On the Record . . . From Arthur + Janet

June 25, 2009

To Our Colleagues,

The month of May came and went and, contrary to the prediction of one
writer, we did not stop printing The New York Times. But given all the
speculation and incorrect information that has been reported about our
Company, we think it is important to create a regular letter written so
that you get the facts directly from us - on the record. In the first of
what we expect will be frequent e-mails, we'd like to talk about recent
events at The Boston Globe. Future letters will discuss financial
transactions, advertising, circulation, costs and the digital challenges we
face as well as other issues as they arise.

All of you know, only too well, that this has been a difficult time for the
economy, the industry and our Company. The recession has amplified the
downward secular trends in our business and caused steep declines in
advertising revenue, particularly in the recruitment, real estate and
automotive categories.

The Globe was one of the first metropolitan newspapers to be deeply
affected by the secular and cyclical forces that are now roiling the entire
media industry. Revenues at the New England Media Group (which includes the
Globe, Boston.com, the Worcester Telegram & Gazette and its Web site) have
declined from $700 million in 2004 to $524 million last year.

In the fall of 2008, the Globe and Boston.com developed a strategic plan to
deal with their operating loss, which earlier this year was projected to be
roughly $85 million in 2009. The plan has several components to increase
revenues and lower costs. Here are the strategic steps we have taken:

• We have just completed the consolidation of printing facilities in
Boston, which is expected to save $18 million a year.

• In the last month, we significantly raised prices on newsstand and
home-delivered copies of the paper.

• The compensation of the Globe's managers and other nonunion employees
were significantly reduced in 2009/2010 through a salary reduction and
elimination of their annual incentive plan.

• The Globe's labor contracts are being restructured in order to save $20
million in annual operating costs - essential to our turnaround plan. We
had reached agreements with seven unions that provided slightly more than
$10 million in savings. Yesterday we reached an agreement, which is subject
to ratification, with the Boston Newspaper Guild, which would provide us with
another $10 million in expense reductions.

There will be still more to come but with these steps the Globe is on a
path to a more secure financial future. We are deeply grateful to all of
our colleagues in Boston for the hard work and sacrifices they have made to
put the Globe on a stronger financial footing.

In future letters, you'll hear from us about other things we are doing to
strengthen our Company and prepare us for the future. These are tough times
and we recognize that all of you are working very hard to make tomorrow
better than today.

Thank you, we deeply appreciate it.

Arthur & Janet

Arthur Sulzberger Jr., family steward to the financially-troubled paper, has written an embarrassing paean to its benefactor Slim. At least he had the good grace to publish it elsewhere, in Time magazine. Can you smell the butter?

I recently had the great pleasure of meeting Carlos Slim... It was obvious from the moment we met that he was a true Times loyalist... Carlos, a very shrewd businessman... has funded extensive public-health education programs and... helped thousands of students throughout Latin America...

Carlos knows very well how much one person with courage, determination and vision can achieve.

Sulzberger just finished examining 30 different online-news business models in hopes of making more money from nytimes.com. The publisher is well aware of how challenging it is to turn a profit online. So perhaps he should not be blamed for seizing the opportunity to exploit his real talent: Pleasing the rich and powerful people who own his company, through flattery and every other means.

Sulzberger is hardly alone: many in the traditional media find it easier to court new sugar daddies than to implement deeper forms of change. The Times scion is, however, the most conspicuous — and so, in many ways, the saddest.

It's hard to imagine the Black Hawk Down author getting as much milage from a few interviews as he did just fact-checking Sulzberger's TV appearances and office furniture, not to mention the quotes and anecdotes he elicited from (mostly) anonymous coworkers past and present.

Highlights, setting aside the well-known anecdotes and failures Bowden retreads, follow, category by category.

Sulzberger clinging to factually incorrect information

Keep in mind: This guy is the publisher and family steward of the New York Times.

