Why is the Ford Foundation donating to Kaplan Education and Jerry Springer?

By Steven Brill
August 7, 2012

It was widely reported last week that the Ford Foundation has given The Washington Post a $500,000 grant to hire four extra reporters for a year “to work on special projects related to money, politics and government,” according to a staff memo issued by the Post’s top editors. This followed a May announcement that the foundation had given a million dollars to the Los Angeles Times to expand coverage in areas ranging from local immigrant communities to the state prison system.

These reporting initiatives are worthy endeavors aimed at fortifying great newspapers whose profits have been savaged by the rise of the Internet. However, The Washington Post Co (though not the newspaper) is still quite profitable. The company reported operating income of $77.8 million in the first half of this year. In fact, the Post Co division that owns a group of local television stations is enjoying boom-time revenue this year because of the flood of 2012 political advertising; operating income in that unit increased 43 percent in the first half of this year over last year.

The Post Co also owns the Kaplan education business, and although Kaplan’s for-profit universities are suffering because of a government crackdown on abuses related to marketing and student loan commitments, its test preparation division has shown improved results.

So why didn’t the grant givers at Ford tell the Post to get its parent company to boost its SAT or LSAT coaching fees by 50 cents or a dollar if it needed that $500,000 so badly? Or chop the bonuses of senior executives a bit? Or siphon off ad revenue from those booming television outlets (whose shows include The Tattooed Teenage Alien Fighters from Beverly Hills), or dip into the profits its cable-television systems get from people buying adult movies?

The Tribune Co, which owns the Los Angeles Times, has been in bankruptcy, but that’s only because the current financial-investor owners took on a crushing debt burden to overpay the prior owners of the company’s media properties. The Los Angeles Times itself is still profitable, as are its other divisions, including, for example, the broadcast division that owns local television stations such as WPIX in New York, which features the Jerry Springer Show at 11 a.m. every weekday.

If the paper needed that million dollars so badly, why couldn’t the company ask Springer to cut his syndication fee a bit? Or why not divert some profits from its broadcast of Gossip Girl? Even more easily, the grant givers at Ford could have suggested that Tribune grab some of the dollars gushing in from political ads being bought on its television stations in Denver or Miami, both of which are in hotly contested swing states?

Of course, in the context of big business realities, these are naïve questions. Even the biggest or richest conglomerate – and the Post Co and Tribune are neither – has to insist on each business unit being self-sustaining. The company’s shareholders ultimately won’t tolerate treating one division in the family like a charity. But why should a third party, the Ford Foundation, step in and become the benefactor? Besides, the Los Angeles Times makes money.

When Henry Ford set up his Foundation, did he really intend to help bail out over-leveraged financial investors in a media conglomerate? And is the New York Times not getting these Ford grants because it is doing so well by charging readers for online access that, at least on a relative basis, it doesn’t need the money? Or is the Times about to get some of the Ford money, too? Has the Times sought a grant? What about other newspapers?

A thoughtful reporter ought to find out how the newspapers involved and the people at Ford have approached these issues. Why do they think it makes sense to donate to profit-making companies that have resources of their own but seem not to value the work being funded as much as Ford does?

There are all kinds of other questions related to the grants, including how conflicts are going to be handled and disclosed when the news organizations cover Ford or its hundreds of other grantees around the world.

And how will Ford judge the results when the one-year term of the grants is up? Sure, improved coverage of the areas where the funded reporters are working is likely, but what will that prove? With that in mind, does Ford view this as an experiment that could lead to a non-profit news organization, fully funded by Ford and maybe some partner foundations, covering areas it believes need to be covered? What are the long-term implications – including issues related to conflicts – of that kind of funding model?

The John S. and James L. Knight Foundation – whose primary purpose, unlike the multidimensional Ford Foundation, is to support journalism – thus far (to my knowledge) hasn’t given grants to conventional for-profit news organizations, preferring instead to fund research and experiments intended to develop alternative, self-sustaining models for good journalism. What do officials there think of the Ford grants?

David Halberstam’s landmark 1979 book The Powers That Be was an awestruck look at the clout of the Los Angeles Times and The Washington Post (along with Time and CBS). That these two once-mighty newspapers have now accepted charity is a big deal.

PHOTO: Television personality Jerry Springer arrives at the 34th annual Daytime Emmy Awards in Hollywood, California, June 15, 2007. REUTERS/Fred Prouser

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