“We did not have a unified vision of the future the last two years. Even if we did have a unified vision I’m not sure we had the energy to carry it out.”
—a Reader founder explaining the paper’s sale in July to Creative Loafing Inc.
“While others may be looking at publishing companies through the lens of old print media, we are pioneering the opportunities offered by convergent print, web, and new media applications.”
—Creative Loafing’s CEO, Ben Eason, after buying the Reader
The former owners of the Reader explained when they sold this paper last month that it was facing financial challenges they felt too old and spent to tackle. One of the most exhausting of those challenges was personal: the owners who spoke for the Reader were being sued by a founder they’d stripped of operational authority some 20 years earlier. This was Tom Rehwaldt, a frequent minority of one at board meetings of Chicago Reader, Inc., who nevertheless owned 19.1 percent of the stock . . .
I’m told that as the fat years rolled on, Rehwaldt found other interests and was for the most part the silent partner they all wanted him to be. They might wish in retrospect that they’d bought him out then, but his stock was worth a lot of money and no one was interested in paying him off out of their own pockets. A few years ago profits began to dip, and Rehwaldt began speaking loud and long at board meetings. In late December he filed another suit, this time accusing the officers of Chicago Reader, Inc., of acting against him in a way that was “illegal, oppressive or fraudulent.” . . .
Rehwaldt’s suit had confronted the other owners with the prospect of paying a small fortune in legal fees to defend themselves and the Reader. Nobody had the stomach for that.
“It wasn’t the straw that broke the camel’s back. It was the three-pound bag of manure that broke the camel’s back,” says one of the former owners. Another: “It would be overstating it to say [the suit] forced the sale, but it certainly encouraged it. It was one of the things that made the future look bleak—fighting a lawsuit, all of this bad news coming out about the company. At a time when we were supposed to be turning the company around, we’d be spending our money on legal fees. And also, the idea that Rehwaldt would fight us at every turn. The sale was one of the things that would make it all go away and get him out of our lives forever.”
Ben Eason borrowed about $30 million to buy the Reader and the commonly owned City Paper in Washington, D.C. The money to repay that debt had to come from somewhere. In December I gloomily blogged:
I found myself sharing a table with Dawn Clark Netsch at a dinner last week and she said she’d noticed changes in the Reader. Was the paper OK? “We’ve got a story on page one by John Conroy,” I said, and that was answer enough. A week later I’d have had to say no. John—and Tori Marlan, Harold Henderson, and Steve Bogira—were no longer with the Reader.
Laying off these staff writers, which editor Alison True did at the beginning of this week, was surely one of the hardest acts of her life and certainly a low point in the history of this newspaper. . . . They’re gone because the Reader couldn’t afford to go on paying them their salaries—”As you might guess, this move represents a shift in the financial structure of our relationship with contributors,” True wrote.
Richie’s last race
For better or worse, Daley’s greatest accomplishment so far has been the destruction of Cabrini-Green, Robert Taylor, Henry Horner, and other outdated high-rise public housing projects. The CHA’s so-called Plan for Transformation opened up the south, north, and west sides to gentrification and development. Of course, Daley doesn’t come right out and admit he got rid of the poor people. He goes along with the idea that the plan was about finding them adequate low-income housing. But in fact, the CHA admits it can’t keep track of all its displaced residents. I’ll give them a hint. According to a recent study by Illinois Poverty Summit, a not-for-profit research group, the number of poor people living in the collar counties and suburban Cook County has risen by 100,000 since 1999. The CHA might want to try poking around those suburbs if it really wants to find its evicted tenants.
From “He’s Going to Win: Here’s why you should vote against him anyway” by Ben Joravsky. In 2011 the U.S. Census would report that Chicago had lost 200,000 people in the past decade. City Hall organized no search parties.