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Sam Zell and Carl Bernstein Affirm My Analysis of Bezos and the Washington Post

BEGIN TRANSCRIPT

RUSH: On this program yesterday, in discussing Jeff Bezos and the purchase of the Washington Post, I, of course, your host, said many things.  I opined in many ways.  One of the things that I pointed out was that the actual worker bees in journalism, in this case the Washington Post, don't care about the customers, don't care about profit or the bottom line, don't think that they should even be subjected to those kinds of pressures, because their mission is so important.  They are so important that they shouldn't be bound by these ordinary, average, everyday capitalistic concerns like profit, the bottom line.  The hell with that.  We're important people. 

And I also pointed out that the news business is one of the few in which the customer is always wrong. The customer doesn't know anything, in the eyes of the people in the business.  The customer is too stupid, too unsophisticated to understand what journalism really is.  And, as such, readers, customers, viewers are held in contempt.  I said that most journalists don't even do their jobs for their readers.  Most journalists are writing for other journalists to impress other journalists.  To come up with a point of view that some other journalist hasn't.  The closed community. 

So, lo and behold, my words have been borne out by somebody who was in the business.  Sam Zell is his name.  He's a real estate tycoon in Chicago.  And full disclosure.  At one time this program's syndication partner was Jacor Communications, and Jacor Communications was a radio station group, basically, that was owned by Sam Zell.  It was just for a few years. I never met Sam Zell, never got to know him.  I met his emissaries.  Sam Zell is the guy who I think bought the Los Angeles Times, bought a lot of the Tribune papers and just lost his shirt.  First time Sam Zell's lost significant money in anything he's tried. 

Sam Zell, like any other confident entrepreneur, thought that he could turn around major American newspapers.  So last night Neil Cavuto caught up with him on the Fox Business Channel and talked to him about the Jeff Bezos purchase of the Washington Post.  Cavuto said, "You said at the time quote 'In my experience, newspaper people are at least as greedy as anybody else and any perception to the contrary is perpetuated by the media itself.'  What did you mean by that, Sam?"

ZELL:  Well, I mean, there's this, you know, this illusion that they and Lloyd Blankfein are doing God's work.  You know, and therefore, if you're doing God's work, you should get a pass on economic reality, you should get a pass, when revenue go down 30% instead of lowering the head count, you should maybe increase it.

RUSH:  Lloyd Blankfein runs Goldman Sachs, and Goldman Sachs is thought to be bigger than God in their own minds, and that's what that comment's about.  Sam Zell is saying these journalists didn't want to be held to the bottom line. They didn't want to care about that.  They thought they should get a pass on economic reality.  If the newspaper or the news division's losing big money, the owner should just soak it up, the owner should gladly lose money. That the news business is so privileged and so important and so chosen that there ought not be any making money in it in the first place.  You almost have a duty to lose money.  And Sam Zell said that he was shocked. 

He called them greedy.  What he meant by that was, they're greedy, and they wanted to be paid, they wanted to get everything they were due, whether or not the paper made any money.  They damn well were gonna get paid.  They weren't gonna lose money.  They weren't gonna work for nothing, but the owner should.  I will never forget, folks, Larry Tisch of the famous Tisch family -- Larry's brother, Bob, his son's now co-owners of the New York Giants, the Loews hotel chain.  Steve Tisch.  Steve is a major Hollywood producer.  Their uncle Larry Tisch goes and buys CBS in the nineties.  He looks at it, and he's looking at the books, and he sees that the news division is bleeding money.  So one of the first things he did was to announce cutbacks.  I think he was gonna lay off 200 people, and Dan Rather went bat crazy. 

Dan Rather and some of the old war horses, the Charles Kuralt's of the world in there at the time, they just lost it, and they said (paraphrasing), "Tisch doesn't know what he's doing. This is irrelevant. We can't stand cutbacks here in the news division at CBS. We shouldn't be forced to work under these kinds of bottom-line pressures."  I'll never forget it.  Of course Tisch got out of it as quickly as he could, because he found that the people involved in it didn't care.  In fact, there was even honor in working for a place losing money.  That's why CNN exists the way it does.  There's honor in maintaining the cause while losing money.  The left loves each other in that regard. 

