Cleveland: Confused City on a Seesaw
CHAPTER TEN: Three-Base Errors
The economic management and editorial direction of newspapers in all big cities has a tremendous effect on the prosperity of the cities, their social welfare, and even their survival. The newspapers go directly into the homes of citizens, and not only keep them informed of the news of the city and the outside world but advertise what to buy. They keep a daily watchful eye on the conduct of government at all levels, often expose and criticize malfeasance or nonfeasance, and at election time, endorse the candidates they consider most capable. It is this capacity to be the perpetual watchdog, the adversary of government, with the ability to elect and defeat, that gives them power. Knowing this, their editors feel a deep responsibility not only to encourage good public officials and keep them honest and on the ball but also to encourage the growth of the city's business and the improvement in its social welfare and living conditions.
In recent years, the electronic media, radio, then television, have come into the picture and today they have an even greater economic impact on what the public buys. They have also the power to influence government and sway elections by the way they report news. Some of late have made direct editorial comment and more are likely to do so in the future. So the officials now think and talk in terms of the "media" rather than of the newspapers.
It is impossible to overestimate the influence of these electronic communications media, but it was not always thus. In the early days of radio and TV, many of the newspaper owners did not readily grasp what a powerhouse or potential gold mine of profits they had. It took a certain genius for management, a sixth sense of what the public would go for, a knack for entertainment as well as how to make money -- and a far-sighted vision of how the communications industry would grow.
Newspaper executives in many big cities instinctively sensed this, and early in the game, bought radio and TV stations and tied them together with the newspapers. So did some magazines, such as Time, Life and Newsweek. In Cleveland, the top decision-makers in the Forest City Publishing Company didn't seem to know how to make the most of what they had. The result was that for over twenty years, they made an incredible series of three-base errors, let a gold mine slip through their hands, and slowly but surely dissipated the assets of what had once been a tremendous fortune, the Holden estate.
To completely understand some of the contemporary economic and political history of Cleveland, it's necessary to put into perspective its newspaper, radio, and TV history, which concerned the Plain Dealer and News (Forest City) and the Press. It is only now becoming fairly clear what happened, because no in-depth, informative surveys were written about it during the forties, fifties, and sixties, when the big things happened. Some bits and pieces came out in the form of announcements, but no analytical appraisals; the media are chary of writing about themselves. Yet what did happen had a profound effect later on the community of Greater Cleveland, particularly the economic condition of downtown, the political patterns, and in the seventies the widespread downgrading of the city as a sort of national joke.
It is necessary, first of all, to understand what the Forest City Publishing Company was, how it came about, and who ran the show. In the beginning, it was not something carefully planned, with great benefits for the future, as many mergers
are. It was strictly a fire-alarm rescue job, organized in 1934 by the owners of the Plain Dealer to keep the News from going bankrupt or being bought by outsiders during the big depression. It put the burden of keeping the News alive on the owners of the Plain Dealer. Then after that, Forest City got into the radio business.
About the time the depression began to ease, something else important happened. The real control of the Forest City properties reverted to the trustees of the Holden estate. For the previous quarter-century, the estate had owned the Plain Dealer (and other assets, including the Hollenden Hotel) but had leased the management of it to the Plain Dealer Publishing Company, beginning with Elbert H. Baker, which stood to win or lose on its management skill. Mostly it was winning, as it bought the Leader from the Hannas, and forged ahead of the Press. (John S. McCarrens, in those days before heavy federal income taxes, was making $200,000 a year clear. Paul Bellamy was making $100,000.)
When the lease expired and property came back to the Holden estate, Major Ben P. Bole, a Holden son-in-law, and a lawyer, became president of Forest City, and took an active part in business office decisions. He was able to devote his entire time to it, since he was not involved in much outside practice. He was a close friend of Bellamy and of an old army buddy, Sterling E. Graham, who later became general manager.
Managing and advising the various Holden trusts was a full-time job, for there were several of them, each with different trustees. The rich mining properties (mostly Island Creek and Pond Creek Coal companies) had been separated from the real estate and newspaper, and left largely to Albert, Liberty E. Holden's oldest son and his two daughters, Mrs. R. Henry Norweb and Mrs. Katherine Holden Thayer. The newspaper and real estate property was left in trust for a younger son, Guerdon, and four daughters, Mrs. Ben P. (Roberta) Bole, Mrs. Windsor T. (Delia) White, Mrs. Henry (Emory) Greenough, and Mrs. John R. (Gertrude) McGinley, and their descendants.