• The linchpin of Sulzberger's business strategy is a factually incorrect family story. The publisher enthusiastically described on the Charlie Rose Show a decision by his grandfather to expand the space for news during World War II. Bowden: "This story is false. It is dismissed even in The Trust, a mostly glowing account of the newspaper and the family written with the full cooperation of the Sulzbergers... [the grandfather] increased space for ads and decreased space for news."
  
• Sulzberger framed a purported Winston Churchill quote in his office, from a speech during World War II: "Never never never give up." Bowden: "What Churchill actually said was 'Never give in, never give in, never, never, never, never-in nothing, great or small, large or petty-never give in,' and he added an important qualifier: '-except to convictions of honour and good sense.'"

They really don't like Sulzberger in the executive suite:

• Bowden: "Even the mid-level talent around Arthur does not regard him as a peer, much less a suitable leader. He is accepted, of course. The family does own the newspaper..."
  
• The business side, said one former associate, "saw him as insubstantial, as flighty, as glib, and as not caring about them as much as he cared about journalists."
  
• Former Times staffer: "He has no rays." Bowden: "Rays, as in the lines cartoonists draw around a character to suggest radiance, or power... [the] deficit is a standard insider lament about Arthur."

It's not much better in the newsroom:

• Sulzberger likes to talk about his oh-so-hardscrabble days as a newspaper reporter/Times heir apparent. Former Times executive: "He'll just do it as a throwaway-‘When I was a reporter.' I will say this to him one day: Don't say that... Do you think it's giving you more credibility with journalists? It actually gives you less."
  
• The provincial publisher was once confused by a question about a story in that day's "Post," meaning Washington Post. He supposedly replied, "I only read the Times, The Wall Street Journal, and the New York Post." Page Six trumps Watergate, apparently.

• It was already known Sulzberger declined to invest in Google. It turns out he also passed on a potentially hugely lucrative partnership with Amazon.com, to embed affiliate links in the online Times Book Review. Former CFO Diane Baker: "They said, We can't do it, because Barnes & Noble is a big advertiser."
  
• Sulzberger's use of the term "platform agnostic" to describe publishing news both online and in print is nonsensical. Tom Rosenstiel of Pew's Project for Excellence in Journalism: "Agnostics are people who don't-who aren't sure what they believe in. That's the first problem. And the second problem is, in practice, there is no such thing as being platform agnostic. You actually have to choose which platform you work on first... you need to change the culture of a news organization and decide that the Internet is the primary new thing."

Just ouch:

• Damning praise from longtime Sulzberger "friend" Steve Rattner, the former Times reporter turned investment maven turned Obama auto bailout adviser: "In everything he does, he means well." (Emphasis added.)

[Vanity Fair]

After leaving a reporting job at the Portland Oregonian to move to New York, Arthur Gregg Sulzberger has been set up with a job at the Times' website. He'll be writing and reporting for the City Room blog, part of the paper's impressive Metro desk, writes the New York Observer's John Koblin. He's sitting next to Jennifer 8. Lee and a bunch of editors.

His colleagues are thus far impressed. "When I looked at his clips, I said ‘Oooh! This guy ain’t bad!'" one anonymously told Koblin. "Eager to please and humble," said another. Those are pretty good reviews for a writer presumed to owe his job, in large part, to his father, grooming him to perhaps take over the paper. In the wake of the Times' first-ever mass layoffs a few months ago, one might have forgiven Sulzberger's newsroom compatriots a dose of resentment for the nepotism.

For all his professional good fortune, relative to other ink-stained wretches, Sulzberger is in a tough spot, relative to past Times scions. Amid a scramble for cash and falling revenues at the paper, there's persistent talk of its failure. As unlikely as that might seem, it's a scenario being taken far more seriously than it would have been just a few years ago, to say nothing of a few decades ago.

