Midwest reporters reflect on sale of Warren Buffett papers to Lee Enterprises

Like many of her colleagues at the Omaha World-Herald, Jessica Wade said she was blind-sided by news last week that Warren Buffett was selling his hometown newspaper to Lee Enterprises Inc. 

“There seem to be two different reactions to the sale: anxiety over what this means for job security and our ability to provide holistic news to the community; and cold indifference followed by the half-hearted shrug, ‘well, the industry is dying,” said Wade, the paper’s digital editor and a breaking news reporter.

BH Media Group, part of Berkshire Hathaway, announced Jan. 29 that it was selling its entire newspaper portfolio–which includes 30 daily and 48 weekly newspapers–to Iowa-based Lee Enterprises for $140 million. Lee is a publicly traded company that owns 50 newspapers, including the St. Louis Post-Dispatch and Southern Illinoisan. With the sale, Buffet is now out of the newspaper business.

“We had zero interest in selling the group to anyone else for one simple reason: We believe that Lee is best positioned to manage through the industry’s challenges,” Buffett said in a statement.

Lee Enterprises has already had a regular presence in the BH Media world, taking over management of the newspaper chain in 2018. 

Tim O’Neil, a retired reporter of the Post-Dispatch was in the newsroom when Pulitzer, Inc. sold to Lee Enterprises 15 years ago– a sale of 12 daily newspapers for $1.5 billion. 

O’Neil had just finished his role as president of the St. Louis Newspaper Guild (now the Midwest Newspaper Guild) a year prior to the sale of the Post-Dispatch, fighting contract negotiations as a representative of the union when Pulitzer hired lawyers King & Ballow of Nashville to “beat up the union,” as O’Neil recalls.

For him, calling Lee Enterprises into the newsroom was a welcome, albeit rocky, change.

“The basic theme with Lee is that, when they bought the Post-Dispatch, they didn’t know what to expect,” O’Neil said. “There was this culture clash with a company who worked with smaller papers, versus this big daily paper. However, we wound up putting together a fairly workable relationship.” 

O’Neil admitted that, yes, there were quite a few layoffs in the newsroom, and the 2008 recession hit the industry hard. However, he said he admired that Lee Enterprises worked with the guild for direct bargaining.

“There’s no fun working at a shrinking enterprise where people get laid off,” O’Neil said. “When you look across the landscape, these hedge funds are buying newspapers and taking them to the slaughterhouse. Lee at least seems to want to be a newspaper company.”

Gary Sawyer, an assistant teaching professor at Iowa State University, began working for Lee Enterprises in 1981. He worked as an editor and publisher for Lee newspapers in Iowa, Oregon, and Illinois. From an editorial perspective, Sawyer said Lee Enterprises has always been “hands-off” in the newsroom. 

It was a pleasant experience working for Lee, but during the last years before he left the industry the job became more stressful, Sawyer said. 

 “But that’s not Lee’s fault, that’s more the business in general,” he said. 

Sawyer said he thinks the purchase of BH Media makes sense, but the price it was bought at surprised him. 

“That’s what struck me. The value of newspapers has dropped considerably,“ he said. 

Sawyer said because Lee is a corporation there is pressure to meet certain financial targets that require newsrooms to make personnel decisions. For example, layoffs.  

“I’m not going to pretend that there weren’t any corporate guidelines you had to meet…so there were things that had to be done,” he said. “But, you know that goes with working for a corporation.”

Employees for The Southern Illinoisian, the regional newspaper for the southern 16 counties in Illinois based in Carbondale, know the reality of working for a corporation in a struggling industry all too well. 

In 2018, a corporate directive led the Southern’s newsroom to make cuts, leading to mass unannounced layoffs. 

According to a News Guild press release, the layoffs totaled about 18 percent of the paper’s workforce including three newsroom employees.

Janis Henning reported for The Southern for two years, leaving in August 2018. She said that when local management was told by corporate to make cuts, reporters who were being laid off came to file their stories were instead ushered into the editor’s office and told the bad news. 

