ROB-a-CO? ROB-a-BANK? THE ULTIMATE CONFLICT OF INTEREST
by Joe Shea
American Reporter Correspondent
HOLLYWOOD -- "Does the Voice go around saying it's owned by Weiss, Peck & Greer?"
That innocent question, in response to her questions about who owns a publication called the New York Press (the answer being Avalon Equity Partners), was posed recently to Cynthia Cotts, author of the well-known Press Clips column in the current issue of the Village Voice, America's largest alternative news weekly and owner of the L.A. Weekly and other alternative papers around the United States. Currently, the Voice, the Weekly and the New Times chain are targets of a vigorous Justice Dept. antitrust investigation that is expected to lead to indictments any day now.
The newspaper chains are accused of shutting down competing publications in two cities to give each a monopoly market in one of the cities where they formerly competed. They closed the New Times paper in L.A. and the Voice-owned paper in Cleveland, but the real crime is that they put some interesting journalists out of work, including Jill Stewart, the only one who was courageous enough to take a stand for the independence of Hollywood in the recent secession battle here.
I am an alumnus of both the Voice and the Weekly under several ownerships. The ownership of the Voice changed hands several times while I wrote for it from 1968 to 1978, and it has changed twice during my on-again, off-again stint at the Weekly from 1979 to 2001. But Weiss, Peck & Greer? Who are they?
I think it would probably come as a shock to some Voice readers and writers that the people who own the Voice - the real owners - also own huge blocks of stock in some of the largest corporations in the world.
Weiss, Peck & Greer are a wholly-owned subsidiary of Robeco, a firm founded in 1929 and headquartered in Rotterdam, The Netherlands, that itself is 100 percent owned by Rabobank Group, which manages some $95 billion is assets, has branches in all the world's major cities and a Cayman Islands regulated affiliate (run from New York). Their description of themselves is, "Rabobank Group is a co-operative organisation comprising 397 independent local Rabobanks. Together, these form the supra local co-operative Rabobank Group."
The people who own the Voice and the Weekly have invested their $95 billion this way: 3.47 percent is in Microsoft, 3.41 percent in Citigroup, 3.12 percent in Pfizer, 2.89 percent in Bank of America, 2.75 percent in Johnson & Johnson, 2.71 percent in General Electric, 2.81 percent in Exxon Mobil, 2.44 percent in Wal-Mart Stores, 2.37 percent in Verizon Communications and 2.01 percent in Washington Mutual, according to their Website (http://220.127.116.11/en/topnav/index.html). And those are only their top 10 investments; there are hundreds more.
The people who own the Voice touch every aspect of human life through their holdings, and there is no topic of political or economic significance covered by the paper - or any of the seven "alternative" papers that they own in large American cities - in which Rabobank does not have some financial interest.
Should the Voice storm the citadels of power demanding an end to corporatization and globalization, it would be the Voice of American hypocrisy. Should it weigh in against monopoly power and a diminished free press, it would likewise sin. Clearly, what its readers and writers don't know is sort of good for them - they would have nothing to read, otherwise. They might add that the Voice and the Weekly are worth their cover price in credibility - zero.
There was a time, long ago, when the great French philosopher Voltaire was said to have mastered all of the knowledge that humankind had acquired since it moved into caves. The Internet has since come along and acquired the same distinction, virtually, and then turned that knowledge over to the entire world. The Net was the cauldron in which The American Reporter was created, using email to send and receive stories and commentary from independent journalists all over the world. Like Rob-a-Bank, we are a for-profit cooperative owned by some 300 journalists who have contributed to our pages, earning equity with every word they write. Like Voltaire, we are know-it-alls.
Unlike Rob-a-Bank, though, we have nothing to invest and have yet to even incorporate - in fact, if possible, we never will. Our equity has about $5 million in value on the books, but no cash value at all. Our income in 2002 was approximately $700, of which I earned about $250. I spent several thousand to improve its prospects and support its writers, but since I didn't have much earned income, I won't be able to get any deductions for that investment this year.
