May 4, 2008 - May 10, 2008

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Strib Bankruptcy Watch: The Hits Keep Coming

Filed under: Media

It's been a tumultuous week at the Star Tribune, what with all the speculation that the paper of record is broke. Here's your roundup of the week that was.

A cheeky take by the Brits, with the genius headline Newspaper Killer Confesses.

At last, we have found a culprit who is slowly killing newspapers across the United States. Her real name is unknown, but her online identity is daphne3620 and she left the following comment on the Web site of the Minneapolis Star-Tribune:

Now I feel like garbage I read the Star Trib online and don’t subscribe to the actual physical paper. Sorry .. guys! I would gladly pay to use the site here .. give it a thought. I am serious .. I will pay.

This comment was attached to an article posted to the Strib’s Web site on May 6 that revealed that the paper’s owner had to write down 75 percent of the $100 million it paid for its stake. Private equity firm Avista Capital Partners engineered a purchase of the paper from McClatchy Co, which was announced in 2006. Since then, the paper has hemorrhaged revenue, just like many other big-city dailies.

The write-down, taken at the end of 2007, reflects the estimated loss of value and is consistent with the falling stock prices of publicly held newspaper companies such as McClatchy and the New York Times. Avista’s public accountants required the private equity firm to write down or “mark to market” the estimated value of the Star Tribune.

The memo denied a recent report in the New York Post that the Star Tribune may file for bankruptcy.

“The Star Tribune currently has sufficient liquidity and is up to date on all its debt payment obligations,” said the memo, distributed by Avista.

And if this turns out to be wrong, daphne3620 and all her freeloading friends will have to pay a very big price indeed. (Me included.)

George White of the Daily Deal writes about a potentially revelatory press conference held by the Star Tribune's new cost cutters, the Blackstone Group:

At a Wednesday media conference, Jill Greenthal, a senior advisor at Blackstone, said that the current environment is "as turbulent a time in media as we've ever seen, particularly for old-line companies. I think we're only at the tip of the iceberg in terms of what it means for the industry."

With the Internet gutting the high-margin classified business that the industry has long relied on, newspapers are hunting for new business models that will allow them to weather the storm. The turmoil has attracted investors like Avista and Sam Zell.

"Buying a newspaper is not for the faint of heart. It's either a really great time to buy a newspaper," Greenthal said, "or a really bad time to buy a newspaper. Time will tell." But from the state of the Star Tribune, it may be the latter. - George White

And another British take, this time suggesting the Strib might be the first major American newspaper to go under:

Will the Strib be the first domino to fall in America's newspaper crisis?

A sign of the increasingly hard times in US newspapers, as portrayed by Philip Stone, is a real eye-opener. In December 2006, one of America's ailing newspaper chains, McClatchy, sold the Minneapolis Star Tribune to a New York private equity group, Avista Capital Partners, for $530m (£271m).

At the time it was widely thought that McClatchy were the losers, having paid $1.2bn (£614m) for the paper nine years earlier. Well, McClatchy is hardly doing well nowadays but Avista's Minneapolis investment has proved to be one of the all-time financial disasters.

Avista, having invested $100m of its own money and borrowed another $430m to fund the deal, has announced that it has written down the value of its investment by 75%. And one report at the weekend claimed that the Star Tribune - known as the Strib - was facing bankruptcy.

That may well be far-fetched because Avista has said that the paper can meet its obligations. But Stone points out that the assurances are hardly convincing. Doubtless, the banks which loaned the money to Avista, Credit Suisse and the Royal Bank Of Scotland, are also going to be wary of touching newspaper investments in future.

So how is the Strib doing in terms of sales? Last week, the paper reported that its weekday circulation had dropped by 6.74%, to 321,984, in the six-month period up to March 31. Almost all US daily papers are losing sale, but that's one of the worst performances.

Posted by Kevin Hoffman at May 10, 2008 10:34 AM | Comments (0)

 

It ain't easy being poor, female, and young in Minnesota

Filed under: Women's Issues

A sobering study released last week by the Women's Foundation of Minnesota yields unsettling news about the state of our state's girls. Nutshell: From self-esteem to physical abuse to college readiness to making babies, things could be a lot better--especially for poor and minority girls.

Here's a breakdown of the most salient findings:

-Most poor families in Minnesota are headed by single mothers.
Among black families in poverty, 71.5 percent are headed by single mothers.
Among impoverished American Indian families, the statistic is 67.2 percent.
And among poor white families, it's 59.5 percent.

-There is a huge difference in teen birth rates between white girls and minority girls.
The following numbers are from between 2001 and 2005:
For every 100 Hispanic girls aged 15 and 19 in the state, there were 11.1 babies.
For American Indian girls: 9.7 babies.
For white girls: just over 2 babies.

-Girls have lower levels of self-esteem than boys within every racial and ethnic group and grade level. Moreover, boys’ self esteem gradually increases from 6th grade through 12th grade, most girls’ self esteem drops in the 9th grade.

-Over a fifth of American Indian and black girls report physical abuse by a family member.

-School-wise, although Minnesota’s girls best boys in grades, study time, attitude towards school, and educational ambition, ACT data for the state shows that only 28 percent of girls—as opposed to 36 percent of boys—meet college preparedness standards in English, math, reading and science.

To check out more of the findings, go here.

Posted by Jonathan Kaminsky at May 10, 2008 9:00 AM | Comments (0)

 

Video: Wolf puppies from the Wildlife Science Center

Filed under: Environment

For a rare look at two-week-old wolf puppies, visit our text-rich photo gallery of a wolf litter born April 27 at the Wildlife Science Center in Forest Lake.

It's extremely uncommon to see wolf pups this young. Generally, they don't leave the den for months. If you weren't lucky enough to see them today, here are two videos:

A pup is weighed, and then climbs all over a human friend:

A bucketful of wolf puppies wriggles.

Posted by Jeff Shaw at May 9, 2008 1:00 PM | Comments (1)

 

Motorist kills dog, sues owner

Filed under: Animal Rights

Well, if you didn't love America before, here's one more reason to gloat about our lawsuit loving nation.

After crashing into and killing Fester, a 13-pound miniature pinscher that ran into the road in Cloquet, a small town outside of Duluth, Jeffery Ely has decided to sue the dog's owner. Fester snuck out without a leash when its owner was trying to let the family’s other dogs inside.

Ely is requesting $1,100 for damages to repair his 1997 Honda Civic and to account for the time he had to take of from his two jobs to get the car repaired and court fees.

Fester's owners, Nikki and Daniel Munthe of Cloquet, have countersued asking for $2,400, the cost to buy Fester, the time she had to take off work for court appearances, and the cost of buying a dog to replace him.

