At the Windsor Star, for example, publisher James Bruce was summoned to Toronto for a meeting the next day with the new management at Southam, in the spring of 1997. Reportedly, the first question he was asked was, "Who do you recommend as your replacement as publisher?" Subtlety is not the forte of the new regime. Within the month, Bruce had taken "voluntary" early retirement at 55, and was replaced by Jim McCormack, a "bean counter" and former director of circulation and marketing from the Toronto Sun. McCormack took over on May 1 and shortly after the local section fronts were bumped inside in favour of international and business news. Soon thereafter McCormack sat down with Lisa Monforton, editor of Express magazine, a weekly arts and entertainment supplement to the Star. McCormack reportedly "didn't like" Express, and wanted it to be folded into the regular paper and replaced with something "more mainstream and less esoteric." When Monforton defended the four year-old publication, which was designed to appeal to younger readers, McCormack apparently said, "Will you be able to do this or not?" The implication was clear: do the job or I'll replace you with someone else who will.
The Southam annual report for 1996 indicated that new publishers were hired in that year at the following Southam newspapers: Kamloops, Medicine Hat, Calgary, Brantford, St. Catharines, Timmins, Hamilton, Kingston, Cornwall, and Sydney.
Since the first printing of this book in August 1996, Conrad Black has successfully consolidated his control over Southam Inc., obtaining more than 50 percent of the voting shares and replacing the "obdurate rump" of independent directors who balked at the changes he wanted to make, in the spring of 1996. At this writing in June 1997 Black has been (temporarily?) thwarted in his attempt to control 100 percent of Southam, which would give him unfettered access to its annual cash flow, without concern for minority shareholder rights. His offer for the outstanding shares was too cheap and the profit potential of his brand of vampire journalism too great to convince minority shareholders to relinquish their stock.
Like former American publisher and politician William Randolph Hearst, Black has been quite open about using his newspapers for political influence. Editors who disagree with him have sought employment elsewhere, in keeping with Hollinger President David Radler's dictum quoted herein, that, "If editors disagree with us, they should disagree with us when they are no longer in our employ." In 1996, examples included editors Joan Fraser of The Montreal Gazette, and Peter Calamai and James Travers of The Ottawa Citizen. Another example is Claude Gravel, who quit Quebec City's Le Soleil after less than two years of Black's ownership. Gravel said Black "did not want news stories that irritated business leaders, certain interest groups and top civil servants.. In his 1993 autobiography, Black recounts how he wrote front page editorials in Le Soleil as part of a 1989 feud over Quebec's language laws, with British newspaper tycoon Robert Maxwell. "I replied on page one of Le Soleil the next morning that Bob's expressed view was hypocrisy and buffoonery.' He faxed me back a rather wan reply, and I published this and another withering response on page one of the following day's Le Soleil," Black wrote.
In October of 1996 a spine-chilling event occurred in the annals of Canadian newspapering. Conrad Black instructed his 59 Canadian daily newspapers to run a column which he wrote, dictating its inclusion, position (the opposite-editorial page) and headline ("Conrad Black's response to the CBC"). The column was Black's response to The Paper King, a CBC-TV documentary which Black termed "a smear job," and "a televised kangaroo court." In fact, the CBC documentary was quite tame. It was balanced and if anything understated. It was produced by senior correspondent Joe Schlesinger, who confined himself to interviewing mainstream "critics" of Black such as Peter C. Newman, chronicler of the rich and famous, former Conservative MPs, and Black's former drinking buddies. Author Mordecai Richler (now a Southam columnist) told the camera "I don't think [Black] should be dismissed out of hand," and went on to support chains because individual newspaper owners have gone the way of "doctors making house calls." Black's partner David Radler was given equal time to respond to the (mostly) friendly criticisms. Of the Cranbrook (B.C.) Daily Townsman, Radler said, "I think we are producing as good a newspaper as we can, in a market which only warrants a weekly." Radler insisted, "We are not going to change liberal papers into Conservative think-tanks."
