I spent a lot of time pondering what the Boston Newspaper Guild had accomplished this week by rejecting the wage cuts and other concessions that The Boston Globe demanded. Here is what I came up with:
Guild members have virtually assured themselves a 23 percent pay cut beginning next week. The concessions package included only an 8 percent reduction, but it also had cutbacks in pensions and job guarantees that apparently were more valuable to some employees than their short-term salary.
Also, the Guild gave the paper’s owner, The New York Times Co., a path to shut down the paper completely and with less embarrassment to the company’s managers, who think of themselves as defenders of quality journalism.
A strike by the Guild to protest the unilateral 23 percent pay cut almost assuredly would lead to The Globe’s demise. So, probably, would a strike by any of the paper’s six other unions, most of which have already agreed to their own concessions. Guild members seem to think that by rejecting the proposed changes they can force the company back to the bargaining table. I do not see why that would happen. Even without a strike, management, despite current pledges to keep the paper open after imposing the pay cut, might simply decide that no amount of concessions makes it worthwhile to keep The Globe alive.
Remember, the New York Times Co. publishes The New York Times. The Times is a national newspaper, readily available in New England. The Times also is losing circulation, advertising and money. I do not think Manhattan-based executives would be sorry to see the readership of a defunct Globe switch to a New England edition of The Times, which might include some former Globe writers. The Globe’s other workers, including circulation and advertising personnel who, along with editorial staff, comprise the membership of the Guild, would be redundant.
Even with the rejected concessions The Globe would be on track to lose tens of millions of dollars this year. The New York Times Co. lost nearly $75 million in the first quarter alone. Times executives have every reason, and maybe even a fiduciary duty to shareholders, to shut down The Globe if it cannot soon be made profitable.
They see it differently up in Boston. Somehow, this seems to be a Yankees-Red Sox grudge match playing out in the financial columns rather than the sports pages. In a statement, Boston Newspaper Guild President Daniel Totten (whose career was in The Globe’s circulation department) declared that the Times Co. “must do better,” adding, “Globe workers and the New England community understand that the quality of The Boston Globe—an institution so vital to the life and culture of the region—depends on the fair treatment of the men and women who work so hard to produce it.”
The Globe’s regional importance is undeniable but irrelevant. So, too, are the comments Totten has made about the incompetence of Times Co. managers, whom he blames for making bad real estate deals in New York that wasted company assets.
I happen to agree with Totten that the Times management, protected behind firewalls that entrench Sulzberger family control, is inept. But so what? The company’s assets still belong to its shareholders, not to its employees or to the communities where it operates. If The New York Times Co. cannot make its core business profitable, it will not survive to keep any of its operations alive.
Does Boston deserve a high quality, locally run news organization? Surely. Is the New York Times Co. committed to delivering this? Maybe not. If anyone wants to buy The Globe, it is for sale, as The Globe itself reported yesterday. If Guild members want to try to move into the future with their own print or online publication, they are free to start one.
Don’t hold your breath. Guild members do not seem to have a Plan B. “Hell no!” might make a good chant on a picket line, but it does not accomplish much in business.
Larry M. Elkin is the founder and president of Palisades Hudson, and is based out of Palisades Hudson’s Fort Lauderdale, Florida headquarters. He wrote several of the chapters in the firm’s recently updated book,
The High Achiever’s Guide To Wealth. His contributions include Chapter 1, “Anyone Can Achieve Wealth,” and Chapter 19, “Assisting Aging Parents.” Larry was also among the authors of the firm’s previous book
Looking Ahead: Life, Family, Wealth and Business After 55.
Posted by Larry M. Elkin, CPA, CFP®
I spent a lot of time pondering what the Boston Newspaper Guild had accomplished this week by rejecting the wage cuts and other concessions that The Boston Globe demanded. Here is what I came up with:
Guild members have virtually assured themselves a 23 percent pay cut beginning next week. The concessions package included only an 8 percent reduction, but it also had cutbacks in pensions and job guarantees that apparently were more valuable to some employees than their short-term salary.
Also, the Guild gave the paper’s owner, The New York Times Co., a path to shut down the paper completely and with less embarrassment to the company’s managers, who think of themselves as defenders of quality journalism.
A strike by the Guild to protest the unilateral 23 percent pay cut almost assuredly would lead to The Globe’s demise. So, probably, would a strike by any of the paper’s six other unions, most of which have already agreed to their own concessions. Guild members seem to think that by rejecting the proposed changes they can force the company back to the bargaining table. I do not see why that would happen. Even without a strike, management, despite current pledges to keep the paper open after imposing the pay cut, might simply decide that no amount of concessions makes it worthwhile to keep The Globe alive.
Remember, the New York Times Co. publishes The New York Times. The Times is a national newspaper, readily available in New England. The Times also is losing circulation, advertising and money. I do not think Manhattan-based executives would be sorry to see the readership of a defunct Globe switch to a New England edition of The Times, which might include some former Globe writers. The Globe’s other workers, including circulation and advertising personnel who, along with editorial staff, comprise the membership of the Guild, would be redundant.
Even with the rejected concessions The Globe would be on track to lose tens of millions of dollars this year. The New York Times Co. lost nearly $75 million in the first quarter alone. Times executives have every reason, and maybe even a fiduciary duty to shareholders, to shut down The Globe if it cannot soon be made profitable.
They see it differently up in Boston. Somehow, this seems to be a Yankees-Red Sox grudge match playing out in the financial columns rather than the sports pages. In a statement, Boston Newspaper Guild President Daniel Totten (whose career was in The Globe’s circulation department) declared that the Times Co. “must do better,” adding, “Globe workers and the New England community understand that the quality of The Boston Globe—an institution so vital to the life and culture of the region—depends on the fair treatment of the men and women who work so hard to produce it.”
The Globe’s regional importance is undeniable but irrelevant. So, too, are the comments Totten has made about the incompetence of Times Co. managers, whom he blames for making bad real estate deals in New York that wasted company assets.
I happen to agree with Totten that the Times management, protected behind firewalls that entrench Sulzberger family control, is inept. But so what? The company’s assets still belong to its shareholders, not to its employees or to the communities where it operates. If The New York Times Co. cannot make its core business profitable, it will not survive to keep any of its operations alive.
Does Boston deserve a high quality, locally run news organization? Surely. Is the New York Times Co. committed to delivering this? Maybe not. If anyone wants to buy The Globe, it is for sale, as The Globe itself reported yesterday. If Guild members want to try to move into the future with their own print or online publication, they are free to start one.
Don’t hold your breath. Guild members do not seem to have a Plan B. “Hell no!” might make a good chant on a picket line, but it does not accomplish much in business.
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