Slouching Toward Mediocrity

The once proud Beacon Journal takes a hit from Wall Street.

U.S. Maple, with Sweet Roxx and Shuteye Grog Shop, 1765 Coventry Road, Cleveland Heights 10 p.m., Friday, March 2



Editor Jan Leach's job is to hold her downtrodden - staff together.
Editor Jan Leach's job is to hold her downtrodden staff together.
They speak as if someone is terminally ill, employing words like "sad," "devastating," "a tragedy." Forget, for a moment, that they're merely talking about a newspaper. This is The Beacon Journal, not just any paper. And those doing the talking are employees past and present who believe that Wall Street and the paper's parent company are slowly killing one of Akron's proudest institutions.

From this modest city of 215,000 people, The Beacon Journal created a national reputation for its spunk, aggressiveness, and penchant for tackling issues much larger than is custom for papers its size. "A lot of newspapers can live on their reputations for years and not really be good newspapers," says former editor Dale Allen. Yet The Beacon had the hardware to back it up.

It has won four Pulitzers in the last three decades. At one point, the Associated Press named it Ohio's best paper nine times over a 14-year run -- though it was dwarfed in size and staff by much bigger papers in Cleveland, Columbus, and Cincinnati. Unlike most midsized dailies, it attracted topflight reporters instead of serving as a finishing school for its larger brethren. The pay was good, the work robust, and the atmosphere inviting. "I know it sounds corny," says former columnist Regina Brett, "but you were really part of the Beacon family."

All of which made for pleasing economics. The Beacon's penetration rate -- the percentage of readers per available households -- was among the highest in the country. And despite the free fall of Akron's rubber industry, "I believe it was always profitable on a year-to-year basis," says Allen, who retired in 1997.

But these days, The Beacon's glow has faded. In recent months, the paper dumped its Sunday magazine and News & Views section. It's cut back on resources, barred certain sports beat reporters from covering their teams' away games, and eliminated suburban bureaus. Last week, it announced layoffs for 10 newsroom staffers.

Such cutbacks usually indicate a business in trouble. But for The Beacon Journal and its parent company, Knight Ridder, the exact opposite is true. Both appear to be pocketing record earnings. The problem is, that's just not good enough.

To the thinking of older Beacon staffers, John S. Knight should be canonized. Friends called him "crusty" and "blunt," but he was a newsman's newsman, a Pulitzer-winning columnist and the catapult behind The Beacon's launch from backwater journal to national acclaim.

He inherited the paper from his father in 1933 and went on to form the Knight Ridder chain, which now claims 32 papers nationwide. Though journalists decried the consolidation of America's news into a few corporate hands, Knight's papers were largely spared their derision. Instead of stripping his new purchases of resources and talent, as other absentee owners did, he believed great papers were good business.

Nowhere was this more evident than in Akron. Knight threw money into his news department and didn't blanch at sending reporters around the world, if it meant a good story. The tradition carried on long after his death in 1981. "We were the highest-paid staff in Ohio," says one veteran reporter. "When people were coming to this area, the best journalists would come here instead of The Plain Dealer or The Cincinnati Enquirer. Don't underestimate the funding."

Corporate support allowed the paper to fight protracted court battles over government access, to stand tall when the well-heeled threatened to sue if a story ran.

"Knight Ridder was the place to be," says Bob Paynter, a former reporter who now works for The Plain Dealer. "You swung for the fences."

The Beacon may have operated just down the road from The PD, but among its employees, there was no question who had the better paper. "We never sat back and said, 'We're little Akron, and we're in the shadow of Cleveland,'" says Arnie Rosenberg, a former deputy metro editor now with The Denver Post. "There's no reason we shouldn't kick their butts."

This thrill of David taking on Goliath -- and winning -- made for an uncommonly stable workforce. Elsewhere, journalism tends to be a vagabond profession. At The Beacon, staffers with 10, 15, 20 years on the job were the rule rather than the exception.

"The Beacon Journal was a great place to work," says Brett, now a Plain Dealer columnist. "I was a single parent, and I'd bring my kids in, and they'd help me take care of them on deadline. You got to know everyone's kids."

Yet this began to change in recent years. Editor Allen retired. The respected Paynter, also a Pulitzer winner, defected to The Plain Dealer. And that, say employees, opened the floodgates. More than a dozen colleagues would soon follow Paynter to The PD. Employees estimate that, all told, some 40 reporters and editors eventually fled Akron.

Paynter says he was simply enamored of the work of The PD's new editor, Doug Clifton, who was beginning to revitalize the paper. Others say a midlife crisis epidemic struck The Beacon; Clifton was raiding the newsroom with lucrative offers, and staffers in their 40s thought there might never be a better time to jump.

Yet Debbie Van Tassel, a former editor who's now The PD's business editor, offers the most common rationale for The Beacon exodus: "The paper seemed in a bunker mode. I felt like I belonged in the big leagues, and the paper was moving backward."

"For the fifth year in a row," Tony Ridder boasted to the financial press in January, "we are reporting record earnings per share. We are also reporting record operating income, record cash flow, and record net free cash."

These are the giddy words of Knight Ridder's chairman and CEO, a man clearly pleased with himself and his company. As he should be. Though earnings are expected to fall modestly in the first quarter of 2001, and the company recently laid off Internet staff, the daily newspaper business has never been more profitable -- particularly at Knight Ridder.

