An alternative weekly once tagged David Burgin, then editor of the San Francisco Examiner, as ”Lou Grant on PCP,” referring to the drug that can produce confrontational behavior.
Well, Burgin, now editor of The Houston Post, did nothing last Sunday to soften a reputation for engendering conflict.
As President Bush and Soviet President Mikhail Gorbachev met in Helsinki, Post readers found this headline across the top of their paper: ”Lawsuits allege pattern of Chronicle circulation fraud.”
That`s Chronicle as in Houston Chronicle, Burgin`s competitor.
The story, which jumped to an entire broadsheet page inside, suggested that the Chronicle for years has deceived the Schaumburg-based Audit Bureau of Circulations, the circulation meister for papers and magazines, and inflated its circulation figures by as many as 85,000 copies a day. Chronicle daily and Sunday circulation are reported as 449,755 and 620,752, while the Post reports 328,869 and 371,634.
Claims of Chronicle cheating, including forcing distributors to accept more papers than they could sell and counting copies sold to a salvage yard, aren`t entirely new. Indeed, the Post had reported on some lawsuits earlier.
The most notable element was the decision by Burgin, former editor of the Tribune Co.-owned Orlando Sentinel, to take after the opposition in such a dramatic way.
He said he knows that, generally, newspaper publishers don`t sling much mud at one another over circulation claims. But, convinced that the Chronicle was cheating, he asked Post owner Dean Singleton, ”Why do you guys protect one another?”
He got a go-ahead to pursue the story, adding that his own circulation director ”wanted to kill the story” and then ”wanted to read it” before publication. Burgin refused.
”It blew my mind,” Burgin says, to learn that there were 11 lawsuits in all, not just four or five, against the Chronicle. One suit by a former distributor resulted in a $1 million jury award against the paper.
The story included a former Chronicle zone manager`s statement that he created false circulation and a former ABC board member`s contention that
”publishers cheat and get away with it.”
M. David Keil, president of ABC, notes that ABC completes more than 2,500 audits of papers and periodicals each year.
”If there`s an organized and managed attempt to deceive,” he says,
”it`s not a certainty that any auditor will uncover this fraud.”
ABC stands by its Chronicle analysis, says Mike Lavery, senior vice president for auditing services.
Chronicle response? There was nothing in its pages.
”It was a self-serving, when-did-you-last-beat-your-wife story,” says Chronicle Editor Jack Loftis.
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It may say something about financial reporting that one superior practitioner of it is a failed comic novelist.
”Well,” says L.J. Davis, ”I published five novels and, at minimum, was one of America`s least-appreciated comic novelists.”
Davis, 50, is a native of Boise, Idaho, who got into financial reporting late but with a flourish, picking up awards and insights on a frequently uninspired area of journalism.
”Too often, business pages are just dull, jargon-filled and amount to corporate bulletin boards. But a lot of these stories are tremendous, like wartime dramas, with vast sums and huge enterprises at stake,” says Davis, whose ”Chronicle of a Debacle Foretold,” a nifty overview of the savings-and-loan mess, highlights the September Harper`s magazine.
”Ever since the first Florentine loaned his first ducat to his first Medici, it has been one of the most shopworn cliches of the financial industry that the best way to rob a bank is to own one,” he writes.
Davis is a Stanford University graduate with a degree in Western European history who spent much of the 1960s turning out novels and stories for New York magazine. He stumbled into financial journalism when a bogus tip on Arab penetration of the U.S. economy led him to the financial misfortunes of Bert Lance, Jimmy Carter`s banker chum who quit as director of the Office of Management and Budget amid rumblings of suspect banking practices back in Georgia.
Davis forced himself to understand balance sheets and securities documents in weeks of dissecting Lance doings such as insider loans that, in retrospect, ”are exactly what you`d see later with the savings and loans.”
The Lance piece was for Harper`s, where he`s a contributing editor. In 1982, he crafted a dazzling two-parter on the Hunt brothers` stunningly brazen attempt to corner the silver and soybean markets. Much of the story, especially the brothers` quest for beans, had been missed by reporters and Wall Street analysts.
”That was illustrative of how it can take you 30 seconds to realize what somebody`s doing but six months to prove how he did it,” said New Yorker Davis, who cruised through Chicago last week. He won the heavyweight Gerald Loeb Award for the series.
