Prepare to be Mushroomed
The massive leveraged buyout of the Tribune Company by Chicago real estate magnate Sam Zell—the 65th richest man in America according to Forbes, with a personal fortune of $4.5 billion—is in the beginning stages. My bet is that it will result in a tsunami of layoffs, buyouts, firings, and wrecked careers and lives.
According to the Jan. 25, 2007 Newstrack, the media industry slashed 17,809 jobs in 2006, an 88% increase over the 9,452 jobs lost the prior year.
Last year, we watched The Philadelphia Inquirer and Daily News fall into the hands of a local consortium of investors that has neither newspaper experience nor deep pockets. The carnage has not been pretty.
I am reminded of a long, liquid lunch that I had many years ago with my first book publisher, a taciturn, rotund Vermonter named Paul S. Eriksson. He was the proprietor of a tiny business on West 58th Street with just two employees—himself and his wife, Peggy.
At one point I asked, “Paul, why don’t you get bought?”
“Huh? What do you mean?”
“RCA just bought Random House and CBS has acquired Holt. Why don’t you find a nice rich investor to buy you, pump some financial juice into your operation, so that you can publish more books and become a real player?”
Paul thought a moment. “Nah,” he said. “You know what happens to the CEO of a small company that gets bought? They mushroom the guy.”
“What do you mean ‘mushroom the guy?’”
“What do you think it means?”
“I don’t know. Something like this?” I drew a mushroom shape in the air with my two forefingers.
“No,” he said. “When you mushroom a guy, you keep him in the dark for a long time, you feed him a lot shit and then you can him.”