The Inquirer‘s ‘Lenfest solution’

Among the many institutions clamoring for Lenfest’s support after his windfall, one of the most urgent was the Inquirer, Philadelphia’s dominant news organization but also, as a print newspaper in an age of digital communication, a potential financial basket case threatened with extinction. To keep this civic asset alive and in local hands, in 2012 Lenfest assembled a consortium of civic boosters ostensibly dedicated (like himself) not to profits but to the preservation of a vital journalistic resource.

Struggle for control

This rescue mission, he soon discovered, was flawed in several respects:

First, Lenfest and his centomillionaire business partners lacked any journalistic roots, which is to say they lacked the experience, independence, wisdom, patience, and humility to run a credible news operation. Although each of them solemnly pledged not to interfere with the paper’s news coverage, none of them (including Lenfest) could resist the temptation to meddle. During the 2014 Pennsylvania gubernatorial election campaign, for example, Lenfest ordered the Inquirer’s editorial board to refrain from endorsing a candidate; instead, the editors were instructed merely to list the candidates’ positions on the issues and let readers decide for themselves, as if the candidates’ character and experience don’t matter.

Second, not all of Lenfest’s partners shared his benevolent agenda. Most notably, South Jersey political broker George Norcross III perceived his tie to the Inquirer as a means of enhancing his political power, not to mention advancing the media career of his twentysomething daughter. Lenfest removed Norcross from the partnership only after an exhausting legal struggle that dragged on until 2014.

Third, local ownership of a newspaper — the primary goal of Lenfest’s partnership — has little to do with good journalism. Under the local ownership of the Curtis family and then the Annenbergs, the Inquirer never won a single Pulitzer Prize; it has won 20 since it was acquired by the Miami-based Knight-Ridder chain in 1970. As the current film Spotlight makes clear, the Boston Globe pursued its momentous exposé of sex abuse within Boston’s Catholic Archdiocese only because Marty Baron, a newly arrived “outsider” editor unfettered by local entanglements, pushed his complacent editors and reporters to pursue the story.

Investors and donors, too?

Last week, at the age of 84, Lenfest extricated himself from his tar baby by donating the Inquirer and its sister properties — the Daily News and philly.com — to a newly created entity. Under this new arrangement, Lenfest’s old partnership, Philadelphia Media Network, will operate as a for-profit company owned by a new not-for-profit entity, the Institute for Journalism in New Media, which will in turn answer to the Philadelphia Foundation, the city’s community foundation. At least as initially described, the new entity will be able to seek both investors and donors.

No, I don’t quite understand it either.

This gambit was initially applauded as a “bold and innovative plan” to sustain independent big-time investigative journalism in the age of fragmented (and mostly poorly financed) Internet websites. Increasingly, these days, investigative journalism is going the nonprofit route: Consider, for example, the Pulitzer prize-winning newsroom ProPublica.org; the Marshall Project, a digital site that focuses on the criminal justice system; the Center for Investigative Reporting; and the Tampa Bay Times, which has operated for decades under the nonprofit Poynter Institute For Media Studies.

But Lenfest’s noble experiment, like his previous experiment, will likely run afoul of a few structural (not to mention human) defects.

Entrepreneurial mindset

As the Inquirer itself pointed out on Sunday, few philanthropists support the cause of investigative journalism per se. Most such donors harbor some agenda they would like investigators to pursue — education, say, or the environment, or police reform, or religion, or capitalism. An independent news organization that relies on such donors for support will quickly cease to be independent.

More troubling to my mind is the assumption that foundations and other nonprofits are by definition benevolent institutions. Many of them are, of course. But even the most virtuous foundation lacks stockholders or customers and, consequently, lacks the incentive to think entrepreneurially — which is the key to enterprising journalism.

In Spotlight, the Boston Globe’s new editor, Marty Baron, reminds his colleagues that they labor under constant pressure (presumably from their stockholders and the marketplace) to make the Globe vitally important in Bostonians’ lives. By contrast, no one has his or her life’s savings invested in a foundation — and without that personal survival motive, the urge to innovate becomes less urgent.

Fire in the belly

Perhaps the best example exists right here in Philadelphia. WHYY Inc., the local public TV-radio outlet, has hundreds of employees and an annual budget of more than $30 million. Those resources could be invested in gutsy journalism or provocative local programming — but WHYY lacks the motivation to do so. Bill Marrazzo, its chief executive, is compensated according to a formula that rewards him for increasing members, raising funds, and balancing budgets, not for making an impact on the community. Its trustees decline to push him journalistically or creatively because they lack any financial incentive to do so. Not until 2008 — ten years after Marrazzo arrived — did WHYY pay serious attention to TV journalism with the hiring of former Inquirer editorial page editor Chris Satullo to run its bland newsworks.org website — and Satullo was dismissed last September. No reason was given for his departure, but I suspect it was a case of someone marinated in a for-profit culture who couldn’t or wouldn't adapt to the more cautious not-for-profit culture.

Increasingly, the not-for-profit world has become a refuge for seasoned journalists who've lost the fire in their bellies. Max King, the Inquirer’s former executive editor, now dispenses environmental grants as CEO of the Pittsburgh Foundation. Zack Stalberg left his longtime editorship of the Philadelphia Daily News to head the Committee of 70, a local civic watchdog organization, and then retired altogether. The halls of the Pew Charitable Trusts abound with ex-journalists.

These refugees from the rough-and-tumble world of for-profit newspapers still do good work, to be sure. But they rarely kick ass (as Stalberg used to describe his role at the Daily News).

A perfect solution to the great challenge of the Internet age — how to make money from good journalism — will never be found. But an imperfect solution may well arise where we least expect it. The rambunctious 20th-century print model whose passing we now mourn didn’t actually surface until John Wanamaker discovered that newspapers made dandy vehicles in which to advertise clothing, furniture, and other dry goods.

Gerry Lenfest deserves applause for his Inquirer experiment, and of course for his good intentions. But don’t be surprised if, in this case, Julius Rosenwald has the last word.