We try not to, but we sometimes have conflicts of interest, as well. I have had one in writing - as objectively as I can - about my wife's former employer, Patricia Slesinger, the owner of the Winnie the Pooh rights that are the subject of a huge lawsuit against Disney. Ironically, the husband of the lawyer. Bonnie Eskenazi, who is suing Disney for the Slesingers has one, too, sort of - he works for Disney as an Imagineer
When I quoted Patricia Slesinger using the word "disgusting," she fired my wife because I wouldn't change it to "disappointing." We sued her privately, through my lawyer, but she welshed on the payments and we now plan to sue her formally in Los Angeles Superior Court. But who is going to cover the case, if not me? And I may be a material witness in it, too - my wife and I were deposed for a total of something like 22 hours by Disney's lawyers, and either or both of us may be called if it goes to trial.
A tv reporter from London's Channel 4 called last Wednesday to say he's sending a film crew across the Atlantic to interview me, and described me as "the world expert" on the case. Fortune Magazine's staff writer emailed me a bunch of times for his cover story in the Jan. 3 issue. A friend who is L.A. bureau chief of USA Today credits me for generating a "huge wave" of publicity about the case, which I have. Unfortunately, I'm not surfing that wave - it's crashing on me.
I don't own General Electric, though, or any part of Microsoft. I do invest in some cable companies, banks, utilities, ISPs and telecoms. Through those I suspect I also touch every aspect of human life, very softly. WorldCom, for instance, is trading at $0.182 per share, and I thus have about $364 worth of it. They have two billion shares outstanding, so they don't probably pay inordinate amounts of attention to what my 2,000 have to say (and I don't think much about them, either).
I also have $169 worth of Adelphia stock, which I wield with growing authority. My $52 investment in Cypost, an ISP, has not yet entitled me to a seat on the board, but my $1,200 stake in Charter Communications puts me right up there with Microsoft co-founder Paul Allen, or almost. As a rule, you can assume that if I own it, it's broke. I also keep all my money in Bank of America, and if I were to threaten to pull all $103 out, it would likely collapse - in laughter.
Conflicts of interest are either real or apparent. The conflict in the case of my wife - where I was forced to choose between her housekeeping job or my newspaper -was a real one. In contrast, here's an apparent conflict:
Back when I was writing for the Village Voice, I came across a major story in 1974 that involved Nelson Rockefeller's gifts - $50,000 in all - to a Bolivian diplomat during the Cold War. Victor Andrade had been a "front for Nazis" in the prewar government of Bolivia, according to secret documents I unearthed in the OSS archives of the Library of Congress. At the time, Gov. Nelson Rockefeller was in front of the House Judiciary Committee, which was holding hearings on his nomination as Vice President by President Gerald Ford, to replace the jailed Spiro Agnew.
To get the story published, it would have to be approved by the editor, Tom Morgan - Nelson Rockefeller's son-in-law. It would also have to be approved by the paper's libel lawyers, and I would have to trek up to their offices in Rockefeller Center. My uncle, William Shea, was an appointee of Gov. Rockefeller's and was then sitting on the New York State Supreme Court. My grandfather on my mother's side was John D. Rockefeller's carriage driver. Was all that a problem, I wondered?
If it was, I never heard about it. The story ran untouched. But compare that to an experience I had at the LA Weekly back in 1979, the year it started. I heard about a stabbing outside the Starwood nightclub in West Hollywood and for some reason decided to follow up on it. My investigation revealed that the neighbors of the Starwood had been complaining every week to the local Sheriff's station deputies, who told me they felt powerless to do anything about the club. The joint was an important venue of the punk rock revolution in music, and it was also one of the Weekly's most important advertisers.
When I turned the story in, publisher Jay Levin told me flatly that it could not run because it would endanger those ads. I was disappointed, but not surprised. Jay was a committed progressive who had a great deal to say and to do still ahead, and losing the Weekly at that time would have been a tremendous blow to everything that was yet to come - its fight for a living wage ordinance, for gender neutrality, for a clean-up of L.A.'s terrible air pollution - and the tradeoff wasn't worth it, even slightly.
