5/11/12, "The Washington Post Co.’s Self-Destructive Course," CJR, The Audit, by Ryan Chittum, Poynter.org
"The Washington Post Company‘s dismal quarterly earnings release last week was received with something of a shrug—more of the same. But the report is worse than the reaction suggests and raises fundamental questions about the Post’s strategy, not just for the newspaper, but for the whole company.
If you hadn’t heard, the Washington Post Company is basically a for-profit college/SAT-prep firm that sidelines as a cable-TV provider and newspaper publisher. The august Washington Post (I’ll italicize Post here when referring to the newspaper and won’t when referring to its parent) contributed just 15 percent to its namesake company’s revenue in the first quarter but was a $23 million drag on the bottom line.
Kaplan, the Post’s education division, is the company’s cash cow, and a few years ago looked like the newspaper’s savior. But its revenue has fallen sharply over the last year and a half since for-profit schools, very much including Kaplan’s, came under pressure for predatory practices. Its sales tumbled 14 percent from 2010 to 2011 and dropped another 11 percent in the first quarter.
Its deteriorating prospects spells more trouble for the Post’s newspaper division, whose very bad first quarter included not only that $23 million loss but also a 7 percent decline in revenue. Crucially, its digital ad revenue—the paper’s main hope for the future—went into reverse and hit negative 8 percent. It’s just the latest in a long line of bad results.
Layoffs have reduced the Post’s newsroom to a little more than half its peak size.
Despite this, the company continues to fork over hundreds of millions of dollars to shareholders in the form of dividends and share repurchases. The Post is disgorging the cash, as JW Mason calls it, to investors and depriving its businesses of resources.
The company as a whole is still profitable and has earned a total of $546 million since the start of 2008, when the financial crisis began in earnest. But in that same time it has spent more than twice that—$1.1 billion—on buybacks and dividends that have helped put a floor under its share price (and its earnings per share).
Much of that money is being squandered to appease the short-term interests and cash needs of shareholders, who very much include the Graham family, which controls the voting shares of the Post.
While the company has been bleeding revenue and income in the last year-plus, it has actually been increasing the amount of cash it pays out in dividends. Last year, it paid a $9.40 dividend for each share—a total cash payout of $75.5 million to shareholders. It has raised its dividend in nine of the last ten years for a total increase of 69 percent. The stock now yields a healthy 2.9 percent, a richer dividend payout than shareholders get from giant, cash-flush firms like Exxon Mobil, Apple, Microsoft, and Walmart....
This is financialization at work. Instead of investing in its business operations, the Post is investing in its stock, which is a very different thing. The only way this bet pans out is if the Post’s shares rebound significantly in coming years. Would you put money on that? I sure wouldn’t (moreover, the company effectively levered up to buy them. The Post rolled over $395 million in debt in early 2009 to mature in 2019—at a 1.75 percent premium to its old bonds)."...
5/10/12, "Washington Post Romney Hit Piece Implodes," Ben Shapiro, Breitbart Big Journalism
"Today’s unconscionable Washington Post story, which implied without evidence that Mitt Romney was a homophobic bully to one John Lauber back in his high school days five decades ago, has totally imploded.
Timed to drop the day after President Obama’s announced embrace of same-sex marriage, the story set the political world atwitter. But earlier today, Breitbart News reported that the Post had inflated witness testimony. The original Washington Post piece stated the following:
“I always enjoyed his pranks,” said Stu White, a popular friend of Romney’s who went on to a career as a public school teacher and has long been bothered by the Lauber incident. [emphasis added]
Yet in an interview with ABC News today, White disowned that characterization:
While the Post reports White as having “long been bothered” by the haircutting incident,” he told ABC News he was not present for the prank, in which Romney is said to have forcefully cut a student’s long hair and was not aware of it until this year when he was contacted by the Washington Post.
White didn’t know about the incident until this year, but the Post reported that he had “long been bothered” by it. We demanded a correction.
So the Washington Post did what no reputable newspaper should ever do when caught falsifying testimony: it made a stealth correction to its own article. The article now reads:
“I always enjoyed his pranks,” said Stu White, a popular friend of Romney’s who went on to a career as a public school teacher and said he has been “disturbed” by the Lauber incident since hearing about it several weeks ago, before being contacted by The Washington Post. “But I was not the brunt of any of his pranks.” [emphasis added]
The Post did not note that it had made any correction to the article.
It was irresponsible of the Post to run the hit piece in the first place, especially given its obvious bias; to retract a critical phrase and replace it without noting the retraction is just as bad.
But it gets worse. Tonight, Christine Lauber, John Lauber’s sister, said that she didn’t know anything about the bullying incident. More importantly, she said that the story had factual inaccuracies. Betsy Lauber, another of John’s sisters, told ABC News, “The family of John Lauber is releasing a statement saying the portrayal of John is factually incorrect and we are aggrieved that he would be used to further a political agenda. There will be no more comments from the family.” Said Christine, “If he were alive today, he would be furious [about the story].” Jason Horowitz, the reporter on the Post story, did speak to both sisters and quoted them in the story – but apparently still botched the facts.
The Post piece implies that the Romney incident was somehow the beginning of the end for Lauber:
Sometime in the mid-1990s, David Seed noticed a familiar face at the end of a bar at Chicago O’Hare International Airport.
“Hey, you’re John Lauber,” Seed recalled saying at the start of a brief conversation. Seed, also among those who witnessed the Romney-led incident, had gone on to a career as a teacher and principal. Now he had something to get off his chest.
“I’m sorry that I didn’t do more to help in the situation,” he said.
Lauber paused, then responded, “It was horrible.” He went on to explain how frightened he was during the incident, and acknowledged to Seed, “It’s something I have thought about a lot since then.”
Lauber died in 2004, according to his three sisters.
But Lauber, at least according to his obituary in the South Bend Tribune, led an incredibly full life. He graduated from Vanderbilt, became a member of the British Horse Society, had his seaman papers, was a licensed mortician in three states and head chef at the Russian River Resort in California, and even served as a civilian contractor to the troops in Iraq. This does not sound like someone crippled by a supposedly crucial incident back in high school."