Black refused to be interviewed for the documentary, but in his column he denied being "extremely conservative." Former British PM Margaret Thatcher disagrees, having said she found herself on his left, politically. Black said he seeks "no more than a fair hearing for a range of intelligible views" in his newspapers, and that "we have had our share of controversy, but we have never departed the mainstream of Canadian opinion and our names and views do not frighten reasonable people." In his column Black wrote that in his 30 years in the industry "we have built up one of the largest and highest-quality newspaper companies in the world," saying he has "strengthened every newspaper franchise we have influenced." While this might be the case for Black's flagship paper, The Daily Telegraph (nicknamed "the Torygraph") in London, and recently the Ottawa Citizen, it's hard to think of a single other example amongst the 500 titles he owns worldwide. The much-vaunted Jerusalem Post had its reporting staff cut by 50 percent when Black took it over, while its editorial content moved far to the right. As indicated herein, even papers such as the Cambridge (Ontario) Reporter which Black bought from the notoriously stingy Thomson chain, have seen staff cuts of 30 percent or more -- hardly a prescription for strengthening and improving quality.
Black went on to claim that "no editors of ours have ever retired because of interference." This would come as a surprise to Joan Fraser of the Montreal Gazette and James Travers and Peter Calamai of the Ottawa Citizen, editors who, as we've seen, resigned in 1996 over differences with the direction taken under Black's ownership.
Black saw the CBC documentary as further evidence of what he calls, "the virtual monopoly [of] the soft left" in the Canadian media. By insisting that his column be run and even dictating the headline, he has made it impossible for his own editors to deny his influence, galvanizing opposition even within the journalism ranks. He has also established a nasty precedent. What's next, front page editorials by Black, endorsing Jean Charest's Conservatives?
Indeed, in the fall of 1996 and winter of 1997 Black's partner and Hollinger Board member Peter White wrote on Hollinger stationery soliciting funding as chairman of the PC Canada Fund, on behalf of the federal Conservative Party and Jean Charest. White is president of Black's Unimedia Inc., publisher of Le Soleil and Le Droit, and sits on the board of directors of Southam Inc. This is a blatant, shocking and unacceptable conflict of interest. When Maude Barlow of the Council of Canadians raised the issue publicly in the spring of 1997, just prior to the national election campaign, the news media ignored it, with the exception of the Toronto Star which ran one tiny article and then ignored it.
Two of Black's Canadian papers thus far have been centred out for special treatment: the Montreal Gazette, and the Ottawa Citizen. As mentioned, the editors of both papers resigned in 1996, over differences on the plans by Black and Hollinger. Citizen editor James Travers, for example, commented that "there was some room for differences of opinion [with Black] that would make it difficult to continue in a job like this." He went on to add that "on social policy issues, I think we are quite far to the left of Mr. Black's point of view." Under the editorship of Neil Reynolds, former president of the right-wing Libertarian Party of Canada, the Citizen was subjected to a thorough make over early in 1997, from a more moderate right-wing voice to a strident champion of neo-conservativism. In an understatement, one journalist described the changes as "probably the most dramatic transformation a Canadian newspaper has seen this decade." The Globe's Doug Saunders went on to indicate that "At the same time as [Black] slashes staffs, shuts down departments and demands far higher profit margins from most of Southam's 32 papers...Black is shaking up the content of the larger newspapers."
The new editorial-page editor replacing Peter Calamai who also resigned over differences with Black and Hollinger is William Watson, former executive member with the right-wing Fraser Institute of Vancouver. He is joined on the editorial board by fellow Fraser Institute alumnus John Robson, conservative writer Dan Gardner, who came directly to the Citizen from Ontario Conservative Education Minister John Snobelen's Office, and before that premier Mike Harris' office, with no prior journalistic experience. In 1997, managing editor Sharon Burnside resigned from the Citizen, along with columnist Ken McQueen, editor Rozz Gucci, and health writer Elaine Medline. The latter commented, "I don't want to make any more money for Conrad Black." The result of all of this, inevitably and observably, is a rightward tilt in the Citizen towards Black's own views. His claim that he is merely adding diversity and balancing out the leftist and politically correct tilt of unionized working journalists, is demonstrably false.
As for the Gazette, according to Black's partner David Radler, from now on "the Montreal Gazette will stand up for the minorities who have been victimized by separatist governments." Black has turned the Gazette from a moderate voice under former editor Joan Fraser, into a shrill voice of anti-separatism. By adding columnists such as his wife Barbara Amiel on international affairs, and neoconservatives Andrew Coyne on national affairs, Giles Gherson on economics, Mordecai Richler, and (former Amiel spouse and mentor) George Jonas, Black has shifted the entire Southam chain sharply to the right. In changing to a hard-line stance, the Gazette risks exacerbating Canadian unity problems. As it represents the voice of English Canada to French-speaking Quebecers, its stance may well further entrench the two solitudes. An indication was provided when Black hired Mordecai Richler as a columnist for Southam in spring, 1997. Richler, still on his winter hibernation in London England, began immediately to write columns attacking the Quebec separatist movement.