The case is scheduled to be heard in St. Louis County Court today.

Too bad Fester isn't still alive. We’re sensing with the right lawyer he could pull in so much bling, he could have the biggest doghouse in the state.

Posted by Beth Walton at May 9, 2008 11:05 AM | Comments (0)

 

Now where is that pesky convention again?

Filed under: Media

Apparently, everyone needs a little geography lesson now and then, even the fact checkers at the USA Today.

The House Committee on Oversight and Government Reform recently surveyed hospitals in seven U.S. cities. “Lawmakers looked into hospitals' ability to deal with a sudden influx of victims in the five cities considered at highest risk for terrorist attack and in the two cities hosting this summer's political conventions…Denver and Minneapolis,” the newspaper reported.

The Committee found that the Hennepin County Medical Center does not have the capacity or space in the emergency room to handle a surge from a terrorist attack.

But, it seems only Congresswoman Betty McCollum (D-“I’m so smart, I’m from St. Paul, the third most literate city in the country!) and the Associated Press noticed a glaring error in the Committee’s work.

They never investigated Regions Hospital in St. Paul, the designated first responder for an incident at the Convention Center.

Editors take note: McCollum corrected her colleagues in Congress last Wednesday, saying something to the likes of this.

The convention is in St. Paul, you morans.

Posted by Beth Walton at May 9, 2008 10:34 AM | Comments (1)

 

Breakfast of Champions 5/9: Up the wolves

Filed under: Breakfast of Champions

From the department of "late notice, but you don't want to miss this," comes an incredibly rare chance to see baby wolves. This afternoon, you can see 12- to 14-day-old wolf pups.

Today, Friday, May 9, the pups will meet the public at an event from 3:30-5:30 pm at the Wildlife Science Center in Forest Lake. It's $5 for adults and $4 for children, which is plenty cheap, and all the money goes to help support educational programs at the WSC. Later that evening, the pups will move to the center's flagship educational facility in Ely.

The International Wolf Center staff will care for the young gray wolves, who will join eight-year-old arctic wolves Malik and Shadow and four-year-old great plains wolves Maya and Grizzer, at the Ely interpretive facility.

There's going to be a party when the wolf comes home. I'll be there with a camera, and you should be, too. Suggested listening:

DAILY DISH: WHAT'S NEW AROUND THE SITE

Filling your punk rock quotient was a Triple Rock show that featured Kitten Forever. Erin Roof reviewed; Tony Nelson photographed four of the six bands.

Three new posts on the food blog, two of them about tasty things. Okonomiyaki is among the best stuff on earth, and James Norton tells you where to get it on Sundays. We've got a refreshing drink suggestion for spring. Finally, Chino Latino's latest billboard is in poor taste, writes Rachel Hutton. Maybe someone will call them a fratboy snark sheet. Maybe not. Either way, I'm not eating there.

Will Amy Klobuchar have a shot a the vice presidency? She's the second Minnesotan to be mentioned in the VP race.

We pick on Katherine Kersten a lot here. That's because she deserves it. But we've never photoshopped her into Mortal Kombat before. Ward Rubrecht fixes this oversight.

Gary Hodges hides video game material from his girlfriend. Not everything. Just a few things. Here are the top five.

Books: is there anything they can't do? Revitalizing the warehouse district is on that can-do list, says the New York Times.

I fix potholes. Not for the money. Not even for the love. Just for you. You, the reader.

With all the media attention focused around Hillary Clinton and the Democratic race, it's remarkable that these race-baiting comments haven't gotten more attention.

Posted by Jeff Shaw at May 9, 2008 5:03 AM | Comments (0)

 

VP Klobuchar Watch: Amy makes list of potential Obama running mates

Filed under: VP Pawlenty Watch

Will Senator Amy Klobuchar become our nation's next vice president? It's hard to keep track of all the many factors at play--OK, it isn't, there's only one factor at play. But the VP Pawlenty Meter (TM) gimmick is working well so we decided to franchise it out.

Tim Pawlenty isn't the only Minnesotan with a chance to land on a presidential ticket this year. The influential Democratic site TPM Cafe recently named Senator Klobuchar on a list of potential VP candidates for Obama:

In any case, he should pick a woman and any other woman will raise the question "why not Hillary."

My guess. He goes with Clinton or with Governors Sebelius (KS) or Napolitano (AZ) or Senators McCaskill (MO) or Klobuchar (MN).

We're putting the odds of a VP Klobuchar at 20 to 1 to start, with exacta betting on a Klobuchar/Pawlenty VP ticket starting at 100 to 1.

Posted by Kevin Hoffman at May 8, 2008 2:13 PM | Comments (5)

 

Pothole of the day: A triumph for the ages

Filed under: potholes

Tired of reading about the Strib's financial tribulations? Sorry about that. Ready for some frivolity flecked with good news? You know we've got you.

You may remember Foucault's Pothole on North 17th St. and Washington. Hold that memory in your heart, because that's all it is now.

Filled:

Paul Demko left just as we were starting to make an impact. How could the guy leave to write about inconsequential things like political contests when Pothole Haiku was touching lives?

Am I taking credit for getting this pothole fixed? Sure, I'll take the credit. Blame? That's for suckers.

Posted by Jeff Shaw at May 8, 2008 10:51 AM | Comments (0)

 

Breakfast of Champions 5/8: Reasoned Dialogue in the Polis

Filed under: Breakfast of Champions

Often during meeting at City Pages Global HQ, we talk about how we'd like to get more comments on the blogs. Discussion is fun! It's the lifeblood of the polis! It exemplifies Aristotle's maxim of rational actors reasoning together!

Except it's the Internet. We always forget that part.

We're getting more comments on the blogs lately, which is great. Bring 'em on, especially the critical ones. Constructive criticism is healthy and necessary, and vicious criticism is often hilarious. Take, for example, the latest comment on an old Ron Paul post:

---
Name: ART DEKKO

ANYONE WITH BRAINS (UN-WASHED BY THE MEDIA) STILL INTACT....HAVING HEARD OF
RON PAUL....MUST CERTAINLY VOTE FOR HIM.

IMAGINE....GETTING ALL THOSE VOTES THUS FAR, WITH A TOTAL NEW YORK MEDIA
BLACKOUT.
YOU BOYS ARE SCARED SHITLESS.

RON PAUL GETS MY FAMILIES VOTES IN NOVEMBER."
---

Nothing says sanity like caps lock. He gets points for the name, though. Unless it's not a pun, but his actual name, in which case I award his parents the points.