He spent months dissecting one of the early battles of the 1980s` Michael Milken/junk-bond-fueled merger and takeover craze, namely T. Boone Pickens`
assault on Gulf Oil. His Harper`s piece won another big financial-writing award, the Champion Tuck award.
He struck again in May 1987, with a richly historical Harper`s opus that did nothing less than predict the stock market crash.
”Sexist analogy aside, you looked at the market and realized it was bulging like a fat lady in a silk shirt and would blow any moment,” he says. It crashed Oct. 19, and Harper`s won the National Magazine Award`s non-fiction category for Davis` story.
A June effort, for the New York Times` Business World magazine, profiled Coniston Partners, a New York buyout firm of yuppie raiders. It disclosed new details about suspicious European backing for the firm, which took a large stake in United Airlines and revealed that, improbably, neither United`s management nor its lawyers seriously inspected the makeup and funding of Coniston, its attacker.
Unraveling Coniston`s far-flung funding, especially European, ”was blazingly complicated,” Davis says. Questions raised about its credibility and backing might have played a part in its disbanding less than two weeks later.
Davis is not blind to the deadline pressures that can hinder financial reporting. Yet he finds that newspaper and magazine financial sections tend to lack institutional memory and see too many stories as ”new” when they aren`t; fail to put stories in social and cultural context; and tend to rely on young reporters with liberal arts educations ”who are flummoxed by numbers.”
If he were a financial editor, Davis says, he`d hire a real investigator, ”a cop or somebody who thought like one; somebody in a cheap suit and white socks.” Then he`d strive not to let stories ”drop off the scanner,”
not to keep pulling reporters off a story after a couple of days.
”The decimation of the American economy under Michael Milken is as big a story as Saddam Hussein and Kuwait,” Davis contends. ”No editor would think of pulling somebody off Kuwait, but business reporters get pulled off big stories all the time.”
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Mark Fitzgerald, Chicago reporter for Editor & Publisher, received a most intriguing fax from a journalist, a newsletter from the National Golf Reporters Association. Fitzgerald was moved to write a story about this aspiring professional group.
To appreciate the momentous nature of this news, you need this background: The ethics of too many golf writers have long verged on the tawdry. But their professional group, the Golf Writers Association of America, is striving to clean up its act and alter its freebie-filled ways.
Now come former reporters Michael Jamison and Richard Sink, co-partners in Golf Reporters Enterprises Inc. of Longwood, Fla., publisher of a bimonthly golf magazine that circulates in the Carolinas and Florida, with plans for a new association unencumbered by all the righteous talk of do`s and don`t`s.
For a $40 annual fee, they promise eight newsletters a year and, among other goodies, ”an annual gift pack with merchandise, coupons and discounts from NGRA corporate sponsors”; ”complimentary meals and social functions hosted by corporate sponsors, in conjunction with outings and tournaments”;
solicitations for golf junkets across the country and the world; ”your name and address given, upon request, to corporate sponsors so that you can receive new items in merchandise and equipment periodically during the year.”
Jamison said last week that there is ”dissatisfaction” within the mainline golf writers group, in part due to growing ethics strictures that
”many members don`t agree with. They don`t feel the organization should be setting standards of ethics.”
How many? Any names? Jamison demurred, stating that those ”we`ve spoken with are not the Bob Verdis of the world, working for national papers”-an allusion to Tribune sports columnist Bob Verdi.
He thus implied that economic circumstances of those at smaller media outlets inspire a different perspective on acceptance of a shiny new golf bag emblazoned with corporate logo; a complimentary trek to and rounds of golf in Scotland; a snappy metal driver to test; or some garishly plaid, bell-bottomed golf pants.
Jamison claims a Higher Purpose to all this. Yes, this all can benefit you, Mr. and Mrs. News Consumer.
”Golf reporters can better serve readers if they know how the corporate world works,” he says, ”but we`re not a candy store with our doors swung open.”
A truly reassuring footnote: According to reporter Fitzgerald, after his report appeared last week, he got a call from an official of Time-Life Books. Worried about ethics?
No way. She just wanted the group`s address so she could try hawking a new Time-Life golf book.