On the economic front, the Southam chain cut the equivalent of $20-million in annual expenses in the third quarter of 1996 by eliminating more than 100 jobs at its Toronto head office. Severance payments in 1996 to a handful of Southam executives, such as former CEO Bill Ardell, exceeded $7-million. Southam made a profit of $94-million on $1-billion in revenues in 1996. Conrad Black made $2.6-million in 1996 as CEO for Hollinger Inc., up 5 percent from 1995. President David Radler made $2.5-million in compensation, while London Daily Telegraph CEO Daniel Colson made $2-million. According to The Globe and Mail, Black's company Ravelston Corp. Ltd. is contracted to act as manager of Hollinger and to carry out head office responsibilities. Last year Hollinger paid a management fee of about $11-million for this arrangement, an amount which is set to rise by 17.5 percent to almost $13-million for this year.
In spring 1997, Conrad Black handed himself a gift of $70-million, in the form of a special dividend on Hollinger Inc. shares. The dividend amounted to $2.50 per share, for a total of $140-million: half for Conrad and half for all the other shareholders at Hollinger. The windfall increased Black's net worth by almost one-quarter, to $372-million. "It really was Conrad's view that it was time that our good and patient shareholders received something," said Jack Boultbee, Hollinger's chief financial officer. Boultbee added that Black himself has been "a good and patient shareholder, but there's lots of others..." According to The Globe, the dividend represents some of the proceeds from the $523-million sale of Hollinger's Canadian publications, to Hollinger International Inc. of Chicago, in 1996.
In the 1996 Southam Inc. Annual Report, Black wrote that the fired Southam executives were "consoled by an astonishingly generous system of golden handshakes." He lamented the fact that "management paid great attention to reinforcement of their own income security." It seems that what is good for the gander is not good for the geese. As Chairman, Black also used the 1996 Southam Annual Report as a forum for his views on the company's recent history and future. In a five-page "Chairman's Statement," Black continued his condemnation of working journalists specifically at Southam. Black described how Southam editors formerly had too much independence a situation which met with the approval of working journalists, but not shareholders. "It was the view of Hollinger's managing shareholders, including me, for many years, that Southam had effectively adopted a policy of granting complete independence to editors, in budgetary and content matters, in tacit exchange for endless laudations as ideal owners' from the working press," he wrote. This is a system, according to Black, which could not work. "The objective quality of the product is too closely related to the financial results to be so completely separated from the activities of the chief executives." Black went on to describe how single newspaper monopolies led to "complacency" and the attraction of "second rate" Southam journalists, prior to his consolidation of control over the company in 1996. He said the papers were bland, inaccurate and "politically correct."
"The editorial products often combined the worst aspects of the monopolistic complacency of a single newspaper in its market with defeatism opposite other media. The Southam newspapers tended to attract second-rate journalists and to produce blandly written material echoing the political faddishness of the time. A politically correct pursuit and championship of many rather esoteric and unrepresentative causes often took the place of style, balance and accuracy," Black wrote.
Black pointed to the right-wing Calgary Herald and the Montreal Gazette as examples of this political correctness. "Many Southam newspapers profoundly alienated their natural readerships and in many cases the goodwill attaching to the trademarks eroded with their circulations. Calgarians for example, tired of attacks on the petroleum industry and the provincial government, and English-reading Montrealers wearied of apologia for Quebec's mistreatment of the non-French cultural minority," Black wrote. He bemoaned the low levels of profitability and mediocrity at Canadian newspapers compared to those in the U.S. and the U.K. "Even fewer have attained the average for journalistic professionalism of leading newspapers in either of those countries. Southam has, even by Canadian standards, been an underachiever and has contributed to a widespread Canadian problem of mediocritization in many ways," he wrote.
On a positive note, Black said the new regime is firmly in control. As indicated, 100 heads have rolled at Southam's head office, saving $20-million annually. "The head office apparat has been dispersed," Black commented. New profit margins have been set, and the people have been put in place to deliver them. "The publishers and other unit heads are working out profitability and conceptual quality targets with us, committing to their achievement and receiving every assistance from us in achieving them," he wrote.
