government is doing or failing to do, when there aren’t enough reporters to attend important meetings and hearings–when even the tried-and-true lure of sports reporting fails to include coverage of all the local teams–why would anyone pay for that newspaper?

If I had a career producing dresses, and the dresses became progressively more shoddy and poorly constructed, people would soon stop buying them. The difference is, a failed dressmaker doesn’t endanger democratic self-government. A failed news media, however, threatens the ability of a local community to address–or even recognize–collective problems.

The good news is that the gap created by newspaper chains that pursue profits by ignoring their essential purpose are being challenged by new entries into local information markets.

The Indiana Local News Initiative is the latest media startup in Indianapolis. It joins The Capital Chronicle that debuted last July and State Affairs Indiana, that arrived in December. And last August, digital media company Axios announced plans to launch a daily email newsletter in Indianapolis.

They knew a news desert when they saw one.

Comments

My Favorite Think-Tank

Time Magazine recently ran a story about my favorite think-tank, the libertarian Niskanen Center.

In an era where the categories “conservative” “libertarian” and “liberal” are slapped  onto politicians and pundits whose opinions predictably hew to stereotypical expectations, Niskanen’s scholars look at policy proposals through a thoughtful lens that shatters preconceptions about what to expect from people wearing those labels. For example, Niskanen scholar Samuel Hammond co-authored “The Conservative Case for a Child Allowance,” arguing that giving cash to parents would strengthen families, bolster the institution of marriage, and reduce abortions, while at the same time boosting the economy and lessening dependence on the state.

As the Time article notes,

It’s tempting to think there’s no place for serious policy discussion in today’s Washington. Politics is all about culture-war theatrics, Congress seems hopelessly stalemated, and the President can’t even give a State of the Union address without it devolving into a yelling match.

The innovative output of the Niskanen Center is a counter to the belief that no one is interested in serious policy development.

The Time article tells us that Niskanen’s founder came from CATO,  where he had harbored increasing concerns about that organization’s approach to libertarian ideology.

He made common cause with an emerging cohort of thinkers who questioned libertarianism’s traditional home on the right side of the political spectrum. Libertarian values could just as easily lead to an embrace of left-wing causes like same-sex marriage and drug decriminalization, but organizations like Cato tended to ignore those issues in favor of a relentless focus on shrinking government.

I first came across Niskanen when I was researching arguments for and against a universal basic income, and came across a paper written In 2016 by Samuel Hammond.

In his analysis, Hammond had enumerated what, from his and the Center’s perspective, he saw as the “ideal” features of a UBI: its unconditional structure avoids creating poverty traps; it sets a minimum income floor, which raises worker bargaining power without wage or price controls; it decouples benefits from a particular workplace or jurisdiction; since it’s cash, it respects a diversity of needs and values; and it simplifies and streamlines bureaucracy, eliminating rent seeking and other sources of inefficiency.

What I found so refreshing about that perspective–and since then, several other analyses produced by Niskanen–is the absence of what we might call ideological rigidity. Investigations of policy by the Center’s scholars reflect a set of values–values that are libertarian in the original sense of the word.

Today, when we hear “libertarian” we think of the Koch brothers and the rigid, anti-government “let them eat cake” approach of politicians who claim that label. But Niskanen scholars inhabit the real world.As a result, the Center has been able to escape the dreary predictability of the multiple rightwing think tanks that were created to advance pre-ordained political goals, and continue to crank out “scholarship” that is indistinguishable from partisan talking points

.At a time of polarization, Niskanen has become a home for heterodox thinkers from left and right alike. In its D.C. office suite, a former Bernie Sanders campaign staffer is working on proposals to increase access to health-care and disability benefits by simplifying regulations; at the same time, a former staffer at the libertarian Cato Institute is mapping out new ideas for copyright reform. Niskanen’s head of immigration policy is a Republican former national-security lawyer; its head of climate previously worked for an environmental group that was accused of racism for supporting a revenue-neutral Washington state climate initiative. The influential center-left writer Matt Yglesias is a Niskanen fellow; the Times columnist Ezra Klein’s embrace of “supply-side progressivism” echoes many Niskanen ideas. “Niskanen is one of the most provocative, original players in the think-tank world and the ideas space overall,” says Zach Graves, executive director of the Lincoln Network, another heterodox new institute that focuses on technology and innovation.