Major Bole died suddenly, however, just before World War II commenced, and the burden of management of the trusts fell largely on I. F. Freiberger, vice-president and trust officer of the Cleveland Trust Company. Freiberger was a banker with many other problems, a civic and welfare leader, a director of a dozen corporations. He was not a newspaperman, had no experience in the communications field, yet the final decision on how to get the best return from the property of the Forest City Publishing Company, how to invest, when to buy or sell, and even what to do about executives who might not be up to snuff, fell on his shoulders. Also how to keep the various factions among the Holden descendants satisfied with their incomes and agreeable to his judgments.
Freiberger was one of the most universally loved and respected gentlemen who ever lived and worked in Cleveland. He had been a poor boy, sold newspapers, worked his way through college (Western Reserve) and law school, and rose steadily in the bank. He was even tempered, judicious, cautious, friendly, urbane -- one of the most honored men in Cleveland.
Unfortunately, he had no instinct or talent for the news business or the entertainment business. Yet by having to act as trustee, he was forced to make far-reaching decisions in both fields. It is painful for me to criticize Freiberger or to second-guess him in retrospect, but in the end, he was most responsible for the three-base errors that resulted in the sale or liquidation of two big newspapers, and five radio stations, and the failure to buy a TV station that since has become tremendously profitable. It became almost a classic case of how millions left in trust could shrink in value, how the losers sucked the profits out of winners, and how enterprises that had been dull and comatose suddenly came to life and became bonanzas after they were sold.
Freiberger knew, of course, about the undercover deal that McCarrens of the Plain Dealer and Meilink of the Press had made, through which the PD agreed not to use its radio station, WHK, to promote the newspaper, and in return Scripps-
Howard agreed to furnish all the newsprint necessary for the PD and News, at a discount. (This has been explained in previous chapters.) Although the paper was not tying in with WHK, Forest City still had the problem of trying to make WHK profitable. The principal obstacle to profitability was H. K. Carpenter, who had been owner and manager when Forest City bought the station, and who was retained as manager. (WHK at that time also controlled WCLE, a smaller local station. In ensuing years, Forest City also bought a controlling interest in stations in Akron, Columbus, Cincinnati, and Youngstown. It had the makings of a news network, but none of the stations seemed to be doing exceptionally well.)
Freiberger, a compassionate man, slow to make moves that would cause pain and ever hopeful that events would work themselves out, let Carpenter remain as manager of WHK for twenty years. Yet it was obvious to everyone in the editorial department of the PD and News that Carpenter had no instinct for show business, which is what radio was, and still is, to a great extent. He was a fine citizen and devoted churchman, but he had no patience with popular music, which over the years became louder and louder, from jazz to boogie-woogie, to rock-and-roll. Nor was he fast enough on the bases to develop good network connections. While the competing stations began to go heavy on entertainment, WHK continued its old-maidish programming. Carpenter made no effort to find out from the Plain Dealer entertainment experts what sort of programs would bring in more listeners. WHK was almost
totally inept at gauging the public's appetite.
The Forest City brass was unhappy that WHK was not bringing in more revenue; but instead of unloading Carpenter, they tried another expedient. They put in as sales manager Kenneth Hackathorn, who had been the PD classified ad manager. Hackathorn tried hard, but couldn't sell enough commercials to tie in with Carpenter's dull programs. When the other Ohio stations were acquired, nothing was done to coordinate them into a unified network. Each one ran itself. Operations simply drifted along thus through the forties and
fifties, yet Forest City bought a good-sized piece of real estate, at 5300 Euclid, where the old Metropolitan Theater had once operated, as a headquarters and showplace for WHK. Then suddenly and inexplicably, between 1952 and 1954, Forest City started to disengage from the radio business. (About this time the PD was reorganizing its production, secretly looking for a new editor, and getting ready to move into the remodeled News building.) The big stock interest in the Youngstown station was sold. The Columbus and Cincinnati stations were sold to local operators. The Akron station was sold to a former PD ad salesman, Phil Herbert, and immediately, with more lively and relevant programming, began to make a big profit. All the out of town stations started to make money as soon as they were sold. But WHK still didn't.