So Cavuto said, "Well, how would you explain it, then?  I mean, you're the boss.  Why didn't you go back there and say 'Look, whatever your pie-in-the-sky thoughts, we're losing money.  You're not getting it, you gotta get this.  Until we start making money, you're not gonna get any more.'  Why didn't you tell 'em that?"

ZELL:  Now, the problem comes down to how some great philosopher, I think it was Confucius, who said, "Never pick a fight with a guy who buys ink by the barrel."

CAVUTO:  You own the barrel.

ZELL:  That's what I thought.  That's what Jeff Bezos thinks.  What I found out, and what he's gonna find out, is he doesn't own the paper.

RUSH:  That to me is fascinating.  Sam Zell owned the Chicago Tribune, the LA Times, he owned it.  And he was being excoriated in his own papers, he was being written up as a slime bucket, cheap SOB.  And he's telling Cavuto, "Yeah, you never get in an argument with people who buy ink by the barrel."  He said, "You own the barrel!"  "No, the owner of the paper doesn't own it.  And Bezos is gonna find this out.  He's gonna find out he doesn't own the paper." 

I don't know that Zell gets it, what these guys are fighting is liberalism, not so much anti-capitalism, of course the two go hand in hand, but they're fighting liberalism.  I don't know why people can't see what's in front of their faces ideologically.  There's more to this.  We've got a little bit more Carl Bernstein next.  Wait 'til you hear these.

BREAK TRANSCRIPT

RUSH:  Last night Piers Morgan Live on CNN.  He spoke with Carl Bernstein, Washington Post, Woodward and Bernstein, and Piers Morgan said, "Jeff Bezos is a genius, a multibillionaire genius, everybody that uses Amazon loves it because it's an incredibly efficient service that provides everything you could possibly want in life."

BERNSTEIN:  The great hope here is -- look, our failings are an economic model that doesn't work anymore, and hopefully by having a genius from the Internet age, from Internet technology who will help find a model that will preserve the most enduring aspects of great journalism and marry it with this new culture, that's the hope.  We need an economic model. We need somebody who has the deep pockets to sustain great reporting.  That's what's been lacking.

RUSH:  Need the deep pockets to sustain great reporting.  It's a charity.  He wants somebody to run the Washington Post as a charity, just throw money at it, give money to it, for great reporting.  When are you people gonna realize it is your content that's being rejected?  It's your content that is your problem as much as anything else?  When?

BREAK TRANSCRIPT

RUSH:  I want to go back to Carl Bernstein. I want to play sound bite four again, and there's a companion one that follows.  He was on with Piers Morgan last night, and Piers Morgan's going on and on and on about how great Amazon is. "Jeff Bezos is a genius, and a multi-billionaire genius and everybody that uses Amazon loves it," which is key. I'm gonna make that point in a different way in a moment. 

But Piers Morgan, he doesn't even know what he's doing but he's putting it out there.  He's saying to Bernstein, "[E]verybody that uses Amazon loves it." Now, I always need to make allowances.  There are always gonna be disgruntled customers.  But Amazon's not hated by half the people in the country, is my point.  People that use it love it, and they like it. 

They think it suits their needs.  It fills the bill, whatever it is.  He's making that point to Bernstein.  So you got "a multi-billionaire genius and everybody that uses Amazon loves it, because it's an incredibly efficient service that provides everything you could possibly want in life." Now, listen.  Here's Bernstein. I'll play this again because it dovetails with the next bite coming.

BERNSTEIN:  The great hope here is, look our failings are an economic model that doesn't work anymore, and hopefully by having a genius --

RUSH:  It's it is not your economic model!

BERNSTEIN:  -- from Internet age, from Internet technology --

RUSH:  Ah, give me a break.

BERNSTEIN:  -- will help find a model that will preserve the most enduring aspects --

RUSH:  It's not the model!

BERNSTEIN:  -- of great journalism and marry it with this new culture.  That's the hope.  We need an economic model. We need somebody who has the deep pockets to sustain great reporting.  That's what's been lacking.

RUSH:  Yeah, you need somebody that's philanthropic. You need somebody to treat you as a charity.  There's nothing wrong with "the business model."  The Washington Post business model is ours.  You sell advertising! Now, in order to do that it's gotta work for the people that buy it, and it's not working for people that buy newspaper advertising. It's not working anymore.  Why?  Is it because of where it is?