What I found so encouraging about Niskanen is that, at a time when ideologues of both the Left and Right seem mired in ideological platitudes and automatic, knee-jerk defenses of preordained policy positions, its output and influence demonstrate that new  ideas–rooted in libertarian values moderated by thoughtful evaluation of real-world evidence– can bridge governmental gridlock.

“Liberal democracy is in the balance, right?” says Niskanen’s president, Ted Gayer, an economist who served in the Treasury Department under President George W. Bush. “If our government institutions fail, people lose confidence in them. You’re left with populism or you’re left with authoritarianism, but you’re not left with a governing philosophy that is going to help promote public welfare and help government operate more effectively.”

I count myself a fan. Visit the Center’s website and see what you think.

Comments

Once More, With (Angry) Feeling…

In case you doubt my repeated assertions that the Republicans controlling Indiana’s legislature are waging all-out war on the state’s public schools, take a look at the current status of bills heading for passage this legislative session.

The budget bill has a 5% increase for public schools in the first year of the two-year budget. That minor increase, however, has to cover the newly “free” textbooks–a requirement that reduces funds left for  everything else (including teacher salaries) by 1.5 to 2%.    

Contrast that with the planned raise in virtual charter school funding in the first year– 18.3%, despite the state’s past unfortunate experience with “virtual” schooling. Or with  voucher schools funding, which is getting a 70% increase, despite the fact that those schools have failed to improve educational outcomes and increased social divisions.

That enormous increase in funding doesn’t come with any increase in accountability–far from it.

The budget also includes $10 million each year for “Education Savings Accounts” (a/k/a vouchers) plus $1.5 million each year for the State Treasurer, to cover program administration. (Interesting that oversight of a purportedly educational program isn’t handled by the Department of Education…)

Then there are the brand-new “Career Scholarship Accounts” that will pay private companies to employ students who will “learn” while they work: $7 million in year one, $14 million in year two. I’m sure it is just a coincidence that one of the sponsors of that particular boondoggle runs a company that stands to benefit handsomely from it….

A recent article from Talking Points Memo pointed out that vouchers are popular with legislators, but not with the public. The author wanted to understand why voucher programs continue to grow despite evidence they do not improve, and often even impede, students’ educational achievement.

Rather than put the question of whether to use public money for private schools before voters, advocates for choice almost always want state legislatures to make the decision instead. That may be because a careful look at the efforts suggests that if it were up to voters, school choice proposals would rarely succeed.

The article went on to describe past results in states that –unlike Indiana–allow citizens to vote on such issues via initiatives and/or referenda. In Indiana, our excessively gerrymandered legislature is not “hobbled” by a mechanism that might allow citizens to weigh in.

A new report by Public Funds Public Schools—a project of the Southern Poverty Law Center (SPLC) and Education Law Center (ELC)—has documented a massive increase in public spending on voucher programs in the decade following the Great Recession.

The report, The Fiscal Consequences of Private School Vouchers, examines the growth in voucher programs and spending in Arizona, Florida, Georgia, Indiana, Louisiana, Ohio, and Wisconsin from fiscal year 2008 through fiscal year 2019. For comparison, the report provides data for per-pupil expenditures on public education in inflation-adjusted dollars for these seven states, as well as the nation’s 43 other states, over this same period.

But it isn’t just money.

Lawmakers aren’t just defunding public education–they are passing bills that make teaching hazardous. In Indiana, Senate Bill 12 will remove the legal defense currently available to school teachers and librarians (who they evidently believe are handing out porn to kindergarten students) and adds yet another mechanism through which parents can challenge school library materials. 

House Bill 1407 is one of the numerous, misnamed “parental rights” bills targeting trans children; it opens the door for litigation against schools, teachers and other government employees who might exhibit a modicum of compassion for these children.

Then there’s House Bill 1608, providing that “no employee, nor a third-party school vendor may provide any instruction to a student in K-3 on human sexuality.” 

An employee or staff member of a school may only use a name, pronoun, title, or other word to identify a student that is inconsistent with the student’s biological sex as either male or female based on genetics and reproductive biology at birth if the student is emancipated or a parent requests in writing the use of the specific name, pronoun, title or other word to identify the student.

There’s much more, but you get the gist: our state lawmakers–few of whom have any background in education (or medicine, when it comes to issues of gender dysphoria)–are engaged in an all-out war on our  public schools and the people who teach in them.