At long last, Hackathorn replaced Carpenter as general manager, but by this time it was too late to reverse the long, dull trend, and in June 1958, WHK was sold to Metro-media Inc. The new owners changed the program style at once, went heavily for short news bulletins and rock and roll aimed at the teeny-boppers, and immediately became the most profitable station in town. Listening to the noise was hard on the ears, but the boom-boom and screeching brought in the money.
Forest City could have bought a TV station, WJW, at this time, but Freiberger would not invest in TV. So the Plain Dealer never got a TV station to compete with Scripps-Howard's WEWS (Channel 5). Finally WJW (Channel 8) was sold to Storer Broadcasting Company and has continued to be profitable and well managed ever since. Forest City could have bought it for peanuts when it first went on the air.
What seemed to be going on within Forest City was a kind of journalistic schizophrenia, an inability to decide how to fight (or whether to fight at all) the rapidly rising Press. This may explain why no serious effort was made to derail the Erieview project, the Press's baby. Forest City had taken over the losing News in the thirties, and for a short while it looked as if the News might become a little sister to the Plain Dealer,
with coordinated editorial policies, an interchange of staffs, and an infusion of capital to help the News promote its circulation. This did not materialize. Forest City still was not using its radio station to promote either the News or the Plain Dealer, even though the newsprint deal had fizzled out, and Graham was having a devil of a time trying to buy enough paper to print the big Sunday Plain Dealer. The company bought out-of-town radio stations, then did nothing to tie them together into a news network, and finally sold them for a price far below what they were actually worth.
After a long period of indecision, the bosses decided to move the Plain Dealer to East Eighteenth Street and Superior, and install a new editor, Wright Bryan of the Atlanta Journal, to replace the ailing Bellamy. No sooner had the Plain Dealer moved in 1956 than a crippling strike closed the News and the Plain Dealer for four weeks, from 1 November to 28 November. For the first time in history, no Cleveland paper published the election results for the county, state, or nation. Nor did they publish the dramatic story of the Suez crisis, in which the British had started to bomb the Egyptians and were forced to
stop it by President Eisenhower. Nor did the readers know about the Hungarian revolution and the way Russian tanks barreled in to put it down with much bloodshed.
Freiberger and Graham had been hopeful that moving the Plain Dealer into a new plant, which wrapped around the News building, would produce big economies in production. But it didn't happen. The Plain Dealer for a long time had the reputation of being the softest touch of all newspapers in the country for the printcrafts, a haven where incompetent itinerant printers could always find refuge, not work very hard, and never be fired. A series of production managers failed to solve the problem, and at the end of the first year, there were actually more printers working for Forest City than had worked separately for the Plain Dealer and News before the move.
The hapless News continued to suck out the profits made by the Plain Dealer, at the rate of one million a year, and the
beneficiaries of the Holden trusts were beginning to complain that they were not getting the income they should. There was no love lost between some of the younger Holden descendants. One of them, Peter B. Greenough, who had been working on the Plain Dealer as a business reporter and editorial writer, was convinced that he was going to move into a top editorial spot when the inevitable replacement of Bellamy would take place. But Freiberger by-passed Greenough, and shortly afterward, Pete departed for Boston, where he held important jobs on the Globe and Herald-Traveler, and later quit to devote his whole time to managing the career of his wife, the phenomenal opera star, Beverly Sills, whom he had married while on the Plain Dealer.
The situation dragged along for a couple more years. Then the News was suddenly sold to the Press, in January 1960, and ceased publication. A few editorial employees went over to the Plain Dealer, and the rest received severance pay. Another part of the big Holden estate had gone down the drain, and Cleveland became a two-newspaper town. The Press seemed to have won the circulation battle, and was flying high. With the addition of the News circulation, and eliminating duplications, it now claimed 380,000 daily, and seemed likely soon to go over 400,000. Louis Seltzer had really brought it to the top, just as he had produced Erieview, next to the Press's new building.
While all the three-base errors were being committed, it is ironic that one of the Holden children was opposing most of the decisions, but was not in a position to throw any weight against them. He was Guerdon S. Holden, the youngest son, a beneficiary of the trusts. He was regularly ignored by Freiberger, as someone whose judgment was not sound. But Guerdon, in retrospect, was more often right than wrong.
