Let’s take another look at Kansas City Star parent McClatchy head guy Gary Pruitt...
As my former colleagues at 18th and Grand hunker down and await another likely pre holiday bloodletting, yesterday’s column wondered aloud how Pruitt, having blundered so badly, has managed keep his job. He’s been doling out plank walks by the hundreds to journalists whose only crimes were working at a company he foolishly leveraged at the exact wrong time.
To be clear, layoffs would have come to the Star even if Knight-Ridder still owned the biz. But by Pruitt’s taking on such huge debt, the casualties have been far greater than they likely otherwise would have been. And piloting McClatchy’s stock from $63 to an all but worthless buck is no small feat.
Yet Pruitt still has his job. In what universe does that logic exist?
"Pruitt was always a golden boy in the eyes of the Wall Street analysts — even now they treat him with obvious respect even though it’s all gone to the crapper," says one prominant news exec. "I think the McClatchy family must love him like a son."
Just how golden was Pruitt in his pre Star hey days? Very.
Take the blowjob administered by American Journalism Review writer Susan Paterno in 2003:
"Pruitt presented himself at the Ritz as he often does, a modern Candide, always positive, always on message, always looking as though he stepped from the pages of a Ralph Lauren catalog, running a company as trim and fit and athletic as he is. He has a smile that probably broke a hundred hearts in high school and an endearing goofy charm, stumbling over Hegel and rattling off Rolling Stone lyrics in the same conversation, likening his Wall Street strategy to a Lenny Kravitz tune for analysts, talking as guilelessly about journalism as he does about redecorating his office from the dark wood paneling of the previous regime to a streamlined modern gray and blue, with matching Expressionist paintings and a light fixture that his mentor and predecessor Erwin Potts told him looks vaguely pornographic."
"At 46, Pruitt represents the future of journalism, a new game whose rules have changed considerably from the ’70s and ’80s…" Paterno panted. "Today, McClatchy papers are thoroughly modern and professionally designed newsgathering machines…"
Paterno’s yarn did contain insight into what would become Pruitt’s Achille’s Heel; his appetitite for acquiring other newspapers.
"Pruitt’s strategy is straightforward: Pay what it takes to acquire newspapers in growing regions, eschew all ‘national pretensions,’ as he has said, make the papers the best for their size, maintain the leading local Web site and boost advertising market share, all the while defusing unions, raising readership and tightly controlling expenses," Paterno wrote. " ‘A company our size either has to grow or die,’ says (former Star editor) David Zeeck, executive editor of the News Tribune in Tacoma, a midsize McClatchy daily. ‘It’s gonna eat or get eaten by somebody. Gary talks about that all the time. You’re either gonna be eaten or [be] an eater. We want to be an eater.’ "
Unfortunately for the Star and McClatchy stockholders, Pruitt ate too much at the exact wrong time.
Two years after buying Knight-Ridder and the Star, Pruitt made 24/7 Wall St.‘s list of "10 CEOs That Need to Leave."
"The company’s corporate governance section does show ‘an annual CEO review’ and we would suggest the company get on this…" 24/7 wrote, adding, "The problems will likely continue under a new head, but this company looks ripe for new blood to lead the day to day operations."
That same year, NewsBusters nicknamed Pruitt "Bagdad Bob."
"He was the Iraqi press spokesmen who caused much amusement in the West because of his unrealistically upbeat pronouncements when Iraq was invaded by the United States and its allies in 2003," NewsBusters wrote. "Among Baghdad Bob’s funnier announcements was his declaration that no Americans were in Baghdad at the same moment when American troops were patrolling the streets of that city just a few hundred yards from where he was holding that press conference.
"Well, the newspaper industry has its own Baghdad Bob in the form of McClatchy CEO, Gary Pruitt, who in early 2007 gave his own unrealistically upbeat reports to his company’s employees on the purchase of Knight-Ridder in 2006. That purchase quickly turned into an utter disaster as evidenced that the former Knight-Ridder flagship newspaper, the Miami Herald, is now being put up for sale by McClatchy."
CNBC’s Jim Cramer has called Pruitt "a walking disaster…a one-man black hole for shareholder value," further adding that, “If Gary Pruitt had been the captain of the Titanic, that would not have been an accident, hitting that iceberg.”
Yet five years into a steep slide that has cost thousands their jobs, Pruitt remains large and in charge.
At this point the only way McClatchy and the Star are likely to free themselves of Pruitt’s death grip is if the company is forced into bankruptcy, insiders suggest.
"And a whole new management regime comes in, like what has been happening with Journal Register company, which is in the hands of a hedge fund or some kind of private equity company…," the news exec adds. "That is what the end game is looking llike for these companies…(but) bottom line, it is hard to see a sunny outcome."
Aside from whatever’s left of the Pruitt mythology – the cool, modern guy, who likes rock n roll and goes surfing – this much is clear: "He’s not Steve Jobs or Superman."