And what are those profitability targets? Hollinger's Chief Financial Officer Jack Boultbee told reporters in the spring of 1997 that he wants 25 percent profits out of Southam by 1998, and 35 percent eventually. In 1996 Southam averaged just 13 percent profits, so there is a lot more squeezing to do. Boultbee said previous staff reductions announced by Southam are inadequate, but he refused to say how many more people will be fired.
At the Cornwall (Ontario) Standard-Freeholder, in a pattern reminiscent of Black Saturday in Saskatchewan in 1996, 21 full and part-time workers were laid off or given early retirement in April 1997, leaving just 42 employees. At the St. Catharines Standard, which Southam initially purchased in the spring of 1996, reporters reacted with a shrug in response to the initial layoffs. "Just clearing out some of the dead wood," was the reaction. Then there were two more rounds of firings, and suddenly everyone began looking over their shoulders. When a union drive was held in April, 1997 at the Standard, the company was so sure it would fail that it cut off the building access card of one of the organizers on the day of the vote. The vote was successful and now the Standard's newsroom is unionized, but if the vote had failed, observers feel the organizer would have been fired immediately.
In a related development, 10,000 ad-mail workers at Canada Post lost their jobs early in 1997, thanks to pressure from the big newspaper chains who wanted the work privatized into their own hands. Now young newspaper carriers, entrepreneurs whose work is contracted out to avoid minimum wages, paying benefits, and unions, are further weighted down with ad inserts they receive little or nothing to deliver, and the owners profit!
Black's wife Barbara Amiel is perhaps the most widely published columnist in the country, with a monthly column in Maclean's magazine, as well as (potentially) columns in the 59 papers in the Southam-Sterling-Hollinger chain, the 11-newspaper Sun chain, and the Financial Post. That makes a total of 71 out of 105 newspapers. Her potential newspaper audience is about 3 million families in Canada alone. Added to this is another half-million families who receive her column in Maclean's, once a month. The Black's primary influence comes through Hollinger Inc., where Barbara is Vice-President Editorial, and Conrad is chairman of the board and CEO. Their influence extends through their extensive daily newspaper holdings, and the broadcast media across the country which they reach through the Canadian Press (CP) and its Broadcast News and Press News Services. CP operates as a cooperative, with a relatively small news gathering staff, and most of its employees involved in gathering and re-distributing news collected by its member newspapers. Through these wire services Black reaches out beyond media under his direct control, to almost all of our news media. CP goes out to nine Thomson papers, 10 in the Sun chain, and those of Power Corp., and Quebecor Inc., in addition to about a dozen independents. In all, CP reaches 86 of 105 dailies.
Through his own holdings which provide much of the CP material, and the other subscribers to CP, Conrad Black now reaches every newspaper in this country except four: the Times-Globe and Telegraph-Journal of Saint John, N.B., owned by the Irving family, the Sherbrooke Record, (ironically, his first daily) now owned by Quebecor Inc., and the Sentinel-Review of Woodstock Ont., owned by Newfoundland Capital Corp. In addition, CP's Broadcast News wire goes into 140 radio stations, 28 TV stations and 36 cable outlets in Ontario alone. The total across the country is: 425 radio stations, 76 television stations, and 142 cable outlets. CP's Press News service is picked up by CBC radio and television, and 110 outlets in business, government, schools and other "non-news" outlets. So, through CP, Conrad Black now reaches 753 private and public educational broadcasting outlets across the country, plus all of the CBC radio and television stations. The CBC owns 89 stations, and 1,160 CBC rebroadcasters, has 31 private affiliated stations and 292 affiliated or community rebroadcasters.
The extent of Black's influence over the Canadian Press may be seen in some significant events which occurred in 1996. In June, 1996, after Black consolidated his control of Southam Inc., Southam announced that it was considering pulling out of CP, and served notice to CP that it intended to do so by the end of the year. Ultimately, Black was credited with "saving" CP, by keeping Southam in it. But this was accomplished at a cost of further drastic cutbacks to CP. Black wound up firing Southam CEO William Ardell. The latter became the scapegoat for allegedly creating the threat to withdraw from CP, all the while Black used the threat to extract major concessions from CP, including the resignation of CP President David Jolley. Jolley was replaced by Sterling Newspapers president Michael Sifton, a Hollinger employee who, several months earlier, proved his loyalty to Black by selling him the (Saskatchewan) Armadale chain and simultaneously announcing a 25% cut in staff.