I don't mean to pick on this particular commenter, or even the swarm of Paulbot commentators whose name is (and numbers are) legion. I say this in all sincerity -- we appreciate every reader, including those that give us a hard time. Besides, that whole thread is made of 100% pure weapons-grade comment win, and whenever I'm having a bad day, I go back and read it. It is like mirth in pixel form. If the threads start picking up, I'd love to start a "Comment of the Day" or "Comment of the Week" feature.

Okay, back to work. Those brains aren't going to wash themselves.

DAILY DISH: WHAT'S NEW AROUND THE SITE

Three new Culture to Go posts highlight the morning's offerings. Caroline Palmer, who writes on dance for print, is going to be doing more line for us as well. Today she gives you a preview of the new ARENA dance performance, which begins today and draws on the imagery of Gustav Klimt.

The Grammy-winning Swell Season came to the Orpheum, and Andrea Myers was there. Desiree Weber's review of Tokyo Police Club at the Varsity also includes notes on opening band Smoosh, who I saw play at the Columbia River Gorge when they were pre-teens. No, really. I remember songs about whales and unicorns. OK, I've said too much.

Matt Snyders likes the smoking ban in bars, but finds it against his principles. True, his principles are the wrong principles, but they are better than no principles at all.

Hey, another cool band flyer.

The latest on the Strib bankruptcy story is here. More possibly coming later today, depending on if I can run it down or not.

It's intriguing to see the press' differing reactions to the Democratic race here and overseas. Kevin Hoffman notes that Obama has effectively won already, but you wouldn't necessarily know that from mainstream American press coverage. Elsewhere in the world, it's being taken almost as a given. Check out this article from the German news source Der Spiegel entitled "The End of the Clinton Era." Pretty succinct.

Posted by Jeff Shaw at May 8, 2008 8:12 AM | Comments (9)

 

Smoking Bans: Good Ol' Fashioned, Good-Intentioned Folly

Filed under: Law

Yesterday’s Strib contained an interesting little diddy via the AP pertaining to smoking bans in bars and restaurant. The story’s crux—a recently Massachussettes study suggests the smoking ban disuades teens from becoming smokers—bolsters the idea that smoking bans have largely succeeded in promoting health.

Both supporters and opponents of the ban point to various studies backing their respective positions. (Anti-ban contrarians embrace this one linking bans to an increase in drunk driving deaths.) No matter your position vis-à-vis The Ban, it seems the greatest-good/utilitarian argument is the only rhetorical tool on the proverbial toolbelt.

That in mind, we decided to examine the philosophical underpinnings of The Ban... and pick them apart. Why? Because apparently we are contrarians.

First of all: two things to consider when weighing a law’s righteousness: 1) how much coercion is being thwarted by the law and 2) how much coercion is inherent in the law's enforcement.

Implemented justly, laws enhance and protect liberty, which is to say that the coercion being thwarted outweighs the coercion being implemented. Murder is the negation one’s right to life. So it is illegal. Theft, by definition, is the plundering of one’s property. So it is illegal. What both these laws—and all sound laws—have in common is that they protect unwitting and/or helpless victims from aggressors, and thus protect liberty.

But unlike the above said laws, the smoking ban confronts no such coercion, because coercion can’t exist when all actors behave on their own accord and no fraud is at play. In other words, so long as A) the workers and patrons of bars are aware of the risks and B) they are not bound to the bars’ premises against their own will, there is no coercion to thwart. Consequently, any law that attempts to alter or restrict their behavior one way or the other will inevitably introduce more coercion into the realm than existed before, since laws necessarily entail coercion for their enforcement.

Smoking ban proponents will dismiss the above as pedantic gibberish. “You’re missing the point! We’re saving lives!”

Well, what of it?

The world is fraught with dangers, and secondhand smoke—as exaggerated as its risks may be—is sadly one of them.

But laws are designed to protect lives, not save them. Conceivably, lawmakers could concoct legislation putting citizens under virtual house-arrest when they’re not at work or buying groceries or bitching about smokers. This would eliminate much risk and no doubt save thousands of lives a year, surely more than a smoking ban. But would such legislation be ethical or prudent? Of course not. (This analogy is not to imply that fascistic lock-downs are in any way comparable to smoking bans in terms of severity, but to illustrate their shared underlying folly.)

Okay, it’s Confession Time. I personally enjoy the smoking ban. Really. I like the fact that my clothes don’t reek of smoke in the morning, and that my lungs feel clean, and that my bar-tending friends are less at-risk for lung cancer.

But my self-interest in the ban doesn’t magically render it ethical. After all, as a honkey with testicles, I presumably enjoy a number of socially-conferred advantages— but that doesn’t make institutional racism or glass ceilings any less abhorrent. Principles, as a matter of course, exist independent of self-interest. I would love to be able to steal from a bar owner’s cash register as much as I’d love to dictate his smoking policy. Who or how many benefit from my intrusion, in terms of health or monetary gain, is irrelevant. My robbery of his cash register is not vindicated just because I donate the entire loot to charity. My forcing him to ban smoking is not justified simply because I’m allegedly saving other people’s lives. It’s not my money to give away. It’s not my call to make.

Posted by Matt Snyders at May 8, 2008 6:24 AM | Comments (14)

 

What we learned about the Strib's financial misfortunes today UPDATE x4

Filed under: Media

We're on Strib Bankruptcy Watch Day 3, and the caffeine is giving me and the story a second wind. Business really picked up yesterday with the publication of Jeff Shaw's web-exclusive news story revealing that the Strib's debt was trading below 60 cents on the dollar. Ouch.

As MinnPost's David Brauer describes it:

After Shaw's story broke, Strib parent Avista Capital Partners finally handed one of their reporters some inside dope; Neal St. Anthony disclosed that Avista was "forced" to write off $75 million of their $100 million investment. St. Anthony amplified Shaw's info, noting that $96 million in subordinated debt trades for 10 cents on the dollar. Citing cost cuts and unspecified revenue-producing investments, an Avista memo states, "We view 2008 as the year to prove a recovery is possible." So far, so bad.

You can read the Strib story about it here. You can read the New York Post's story about it here.

How have readers been taking the news? There's only four comments on the Strib story so far. This one is the most brutal:

They dug their own grave My company spent hundreds of thousands annually on advertising. They literally threw our money out the door with an amazingly arrogant and irrantional attitude. When negotiating a contract that was worth 6 figures, they basically told us to pound sand. We withdrew our advertising completely, and found that our sales actually INCREASED when our dollars were directed to other media. This newspaper is irrelevant to sales. Thus, they are destined for a liquidation. They have only themselves to blame.

posted by wanninger on May. 6, 08 at 11:12 PM |
21 of 25 people liked this comment.