Then there is the separation of his parents, announced less than a year ago, and the rumors about his dad. Just as dinner-party speculation about Pinch Sulzberger and Caroline Kennedy settled down, gossip about his purported three-year relationship with a woman named Helen Ward hit the tabloids. That sort of chatter cannot be easy on Arthur Gregg Sulzberger's mother Gail, with whom Arthur Gregg is said to be close. Even before the gossip, Gail was reported (again by New York's sources) to be "really hurt" and "taken aback" by the split.

It won't be easy, in all likelihood, for Arthur Gregg to work for his father while trying to provide some comfort to his mother. But if he can navigate that near-term challenge, he at least has a shot at getting the Times past all the threats it faces in the long term.

After speaking to a friend of Ward's husband, Page Six reported the two started their affair on an Outward Bound trip to Machu Picchu in Peru in 2005 and later met surreptitiously (and repeatedly) in New York. The gossip page had previously reported the affair started only "about a year ago." But the tabloid corrected itself after talking to the once-bitter husband's friends, including this one:

"Imagine how you'd feel, to find out what was really happening when your wife went every other week to quote-unquote work in New York."

If Sulzberger cheated on his wife — which he did, unless he was secretly separated for three years — it's all the more absurd to definitively conclude, as Page Six did last time, that "Caroline Kennedy is innocent" of an affair with the Times scion. If Sulzberger would cheat on his wife, he'd cheat on his mistress. Think what you will about the Kennedy/Sulzberger dinner-party chatter, but this relationship has no bearing on its veracity.

Does the affair have any bearing on Sulzberger's ability to lead the Times Company, then? Not really; he's made enough professional mistakes to make his private foibles a sideshow. The company under his watch instituted its first major layoffs, saw its debt slide to junk status and tried, in a down market, to mortgage the headquarters building it constructed at great expense. Sulzberger over saw ill-advised share buybacks, dividend payments and dumb acquisitions on the business side and fabrication and war propaganda on the editorial side, etc. etc. etc.

The Times publisher does get credit for avoiding the cliche of the mogul with a decades-younger galpal. Ward is 49, just eight years Sulzberger's junior.

Page Six is reporting that Arthur Sulzberger Jr.'s girlfriend is Helen Ward of Aspen, Colorado, who he met on a trip to Peru "about a year ago." Sulzberger didn't announce his separation from his wife until four months or so after meeting Ward, but transferred an apartment to his wife's name prior to that, so it's entirely possible but not entirely clear that he was separated from his wife at the time his relationship with Ward started.

For what it's worth, Ward's husband is said by a Page Six source to be "crazy bitter" right now.

The Times won't comment on Ward. But a spokesman did give the Post a full-throated rebuttal to the speculation about an affair between Sulzberger and Caroline Kennedy:

"Mr. Sulzberger is not and never has been romantically involved with Ms. Kennedy."

Page Six goes on to say that since Sulzberger has a girlfriend, there's no way he could have slept with Caroline Kennedy. Because, presumably, Sulzberger's lover of the moment, who he's been seeing for an indeterminate amount of time, precludes him from having slept with someone else in the recent past.

And because boyfriends, like husbands, do not sleep around. As the Post's gossip columnists know particularly well.

(Top photo of Helen Ward from an Apsen, Co. dinner of the Aspen Institute, an organization that has collaborated, along with CEO Walter Isaacson, on several projects with the Aspen Science Center, led by Ward's husband Kevin.)

The money isn't enough.

The Times will give quite a bit for the honor of an investment from Slim, whose success has been chalked up to, variously, the sackfuls of money he delivered to Mexico's then-ruling party in the early 1990s, the pushing away of competitors by that party, the high prices his company charged in an impoverished telecom market (thanks again to said party), allowing his country's communications infrastructure to languish, and leveraging his Mexican monopoly into other businesses abroad.

In addition to a 14 percent interest rate —higher than one gossip-grubbing blogger's non-teaser credit card rates of 9 and 10 percent — the paper is giving Slim warrants that could be converted into stock controlling 17 percent of the Times Company, making him the third-largest shareholder behind the Sulzberger family and Harbinger Capital, with roughly 20 percent each.