Ardell's problems really date back to a public disagreement he had with David Radler in 1995. Radler commented in public that Southam's returns and profits were not very good, and Ardell took issue with him. Ever since that time, in my view, Ardell was a marked man. The CP affair and the consolidation of control by Hollinger over Southam offered Black and Radler the opportunity to get rid of Ardell and others in management at Southam. Southam, its management, and Ardell by implication were blamed for creating the threat to withdraw from CP. Black was credited with saving CP, by keeping Southam in it, all the while he used the threat of withdrawal ostensibly coming from Ardell and Southam, in order to extract major concessions from CP. Meanwhile, Black was the co-chairman of Southam at the time and it is inconceivable to think that he would not have approved of the plan to pull Southam out of CP. Black came out of it all portrayed as a hero, and Ardell wound up unemployed although he did receive a handsome compensation package.
Black was asked in early June 1996 whether he planned to make some changes at the senior level at Southam. He replied, "No, not the senior levels. I think they've got a lot of good people there. I think Bill Ardell has assembled a good team. It's more fine-tuning and giving a bit of leadership in places where there has been a necessity by management to tread carefully over eggshells because of the factionalism among the directors").
In the corporate press, Black was credited with rescuing CP from certain demise at the hands of Southam Inc. controlled both before and after the June announcement by none other than Conrad Black. This was a little like crediting the executioner when news of a reprieve for the condemned comes down. The corporate news media, which are largely owned by Black, indicated that he disagreed with a plan to pull out of CP which was announced by Southam in June. Black was chairman of Southam at the time, and along with Paul Desmarais of Power Corp., exercised controlling interest in the company, as he had since early in 1993. "If people are saying we saved CP....fair enough," Hollinger president David Radler told The Ottawa Citizen in August, 1996. With friends like this, who needs enemies?
Regardless of who had this much control over our information media, it would be cause for concern. The fact that it is Conrad Black and Co., is particularly reprehensible, because of his admitted use of his newspapers for political purposes, and because of the nature of his views. What are those views? After a considerable amount of time spent poring over the writing and speeches of Black and Amiel, I think that their views can be summed up fairly well by a single theme: anti-communism. Of course, by this I don't mean the failed Soviet empire and the cold-war mentality which was opposed to that brand of so-called "communism," although they were both cold war warriors. Like the U.S., whom they greatly admire and under whose puerile political system the political spectrum has become so truncated that the term "liberal" now means "communist," Black and Amiel's hostility is directed at moderate social democrats. In his writings Black returns ad nauseum to an attack on the "caring and compassionate" society of social, educational and health care benefits, which he says "is a euphemism for what has become a ruinously exaggerated process of taking money from those who have earned it and giving it to those who haven't."
In other words, he is adamantly opposed to any form of redistribution other than the current system of taking from the poor to give to the rich. An alleged "free marketer" to the core, like all corporate free marketers Black supports welfare for the rich in the form of tax subsidies, public sponsored research and development, grants, and so forth. This care-less and compassionless mentality means an intolerance for the public good. It is a philosophy of individualism, of greed and selfishness.
What can be done about all of this? The answers remain the same. The starting point is educating the public about the nature and extent of the problem: a Herculean task given the control corporations and the Family Compact have over the information media. There are a number of suggestions in this book. Additional ones have since been made by the Campaign for Press and Broadcasting Freedom, a broad coalition of groups devoted to fighting against the developments outlined in this book. When people desire change, they will bring it about. The apparently unlimited greed of the Family Compact members will ultimately prove to be their own downfall. It is an all-consuming greed which prevents them from sharing a few crumbs with the masses. Rather than leaving in place modest social programs such as adequate health care, education, welfare and unemployment benefits, they have cut these back under the pretense that we can no longer afford them. More wealth in this country than ever before, corporate profits which consistently leapfrog over the previous year's records, levels of private wealth which are obscene, and there are no crumbs to be shared around? Why not? This type of greed is on our side, for it will ultimately lead us into the streets and the legislatures, where we will throw the rascals out and begin to govern in the people's interest.