David Warsh: Trump keeps grifting; what next for Bloomberg?
Bloomberg’s headquarters tower on Lexington Avenue in Midtown Manhattan
SOMERVILLE, Mass.
Donald Trump is planning to start a social-media network to compete with Twitter and Facebook, which have kicked him off their platforms. Digital World Acquisition Co. (DWAC), a so-called blank-check company, or SPAC, plans to fund Truth Social, Trump’s venture, with the $290 million that the company has raised from institutional investors, merging itself out of existence in the process. DWAC shares closed Friday at $94, a ten-fold increase over their initial offering price a few days before, having traded as high as $175 during the day. Trump’s alternative to Twitter is scheduled to launch next month.
But Truth Social seems unlikely to succeed.
Whatever the case, investors in what by then will be listed as Trump Media & Technology Group will be able to continue trading with each other, after the DWAC evanesces. The Wall Street Journal on Oct. 23 explained the road ahead. Bloomberg Opinion columnist Matt Levine commented, “If you are in the business of raising money to fund a social media company that you haven’t built yet and perhaps never will, the SPAC format has a real appeal.” In other words, Trump Social is another example of pure Trump fleece.
Meanwhile, there is Bloomberg L.P., almost the polar opposite of what Trump intends.
By now the Bloomberg story is well known, thanks to Eleanor Randolph’s excellent 2019 biography: how the 38-year-old Salomon Brothers partner was first banished to the computer room, then squeezed out of the firm altogether after a merger, only to surface two years later, aided by MerrillLynch (which still owns 12 percent of the company), with a proprietary bond-price data base and a package of related computer analytics, a system he first called Market Master.
Bloomberg terminal-subscription growth (at $24,000 a year apiece!) was so explosive in the ‘80s that, by 1990, Bloomberg was able to start a news service, hiring Matthew Winkler, the WSJ reporter who had covered his rise, as its first editor-in-chief. Bundled with Bloomberg analytics, Bloomberg News grew by leaps and bounds as well, until it rivaled powerhouse Reuters, the world’s oldest and largest news agency. John Micklethwait, editor of The Economist, replaced Winkler and continued to build its staff, hiring newspaper veterans and various media stars, But Bloomberg News’s product remains almost entirely online, which limits its influence in some critical dimensions. I read it there; it is not the same as print.
True, there is Bloomberg Businessweek. Bloomberg bought the time-honored title from McGraw-Hill in 2009, at a fire-sale price, inserted his name, and gave it a complete makeover. The magazine arrives via postal mail, one day or another each week, and often many more days go by before I open its cover. When I do, I am always impressed by its contents, especially the decent, moderate Republican tone of its editorials, in sharp contrast to the over-the-top WSJ editorial page. But there is something about the weekly magazine format that no longer works, at least for those lacking leisure. The Economist fares only a little bit better at my breakfast table.
Bloomberg, 79, was elected three time mayor of New York City. He ran unsuccessfully for president in 2020. It is well-documented that he has long hoped to buy a newspaper – either the WSJ or the NYT. I’d like to know something about Donald Graham’s discussions with Bloomberg before Graham decided to sell The Washington Post to Amazon billionaire Jeff Bezos at a bargain price. My hunch is that Bezos’s four children loomed large in his thinking (Graham was a third-generation steward of what after 75 years had become a family paper.)
Today Bloomberg is worth $60 billion. So why doesn’t he start a print newspaper? Name it for something other than himself. Model it, loosely, on the Financial Times. Print it at first in a dozen US cities, where dense home-delivery audiences exist. He is still young enough to enjoy presiding over an influential print paper for a dozen years or more. He already employs most of a first-rate staff. Moreover, he has two daughters, Georgina and Emma, living interesting lives, waiting in the wings.
David Warsh, a veteran columnist and an economic historian, is proprietor of Somerville-based economicsprincipals.com, where this column originated.
Anglo-American journalism
The news last week that John Micklethwait, editor-in-chief of The Economist, would be moving to New York from London to take charge of the far-flung editorial operations at Bloomberg News reminded me of s politically incorrect joke from my Midwestern childhood – the one about the Norwegian who moved from Minnesota to Wisconsin, thereby raising the average IQ in both states.
To understand why that might have been funny, you only needed to believe that Minnesota thought of itself as having been populated by Swedes and Wisconsin by those of German and Irish descent. The geography of the news business takes a little more explaining than that.
First things first. Micklethwait’s move means that Londoners will be running all four top news businesses in the US. Mark Thompson, former director general of the BBC, is president and chief executive of The New York Times, Gerard Baker, former US editor of The Times of London, is managing editor of The Wall Street Journal, and Will Lewis, former chief creative officer of Rupert Murdoch’s News Corp., is CEO of Dow Jones & Co,. Andrew Rashbass, former publisher of The Economist and chief executive of The Economist Group, is boss of Reuters, the news unit of Thomson Reuters.
Why the Brits? That’s easy – because all have experience in organizations that have successfully accommodated themselves to the Web and, through some combination of history and necessity, established themselves among the first truly global brands. The success of The Economist, the Financial Times, and the BBC point to the possibility that London is the center of the English-speaking world. The success of the grand old liberal Guardian– third most widely-read newspaper site in the world since going digital-first in 2011 – suggests that there is indeed something in the London air.