The Times treats the conversion of these warrants, priced slightly below the recent stock price, as fait accompli in its coverage:

Mr. Slim will receive no representation on the company's board or any shares with special voting rights like those of the Sulzberger family, which controls the company. Nonetheless, when Mr. Slim exercises the warrants, he will be among the largest single shareholders in the Times Company, owning up to 17 percent of the common shares outstanding.

(Emphasis added.)

Though Slim's cash can be used in place of a $400 million credit line expiring in May (and never fully tapped), the Times will still owe another $249 million in 2010. And the company's revenue fell more than three times as steeply as its costs in the first nine months of 2008. Since then, the advertising market has only gotten worse, and 2009 promises to be especially brutal. Even if the Times Company can mortgage its office and sell off assets like About.com, it will eventually need to bring expenses in line with sales. Barring a miraculous market recovery, it's hard to see how the Times Company does that without the newsroom layoffs it said were no longer in the cards.

Dowd's Kennedy column

Dowd wrote that Kennedy has no qualifications, and can't talk properly. When confronted with these deficiencies in Sarah Palin, Dowd referred to the Republican vice presidential nominee's "thin résumé," called her "underqualified," a "bantamweight," and "the two-year governor of an oversized igloo."

Kennedy's government work is far thinner, but, hey, inexperience is a plus these days (four months later):

People complain that the 51-year-old Harvard and Columbia Law School grad and author is not a glib, professional pol who knows how to artfully market herself, and is someone who hasn’t spent her life glad-handing, backstabbing and logrolling. I say, thank God.

But Kennedy sucks just enough at politics: There are senators who sucked worse!.

People are suddenly awfully choosy about who gets to go to the former home of Jesse Helms, Strom Thurmond and Robert Torricelli.

Right, probably because New Yorkers would never have voted for those first two guys, or re-elected the third. But, hey, let's have Kennedy, because who cares about the senate, right??

None of this necessarily constitutes institutional bias on the part the paper; Dowd reserves the right to be batshit illogical about basically anyone, anytime, for any reason, such as "I know Caroline Kennedy. She’s smart, cultivated, serious and unpretentious."

Confessore on Kennedy's rival

Moving on to the Times' other Kennedy item today, Nick Confessore found anonymous sources to say an aide of Kennedy rival Andrew Cuomo strongly "suggested" to vaious labor leaders and upstate officials that they not endorse Kennedy. Cuomo isn't officially campaigning for the senate seat even though he totally wants it.

The paper did something similar a few weeks ago on Bloomberg's aide politicking for Kennedy. Balance!

Today the paper carries a front-page ad for CBS. Well, sure. It's hard to be shocked by that after the paper's first mass layoffs, a junk rating for its debt, a planned mortgage of its headquarters building and a deep company dividend slash.

Besides, the Times already had display ads on section fronts (since 2006) and the occasional classified on the front. The Wall Street Journal (since 2006), USA Today (since 1999), Los Angeles Times and Chicago Tribune all have front-page ads. The Washington Post is now the most prominent paper to have held out against them.

In 1851, when the Times started publication, it was not uncommon for advertising to crowd news out entirely from the front page. Even by the 1890s, the first two or three pages of the New York Herald contained no news at all. (It's not entirely clear from the Times' cautiously-phrased story today if it ever carried front-page ads during this era.)

The only thing outrageous about the Times' decision is its tardiness. Ten years ago, the paper could have fetched a truly outlandish premium for the honor of front-page placement. Today the novelty has been eroded by competitors like the Journal, and the economy is in the tank. As with his mortgage, dividend cut and planned sale of other assets, Arthur Sulzberger Jr. slept far too many nights on this decision.

