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Darth Vega to the Rescue 

New Chronicle Publisher Frank Vega has been cast as a villain, but he may be just what the Hearst empire needs to defeat the dark forces of the new economy

Wednesday, May 4 2005

Page 5 of 8

Vega became the company's utility man. From USA Today, he was sent to New York to save Gannett's floundering Spanish-language daily, El Diario-La Prensa. ("The problems are usually the same wherever you go," he says. "Waste, low productivity, an unmotivated staff, a lack of new ways to generate revenue and stuff. We got it fixed real fast. ... I got it profitable in about a year.") In short order, he was named publisher of Florida Today, the paper that Neuharth started in 1966 and that provided much of the DNA for USA Today, and then regional president, overseeing several of the company's papers in the Southeast. By 1990, Gannett had grown concerned with its recent acquisition in Detroit, the News, which was limping along despite a joint operating agreement with the Knight-Ridder-owned Detroit Free Press. Vega again was dispatched, this time to diagnose the problem. "I did a pretty thorough report," Vega says, "and basically recommended a lot of people -- my name was not on the list. Two months later, they asked me to go in and fix Detroit."

The strike began in July 1995 and ended 583 days later, on Valentine's Day, as it happens, both companies having lost more than $100 million. Those facts are clear. Nearly everything else is up for debate: Why, exactly, 2,500 workers walked out; what management had offered; who "won" the strike. In 1998, the National Labor Relations Board found that the Detroit Newspaper Agency (now Detroit Newspapers Inc.) had engaged in unfair labor practices by adopting a merit-pay system -- the strike's catalyst, though Vega contends the strike was about union membership and dues more than anything else. A federal appeals panel later overturned the ruling.

The question of whether Vega succeeded -- whether he fixed Detroit -- is still being asked today, and how you answer depends in large part on which side of a picket line you instinctively sympathize with. It also depends on how you define "fix," whether it pertains to the numbers in a shareholder's report or the weight of a newspaper in a reader's hands or something more difficult to quantify, like a paper's quality and civic standing.

"The JOA achieved overnight in employee reductions what would've taken 10 to 12 years to get through negotiations," says John Morton, a veteran analyst and president of Morton Research Inc. in Silver Spring, Md. "The two newspapers suffered some short-term consequences in circulation and advertising because of the boycott, but after they got that first year behind them, everything from then on was gravy. The way they handled the strike was very smart, wherever your sympathies might lie." Analysts put the newspaper agency's profits in 1999 somewhere between $60 million and $70 million, climbing above 1994 levels.

On the other hand, Lou Mleczko, president of the Newspaper Guild of Detroit, says: "By any standard of measure, as CEO of this newspaper agency, Mr. Vega was a failure. The business atrophied and diminished, and he had personal problems." Mleczko ticks off a series of numbers: Prior to the strike, the combined Sunday paper had a paid circulation of almost 1.2 million; at last count, the paper's Sunday circulation was about 700,000, the effect of a prolonged union-led boycott in a union-friendly town. "If Mr. Vega is crowing about how successful he was in Detroit, that's a strange way to mark success."

The strike unfolded nasty and ugly and pretty much entirely on Vega's terms. As president and CEO of the Detroit Newspaper Agency, which oversaw the papers' joint operating agreement, he had prepared the papers for a violent and expensive situation. There was an actual manual, a three-ring binder that detailed how every operation of the paper should proceed in a strike, and by the time workers walked out the door, local police had long since been alerted, replacements were waiting in motel rooms, Vance security was on the ground, and the building was stocked with enough toilet paper to last three months, according to one account. Some saw this as a sign of bad faith, that Vega had been itching for a strike.

"A lot was made of the fact that we planned for the strike," says Vega, who reportedly moved to a windowless office at the onset of the dispute. "And the analogy I used at the time -- and it's a good analogy because of what happened last year -- was that if you live in Florida, and a hurricane's coming, do you just sit there and do nothing? No, you board up your windows, you go buy water, you get batteries, you get a generator. If a storm is coming, you get prepared for it. We wanted to publish a newspaper. We felt we had an obligation to provide news and information every day to our customers. If we had not published and just said, 'OK, we're just gonna sit here until the unions decide they wanna come back to work,' we wouldn't have had a business when it was over."

One replacement worker, who was paid about $1,000 a week, says he went through four rental cars in 10 days. "The second or third day I was there, I lost a windshield," says Eric Caron, who worked under Vega in Florida and helped deliver newspapers in Detroit. "A day or two later I got myself blocked in on a cul-de-sac and got my front end baseball-batted. Another time, I had a woman jump into the back seat of my car after she saw the newspapers and pull out a knife. She was cutting the interior of the car out, and I was just inches from her and her knife."

The violence wasn't restricted to replacement workers, however. Rebecca Cook, then a photographer for the Detroit News, says the turning point for many strikers was an incident outside the paper's Sterling Heights printing plant, what she calls the "most horrific night of the strike." Until then, there had been a routine at the plant. "It was always somewhat theatrical," Cook says. "Every time the trucks would come out with the papers, police in riot gear would walk out into the street, and the picketers would be pushed back, and trucks would come and go." Late one night, Cook recalls, the gates opened unexpectedly.

About The Author

Tommy Craggs


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