Ever since Donald Graham, the heir to the Washington Post, decided tosell the family’s newspaper for two hundred and fifty million dollars,in 2013, to Jeff Bezos, the founder of Amazon and one of the world’srichest men, the preferred solution for a financially strugglingpublication has been to find a deep-pocketed billionaire, with othersources of income, to buy it and run it more or less as a philanthropicendeavor.
That seemed to be what the Wenners—Jann, the father, and Gus, theson—had in mind, too, when they put Rolling Stone, the iconic magazinefounded by the elder Wenner, fifty years ago, up for sale recently. He told the Times that he hoped to find a buyer who understood themagazine’s mission and who had “lots of money.”
But the story of Alice Rogoff and the Alaska Dispatch News is acautionary tale that shows the limits of what a wealthy owner iswilling, or able, to do for a struggling newspaper in the digital era.Rogoff is the wife of David Rubenstein, the billionaire co-founder ofthe Carlyle Group, the publicly traded, Washington-based private-equitybehemoth. Rubenstein, with a net worth estimated by Forbes at nearlythree billion dollars, is no stranger to lost causes. He provided $7.5million to rebuild parts of the Washington Monument, after the 2012earthquake, as part of his ongoing and iconoclastic “patrioticphilanthropy” effort. He provided $18.5 million to restore the LincolnMemorial. He provided twenty million dollars in cash to restore twobuildings on the property at Monticello, the home of Thomas Jefferson,as well as to restore two floors of Jefferson’s home itself. He ownsoriginal copies of the Magna Carta, the Declaration of Independence, andthe Constitution. He has a copy of the Emancipation Proclamation and theThirteenth Amendment, which abolished slavery. He is the chairman of theboard of Duke University (my alma mater, too) and the chairman of theboard of the Kennedy Center. He is a co-chair of the board of trusteesof the Brookings Institution and the chairman of the Council on ForeignRelations. He has an interview show on Bloomberg TV. He has agreed totake the Giving Pledge and donate half his wealth to charity.
By all accounts, though, the Alaska Dispatch News was Rogoff’s baby.She reportedly fell in love with Alaska after a trip there in 2001,according to the Los Angeles Times. She explored the Arctic, huntedmoose, and flew her own plane. A graduate of Connecticut College andHarvard Business School, Rogoff spent ten years as the chief financialofficer of U.S. News & World Report and was also an assistant toGraham, when he was the publisher of the Washington Post. She boughtthe Alaska Dispatch News in March, 2014, from the McClatchy Company,for thirty-four million dollars, when it was known as the AnchorageDaily News. She promptly changed its name and bought a new printingpress to leave little doubt that she was committed to continue to printthe paper. “I don’t see an end to print,” she told the Los AngelesTimes last year, explaining why she bought the paper and the newpress. “If I could see it, I’d be preparing for it. We’re not.” She saidthat she hoped to continue publishing the paper, which had a paidcirculation of about forty-two thousand, for “decades to come.” Afterbuying the paper, she sold certain assets for some fifteen milliondollars and used the proceeds of that sale to reduce the purchase price.She put in six million dollars of her own money and borrowed anotherthirteen million dollars from Northrim Bank.
But Rogoff’s dream of running a local newspaper in her belovedAlaska—she often lived there apart from her husband—slammed into theeconomic realities of the newspaper business. In August, the AlaskaDispatch News filed for bankruptcy protection. Rogoff had been tryingto sell it for months, without success. According to the bankruptcyfiling, the paper was losing an average of a hundred and twenty-fivethousand dollars per week and owed its venders some $2.5 million. Shestill owes Northrim Bank around $10.2 million, the security for whichis the regular payments that she receives as part of a “marital settlementagreement” with her husband, as well as her Wells Fargo investmentaccounts and the remaining assets of the paper. (The couple are notdivorced, though they have mostly lived apart—on opposite coasts—formany years.)
In announcing the bankruptcy filing to readers, on August 12th, Rogoffstruck a poignant and bittersweet note. “I think by now that most of youknow owning this news organization has been a labor of love for me,” shewrote.“The body of work done in our time has been as good as we couldhope for.We’ve worked hard tohelp illuminate the issues of our day andprovide a platform for points of view from across Alaska.Yet likenewspapers everywhere, the struggle to make ends meet financiallyeventually caught up with us.I simply ran out of my ability tosubsidize this great news product. Financial realities can’t be wishedaway.”
Last month, a bankruptcy judge in Alaska approved the sale ofthe newspaper to a new group of buyers, led by the Binkley family ofFairbanks, for a million dollars—the amount of the loan that the familyhad made to the paper a month earlier to keep it going. Very little, ifanything, of that million dollars will go the paper’s existingcreditors. “Obviously, this is not the outcome I would prefer,” Rogoff wrote in a court filing, “but the reason I agreed to these terms is thatmy primary desire is to see that the newspaper continue in operation.”For their part, the Binkleys made their fortune over five generations bytaking tourists and freight up the Yukon River. They are determined tokeep the paper going. “Newspapers across the country are in distress andoperating independently in remote Alaska adds to the challenge,” RyanBinkley wrote to the paper’s readers. “We will be working with thetalented and dedicated team here at the company, building a winningorganization. The ADN can’t be allowed to go away. It’s too important tothe city of Anchorage and to the State of Alaska.”
In the three years that Rogoff owned the paper, its value declinedninety-seven per cent. Sure, she had deep pockets, but not deep enough,it turned out. (Certainly, had she had full access to her husband’smultibillion-dollar fortune, or had he been interested in thisparticular lost cause, she likely could have kept running the paper,which lost $6.6 million in 2016, a million dollars more than it lostthe year before, according to the financial statements filed inbankruptcy court.) She will likely end up losing the six million dollarsthat she invested, plus whatever portion of the $10.2 million that shestill owes the bank, as part of the more than seventeen million dollarsshe told the bankruptcy court that she invested in the newspaper and thenew printing press, which, according to the bankruptcy filing, remainsunused and sitting idly in an old building in Anchorage. As for Rogoffherself, the Los Angeles Times reported that she left the bankruptcyhearing last month virtually unnoticed “and disappeared down thestreet without further comment.” Her Alaska attorney, CabotChristianson, told the paper that she would continue to live in Alaska.(He declined my request to be interviewed about how it went wrong forRogoff. She stopped tweeting last November.) “It is extremely painful,”she told the bankruptcy judge about the paper’s dénouement.
