He Built a Great Paper. Then He Quit

By Chris Welles


Otis Chandler and the Rise and Fall of the L.A. Times Dynasty

By Dennis McDougal

Perseus -- 526pp -- $35

The preeminent newspaper dynasties have run their operations differently from most other businesses. Holding major, even controlling, positions in the stock, members of such families as the Sulzbergers, Grahams, and McCormicks have striven to make a respectable return on investment, but their chief goal has been producing superior journalism. Maintaining family control while building publicly traded, widely diversified media corporations is not easy. The stock market is demanding ever heftier profit margins. In particular, the Sulzberger and Graham families, of The New York Times and The Washington Post, respectively, have managed the process successfully.

Then there are the Chandlers, owners of the Los Angeles Times until they sold out to Chicago's Tribune Co. in an $8 billion deal in March, 2000. Their failure is exhaustively detailed in Dennis McDougal's Privileged Son, an informative work that suffers from overly dramatic prose and a lack of organization.

McDougal tells two related stories: the emergence of the Los Angeles Times as the most powerful newspaper in the West and the history of the powerful Chandler family that dominated the Times, and Southern California, for much of the last century. The author's depiction of some of the major players is compelling, especially that of Harry Chandler, the newspaper's publisher from 1917 to his death in 1944.

In 1885, the 22-year-old Harry took a job loading copies of the fledgling Los Angeles Daily Times on wagons. Nine years later, Chandler married the daughter of the Times's then-publisher, Harrison Gray Otis. Chandler went on to amass a huge empire. Real estate was the base: His holdings amounted to more than 1.5 million acres at their peak. But Chandler branched into everything from cotton to shipbuilding to insurance. He sat on more than 40 boards and held large blocks of several dozen companies' stock. His clout extended deep into politics--mostly far to the right. Critics decried his ruthless, shady tactics. In large part, Chandler was the model for the villain in the 1976 film Chinatown, a classic tale of greed and venality.

Harry Chandler was a seminal figure, but it is Otis, his grandson, who dominates Privileged Son. Named publisher in 1959 when he was only 31, Otis transformed the Times from a profitable but miserable right-wing rag to one that was a worthy rival to The New York Times. Under him, the paper won 21 Pulitzer Prizes. Circulation and profits soared. To outsiders, Otis seemed destined for a long reign.

But Otis saw things differently. Even as he was reshaping the Times, he was building another life as an adventurer--a life that gradually displaced publishing. The Chandlers were methodical and relentless, but Otis took after his grandmother's side of the family, which was restless and risk-taking. He hunted big game in Alaska, surfed, and competed in car races. By 1980, he had rescued and re-created the newspaper beyond all expectations. It was time to re-create himself. He stepped down as publisher. Said one Times editor: "Otis is going surfing, and he's never coming back."

Rather than encourage his children to enter the business, Otis seemed to sabotage them. He stated publicly that his two eldest sons would not make good publishers. Said third son Michael: "My father's got an ego.... It was probably his ego that contributed to his attitude toward keeping us kids from carrying on. He wanted to go down in history as the last of the great Chandlers."

McDougal, a former Los Angeles Times writer, takes no position on the journalistic potential of any of Otis' sons or their cousins. But as his account vividly shows, from the time Otis quit, it was all downhill. In 1986, Times Mirror Co.'s board forced the distracted Otis to relinquish his post as chairman, leaving him with the empty title of chairman of the executive committee. He didn't fight the demotion, though Otis and his cousins, through trusts, controlled the company.

By 1989, a new wave of editors, advocates of a more breezy approach to journalism, came aboard. In the vanguard were Shelby Coffee III, from The Washington Post's Style page, who became editor, and David Laventhol, the publisher of Newsday (owned by Times Mirror), who became publisher. They pushed a faster format and what the author calls "exclamation point journalism." Controversy was soft-pedaled.

Then, in 1995, Mark H. Willes, former vice-chairman of General Mills Inc., took over as CEO. He abolished the wall between advertising and editorial: "I'll use a bazooka if necessary," he said. Possibly sensing vulnerability at Times Mirror, executives at Tribune Co. arranged a takeover. Tribune CEO and Chairman John W. Madigan has a Wall Street background, is a fierce cost-cutter, and boasts a 29.2% profit margin, higher than any other newspaper company. It's questionable whether exceptional journalistic standards will prevail in the face of the relentless push for profits.

McDougal has pulled together a wealth of information. Unfortunately, his material seems only semidigested. One yearns for broader coherence, a clearer sense of narrative. Also, McDougal's prose is riddled with cliches.

For all that, Privileged Son sounds a warning that family-owned media companies, even with huge assets, are fragile. It's too bad, since when they take a stand, such papers, along with journalism schools, can be a defense against the dumbing-down, by-the-numbers approach so pervasive in the media today.

Former BusinessWeek editor Welles worked at the Los Angeles Times from 1983 to 1985.

    Before it's here, it's on the Bloomberg Terminal.