For Kennedy, Self-Promotion Is Unfamiliar, A21

This story on the prospective senator's struggle to sell herself showed her as kind of a cold fish. Which is interesting! She's had "a lifetime of being wooed by others" and now is "courteous but... not exactly passionate." Or qualified, but, hey, that's not NEWS, really.

One Democratic organizer cattily told the Times, "She's raised flags... the recent flubs have been damaging." Ouch. And then there's this:

Byron W. Brown, the mayor of Buffalo, said that when they met recently in his city hall office, he asked if it was O.K. if he called her Caroline. Her response, Mr. Brown said, made for a kind of “Sarah Palin-Joe Biden moment.” “Is it O.K. if I call you Byron?” Ms. Kennedy responded, recalling the vice presidential debate earlier this year.

Probably one of the least provocative (or interesting) Palin comparisons possible. We liked last week's much better. Since it, you know, spoke to her political experience rather than her verbal tics.

But: The headline was "For Kennedy, Self-Promotion Is Unfamiliar." That's a friendly way of putting it.

The Mayor, You Know, Says He Can Relate, A23

Ho ho ho, ha ha ha, the mayor can't talk either, just like ummmmm, you know, Caroline Kennedy. Let's minimize the importance of Kennedy's frightening inability to explain why she'd be a good senator, a handicap even more severe than herUncle Teddy's inability to explain why he'd be a good president. This story existed strictly to quote Kennedy's staunch defender Michael Bloomberg, who said this at a press conference:

“If there is anyone who understands the pain and suffering from having the press criticize how you speak, it is me,” the mayor said during a news conference at City Hall on Tuesday afternoon. “But as I told my oldest daughter when she said, ‘They are laughing at you,’ the only ways I know how to make it better is to go out there and do it every day.” (Yes, you read that correctly: ways.)... He also echoed Ms. Kennedy’s own comments that she would always be held to a higher standard because of her boldface name.

Does Bloomberg even need his own wire service?

Actually, the paper isn't out far on the limb. It's merely passing along the fact that the conventional wisdom in Albany has swung toward detesting Kennedy as entitled and presumptuous rather than being positively infatuated with her as an exciting new bauble named (ZOMG) Kennedy. How about a roundup of hate?

• "The governor is frustrated and chagrined... because he believes that he extended Ms. Kennedy the chance to demonstrate her qualifications but that her operatives have exploited the opportunity to convey a sense that she is all but appointed already."
• Assembly Speaker Sheldon Silver: "If I were the governor, I would look and question whether this is the appointment I would want to make, whether her first obligation might be to the mayor of the City of New York rather than the governor who would be appointing her."
• "Her refusal to say over the weekend whether she would back a Democratic candidate next year, when Mr. Bloomberg will seek re-election as an independent, set off intense reaction among some in the party."
• A passive-aggressive supporter, Nassau County executive Thomas Suozzi: "The way that her handlers and strategists are pushing her and trying to box in the governor is damaging the reputation of someone that we all care about."

Reasonably skeptical. But after putting a policy Q&A with Kennedy on its front page, the Times buried this story ran on page A19.

Reasoning that senate candidates have to file an elaborate, 10-part report on their assets, debts and income, and that Kennedy herself oversaw intensive vetting of Barack Obama's running mates, the Times asked Kennedy for "a variety of basic data," including "potential ethical, legal and financial entanglements." Appropriate.

Kennedy refused!

So the Times found three ethics advocates (from Citizens Union, Common Cause and Democracy 21) and a public policy professor (from NYU) to weigh in, and all but one were outspoken that Kennedy should open up.

The paper also said some people "wonder if Ms. Kennedy’s unwillingness to disclose personal information suggests she lacks the stomach for the kind of intrusive questions that could come her way as a candidate in 2010." Ouch!

Also, the Times has been counting how many questions Kennedy has taken from the press on her "tour" of the state (only 11).

The picture (left) makes Kennedy look friendly, but the story is pretty tough. More like this!