Is it because of newspaper people? Is that it?  What is this business model he's talking about?  We're not losing money here at EIB.  We're thriving.  We are continuing to grow.  We use the same business model.  There's a question that people like Bernstein need to ask themselves as they're heaping praise on Bezos and Amazon.  Mr. Bernstein, ask yourself a question: "Does Amazon insult half of its customers every day, like the Washington Post does?

"Does Amazon pretend that half the country doesn't even exist, like the Washington Post does?  Does Amazon insult and impugn and laugh at and make fun of half the people in the country, like the Washington Post does, like the New York Times does, like NBC, CBS, ABC do?  Does it?"  It doesn't, and if Bezos is gonna make one change, it's gonna be that.  He's a customer service guy.  Brilliance, he's a genius at marrying things?

He's a genius at how he treats his customers. 

He's a genius in the sense that he recognizes what all great business operators that have come before him recognized, and that is you thank got for your customers every day, and you constantly appreciate them and try to increase them.  You don't insult them.  You don't laugh at 'em.  You don't act like you wish they weren't around.  Until that changes in the news media, you can have all the business models you want and it isn't gonna matter a hill of beans. 

Why do you think Michael Jordan...? He's a full-fledged, rock-solid liberal Democrat.  Why you think Michael Jordan doesn't talk about that?  Because Republicans buy Air Jordans, too.  Michael Jordan is not gonna go out and insult half the country at the expense of Nike or his deal with them.  I know you people in the news business have a higher calling.  You are journalists, and you must deal with the country's enemies!

But Jeff Bezos doesn't look at the population of the country or a portion of it as the enemy, and you liberals in the news media do, and you wonder why! You've got shrinking circulation, shrinking ad pages, shrinking ad revenue, and you wonder why your readers don't even patronize your sponsors -- and you don't even think to look at the number one reason why people would open a newspaper, and that's what's in it! 

The content. 

I'm sorry to appear to be yelling and scaring 25-year-old women.  This is just passion.  It's all it is, 'cause I'm sitting there in state of abject disbelief at the thick-headedness that exists here, at the inability to see something that's patently obvious.  If your in business, you're in business.  If you're a charity, be a charity.  If you want to do something where you don't have to make money, then don't talk about business models and stuff.

Go out and find a bunch of sugar daddies, which is how they're doing the Bezos.  I can tell from the way Bernstein's talking here.  They're looking at him as a sugar daddy.  "Deep pockets... Sustain great reporting..."  What kind of money does great reporting pay? I mean, I don't know what you were paid during Watergate, but was your salary? What did it cost you to go out and do your great reporting? 

People are knuckleheads. 

Okay, so next Piers Morgan said, "Look, Carl, this guy is a visionary genius.  If I was at the Post, I'd be thrilled about it."

BERNSTEIN:  One of the things that -- that Bezos has done is he's shown a willingness to stand by an idea, watch it develop, go through troubled times in the development, continue to fund it and perfect it.  That is part of what we need in the newspaper business or the former newspaper business: Marry the new technology with the great things we're capable of.

RUSH:  So here again we're looking at "funding."  (sigh) Look, this is a foreign language to me.  I don't understand how it is that not a single journalist seems to understand that it's not funding, that there's a business involved where they work, and that business is trying to earn a profit, and that profit is what enables the business to continue.  Of course, I know they don't think there should be a profit -- or if there isn't, it shouldn't matter.

This is just as telling as it can be.  I wonder if the dinosaurs are running around looking at sugar daddies to save them.  There no evidence of that, but... (interruption) Well, no. Fox News does not insult half the country.  Somebody's telling me Fox News insults half the country. They do not.  Fox News doesn't insult half the country.  Fox News has, what?

They got one conservative, one really full-fledged conservative show on that network.  Now, the rest of the network's perception is that it's conservative, simply 'cause it isn't liberal.  But they have liberals all over the place at Fox News, all over the place. They've even -- hired liberals from the New York Times to appear on their number one news shows!  Fox does not insult half the country.  

BREAK TRANSCRIPT

RUSH:  I wonder what Carl Bernstein's attitude would be if Sam Walton were the multibillionaire genius buying the Washington Post.  No, no, no, I know he's passed away, but just a object exercise.  What would Bernstein's reaction be if Sam Walton bought the paper?  Do you think he'd be happy some billionaire genius had picked up the paper?  Be talking about funding great reporting and stuff?  Ha.  Be talking about the end of the world. 

END TRANSCRIPT

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