It's an odd phenomenon, to say the least. Dailies have watched their circulation erode for more than 20 years, and their inability to attract readers under age 30 -- the most becoming to advertisers -- is the stuff of legend. Nonetheless, they've somehow managed to increase advertising volume and rates. Combine this with often drastic cost-cutting, and what might seem like a dying business suddenly becomes profitable -- enormously so.

A decade ago, a 15 percent profit margin was thought handsome. Today, the rule is to push 25 percent. Stray too far below, and a publicly traded company like Knight Ridder risks becoming the neglected stepchild of Wall Street.

Knight Ridder came relatively late to the margin escalation game. "It never had the reputation for money-grubbing," says one editor. But in recent years, it has played catch-up with gusto.

Brett began to notice it a few years ago, when The Beacon started "nickel and diming" news staff over expenses. "It used to be that, if you took a source to lunch, that was part of journalism. Then you couldn't take a source to lunch, and then you had to defend where you drove on your expense report."

Reporters held a mock bake sale in protest. The family atmosphere receded. Retired Copy Editor Don Fermoyle detected this in the skits at reporters' union Christmas parties. Where they once consisted of teasing, even tender parodies of managers, they became "really bitter, really angry."

The cuts accelerated. Beginning late last year, The Beacon killed off some of its most popular Sunday sections. It announced plans to close bureaus in Medina and Hudson, stripped down its Columbus bureau, slashed budgets for freelancers and correspondents, and cut travel to the bones, reporters say.

Stephanie Warsmith, chairwoman of the reporters' union, says management has told her the cuts stem not from losing money, but a need to maintain lofty margins. "We have heard that The Beacon makes a 23 percent profit," she says. "They're trying to keep that."

Tony Ridder declined to be interviewed. In a written statement, he said rising newsprint costs and a slowing economy were behind the cutbacks. Only a month after gushing about record earnings, he wrote, "We are operating in the toughest revenue environment we have seen in several years."

Colleagues can see the battle fatigue on Editor Jan Leach's face. Her charge is to uphold the Beacon tradition while its parent withdraws the tools to do so. She describes the situation slowly, carefully. "I have to say that 'excruciating' is a truly clear description."

A veteran writer is more blunt about newsroom morale: "It's lower than a snake's belly in a wheel rut." And the villain, in the eyes of staff, is Tony Ridder.

Reporters say they understand the demands of Wall Street. What they can't understand is Ridder's push for ever-higher profits if times are so dire, or why the company -- and thus shareholders -- can't share in the burden of a slowing economy. They believe Ridder is irreparably damaging The Beacon, and that the paper may soon be just another "sausage maker," as one editor puts it.

"There's clearly a rage," says a reporter. "The feeling is that Tony Ridder has betrayed the paper, that what he's demanding is immoral."

Others believe The Beacon mystique is clouding employees' judgment. Rosenberg notes that some cost-cutting was needed. Syndicated features were purchased, but never used; wire services were bought, though infrequently turned to. "It didn't have cost controls," he says. "It was pretty free-spending."

And while some lament the disintegration of "the Beacon family," others say the paper has long housed unrest. One veteran staffer recalls arriving in the 1980s to find a workplace "modeled off some 1930s industrial labor relations . . . Each side viewed the other with tremendous distrust and animosity." At one point, union members circulated pledge cards, asking readers to drop their subscriptions should a strike be called.

Columnist David Giffels believes the Chicken Little Effect may be in play -- that employees are panicking beyond the situation's gravity. "This is a hyperbolic time right now." He says The Beacon is still doing "great journalism," and he points to recent stories about Ohio's coal industry and the last days of a cancer victim's life. "Readers see that," he says. "They don't see what's going on behind in the newsroom. They don't care."

The quality of a paper, of course, is a highly subjective matter. Even expatriates at The Plain Dealer say The Beacon is still producing good work. But most staffers concede that it isn't what it was just a few years ago. "It's the unanimous opinion of staffers here that we couldn't win those prizes today," says one reporter, referring to the paper's Pulitzers.

The Beacon is slimmer these days. Were it a meal, it might be considered a light lunch rather than a full dinner.

"I don't think you could rely on The Beacon Journal to get all the news you need, if you're interested in world affairs or national events," says Van Tassel.

Adds her husband, Stuart Warner, a former Beacon editor now at The PD: "I don't think they're considered a player in state stories any longer."

Perhaps it's fate that economics have finally forced The Beacon to act like a paper befitting Akron's size, not that of a city much larger. Yet few seem to believe the decline has halted. "The people around me, many are looking for work elsewhere," says one reporter. And the recent layoffs make new departures all the more difficult to replace. "Who would go to a paper that's making 20 percent, and they're laying people off?" asks Paynter.

There's also the matter of additional layoffs. Union chief Warsmith says the company has promised a monthly budget reassessment, and jobs may be added if predictions of stingier revenues prove faulty. Then again, pressure from Wall Street won't likely abate. In the age of constant streamlining, that which is lost today is usually forgotten tomorrow, since there's always a new budget cycle and a new round of cuts to be made.

But Publisher John Dotson Jr. notes that The Beacon increased staff and paper size when times were good and will do so again when those times return. "I don't think Knight Ridder's financial support is any different today than it ever was," he says. "I just had a staff member in here yesterday who said, if John Knight was sitting in my chair today, he'd be under the same pressures I am."

Perhaps so. Yet Knight was famous for placing reader interests first, and he once said that his primary duty was to "not yield to the pressure of merchant or banker, politician or labor union." That was in 1969, long before Wall Street was king.

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