Keep in mind, we also learned that the Strib has been censoring negative comments on its website.

UPDATE 1: David Brauer has the goods on what it might mean to how the paper looks in the near future. The short version: They're trimming some of the extraneous sections and bulking up arts and entertainment coverage.

Call us gloomy guses, but we think it's going to take a lot more painful cuts than this for the Strib to rightsize it's way out of this crisis.

UPDATE 2: Brauer's got a sweet scoop on ramped up efforts to sell the Strib's downtown land. Money quote:

The Strib put it back on the market in January, and now, according to a company memo, the tire-kicking has begun in earnest. Facilities tours began Tuesday, and employees were alerted today that "there will be others over the next few weeks as interested parties come forward."

The memo adds, "We will make every effort to ensure that the tours do not interfere with work operations."

Naw, no way will a roomful of anxious journalists be distracted by strangers measuring the drapes.

To which we can only add: Paging Zygi.

UPDATE 3: Lambert is on point today. Here he tries to figure out the reasoning behind a newspaper company botching the P.R. game so badly:

After a very long year with this crack investment team, we all understand that that "communications thing" really isn't their game. But you would have thought the paper's current publisher, Chris Harte, a.k.a. Avista's "newspaper guy," would have understood that "hiring" heavyweights such as Blackstone might be news, and, therefore, maybe it would probably be a good idea to get ahead of the curve and do the fancy dance, reassuring skeptics that this is simply good, old-fashioned, contingency business stuff, nothing urgent, nothing overly serious. It would, I'm saying, be better than, mmmm, letting someone slide a rumor of bankruptcy to a tabloid that then goes ricocheting around the Internet, making you look like a colossal basket case.

Read the whole thing.

UPDATE 4: Top stories on Google News for "Star Tribune":

Avista Wrote-Down 75% of Investment in 'Star Trib'

Editor & Publisher - 4 hours ago
By E&P Staff NEW YORK Avista Capital Partners, the owner of the Star Tribune in Minneapolis, wrote down 75% of its $100 ...

Star Tribune owner takes write-down
Bizjournals.com, NC - 7 hours ago
Avista Capital Partners, which owns the Minneapolis Star Tribune informed investors that it wrote down a big chunk of its investment in the paper. ...

Star Tribune's owner forced to write off much of its investment
Minneapolis Star Tribune, MN - 19 hours ago
Avista Capital partners wrote down 75 percent of its $100 million share of the purchase price and said the outlook is still uncertain. By NEAL ST. ...

Posted by Kevin Hoffman at May 7, 2008 4:22 PM | Comments (4)

 

Breakfast of Champions 5/7: Storm clouds

Filed under: Breakfast of Champions

News, like spring, is busting out all over. Also like spring, this can lead to turbulent patterns, like the thunderstorm yesterday or fresh information about the Star Tribune's woes popping up.

Enough with the extended metaphors. Let's get to the news. First, the expanded web content packages for two of our stories:

Buried Treasure: the feature about mining in northeastern Minnesota, the Reporter's Notebook post, the first slideshow and the second slideshow.

The Campus Con Man: Andy Mannix's news story, his update and the slideshow of party images.

Strib Watch: Star Tribune news continues to break. We started here in the morning with a Q+A about the Strib's financial status, citing Dun & Bradstreet reports. This gave way to an afternoon Web-only feature about how low the Strib's debt is trading.

When previously unknown facts are coming to light all the time (and MinnPost's David Brauer has new details this morning on how the financial turbulence will affect the newsroom), you're going to wind up publishing certain facts that seem in tension with each other. In this case, the D&B report has some positive data for the Strib, while the debt market makes the situation look pretty bleak. Three reasons I can reconcile writing these two stories on the same day:

1. I'm a Libra
2. Elephant, blind guy, smoke flares thrown by Geist
3. When the facts change, etc. etc.

You can also check out the latest from the New York Post on the story and Kevin Hoffman's post about the Strib purging their website of critical comments.

Hey, hold onto your seats! Katherine Kersten wrenched a quote of context, and used it for her own -- oh, you've heard this one before? Okay, my bad. So, this guy walks into a bar ...

Kersten's missive is actually about Grand Theft Auto IV, which I am sure she has played as much or more than Nate Patrin has. Nate found some stuff to dislike about it, too.

Rachel Hutton reports from the Specialty Coffee Association's annual conference.

Rush Limbaugh dreams of riots in Denver. Riots led by drug-addicted felons, no doubt.

The world is made of math, and I'm fond of numerical quantification. But, like Gary Hodges, I'm not so fond of hierarchical scoring.

Judd Spicer checks in twice in one day, first to report on the Twins heating up ... and then to report on them nearly getting no-hit by Gavin Floyd. At least I'm not the only one backpedaling.

Posted by Jeff Shaw at May 7, 2008 5:54 AM | Comments (0)

 

Is the Star Tribune censoring criticism on its website?

Filed under: Media

It's been a crazy week at the Strib, what with the announcement in the New York Post on Sunday that Minneapolis's daily paper of record was on the verge of bankruptcy. Although the Strib denied that rumor, it did acknowledge that it had brought in the Blackstone Group to help manage its debt-load.

Now comes word, via the comments section, that the Strib may be extending its P.R. campaign into censoring reader comments on its website.

Several readers allege they left comments on the original article that were deleted because the point of view was negative toward the Star Tribune.

Will the Star Tribune censor... ...these comments, too? In their first story over the weekend eight people left comments. When they weren't going in the Star Tribunes favor they were deleted and no more comments were allowed.

posted by Average_Joe on May. 6, 08 at 6:15 AM |
9 of 11 people liked this comment.

Re: Will the Star Tribune censor...
I was wondering what happened to a short comment I made yesterday. I thought I was losing my mind... Wow. It's like we're in second grade all over again if this is how it's going to be.

posted by DainVeli on May. 6, 08 at 12:13 PM |
0 of 1 people liked this comment.

The comments feature does appear to be off on the article.

Posted by Kevin Hoffman at May 6, 2008 6:16 PM | Comments (4)

 

Reporter's Notebook: Buried Treasure

Filed under: Economy

If you just can't get enough of the Iron Range, read on for these two web-only nuggets. First: more history! Also, a detailed accounting of the cutting-edge science behind refining sulfide metals. Without further ado:

(Photo of the Rust Hull Mahoning mine, the largest open pit iron mine in the world. For a sense of scale, see the truck on the right side of the picture? And those two grey rectangles a little to the left of it? Those little grey dots are 12-passenger vans.)