Guerdon Holden was a much misunderstood man, who could have been a brilliant researcher or professor, but whose millionaire father forced him into the wrong channel. (His father obviously did not trust him to handle money on his own. He handled Guerdon in exactly the opposite way he handled
Albert, his older son, to whom he passed on full responsibility for the family's extensive mining interests.) Guerdon attended Harvard and became deeply interested in Egyptology. He traveled widely and wanted to study further abroad and at home. But papa insisted that he take up law. He did attend law school unwillingly, passed the Ohio bar exam, but never practiced. He continued to be fascinated with ancient languages and civilizations.
He was given an office in the old Plain Dealer building, and he had the title of secretary-treasurer of the corporation. The actual treasurer (a succession of them, in fact) bore the title of assistant treasurer. His corporate duties were strictly routine, but he faithfully attended board meetings and did what the decision-makers decreed.
Guerdon's heart was really in the editorial department. He was a rabid baseball fan in his younger days, and because he was given little to do at the office, attended many games. As the sports staff soon found out, he was a bearcat on statistics. He kept an eagle eye on the box scores of all major league games and if there was a mistake, he let the sports editor know. He knew by heart the batting averages of all the Cleveland players and most of the other teams' leading hitters, and his sizeups of the teams were well-informed and accurate. He spent a lot of time every afternoon watching the Western Union sports ticker and later listening to the radio broadcasts.
Because he had plenty of time for boredom, Guerdon made a regular round of the bars at the Hollenden and Statler, and often finished at the Union Club. (But he really disliked the rich and sons of the rich whom he met there. He was rich himself, but he disliked the idle life. He preferred the company of newspaper men, especially that of Paul Bellamy.)
Guerdon used to make a ceremony of providing a between-editions lunch for the editorial workers on election nights. Every year he would order the Hollenden to send over a great array of sandwiches, coffee, and pie about 10:15 P.M. after the first edition deadline. Guerdon hung around until the final edition makeover came off the press. Then, about 4 A.M.,
he would allow himself the luxury of a toast to the victor (if the man happened to be backed by the PD) or a better-luck-next-time drink (if the PD candidate lost).
During the postwar decade, Guerdon's high spot was the daily meeting of the editorial writers, at which Guerdon expressed his opinions freely (but they were usually ignored, as they were by the board of directors, too).
Though Guerdon's views were disregarded, he really had an uncanny common sense. Because of the long-standing legend that he was not to be taken seriously or given any real responsibility, the decision-makers paid him little attention. They would have saved themselves a lot of money if they had. He was strongly opposed, for instance, to moving the entire Forest City operation to the site of the News Building.
"It will cost an abnormal lot of money to wrap a new building around the News building," he predicted. "If we must move from East Sixth and Superior, we ought to buy property on the lakefront, next to the railroad tracks and near the docks, where rolls of paper can be moved just a short distance into the plant. There we should put up an entirely new building. If we move to East Eighteenth Street, it will be too small within ten years."
Guerdon was right. By 1966, the plant was already too small, and plans were under way for a new building. Land was bought near the railroad and docks on the west side, near Edgewater Park, and building plans prepared. They were later scrapped because of high costs and difficulty of getting financing in Cleveland. (The Press avoided such a mistake. When it put up a new building in the fifties, it chose a practical site on the lakefront, at East Ninth and Lakeside.)
Guerdon stubbornly said he would never set foot in the remodeled East Eighteenth Street building, and he didn't. An office was provided for him on the editorial floor, but he never used it. Several months before the move, Guerdon became seriously ill, and was taken to his summer home near Stroudsburg, Pennsylvania, in the Poconos, where he and his second wife, Anne, had spent more and more time in recent years.
His health continued to fail, and he died there 17 December 1959.
Guerdon disliked everything about being a rich man. His clothes were baggy, and his hats looked like discards. For years, he supported a large retinue of servants at the family home on Lake Shore Boulevard, Bratenahl, a lovely old manse surrounded by gardens. Ultimately, however, he decided it was absurd to maintain a staff of sixteen for only himself and Anne, so he gradually pensioned off the maids, chauffeur, cook, gardener, and others, and sold the manse to an Italian family.
Guerdon was a frustrated, lonely man. He knew he had undeveloped talents that would have given him more satisfaction than the routine his father and the trustees had decreed for him. He was a generous man, who overtipped when he considered the service good, and the soul of courtesy. He had the habit of prefacing almost any remark with "May I say. ... " A gentleman of the old school, who deserved a better fate from his family.
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