Mar
18
2009

Crony Capitalist Props Up NYT

Writing that "an astonishing number of North American dailies are gasping their last," veteran Mexico journalist John Ross (CounterPunch, 3/18/09) cites "a recent survey by the New York Times, itself on its last legs," that "lists 75 daily newspapers of being at risk from sea to stinking sea," and singles out how San Francisco Chronicle owner "Will Hearst threatens to close down the Chron if he can't break the unions and turn the Comical into a scab rag." Ross also looks at how "the New York Times has persuaded a Mexican billionaire to bail it out of impending shipwreck":

Well, not just any Mexican billionaire. Carlos Slim is usually ranked Numero Dos on the Forbes Hit Parade with $60 billion under his mattress…. The big guns of Slim's empire are Telmex, the Mexican phone monopoly that charges higher rates than any other such enterprise in the wide world, with which he was gifted in an excess of crony capitalism by the reviled ex-president Carlos Salinas, and American Movil–the Mexican tycoon's cell phone companies dominate 70 percent of the Latin American market….

Slim built his empire on corporate cannibalism and sees weaknesses in enterprises where we mortals do not. There is little else to explain his $250 million investment in the Times, a seriously sagging institution that had only $46 million cash on hand and $1.1 billion in debt when the Mexican tycoon came to the rescue. Since his initial investment, Slim has expanded his holdings to 7.4 percent with the possibility of increasing his shares to 17 percent ownership–only the Sulzberger family owns more.

"The Slim/New York Times connection suggests a solution for the ailing U.S. newspaper industry" to Ross: "Among possible Mexican investors: Joaquin 'El Chapo' (Shorty) Guzman, the capo of the Sinaloa cartel recently listed by Forbes in its up-and-coming billionaire rankings. Drug cartels in Sinaloa are said to already own several dailies in that Pacific coast state."