Also in Kennedy coverage, the Times explained in an Editor's Note how it inadvertently published a forged supposed letter from the mayor of Paris slamming the candidate: It sent a copy of the edited letter back to the email address attached to the original (presumably a French government address), and was supposed to wait for an affirmative reply before running the letter, but did not.

Sadly, the fake letter was the most skeptical writing about Kennedy in the Times all weekend. Surely there's a genuine cynic out there yearning for space in the opinion section!

Archive: Caroline's Times File

When commenter Aaron Altman on Wednesday read the paper's story about senate-hopeful Kennedy's tour of upstate New York, it started with this provocative sentence:

In a carefully controlled strategy reminiscent of the vice-presidential hopeful Sarah Palin, aides to Caroline Kennedy interrupted her on Wednesday and whisked her away when she was asked what her qualifications are to be a United States senator.

That's a revealing introduction. And accurate: Even Kennedy's allies think her tight press strategy is misguided, as shown in the attached clip above.

But by the time the story appeared in Thursday's paper, any comparison to former vice presidential nominee Palin, and all mentions of "control," were gone. The new, much more polite beginning read as follows:

The first day of Caroline Kennedy’s tour through upstate New York on Wednesday was meant to be a low-key, decorous excursion, mindful of the skepticism surrounding her bid to be appointed the state’s next United States senator. Fat chance.

Gone, too, was an account of how, when asked by reporters about her qualifications, Kennedy allowed herself to be whisked away by an aide, into a black SUV, saying only, "Hopefully I can come back and answer all those questions."

The reader never learns about about Kennedy's evasion. Instead, he is fed this quote, crafted after Kennedy had some time to think:

“I just hope everybody understands that it is not a campaign but that I have a lifelong devotion to public service... I’ve written books on the Constitution and the importance of individual participation. And I’ve raised my family. I think I really could help bring change to Washington.”

The Times should cover Kennedy's ducking of questions because it's the right thing to do. She has little track record, and appears unqualified for the office she's seeking, making her public behavior all the more important.

But if that's not reason enough, the newspaper should consider appearances. Sanitizing, in public, a story about your publisher's close "friend" will lead some people to believe the paper is suppressing even more information in private. Whether the decision was made by the original reporters or someone higher up, it was a bad call.

We'll be monitoring the Times' Caroline Kennedy coverage on a near-daily basis, always with a logo, probably a tweaked version of the one above. We don't envy the Times writers who have to cover the boss' good friend. It must be tricky. Or at least feel tricky, particularly since the paper is discouraging talk of the relationship.

But Sulzberger's relationship with Kennedy is an important media story. At the very least, it's going to put the paper in the sights of media critics on the prowl for the slightest sign of bias, not to mention political foes of Kennedy looking for evidence of yet another unfair advantage for the politician.

To start things off, we've taken a (hopefully comprehensive look) at the TImes' Caroline Kennedy coverage, Saturday through Monday, and broken it down by category:

Shameless gushery:

• Caroline Kennedy's ascent isn't nepotism, it's evolution in action! "The case of Ms. Kennedy is not really one of nepotism, Dr. Sulloway says, but of its evolutionary cousin, reciprocal altruism — good will without kinship. Altruism toward non-kin occurs in evolution because there’s a net benefit to all." Week In Review? Please. More like Week In Revision.
• Can you believe she's a Kennedy? A real, actual Kennedy? "Ms. Kennedy... is in many ways embarking on a test of the enduring power of her politically royal name... the Kennedy mystique." Closing "man on the street" quote: "She'll be good. It's in her blood."
• You heard she's sleeping with who now? Because I heard no one cares about her private life. Or our publisher's. "Caroline Kennedy is under tabloid attack, but the charge is presumption: even on TV, commentators openly scoff at her brief, somewhat stilted tour of upstate New York and complain that she is seeking appointment to public office with a queenly sense of entitlement."
• Caroline Kennedy took actual positions on actual issues, sort of. Let's feature her staff's boring politician-speak on the front page.