But the man behind the Starwood turned out to be Eddie Nash, a notorious gangster who went on to be tried and convicted of ordering the murder of six pople in what came to be known as the Laurel Canyon Murders (in which porn star John Holmes played a minor role). Had my story run and perhaps helped empower the police to move against Nash, and look more deeply at his club and discover his heroin-dealing operation, those people might never have been killed. A real conflict of interest may actually cost human beings their precious lives.
When I started the American Reporter, I was moved by my resentment over what had recently happened to me at the New York Post. Assigned to cover the breaking story of the O.J. Simpson case, I went to the murder scene - where I touched the blood on the ground and actually had a vision of the killer - and to his home, to Ron Goldman's funeral, and even had Nicole's famous 911 call enhanced for the first time, revealing that she was having affair with another man while the Simpson's daughter was upstairs in bed. I was the first to find out that Kato Kaelin, whom I met recently, was living with Nicole Brown Simpson before he moved in with O.J. But that aside, what the Post's editors did to my stories was unbelievable.
In one blaring front page banner headline story, for instance, they used my byline but not even one word I wrote. Instead, the story was a series of takes from tv news and entertainment shows, reading like, "Fox News reported" and "Entertainment Tonight reported." All my reporting went out the window, replaced by a running digest of tv news shows. I didn't even own a tv, and it sounded like I spent all my time watching it to find my next article.
Now, of course, Fox's chairman, Rupert Murdoch - once also the owner of the Voice - owns a near-monopoly on satellite news and entertainment broadcasting across the entire planet, and will have a greater one if he consummates another merger he is seeking. It is impossible to contemplate the various conflicts of interest across dozens of countries that any Fox News broadcasts must directly or indirectly have.
How do we weigh the small sins of Joe Shea and Jay Levin against the great ones of Rob-a-Bank and Fox? You can say, well, you can't be a little bit pregnant, even though under the laws of many states you can be little enough pregnant that it's not a crime to terminate your baby's life. You can say that one drop of the ocean of corruption is of the same consistency and evil as all the other drops, or you can say corruption is unevenly spread across the vast continents of crime.
Or, you can say, these are small things weighed against great ones. You should not excuse them, but it helps to have some perspective. I hate what covering Winnie the Pooh has cost me, but to me, it would be worse to not write about it. Beyond what I have already written, there are stories to come that are far more important.
Probably the phrase that best sums up the sea of conflict in which we find ourselves is the one attributed to "Hud" screenwriter Irving Ravetch: "None of us gets out of here alive." We don't leave our time and place in history untouched by it, unmoved by it, unsoiled by its ugliness nor even unsuffused by its beauty. We are a part of the All, and it's not so important who owns what as who owns you. I am captain of my little ship, and by the grace of God, it sails on.
For Rob-a-Bank, their investment in the Voice is probably of relatively little significance. They are unlikely to micromanage an enterprise as diverse in content as the LA Weekly, and unlikely to care much what a Hollywood freelance writer has to say about a Hollywood nightclub.
But if push came to shove - if Rob-a-Bank's investments were put at risk by the reporting of the paper, it might well be different. Why would any venture firm risk a multibillion investment in a high-tech company like Oracle, for instance, so the LA Weekly can get a great cover story exposing its notorious contract with the State of California? The American Reporter, on the other hand, has no problem with any sort of legitimate reporting, no matter whose interests are at risk.
At the end of the day, when taxpayers settle their IRS accounts and the regulators go to their beds, it matters a lot to millions of ordinary people who don't even read newspapers, including the American Reporter. We exposed and helped stop a huge fraud that was victimizing thousands of people a few years back, and afterwards, most were oblivious to all of it.
Countless people served by these publications and our own may never know they were ripped off by someone, never know a ripoff was exposed, and never know they're not being ripped off anymore. The human drama may pass therm by entirely. But our society will not progress one iota, and our culture will not change, our civilzation - our planet - will not be one whit the better if any small, cowering voice is silenced, and will always be the worse for every one that is.
Correction: Earlier versions of this article mistakenly referred to the New York Press as a "gay" publication. It is not. Owners of the New York Press also own a chain of gay-oriented alternative weeklies, but those are connected to the New York Press only by a "mutual investor," according to Village Voice "Press Clips" columnist Cynthia Cotts.