It is said there are two histories of the Iron Range—one of the companies and the other of the workers. In the early days, the miners were European immigrants who came to the Range by the thousands. As Marvin Lamppa relates in his seminal history of the region, Minnesota’s Iron Country: Rich Ore, Rich Lives, “Their purposes for coming were clear. ‘You can get rich in America.’ ‘There’s work for everybody in America.’ ‘The streets are paved with gold in America.’”

Finns, Czechs, Slovenes, Italians, and others arrived in Duluth, quickly filtering up north to the small towns, sometimes no more than a collection of thrown-together bunkhouses at the edge of a mine. The new arrivals were mostly men, but not exclusively; some brought families, and some women made the trip alone to work in boardinghouses and restaurants.

Pay for the miners was a fraction of city salaries. And while the work varied by mine, and mostly by whether it was under or above ground, there was this much in common, according to Lamppa: workers made between $12.50 and $20 a week, worked 10 hour days, six days a week, and faced layoffs in winter.

And they were pushed hard to produce. Underground miners, for instance, worked on contract. Organized into small groups and assigned a section of the mine to hack away at with their pickaxes, they were required to fill a certain number of carloads of ore per day. Paid by the load, the men also faced losing their jobs if they couldn’t fill their quotas. More immigrants were following them, ever eager for work.

The mines were also fraught with danger. Many men were run over by ore cars, blown up by premature dynamite explosions, or crushed by the crumbling earthen walls of a pit. The lack of a common language didn’t help. Orders and warnings were often met with blank stares.

The most infamous accident occurred on a clear winter day in 1924. It was late in the afternoon at the Milford, a shallow underground mine on the Cuyuna Range. The day crew of 48 miners was a few minutes from the end of their shift, and 165 feet below the surface. All at once came a groaning sound accompanied by a strong breeze. The noise quickly grew louder. Then came the shouts: “Water!” The miners sprinted to the shaft—the only way out. The lift was at the surface. Fighting panic, the men instead climbed the ladder, one at a time. But the water was too fast. Flooding the mine within minutes, it continued up the shaft. The men, one after another, lost their grip. Seven made it safely to the ground. Forty-one others drowned. It would take a year to recover all the bodies.

Under such conditions, it is little wonder that conflicts between workers and management arose. And management took a hard line. The face of U.S. Steel in Minnesota was Henry Oliver. Owner of Oliver Mining Company, a U.S. Steel subsidiary, the industrialist was not known for his sympathy toward the plight of workers. Without the mines, he reasoned, miners had no jobs. Without jobs, they had nothing. The miners, Oliver felt, should be grateful to his company.

In early 1916—a year in which the Iron Range produced a record 46 million tons of iron ore—an Italian immigrant name Joe Greeni, working at the St. James underground mine in Aurora, got his monthly paycheck. According to legend, he opened it up, saw it was for only a couple dollars, and threw his shovel to the ground.

“That’s it!” he yelled. He told his coworkers that it was time to stand up for fair, hourly wages. His rage was contagious. Within two days, he’d convinced all the miners in Aurora to stop working. Emboldened, the strikers marched with their families for 75 miles, from town to town, spreading their message of revolt. By spring, over 10,000 and 20,000 mine workers—the entirety of the Oliver Company’s workforce— was on strike.

Oliver was not amused. He hired 1,000 armed mine guards, a move quickly copied by the smaller companies. But unlike a previous strike a few years before, he’d been unable to hire replacements to man the mines. The strike lasted for months, until workers, demoralized and facing a painful winter, caved in.

A couple months later, U.S. Steel unilaterally met some of the demands, offering 25 percent raises, and even helping foster civic life, from supporting youth hockey to staging plays. America was about to enter the Great War, and the company, poised to meet the demand from the U.S. military, didn’t want any slowdowns in production…

If you want to learn more about the history of the Range, I'd strongly encourage you to get yourself a copy of Lamppa's book, Rich Ore, Rich Lives.

+++

Moving along, here's a blow-by-blow account of PolyMet's plans for extracting the metals from the sulfur bearing ore. The other companies mentioned in Buried Treasure plan to use similar technology:

We pick up after the rock's been extracted from the mine and crushed to the consistency of baking flour. The finely-ground rock is mixed into a liquid solution to which chloride salts are added. The mixture is poured into a mammoth vat--essentially an industrial-sized pressure cooker--and filled with air bubbles. The added oxygen causes the sulfur to oxidize and turn into sulfuric acid. This reaction gives off heat, which triggers further chemical reshuffling. First, the noble metals—gold, silver, and the various platinums—fuse with the chloride salts. With an adjustment to the solution’s pH level, these new salty metal molecules turn into a sludge and form at the top of the vat. The highly valuable slurry is scraped out, filtered, packed into bags, and shipped off to refineries all over the world to be turned into pure platinum, gold, and silver.

The remaining metals—copper, nickel, and cobalt—also undergo a chemical transformation triggered by the sulfur-driven heat. Instead of forming with the chlorides, though, they merge with the sulfuric acid. Another change in the solution’s pH allows these sulfide molecules to float to the top of the vat, where they are ladled out.

The solution’s next stop is a room full of boxy vats resembling bathtubs. The liquid is dumped into the tubs and electrically-charged sheets of titanium metal are dipped inside. The carefully calibrated charge attracts the copper molecules, causing them to jump from the liquid and form like frost on the plate. The plate is removed and the copper is scraped off. The copper, 99.99 percent pure, is now ready for sale.

This leaves just the nickel and the cobalt, which, after another change to the solution’s pH, form a powdery, light green substance that is separated from the liquid and, like the noble metals, dried and shipped elsewhere for final production.

As for the solution itself, it is cleared of the remaining waste minerals and sent back to start the cycle all over again. After awhile the solution becomes what chemists call “tired,” meaning that impurities have invaded, bonding with the acid and salt, and making it less effective. When this happens, the liquid is taken out of commission and mixed with limestone, which transforms it into a chalky substance called gypsum. If sufficiently pure, gypsum can be sold as wallboard. Otherwise, the relatively innocuous substance is dumped alongside the waste rock.

Posted by Jonathan Kaminsky at May 6, 2008 6:15 PM | Comments (1)

 

Expanded web content: Campus con man not done with Minneapolis yet

Filed under: City Pages

By Andy Mannix

Daniel Gonzalez, the subject of our news story and photo slideshow this week, is out on work release. He's still incarcerated by Hennepin County, but he is allowed to leave to go to work.

Apparently he has Internet access.

Gonzalez recently updated his Facebook profile picture (which is under the name Anthony Martinez) to a dark silhouetted figure on a white background next to the name “Anthony D” written out in dark, bold letters.