Neutral-ish:

• Uncle Edward can't call labor leaders to make them fall in line behind his niece, or to raise questions about this one union leader who said Caroline Kennedy might not be qualified. But his longtime aide can!
• People often follow family members into politics, because they get free name recognition, they are not intimidated by the political process, and they are bred to seek power, constantly.
• Sad Andrew Cuomo, who has actually qualifications for the job of senator, is dying to campaign for it, but can't, and the coverage of Kennedy is burning him up inside.

• A letter from the mayor of Paris: "With all the respect and admiration I have for Ms. Kennedy’s late father, I find her bid in very poor taste... in my opinion she has no qualification whatsoever to bid for Senator Clinton’s seat... It is both surprising and appalling."
• A joke, but it's on the Laugh Lines blog. Does anyone read Laugh Lines? "Caroline Kennedy would like to be considered Time magazine’s Person of the Year for 2009 and has let the magazine’s editor know of her interest in the honor, aides to Ms. Kennedy confirmed today."
• Kennedy didn't vote in the last four New York mayoral primaries! Slacker. But the tabloids had the story first, and the Times ran it on A25.

Pictures!

Aww aren't they sweet? Implied message: If Paterson doesn't appoint her, we, the Times, will shoot this legacy. (Story)

"Some younger voters know little about the woman aspiring to a senate seat." For example, they don't even know she's a Kennedy! A regal Kennedy, with mystique! (Story)

Caroline Kennedy "has been largely silent about details of her political views until Saturday." But she's in Harlem! Smiling! That counts for something, right?

It seems like a mostly legitimate question to ask, doesn't it? Whether or not they're having sexy sexy old rich scion sex, the special friendship between Sulzberger and Kennedy is well-documented. And when the publisher of your paper is BFF with a public figure, asking whether that friendship affects coverage of that public figure is certainly fair game.

But no, no comments allowed asking about the affair. When this guy tried, the City Room editors asked him to please not bring it up again. "we don't report stuff like this, regardless of the people involved." Stuff like... what? The Times certainly does report on the sexual lives of public figures, all the damn time, from Giuliani to Spitzer to Paterson. But reporting on the Sulzbergers not so much.

Anyway now obv you should all head over to the City Room blog and spam them with thousands of comments about this terrible coverup. (Don't actually do that, it would be really annoying.)

One might presume the nation's most (or second-most) esteemed newspaper would be above doing favors for friends of the family, like quashing an unflattering story. After all, if the Times starts pulling punches on Kennedy — now at the center of New York's foremost political drama — it's going to get real obvious, real fast.

But someone at the paper felt the need to leak word of the forthcoming story to Matt Drudge, a possible precaution, we'd venture, against having it spiked. Or maybe just the usual journalistic self-promotion. Or both!

It sounds like a sizzler: Mayor Bloomberg is spreading word Kennedy is GOING to be senator, so "get on board now!" How presumptuous! Why, she's just like Hillary Clinton, all smug and elitist and whatnot. No wonder there is "an intense backlash among Democrats."

In all seriousness: What a dumb time in American history to try running basically entirely on the strength of your last name. Yes, we're all super pumped about political dynasties in the wake of the Bushes and the Clintons! Someone needs to say, it might as well be the Times.

UPDATE: The Times story is live. Bloomberg says he's not supporting anyone, and his aide is supporting Kennedy on his own time, buit then he also claims in public she "can do anything" and "I have great admiration for her."

"Entitlement" and elitism are mentioned frequently:

They worry that the Bloomberg administration’s advocacy for Ms. Kennedy will only reinforce her image as a privileged Upper East Sider whose biggest base of support is from Manhattan’s exclusive social set.
“It appears to be another case of central casting by the city’s cognoscenti,” said a Democratic city councilman, John C. Liu. “It’s amazing how much it’s all about the upper crust.”

