
McClatchy upgrades CEO’s housing stipend to $35K a month amid buyouts - smacktoward
https://www.cjr.org/business_of_news/mcclatchy-upgrades-ceo-forman-housing-stipend-35k-month-buyouts.php
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babaganoosh89
This happens because the IRS has a $1 million limit on executive salaries for
tax deduction purposes. All these other forms of payments just help get around
that.

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reaperducer
I’d like to see a spreadsheet of McClatchy’s payroll to learn how many of its
employees make less per year than the CEO gets in monthly expenses.

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russellbeattie
Now he can almost afford to rent a 3 bedroom house in Los Altos Hills or
Atherton... (Just kidding, there are no 3 bedroom houses for rent in either
place.)

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metildaa
That is on purpose, limiting the quantity of 2 bedroom units built and
clamping down on the permitting process for 3 and 4 bedroom apartments and
condos is critical for cities and towns that want to keep middle income and
poor families from moving in and burdening their schools.

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secabeen
> The CEO’s compensation is set by the board of directors using public
> consultants and comparable.

This may be true, but the Lake Wobegon effect is strong here, few companies
want to hire a below-average CEO, and few companies want to offer a below-
average CEO compensation package, so they just spiral up and up and up.

~~~
chrisseaton
Why don’t these two statements and the resulting effect apply to workers other
than the CEO though?

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ImprovedSilence
Their salary & compensation isn't public, they have less information on what
the market will bear for their skills. And that's how the company wants it to
be.

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reaperducer
_In his email on Friday, Forman attributed this latest reduction in staff to
“the culmination of the enormous progress McClatchy has already made in our
transition to a digital future,”_

Is there any industry where a reduction in headcount is considered “progress?”

If Google would have reduced its employees by 19k, instead of increasing it by
19k in its most recent results, would that have been spun as “progress?”

~~~
slededit
It would if they maintained the same revenue and innovation velocity.

The last one is really hard to judge though. Its quite common for a CEO to
effectively cut R&D and be seen as a genious for reducing costs. The company
dies a slow death resting on its goodwill for a decade or more.

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evadne
Relevant book: The CEO Pay Machine
[https://www.goodreads.com/book/show/31752824-the-ceo-pay-
mac...](https://www.goodreads.com/book/show/31752824-the-ceo-pay-machine)

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loeg
The title is aggressively misleading:

> According to Segal, this stipend will be used to pay for Forman’s travel,
> housing, office, and security expenses.

It is probably still a lot of money for that, but it goes beyond just housing.

~~~
jpatokal
But why are they paying him a cash stipend instead of expensing against
receipts? Or is this meant to be more of a cap on how much he can spend on all
that monthly?

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loeg
Beats me. It seems like essentially they're paying him $2.4 million, just
divided into 3 separate buckets.

~~~
dkarbayev
$2.04M

~~~
lsaferite
$2.42M

$35k x 12 = $420k

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danso
So weird (but welcome) to see the ugly mundane details of the journalism
industry on HN. I used to work at a McClatchy paper long ago but I have
trouble mustering outrage about its CEO because the excesses of other
companies seem far more egregious. The Tribune Company/Tronc (which owned the
Chicago Trib, the LAT until recently, and the Baltimore Sun, which caused
David Simon to ragequit journalism) was by far the most scandalous IMO [A].
The previous McClatchy CEO (who was there when I was there) made several
million a year, despite being the CEO responsible for making the deals that
absolutely eviscerated McClatchy with debt [0].

The standard line is that without good pay packages, a news company would have
no chance of attracting competent executives to helm the sinking ship. But
what was most frustrating to me at the time was the inescapable cynical belief
that not only would the CEOs fail to right the ship, but that they had no real
skin in the game and would just move on to the next high-paying job once the
time was right. The fantasy that a news CEO would sacrifice his salary to save
some vital newsroom jobs, or fund a company-saving initiative, and join us in
the trenches and fight till the bitter end to save the company or at least go
down with the ship was never even a remotely believable fantasy.

Equally frustrating is there is also no possibility that the company could be
saved by hardworking diligent faithful employees. The investigative stories of
journalistic lore are virtually always loss-leaders. In recent years, winners
of the Pulitzer had already left for other industries by the time they got
their medals. Roger Ebert’s brand and special site would not have been enough
to save the Sun-Times (even if he hadn’t died). Adrian Holovaty created Django
while working at the Lawrence Journal World; Django is the backbone for tech
companies as big as Instagram, but the LJW switched last year to WordPress
[2], having lost the resources to innovate on or maintain its Django backend.

[A] [https://splinternews.com/tronc-executives-rewarded-for-
incom...](https://splinternews.com/tronc-executives-rewarded-for-incompetence-
and-miscondu-1825051977)

[0]
[https://archives.cjr.org/the_audit/the_aps_weak_coverage_of_...](https://archives.cjr.org/the_audit/the_aps_weak_coverage_of_its_n.php)

[1]
[https://apnews.com/dc312a7e503f4b7bb61a62013fea852d](https://apnews.com/dc312a7e503f4b7bb61a62013fea852d)

[2]
[https://www.reddit.com/r/django/comments/8v0fpb/the_lawrence...](https://www.reddit.com/r/django/comments/8v0fpb/the_lawrence_journalworld_where_django_was/)

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onetimemanytime
>> _To me local journalism is public service. I don’t think we should expect
that anyone profits._

Ok, I get it. But why should McClatchy, a for profit corp, shoulder all this?