The description under the photo reads: “one of the covers..Haha..here i come..”

In response to a curious friend wondering what the “D” stands for, Gonzalez responded:

“Yea the "D" Stand for (Definitive means precise; explicit and clearly defined to keep going no matter what..) Also D" is the First Letter of The Name Daniel ; the Alias I use to Use and the one that got me in trouble.The one every one hated so much..It keeps me going Every time i think of "D" as Struggle,and hate and also an ispiration to keep going every day..”

Actually, the “D” stands for Darst. Anthony Darst -- known to his fans as Anthony D -- is a 22-year-old rapper from Minneapolis living in Long Beach.

The silhouetted image is from his album art. Also on Gonzalez’s Facebook profile is a compilation of pictures from “his” studio, Megatropolis Records.

Megatropolis is actually Darst’s record label, and all of the photos are on the Megatropolis website.

Gonzalez has also recently updated his information on the University of Minnesota’s student directory. His name used to be listed as “Anthony Martines”, but has been changed to “Tony M. Martinez.”

When he was arrested, his listed address was for a fraternity house he had been living in. Now it’s an address for the Uptown City Apartments on West Lake Street -- though as of Monday, May 5, he was still in the work house, and still set to be released on June 26. No apartment number accompanies his student information, and the name Martinez is not on the Uptown City Apartment's directory. -- Andy Mannix

MORE CONTENT

Follow Gonzalez' criminal history with our interactive map, which shows you where he lived in town and what crimes he was arrested for in what parts of the country.

Posted by Jeff Shaw at May 6, 2008 2:40 PM | Comments (0)

 

Katherine Kersten manipulates quote in column on Grand Theft Auto IV

Filed under: Media

Letter writer Joshua Nichols points out some selective editing by Strib conservative lightning rod Katherine Kersten in her recent column on Grand Theft Auto IV.

In the column, Kersten writes:

"[T]eenage boys of America," wrote one reviewer, "... you can still kill and maim and plunder and screw until your heart is full," but now "the violence is no longer cartoonish." Thanks to GTA IV's new realism, when G-stringed strippers grind the main character's lap, the player's controller vibrates in response.

But if you run the phrase "can still kill and maim and plunder and screw" through a Google search, you'll find the source material, this Slate column. As you'll see from reading the full quote in context, Kersten used some selective editing to remove portions that were inconvenient to her conservative orthodoxy.

Yes, concerned teenage boys of America, if your parents are irresponsible enough to let you get your hands on this, you can still kill and maim and plunder and screw until your heart is full. But there's a difference this time: The violence is no longer cartoonish. Shoot an innocent bystander, and you see his face contort in agony. He'll clutch at the wound and begin to stagger away, desperately seeking safety. After just scratching the surface of the game—I played for part of a day; it could take 60 hours to complete the whole thing—I felt unnerved. What makes Grand Theft Auto IV so compelling is that, unlike so many video games, it made me reflect on all of the disturbing things I had done.

This isn't the first time Kersten has selectively edited other journalists' work in service to her conservative agenda--she also borrowed liberally from a student newspaper for her recent expose on a sex-positive club at the U of M. Check out this letter from a former editor at the Minnesota Daily:

Dear Ms. Kersten,

Last I checked the Minnesota Daily is a real newspaper organization and If I'm not mistaken Ms. Kersten, you get paid to write articles for the Star Tribune, are a Star Tribune representative, and in turn the Star Tribune profits off advertisement when readers read your column. Your article regarding the U's student group is nearly filled with quotations from the Minnesota Daily article. While you do cite your source and note that no one was available to comment, I find your actions to instead steal another reporter's work and print it under the guise of your work to be the borderline of plagiarism. You are not writing a blog for the internet Ms. Kersten, you are getting paid as a writer. In this instance I find your ethics to be less than desirable and that the Daily has a probable legal challenge against you and the Star Tribune. When the Star Tribune is not able to reach someone for comment, it does not begin aimlessly posting quotes from the New York Times or the Chicago Tribune. I find your actions to plagiarize a lesser newspaper in poor taste and ethically concerning. No link was even provided to the original article plagiarized.

Secondly, your article did not state whether any of those quoted consented to being printed in your article, especially since their words were maliciously modified and coerced. You also included a quote from a University student who is not even directly related to the student group in question, that you did not obtain yourself. This complete disregard of the sources providing you quotes in the first place is a very grave concern. Sources must be treated with the utmost dignity and especially when you did not obtain them or authorize them yourself.

As a former Minnesota Daily editor who has worked tirelessly to truly bring a credible news product to the Twin Cities, your actions are a very arrogant, dismissive and cowardly slap in the face to the hard work of our student reporters who are paid to do real reporting. I would ask you kindly apologize to the reporter in which you have so audaciously stolen from her and print a retraction and apology to the people in question. Unfortunately the Star Tribune has already begun profiting off your stolen work, that cannot be returned to the Daily. The media landscape is not a playground, there are rules to live by and are likely spelled out in your contract Ms. Kersten. There is an ethical standard the press is held to (yes even columnists).

Sincerely and with urgency,

CC: Star Tribune corrections
Star Tribune editor
MN Daily Newsroom
MN Daily Editor
Queer Student Cultural Center
Genevieve Clute
Courtney Sinner

Is there any other journalist in town that gets away with this kind of behavior? (Besides C.J.)

Posted by Kevin Hoffman at May 6, 2008 1:30 PM | Comments (1)

 

NY Post: Blackstone Group to Strib's Rescue?

Filed under: Media

The writer at the newspaper who started the Star Tribune bankruptcy rumor has a followup article in today's edition.

Although the update first seems to back off the bankruptcy claim, implying that the Blackstone Group is here to save the day, by the end of the story we're back in Chapter 11.

Most intriguing is this bit of inside gossip at the end:

Sources close to the situation said yesterday that Blackstone's options for restructuring the Strib's balance sheet are limited and include finding a group of investors to inject additional cash into the company in exchange for some of Avista's equity, or having the private-equity firm invest more.

"The company may be able to pay its debts this week, but if they cannot find additional capital, there is no way they can avoid bankruptcy," said a source familiar with the situation.

Posted by Kevin Hoffman at May 6, 2008 9:27 AM | Comments (0)

 

How bad is it for the Strib?: Questions and answers from independent reports

Filed under: Media

Reporters examining the Star Tribune's finances can be compared to a group of blind men reporting on an elephant. No one source, not even the paper's higher-ups themselves, seems to have all the answers.

Here, we've isolated some critical outstanding issues that everyone is wondering about. Using industry reports and outside sources, we offer the following informed speculation on where the paper stands now and what's to come.