The Enquirer's already testing the waters. Caroline Kennedy wants to go to DC not just to be a Senator, they say, but maybe also to escape her terrible marriage! Supposedly, Kennedy's been on the outs with her husband Ed Schlossberg for years, in one of those amicable quiet classy rich people sort of separations.

That's all well and good for a scion who keeps to herself, but maybe not so much for a Senator? Now that she's openly seeking political office, reporters will openly seek dirt on her family.

And the ease with which they'll find it may be one reason Rupert Murdoch's New York Post tepidly endorsed Caroline today! Think of the headlines they can get out of another New York Senator named Kennedy!

Of course other explanations for the Post endorsement include a) it is a fine and easy opportunity to piss off the Clintons, b) Caroline Kennedy has demonstrated an ability to charm Murdoch before and b) they're looking forward to taking on Kennedy's relationship with New York Times publisher Arthur Sulzberger Jr.

Sulzberger and Kennedy are old, close, maybe special friends. Sulzberger's marriage just ended, btw! And there's some story going around about him already involving some other married woman he's "friends" with: supposedly the husband sent an accusatory email to the woman and Pinch, and the wife replied-all to a number of masthead editors. These are the kinds of stories that will be dragged out now that Caroline Kennedy is seriously being considered for a Senate seat! (See? We just dragged that one out and it's barely related.)

So, Caroline, no. Step back. It's harder to get Rupert to kill that story on your daughter's anorexia when you're a US Senator and not a beloved slightly reclusive icon.

"Scott, Bill, Andy, Martin," and Arthur "Pinch" Sulzberger are really sorry, but turns out the New York Times is in dire financial shape. Advertising revenues at both the paper and the web site remain weak and the financial outlook for 2009 is daunting." You're telling us!

So, no pay increases for all non-union employees in the coming year. But hey, look on the bright side: "We remain a great brand." That's great.

The company also said it was thinking about selling assets, but it's been making similar noises since at least March and was still talking about the idea, internally at least, in late October. As with the Times' bid to mortgage its pricey headquarters, finding a buyer for, say, the Boston Globe or International Herald-Tribune would be tricky in the present economy. About.com, perennially rumored to be for sale, might be an easier sell, to a hungry tech company like Microsoft, but many natural buyers like Google and Yahoo are retrenching.

Some shareholders — or just worried admirers of the newspaper — are not satisfied. The company has been adding debt (at junk prices, these days) even as it pays out dividends to Sulzberger family members and other shareholders. Via Jeff Bercovici at Portfolio:

One audience member wanted to know why the company, which slashed its dividend by nearly 75 percent a few weeks ago, didn't go further. "Why keep the dividend at all?" he demanded. "The notion that cash is flowing out of the company to equity — it seems like you might not understand the gravity of the situation."

Oh, but they're learning! This whole depression has been very educational for the entire Sulzberger family!

Earlier this year, Arthur III's parents decided to divorce. They implausibly suggested the split was "amicable," and by October New York reported the "deeply acrimonious divorce... upset the entire family," including Sulzberger's "really hurt" ex-wife Gail. It can't have helped that Arthur Jr. was seen regularly with Caroline Kennedy. Arthur III, reported by New York closer to Gail, will now be better able to offer emotional support.

Then there are the troubles at the Times Company. Under Arthur Jr.'s stewardship, the company has seen its debt rated junk and made its first newsroom-wide layoffs. With profits falling fast and hundreds of millions in debt soon coming due, the company recently pledged no more layoffs — which means selling off assets and/or cutting the paper's generous dividend, the essential financial glue binding the family in unity behind the family business.

Arthur Jr. is widely believed to want his son to succeed him at the paper. Given where things stand now, the first question is whether Arthur III would even be interested in the headache of a job.

Given where the Times and indeed all newspapers are headed, it's hard to imagine Arthur III anywhere but on the online side of the operation. If you have more specific information, we'd love to hear from you. (Ditto if you have a picture of the guy!)