In science news and publishing, it is a toss-up, as far as I can tell, between the U.S. weekly Science and its British counterpart, Nature. But otherwise the United States, with its enormous domestic market, has yet to create a marque that truly travels well. The clumsy snuffing-out of the International Herald Tribune by The New York Times is one exemplary failure; the embassy-like European and Asian editions of the WSJ are others.
Beaches are littered with the survivors of unsuccessful magazine expansions, Newsweek International and Forbes International chief among them. Maybe the U.S. will never compete with Britain as narrator of the global news, but it is America’s deeply ingrained superpower insularity that the cosmopolitan British editors have been hired to change. Much turns on the formulae they devise and the degrees to which they succeed.
What about The Economist, then? How might the departure of Micklethwait improve its lot? Or will it?
Founded by James Wilson, in 1843, with a view to combining business intuition with the latest economic knowhow, the paper remained small but influential, mainly in Britain, for more than a century. In 1945, its circulation was hardly more than the 6,000 it had been in 1920; Punch, the British humor magazine, would have outsold it then. By 1970, The Economist had reached 100,000, a significant portion of it in the US; by 2000, around 1 million; and 1.5 million in 2012.
It has been apparent for some time that the “newspaper,” as its staffers quaintly call it, needed new leadership. Micklethwait, 52, is an exceedingly intelligent and nimble journalist, and therefore constantly attuned to the unexpected, but he entered Magdalen College, Oxford, just as Margaret Thatcher was coming to power. For the next 20 years or so, the world seemed to embrace her vision of libertarian zeal and self-reliance. Micklethwait’s books with long-time writing partner (and The Economist’s former “Lexington,” now “Schumpeter” columnist) Adrian Wooldridge reflect that trend. In recent years their books have grown steadily more political.
They include The Witch Doctors: What the Management Gurus Are Saying and What It Means for Your Company and Your Career (1996), The Future Perfect: The Challenge and Hidden Promise of Globalization (2000), The Company: A Short History of a Revolutionary Idea (2003), The Right Nation: Conservative Power in America (2004); and God Is Back: How the Global Revival of Faith Is Changing the World (2009).
Micklethwait got the top job only in 2006, just as the world was changing decisively. The financial crisis, accelerating climate change and the rise of China demonstrated that there would be no withering-away of the welfare state of the sort they envisioned in their book last year, The Fourth Revolution: the Global Race to Reinvent the State (2014). There may be a fourth revolution of some sort, but almost certainly it does not involve the retreat from social rights and responsibilities that the book anticipates. The magazine says it hopes to choose a new editor in January. That person will find much to be done.
Now to the Bloomberg organization. Michael Bloomberg’s great good fortune was to be on the losing end of a struggle for power at Salomon Brothers in the early 1980s. Consigned to the back office of the firm, he learned what computers could do and, striking off on his own, built a series of proprietary bond data bases into a financial information business with, on the side, an enormous news-gathering staff (around 2,400 reporters and editors in 150 bureaus worldwide). In 2009 he bought the 80-year-old loss-making BusinessWeek magazine.
Something similarly dramatic was going on all the while at Canada’s Thomson Corp., where a series of shrewd investments enabled Kenneth and David Thomson to buy Reuters, the world’s oldest and most respected news service, with some 2,000 staffers around the globe. The result is that two news-gathering organizations now compete for attention and talent with the NYT and the WSJ – all dressed up but with nowhere to print, except the still highly unprofitable but much more highly-regarded Bloomberg BusinessWeek.
Enter editor-in-chief Micklethwait. He is replacing founding editor Matthew Winkler, a former WSJ reporter who, starting in 1990, built the news service in a pell-mell rush. It is not clear that Winkler had much to do with the successful re-invention of the weekly Bloomberg BusinessWeek, a feat usually ascribed to editor editor Josh Tyrangiel, picking cherries from the vast flow of Bloomberg news. Micklethwait’s task is to sharpen up the weak spots along the vast conveyor belt and bring some order to the whole. His Economist experience makes him perfectly suited to the task.
Sensibility is one thing; point of view is something else again. It was a long conversation one night in San Francisco in 1981 with British entrepreneur Antony Fisher and Milton Friedman that set Micklethwait on a course that lasted for 30 years. It is entirely possible that his encounters with his new employer, splendid in his power and wealth (more than $20 billion), will have now set him on another. Who knows?
Anyone who watched Bloomberg through his three terms as mayor of New York City will recognize that government plays a major, if imaginatively circumscribed, role in his understanding of the scheme of things. No one will mistake him for Milton Friedman. Suppose Bloomberg gradually wins over Micklethwait to his point of view, and the clever editor finds a way to make Bloomberg News more of a household word name, instead of a bitstream confined mainly to terminals on financial traders’ desks. Almost certainly it would involve finding a way to turn a profit from the news as well as the analytics. What then for news of the world? For the world of news?
The Bloomberg-Micklethwait collaboration is only one skein in a vast panorama. Thomson Reuters, the Times, The Wall Street Journal and The Washington Post, recently acquired by Amazon founder Jeff Bezos, presumably for his family, are all in flux. America’s story-tellers are evolving at a faster pace than ever before. The magnate-turned-mayor-turned-publisher and his still-young editor at Bloomberg News are something new under the sun. As we say in the trade, their adventures bear watching.
David Warsh is proprietor of economicprincipals.com, an economic historian and a long-time financial journalist.