Hoosier Legislators are pouring our tax dollars into the coffers of religious schools–and now, “connected” businesses–despite years of evidence disproving the original justifications for vouchers. They are weaponizing state laws in order to provide legal tools to the rightwing activists working to overrule the documented preferences of large majorities of parents who have children in those schools. 

These culture warriors don’t care what their constituents think, but you should call them anyway.

Comments

About Those Banks…

News of the recent failure of two significant banks was enough to send chills down the spines of lots of Americans–especially those of us who are retired and dependent upon funds invested in the market. No matter how conservative our investment choices may have been, it’s like being on an ocean liner: if the entire vessel sinks, we’ll all go down, prudent stateroom choices or not.

As usual, Heather Cox Richardson could be counted on to produce the clearest explanation of the situation–not just the event itself, but the government’s (thankfully competent) response.

At 6:15 this evening, Secretary of the Treasury Janet L. Yellen, Federal Reserve Board Chair Jerome H. Powell, and Federal Deposit Insurance Corporation (FDIC) Chairman Martin J. Gruenberg announced that Secretary Yellen has signed off on measures to enable the FDIC to fully protect everyone who had money in Silicon Valley Bank, Santa Clara, California, and Signature Bank, New York. They will have access to all of their money starting Monday, March 13. None of the losses associated with this resolution, the statement said, “will be borne by the taxpayer.”

But, it continued, “Shareholders and certain unsecured debtholders will not be protected. Senior management has also been removed. Any losses to the Deposit Insurance Fund to support uninsured depositors will be recovered by a special assessment on banks, as required by law.”

The statement ended by assuring Americans that “the U.S. banking system remains resilient and on a solid foundation, in large part due to reforms that were made after the financial crisis that ensured better safeguards for the banking industry. Those reforms combined with today’s actions demonstrate our commitment to take the necessary steps to ensure that depositors’ savings remain safe.”

My immediate reaction was to give thanks that the challenge posed by these bank failures was being handled by the knowledgable and competent people in the Biden Administration, rather than by the Keystone Kops assembled by Trump.

Of course, the obvious next question was: how did this happen?

Most of us think of bank failures as harbingers of Depression, so I was surprised to read that a few banks fail every year, although Richardson reports that these are the first two  during  Biden’s presidency. (There were sixteen during Trump’s four years in office, eight of which preceded the pandemic).

Silicon Valley was the go-to bank for tech start-ups, which typically begin with a lot of cash from investors and IPO’s, and don’t need much in the way of loans.

So, rather than balancing deposits with loans that fluctuate with interest rates and thus keep a bank on an even keel, SVB’s directors took a gamble that the Federal Reserve would not raise interest rates. They invested in long-term Treasury bonds that paid better interest rates than short-term securities. But when, in fact, interest rates went up, the value of those long-term bonds sank.

Then, because SVB concentrated on start-ups, they had another problem. As interest rates go up, investors want faster returns than most start-ups can deliver. That meant that SVB’s depositors began to withdraw their money.

So SVB sold securities at a loss to cover those deposits. Other investors panicked as they saw SVB selling at a loss and losing deposits, and they, too, started yanking their money out of the bank, collapsing it. Banks that have a more diverse client base are less likely to lose everyone all at once.

There is–as you have probably guessed–a larger lesson here. The “libertarians” (I’m looking at you, Peter Thiel!) who have been vocal opponents of government regulation of the banking industry and  government relief for student loans–or really, pretty much anything government does that doesn’t benefit them personally– immediately insisted that in this case, the banks should be bailed out.

Richardson points out that in 2018, under Trump, Congress “weakened government regulations for banks like SVB and that SVB’s president had been a leading advocate for weakening those regulations.” Had those regulations been in place,  SVB would probably have remained solvent.

The Biden administration had been considering tightening the banking regulations that were loosened under Trump, and it seems likely that the need for the federal government to step in to protect the depositors at SVB and Signature Bank will make it much harder for those opposed to regulation to keep that from happening.

Was this a “bail out”? There’s an argument that making depositors whole while letting the shareholders eat their losses isn’t a bailout. The intervention was clearly needed to contain the potential for an economic collapse that would hurt everyone. Whether this is considered a bailout or not, at least the banks, and not the  taxpayers, are on the hook.

Getting rid of the hypocrisy is probably an unattainable goal….

