News & Criticism

The New York Times' Fatboy, Slim

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For those who either resent or revere the New York Times, news that Mexican tycoon Carlos Slim is injecting $250 million into the suddenly troubled newspaper giant is cause for…interest. The most illuminating piece I've read about Slim comes from former Times editorial writer, former boss of me, and current (I think!) Mexican, Andres Martinez. Sample:

Let's face it. The New York Times would never strike a deal with a U.S. tycoon of a similar profile, for fear of triggering real or apparent conflicts between the newspaper's coverage and the investor's interests. Not that you could ever find such a U.S. tycoon: The conglomerate of Slim-controlled telecom, banking, tobacco, retailing, insurance, construction, and other interests has been estimated to add up to 7 percent of Mexico's GDP. Even in his heyday, John D. Rockefeller accounted for only about 2 percent of the U.S. economy. As Forbes put it in its 2007 ranking of billionaires, Bill Gates or Warren Buffett would have to be worth $784 billion to have a similar share of U.S. wealth as Mr. Slim has of Mexico's wealth. […]

[T]he scale of Slim's fortune, and the extent to which it was built on a government-sanctioned monopoly, is scandalously unique. This Wall Street Journal profile provides the background on how Slim leveraged his personal ties to then-President Carlos Salinas de Gortari (and his financial backing of the ruling party) not only to prevail as a bidder in the early 1990s privatization of Mexico's telephone monopoly but to ensure that Telmex remained a poorly regulated monopoly long after its privatization. Slim's companies still control more than 90 percent of all landlines in Mexico and more than 70 percent of all wireless contracts. Mexico's respected independent central banker, Guillermo Ortiz, has pointed to the lack of meaningful competition in Mexico, especially in telecom, as one of the factors retarding the nation's economic development.

Conclusion?

I can assure you that Slim's investment will be a factor, even if unspoken, in editorial decision-making henceforth at the Times.

Whole thing here. Speaking of Slate and media scrutiny, don't miss Jack Shafer's mean little piece on "Chris Matthews' never-ending inaugural jib-jabbery."

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  1. This is a great blog. You will probably like this one too, check it out: http://www.riseofreason.com

  2. The conglomerate of Slim-controlled telecom, banking, tobacco, retailing, insurance, construction, and other interests has been estimated to add up to 7 percent of Mexico’s GDP

    That doesn’t tell me much. I probably control .4% of Mexico’s GDP.

  3. Well. It seems that you haven’t read enough about Slim to make your assessments. Slim bought the phone company including the monopoly rights. The monopoly rights were a condition for Slim to buy the company. At that time the company was pure junk. No one wanted to buy it. He offered to buy it if he was granted monopoly rights. And that’s the way he bought it. Without those monopoly rights virtually no one would have bought Telefonos de Mexico. It’s a case we study in Business Schools. And there is nothing illegal about it./ Now. Slim taught the Times how to save the money they will pay him in interest, by deducting it from their taxes. The Times will end up not suffering at all for the 14% rate. Both Slim and the Times will benefit from it.

  4. The New York Times cannot truly believe that a Major Investor outside the U.S. would not be a factor as much as one inside this country. When you have an investor of that magnitude you “Steer Clear” of any conflicts regardless of where they are from–the bottom line is money!

  5. EJM

    Now, the New York Times does a lot of things very well. But New Yorkers know that to get decent Mets or Yankees coverage, you really have to pick up the Daily News or the Post

    Of course he’ll make a change to the sports section. We’ll expect see more of this and this.

  6. That doesn’t tell me much. I probably control .4% of Mexico’s GDP.

    Carlos Slim is #2 on the Forbes richest list – ahead of Bill Gates and second to Buffett.

    Good company there.

  7. Of course he’ll make a change to the sports section. We’ll expect see more of this and this.

    For me, that’d be better than more Yankees or Mets coverage. (If he could add some real AFL coverage, that’d be still better.)

  8. Carlos Slim is an outstanding name for a villain. I hope he has a thin mustache and a Persian cat.

  9. The Times actually has pretty solid soccer coverage. Best is the Washington Post, though. In fact, Steve Goff’s soccer blog there is the highest-trafficked Washington Post blog (or it was the last I heard, at least).

  10. Whoops — second highest traffic, it turns out.

  11. The Times actually has pretty solid soccer coverage. Best is the Washington Post, though. In fact, Steve Goff’s soccer blog there is the highest-trafficked Washington Post blog (or it was the last I heard, at least).

    And 137 people in the US actually give a shit.

  12. I can assure you that Slim’s investment will be a factor, even if unspoken, in editorial decision-making henceforth at the Times.

    Well, double-duh. If he exercises his warrants he’ll have 17% of their common stock. And, he’ll probably also end up buying into other U.S. companies.

    Of course, the major question I have is how could they get worse? They’ll have to really work at it, but I know they’re up to the task.

  13. And, he’ll probably also end up buying into other U.S. companies.

    That’s the best news I’ve heard all day. So we might not need Obama’s shovel-money-into-the-furnace stimulus package afterall.

  14. Carlos Slim thought CompUSA was a good deal and Ricardo Pliego thought Circuit City was a good deal. Clearly Mexican tycoons need to stay away from American retail.

    And when Martinez says this:

    “Let’s face it. The New York Times would never strike a deal with a U.S. tycoon of a similar profile, for fear of triggering real or apparent conflicts between the newspaper’s coverage and the investor’s interests.”

    I mean–Berskhire has had a major stake in the WaPo for years and nobody’s said boo about Buffett meddling in their editorials (that I’m aware of.)

  15. Carlos Slim thought CompUSA was a good deal and Ricardo Pliego thought Circuit City was a good deal. Clearly Mexican tycoons need to stay away from American retail.

    Heck, if he can drive the NYT out of business, more power to him.

  16. Jack Shafer’s mean little piece on Chris Matthews

    Mean? I thought it was right on the money. It would be mean if Shafer had attributed Matthews’ ranting imbecilities to an insulin imbalance. Anyway, as MSNBC has won the title of “meanest third-rate cable-news network”, what has gone around will be coming around. That’s justice.

  17. I’m shocked — shocked! — at the brevity of LoneWacko’s response. Are the meds kicking in?

  18. Dammit, if it isn’t the poor Mexicans taking our jobs, its the rich ones taking our companies! Is there no end?

  19. Since the very lowest estimates of Slim’s fortune are around $60 billion, the $250 million of chump change he is lending to the Sulzbergers at 14% represents less that one-half of one percent of his pile of loot. Repeat, less than one-half of one percent. Nothing for Carlos to lose any sleep over.

    What I wonder is why he bothers. The NYT never prints anything negative about Mexico, Mexicans, illegal immigrants to the USA, or NAFTA now. Does Slim just want to make sure it stays that way?

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