How bad is it for the Strib financially?

Unclear, but not a disaster so far. Industry reports on the Strib's fiscal health are surprisingly sanguine. Dun & Bradstreet is the leading provider of credit information on businesses and corporations. We acquired their comprehensive reports on both the Star Tribune and its parent company, Avista Capital Partners.

The likelihood that the Strib "will experience financial distress in the next 12 months" or "will not pay [its creditors] on time over the next 12 months" is listed as "low," and is well within the zone considered safe. In 2007, firms with this classification had a failure rate of just 1.2 percent.

This does mean that the Strib's version of events (they've successfully paid debts up until now, and are looking to restructure financial obligations to avoid a future day of reckoning) is more likely to be true than the Post's doom-and-gloom scenario. This does not mean there aren't gathering storm clouds.

The data is not all rosy -- the Strib gets a mixed rating compared to its media company peers -- but it's not ashes and sackcloth, either.

Why is this story coming to light now?

Multiple possibilities. The hiring of private equity firm Blackstone Group to help sort out upcoming financial challenges is certainly newsworthy, so maybe the Occam's Razor explanation -- the press discovered new information and ran with it -- is valid.

But I talked with two financial services experts not connected with the situation yesterday, and each offered a different possible theory about why the New York Post story hit at this time. Either are plausible. Neither is necessarily mutually exclusive from the other.

One, a longtime national business journalist, floated the possibility that Avista themselves leaked the story in advance of trying to sell the Strib. With media companies proving to be a less profitable investment than other capital strategies, it's possible that the firm has decided to sell and is using this story to fuel perception that the paper can be had for a bargain-basement price. Another source, a former CEO, said the timing of the story suggests it's a tool to use in upcoming labor negotiations.

Both of these are speculative opinions, to be sure, but both are possibilities that locals have considered as well. We have calls in to both Blackstone and Avista that have gone unreturned thus far. We will update this post as new information becomes available.

What are the chances this is a scare tactic in the pending labor negotiations with the Guild?

Possible. As MinnPost's David Brauer has noted, the union is skeptical about the story's timing, and I think they have good reason to be. Aside from the obvious -- contract negotiations begin next week, and this is a weighty cudgel for management to swing -- labor costs are among the Strib's most significant expenses.

More on the reasoning behind this in the next answer.

What powers will the Blackwell Group have? How has Blackwell acted in past instances where they were so empowered?

A primary part of Blackstone's strategy has been reducing labor costs, including reducing wages among unionized staff. During its work with Delta during the airline's bankruptcy, union pilots were asked to take a pay cut of 30 percent.

This is a different situation than Delta's, because there is no Chapter 11 filing (at least not yet). A better example might be Blackstone's work with Xerox in 2001.

Rumors of impending bankruptcy started to swirl when the company hired Blackstone. In about a year's time, Xerox came back from the brink -- after shedding 10 percent of the workforce.

Yes, there were other measures taken, like raising capital and "improving operational efficiency." But there's a pattern here of slashed wages and layoffs. For a fascinating background on firms like Blackstone, which are largely unregulated, I recommend the In These Times story "Pirates of Private Equity."

Given the $4.1 billion acquisition of Bristol Myers Squibb on Friday, could Avista be trying to liquidify cash for this deal?

Highly unlikely. Avista has Scrooge McDuck money. Because they aren't a public company, financial data on them is limited, but we were able to run down some hard facts.

The Dun & Bradstreet report on Avista rates their financial health as very high, and their credit risk as extremely low. The report says their financial stress is minimal and the likelihood they'll experience cash flow problems over the next 12 months quite small. Even compared to other wealthy private equity partnerships, their balance sheet is favorable.

Buying Bristol Myers Squibb to them is probably like buying a new car to you and me. A significant investment, but not one likely to require freeing up capital.

Posted by Jeff Shaw at May 6, 2008 6:39 AM | Comments (5)

 

Breakfast of Champions 5/6: Financial wrap-up

Filed under: Breakfast of Champions

New information continues to roll in about the Star Tribune's reported financial woes. We'll keep following the story, with at least one more large post planned this morning. Meanwhile, the new issue will be out this afternoon, with significant expanded web content for both the feature story and a fascinating news piece.

Your guide to all the fresh content:

DAILY DISH: WHAT'S NEW AROUND THE SITE (STRIB DIVISION)

Kevin Hoffman's comprehensive post, which includes background information, interviews, statements and nine updates, is here. The most recent information, which contains analysis of the Star-Tribune's own story this morning, is here.

Also see the initial reaction to the New York Post story and Strib publisher Chris Harte's response. Jonathan Kaminsky spoke with the Minnesota Vikings, who continue to believe that the downtown land owned by the Strib "will be part of an eventual stadium development package" no matter who owns it.

We'll have more updates for you on the Blotter blog throughout the day.

NON-STRIB DIVISION

Jeff Severns Guntzel has noticed a problem with the international media's coverage of Iraq. He calls it "the burqa effect." A thoughtful post about a local site with a thoughtful approach.

If the world were fair, Mildred Loving would be a household name, and the case she and her husband lent their name to -- Loving v. Virginia -- would be as famous as Brown v. Board of Education. Until that Supreme Court decision, miscegenation statutes (laws banning interracial coupling) were legal, and more than a dozen U.S. states had them.

Please join me in chanting: two, four, six, eight, let's all go miscegenate. Then read my remembrance of Mildred Loving.

The Replacements once used our pages as lyrical inspiration. We found those pages and scanned them for your amusement, and for posterity.

The Bent Festival celebrates circuit-bending and the experimental music it creates. See Nick Vlcek's photos of the event at Intermedia Arts.

John Hagee is an unhinged lunatic. John McCain actively solicited his endorsement, and despite loopy anti-Catholic and anti-gay statements from the rotund orator, McCain's still glad to have his support. So why does Barack Obama have to run away from Jeremiah Wright when McCain gets a free pass?

It must be spring, authentically so: the Midtown Farmers' Market is open for business.

Posted by Jeff Shaw at May 6, 2008 5:35 AM | Comments (0)

 

The Strib on Blackstone Group: We mean business, not bankruptcy

Filed under: Media

After a day of furious activity and speculation in the wake of Sunday's surprise revelation that the Star Tribune had brought in restructuring expert the Blackstone Group in an attempt to avert bankruptcy, the Strib has finally released a new statement, albeit in the form of an article about itself. The message: "Bringing in Blackstone, Star Tribune means business."

Translation: Even the Strib's own reporters don't seem to know what to make of the revelation. The usually astute Chris Serres is reduced to positing anything from "new loan terms to additional equity investors in the paper." The paper's own spokesman, Ben Taylor, declined to comment, as did the spokesman from the mysterious Blackstone Group.