“I was working on a story at my cubicle, and a colleague of mine, who had been something of a mentor during my time at The Southern, was let go. When I saw her walk out of the editor’s office, I had a bad feeling: I just knew,” Henning told GJR. “She gathered up her things from her cubicle with the woman from corporate kind of hovering over her, and she whispered to me, ‘Well…goodbye!’ and that was it.” 

The layoffs were devastating, including for local management, she said. 

“We were already spread thin as it was. It was terrible for morale, given the suddenness of the layoffs–I think we all had the feeling we could be let go at any moment,” Henning said. 

But newspaper employees losing their jobs unexpectedly was not the only sign of inadequate financial resources. 

During Henning’s time at the paper, she said editors worked 60 to 70 hours a week as they tried to strategize what should receive coverage with few reporters while continuing to take on ambitious investigative pieces. As people experienced burnout, left or relocated, the paper struggled to find replacements. 

“And even nominal raises were pretty much out of the question,” Henning said.  

In the following year, three more Southern employees were unexpectedly laid off. 

The layoffs were the primary reason why the remaining newsroom employees organized the Southern Illinois News Guild, Henning said. 

Reporters in Omaha, Buffett’s hometown, also formed a union in October of 2018, citing a downsizing under Lee Enterprises. Members of the Omaha World-Herald Guild said they are “dismayed and disappointed” by the sale of BH Media.

Todd Cooper, the President of OWH Guild, tweeted a statement the afternoon following the announcement of the sale.

“Mr. Buffett remains uniquely positioned to forge a vibrant, local ownership path for his hometown newspaper…Instead, he’s chosen to sell to Lee Enterprises, an out-of-state company that has all the nonsense national chains are known for: bloated bonuses for executives, rewarding them for ending journalists’ careers; massive cuts to product, including this newspaper; and, as an added bonus, cutthroat investors, such as vulture hedge fund Alden Global Capital. What an unmitigated mess. It just doesn’t have to be this way.”

Southern Illinois News Guild retweeted the statement, along with other tweets disapproving the purchase including Southern reporter Isaac Smith who tweeted, “We keep on doing the work vital to our communities despite increasing challenges handed to us by a group of people who have little to no understanding of what we do and its value (that’s intrinsic value, not necessarily monetary value).” 

A former World-Herald reporter, Kirby Kaufman left the paper in 2012 when he felt the industry going south. He said the day he knew Lee had taken over the Omaha paper was when he saw the company’s standard “breaking news” banner on the top of the homepage. 

“If you’ve ever worked in newspapers and have half a brain, you know all Lee Enterprises does is just gut newspapers,” said Kaufman, now an ad copywriter. “They’re just going to keep laying people off until they can’t anymore. They cut salaries, they ruin the quality of their products. Newspapers are bleeding, and they’re just going to keep squeezing all the money they can get until there’s nothing left.”

Kaufman said he predicts the eventual closing of smaller weeklies in the Omaha metro like the Papillion Times, Bellevue Leader and the Daily Nonpareil. The biggest bit of tension, he said, will be whether Lee Enterprises finds it important for both the Omaha World-Herald and the Lincoln Journal Star (Nebraska’s two largest papers) to cover Husker football. 

“If you haven’t figured out Plan B yet, you’re in trouble,” Kaufman said. “Or if you’re still studying newspapers in school, would I say follow your dreams? Not right now. Don’t get me wrong; I love journalism and I love newspapers to death. Best job I ever had. But it’s a highly competitive career path where 100 people are competing for one minimum-wage job.”

Kamrin Baker reported from Omaha, Nebraska, where she is a journalism and media communications student at the University of Nebraska-Omaha. She serves as Editor-in-Chief of the campus newspaper (coincidentally named) the Gateway. Reach her at @thekamrinbaker on Twitter. Amelia Blakely reported from Carbondale, Illinois, where she is a student at Southern Illinois University. You can find her on Twitter @AmeilaBlakely.