David Carr's piece in The New York Times asks, "Why Not Occupy Newsrooms?" In it, he laments about corporate downsizing in the newspaper industry. Executives at Gannett, for example, received pay raises and bonuses, even as newsroom budgets were cut and stock prices drained.
Well before the market collapsed in 2008-09, Omaha's Warren Buffett had turned away from newspapers as a solid investment. He told Berkshire Hathaway shareholders that his interest in newspapers remained more sentimental, about friendships and history, than earnings potential. More recently, the Wizard of Wall Street was asked about the Occupy movement. While it hasn't yet raised awareness, he thinks a nonviolent and lawful protest of CEO compensation in the face of too much U.S. poverty and educational inequality could help.
The "wiser" (he's replaced an earlier word, "focused," to describe himself) Mr. Buffett, 81, has said that a CEO who leads his or her company into failure, should not walk away with millions of dollars. Instead, there should be a rule that guarantees the person at the top suffers the fate of employees and investors -- maybe even a worse fate and walk away with nothing.
Mr. Buffett does not go as far as movie maker Michael Moore in asking for investigations and criminal indictments of CEOs. For now, Moore is "one of millions" wanting answers from a New York Stock Exchange that no longer allows him inside or even near for CNBC interviews. Moore puts a populist face on the Occupy movement. Like politicians who "want to take our country back," Moore doesn't articulate exactly when and where utopia was lost. For now, he joins a chorus recognizing something in America is broken. Moore and Buffett at least are pointing in the same direction: at the top of the corporate ladder.
If CEOs had to take most of their wages in stock, then they should be more motivated to protect company value. Consider Berkshire's Nebraska Furniture Mart, which did not resort to layoffs during the downturn. Bob Batt, grandson of founder Rose Blumkin, said Mrs. B taught a flat management structure, keeping costs down, and remembering the customer. NFM keeps a lot of cash on hand, so they do not have to worry about banks and loans. Instead, they weathered the financial storm and come out ready to leap at opportunities for new business. As a small stockholder in Berkshire, I like that approach.
As a journalist, I think American newspapers made a lot of mistakes. They were not thrifty during the good years. They were late to recognize the importance of the Internet. Too often, they were arrogant about near-monopoly position in their media markets. Yet, even with these problems, media companies are in a position to continue to make money -- just not the extraordinary profits of years gone by.
David Carr is right to conclude that newsrooms suffered while management sometimes did not. Executives should have invested in retraining workers and streamlining processes. New business models are slowly emerging, but online, social and mobile media do not guarantee huge new revenue streams. Instead, new media are competing for our eyes, ears, minds and time.
Rose Blumkin's model, "Sell cheap, and tell the truth," may be useful for the new generation of entrepreneurial journalists.