What isn't in doubt is that the Strib is in serious financial trouble:

But the Star Tribune's decision to hire the Blackstone Group indicates the newspaper is trying to deal with the financial ramifications of this decline head-on, before it becomes a full-blown crisis, said analysts. "They see the iceberg ahead and they hired Blackstone to try to manipulate the rudder and change course before they hit it," said Tom Corbett, an equity analyst who covers the media industry for Morningstar.

And as much as the Strib was whistling through the graveyard at the mention of bankruptcy yesterday, it's hard to escape that specter when you read paragraphs like this:

Considered a heavyweight in the world of large-scale corporate turnarounds, New York-based Blackstone has advised Delta Air Lines, Enron, Global Crossing and other embattled corporations through their Chapter 11 bankruptcy reorganizations. "To bring in a heavy hitter like Blackstone, you know the problems at the Star Tribune must be serious," said Ed Atorino, managing director of the New York investment banking firm Benchmark Capital. "They're in there to do more than just talk to the banks. They're in there for a longer-term outcome."

Posted by Kevin Hoffman at May 5, 2008 10:49 PM | Comments (0)

 

The Rosa Parks of love passes on

Filed under: Race

Mildred Loving didn't think she was a hero. She didn't even think she was a political person. But she was, and so are you -- at least you are if you think people ought to be able to love who they love regardless of race.

The aptly-named Loving, who died on Friday, was a plaintiff -- together with her late husband, Richard -- in Loving v. Virginia, the 1967 Supreme Court case that effectively legalized interracial marriage nationwide.

More than a dozen states still had so-called miscegenation statutes at that time, laws that prohibited mixed-race couples from marrying. Today, we see this as an obvious injustice, a racist affront to civilized society. Rightly so.

These are sentiments rooted in justice, and they are wholly justified. But Mildred Loving's reasoning was a little different, simpler, and possibly even better. She had fallen in love with someone and wanted to marry him.

"When my late husband, Richard, and I got married in Washington, DC in 1958, it wasn’t to make a political statement or start a fight. We were in love, and we wanted to be married," she said last year.

Mildred Loving's statement on the 40th anniversary of the case, the source of the passage I just quoted, is a must-read. I'm not kidding. I excerpt it only because I hope it inspires you to read the whole of this graceful, pithy bit of poetics.

For the crime of marrying, the Lovings were arrested and threatened with up to a year in prison -- which Virginia would only waive if the couple agreed to 25 years of exile. They refused. There is a striking juxtaposition between jail and what Mary Oliver's poem "Wild Geese" calls letting "the soft animal of your body/love what it loves." Is there anything more fundamental than that? And yet until this brave couple fought for it, that right wasn't secured.

This summer, I'm going to a wedding that many American states wouldn't have allowed a generation ago. Though I'm not any more, I used to be part of an interracial marriage myself.

On behalf of everyone like us -- no, scratch that, on behalf of everyone -- thank you, Mildred.

Via Metafilter.

Posted by Jeff Shaw at May 5, 2008 6:14 PM | Comments (0)

 

Vikings weigh in on Strib saga

Filed under: Real Estate

Last fall, amid the growing credit crunch, the Vikings backed out of a $45 million deal to buy several blocks of land from the Star Tribune near the Metrodome as part of the team's plan to build a new stadium at the site.

Now that the Strib is reportedly on very thin ice financially, is the team looking to return to the table?

"We believe that the property will be part of an eventual stadium development package or project regardless of who owns it," said Lester Bagley, the team's veep for public affairs. When pressed, he added the following: "I don't want to comment about what's going on there. We don't really know either."

Posted by Jonathan Kaminsky at May 5, 2008 5:39 PM | Comments (0)

 

BREAKING: Strib Bankruptcy Article Fallout -- Who is the Blackstone Group? UPDATE x9

Filed under: Media

THE STORY SO FAR: On Sunday, the New York Post claimed the Star Tribune of Minneapolis was on the verge of bankruptcy. Publisher Chris Harte issued a memo denying bankruptcy but acknowledging the hiring of the Blackstone Group for help restructuring finances. Strib staffers were stunned. Now comes news that the Blackstone Group took a hit on the failed Yahoo! deal this weekend. Meanwhile, Strib owners Avista Capital Partners just made a big purchase in the medical sector.

As you'll see below, Avista Capital Partners, the owner of the Strib, agreed on Friday to the $4.1 billion purchase of a piece of Bristol-Myers Squibb. This, combined with the news of Blackstone Group's involvement in the Strib's assets, may signal a shift by Avista out of the media sector (which is tanking) and toward more heathcare holdings, which are already a major part of its portfolio.

Sunday was anything but a day of rest for the Strib. First came a report in the New York Post alleging that the newspaper was on the verge of bankruptcy and Avista Capital Partners stood to lose its entire $100 million investment. Next I contacted Strib Publisher Chris Harte, who promptly issued a statement. While Harte denied the bankruptcy rumors, he acknowledged that the newspaper had indeed hired the Blackstone Group, as had been alleged.

"We recently hired the Blackstone Group to help us evaluate alternatives to our current capital structure, but that hardly merits a conclusion that we are near bankruptcy," Harte said in a statement released shortly after 6 p.m. Sunday evening. "In fact, Blackstone has substantial expertise in balance sheet restructurings through means other than statutory proceedings like bankruptcy."

Although Harte denies it, a knowledgable source tells me that you don't hire Blackstone to restructure your balance sheet when you have sufficient liquidity to continue meeting your obligations. Also, note that Harte's statement reads: "The facts are that the Star Tribune currently has sufficient liquidity and is current on all its debt payment obligations." Emphasis mine.

The Latest:

UPDATE 6: City Pages interview with Duchesne Drew, the Star Tribune's assistant managing editor for local news:

I see you guys are covering the story on the front page of the business section today.

I expect we’ll do more tomorrow about it. It’s no secret [that the Strib is going through tough times financially]. My expectation is that we’re still going to be here six months and six years and hopefully 60 years as well.

What did you think of the NY Post article?
I don’t know what to make of the Post article, cause I don’t know who his sources are. I don’t want to be overly dismissive of it, but I also didn’t read it and think I need a new job.

What was the reaction in the newsroom?

I think most people were surprised by the story in the Post. The mood here is not … nobody’s packing boxes. It’s not news to us that circulation is down, but it’s not plummeting, it’s just down. What’s telling … our circulation fell in the last cycle and we moved up in the rankings. So it’s something our entire industry is going through. It isn’t really news to us in terms of the challenges we’re facing.