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Bleeding ‘Times’ Blood

Fifth-generation Heir Dave Golden.  

In order to keep the family—and shareholders—happier in these lean financial times, Sulzberger has quietly ramped up the amount of cash they receive in a quarterly cash dividend. This, more than the sale of stock, is the source of the Ochs-Sulzbergers’ working wealth. Sulzberger and CEO Janet Robinson raised the dividend by an extraordinary 31 percent last year—even as the stock price declined. Of the $132 million a year the paper gives to shareholders, about $25 million of it now goes directly into the coffers of the Ochs-Sulzberger trusts.

But the payoff exacts a harsh price: The company is going deeper into debt to pay the high-yield dividend. In the last four quarters, the paper has made less money than it has paid in dividends, and debt-ratings agencies like Moody’s and Standard & Poor’s are threatening to downgrade the company to “junk bond” status, which would paralyze the paper’s ability to borrow money. In August, an analyst for Moody’s suggested the company could quickly improve its rating by lowering the high-yield dividend—a report that sent the stock down 6 percent. Emile Courtney, a credit analyst for Standard & Poor’s who currently has the Times at the lowest investment grade possible, says that even with changes to its cost structure, “there’s a greater than 50 percent chance that [the Times] will go lower to non-investment grade.” If that happens, the paper will have even less money available to climb out of its hole.

‘My family’s dedication to this company is fundamental and enduring,” Arthur Sulzberger declared during Elmasry’s attack in 2007. Indeed, the Sulzberger family’s dedication to the Times has been the gold standard among newspaper dynasties over the last 30 years. The family is steeped in mythology, down to the name of the family trust, Marujupu, shorthand for the first names of the four children of the late matriarch Iphigene Ochs Sulzberger: Marian, Ruth, Judy, and Punch (in 1929, the explorer Admiral Richard Evelyn Byrd actually named one of the glacial hills in Antarctica after them, Marujupu Peak, not far from Ochs Glacier and Mount Iphigene). After Iphigene died, in 1990, the families of her four children decided to fuse their fortunes together in a trust designed to protect the newspaper. By accepting the deal, they gave up the right to sell off controlling shares in the company, which added up to an estimated $1 billion in potential wealth. But it was worth it to try to preempt the phenomenon that trust-fund managers everywhere know to be true: Families fracture and fight and eventually break up over money.

The four siblings had between them thirteen children, a handful of whom—Arthur Sulzberger, Stephen Golden, Michael Golden, and Dan Cohen—became directly involved in the business. Their identities were built on the paper’s prestige, and their commitment was cultivated by bonding rituals at Hillandale, the family’s onetime 263-acre country estate in Stamford, Connecticut, where copies of the New York Times were placed under benches in the gardens.

At one time or another, each of these cousins thought of himself as a candidate to one day lead the company, each rising through the ranks of his respective department—Stephen Golden in forest products, Dan Cohen in sales, Michael Golden in the magazine division. Arthur Sulzberger was not necessarily the obvious choice to succeed his father. While attending Tufts in the early seventies, Sulzberger did hallucinogenic drugs, worshipped the Grateful Dead, and motorcycled with Dan Cohen. But eventually Sulzberger settled down and started working as a reporter, first at the Raleigh Times and Associated Press, later for the New York Times. He shifted to the business side in 1983, and his father anointed him publisher in 1992, despite some skepticism from the company’s board.

After Sulzberger became publisher, Stephen Golden and Dan Cohen left the company. Golden moved to Tucson to pursue a law degree and work for the rights of Native Americans; Cohen, Sulzberger’s closest family adviser and friend (also one of the company’s largest shareholders), was effectively forced out as senior vice-president of advertising by Janet Robinson, with Sulzberger’s blessing, in part because of complaints about his temperament. Cohen started a TV-production company and later got into the submarine and underwater-exploration business, founding DeepSee, LLC, in 2007. (Netscape co-founder Marc Andreessen, a critic of the Times’ management, archly noted that Cohen’s qualification as a company board member was “noted Jacques Cousteau expert.”) Only Michael Golden remained at the paper. In 2002, after the Times acquired full ownership of the International Herald Tribune, he departed for Paris to serve as that paper’s publisher—a kind of second prize for Golden in lieu of being publisher of the Times.

The other cousins have mainly deferred to Sulzberger, enjoying relatively placid lives as philanthropists, conservationists, and charity-board members. Susan Dryfoos serves as the family historian; Lynn Dolnick was a director of the Smithsonian zoo; Cathy Sulzberger is a real-estate developer; Arthur Golden wrote the best seller Memoirs of a Geisha.