Comments

The ReThink Project

I used to defend Indiana’s slow progress by pointing out that allowing other states to innovate and then seeing what worked and what didn’t was prudent. What happened in State X after it did thus-and-so, and what can we learn about the best way to handle thus-and-so?

Unfortunately, that justification too often mistakes stubborn resistance to change for prudence.

That bureaucratic refusal to consider past error was especially annoying in the initial effort to get the Indiana Department of Transportation (INDOT) to rethink its automatic approach to repairing the Interstate highways that divide the city’s downtown.

As I have previously written, it was inarguable that at the 50-year mark (which we hit a few years back),those interstates required  extensive repairs. A group of downtown residents, businesses, architects and landscape architects formed a group they called “ReThink I69/70” and urged INDOT to “rethink” the design of those highways and to mitigate, where possible, the problems they’d created when they were first rammed through the city’s Black and historic neighborhoods.

The racism reflected in the siting of the nation’s Interstate system has been widely documented, and the Biden Administration is confronting the damage.

The interstate system — largely built between the 1950s and 1970s — helped move Americans in large numbers and at high speeds, but its creation required a lot of destruction. History.com reports that “more than 475,000 households and more than a million people were displaced nationwide” due to federal highway construction. “Hulking highways cut through neighborhoods, darkened and disrupted the pedestrian landscape, worsened air quality, and torpedoed property values.”

That damage was largely inflicted in Black and Latino neighborhoods. That wasn’t an accident. At Yale Law Journal, Sarah Schindler writes that the “placement of highways so as to intentionally displace poor black neighborhoods” was commonplace in places like New York, Miami, Omaha, Oakland, and many other American cities. “Although this work was undertaken in order to make places more accessible to cars,” she adds, “it was also done with an eye towards eliminating alleged slums and blight in city centers.”

Knocking down poor neighborhoods to make room for commuter highways was inherently racist, the Los Angeles Times adds: “Highway builders often defended taking property in Black neighborhoods by arguing the land was cheapest there — a fact that relied on government-backed mortgage redlining policies that discouraged investment in Black areas.” Sometimes the harmful intent was more overt, Reuters reports. In Montgomery, Alabama, the state routed Interstate 85 “through a neighborhood where many Black civil rights leaders lived, rather than choosing an alternate route on vacant land.”

The need to address structural problems in our aging roadways gave Indianapolis a rare opportunity to address the problems created by those initial decisions. The ReThink group argued that  thoughtful revamping could improve traffic flow and restore community connectivity and walkability. It could also spur economic development that would significantly add to the city’s tax base–nothing to sneeze at, given our fiscal constraints. It is rare that a city gets such an opportunity.

The initial response of INDOT was to ignore and dismiss the alternatives promoted by the ReThink coalition. It took considerable time and effort to get the agency just to back off its initial plans to add lanes to the current configurations,  consuming more real estate and increasing the divisions between neighborhoods. By the time the coalition had generated enough attention and support for redesign, the northeast section of Indiana’s Inner Loop was already being reconstructed–in place, but thankfully, without the additional lanes and concrete walls.

The remaining work, however, may benefit from the persistence of the ReThink coalition and  the Biden Administration’s emphasis on the need to address the mistakes (and animus) of the past

Today Mayor Joe Hogsett, Congressman André Carson, Rethink Coalition, and the Indy Chamber announced a $2 million grant from the U.S. Department of Transportation (USDOT). The award will fund a planning study around the southeast leg of the I-65/I-70 Downtown Inner Loop near the Fletcher Place and Fountain Square neighborhoods, examining how to create more livable, reconnected communities around the interstate while maintaining interstate commerce and regional travel.

“This federally funded study will help guide our community as it looks at ways we can reunite neighborhoods divided by the original interstate program,” said Mayor Joe Hogsett. “Thanks to USDOT, INDOT, and our community partners, this announcement begins a process that could have lasting benefit for generations of Indianapolis residents.”

There’s a broader lesson here. Citizens who are sufficiently aroused can move lawmakers and bureaucrats.

Chinese citizens forced changes to their government’s  COVID rules. Iranians are protesting their government’s “morality police.” Israeli citizens are opposing Netanyahu.

Margaret Mead said it best : Never doubt that a small group of thoughtful, committed citizens can change the world; indeed, it’s the only thing that ever has.
 

Comments