Malin Burnham and the U-T San Diego Idea Factory

Part Two of two parts
Part One

By Frank Gormlie

As we delve more now in Part Two  into Malin Burnham, “the last Corte Maderan” as Mike Davis calls him, and his possible take-over of San Diego’s only daily newspaper, longtime City Heights community activist, Anna Daniels, one of the editors at San Diego Free Press, cautioned:

When the news broke that Malin Burnham was interested in purchasing the U-T San Diego with the intent of turning it into a non-profit, the main and often only description of him was as a San Diego “philanthropist”.  And it is true–Burnham is known for his extensive philanthropy.

He is also known for his role as a local real estate developer, as chairman of First National Bank at San Diego and as a former Director of San Diego Gas and Electric. It might prove useful in the future to keep these other interests in mind.

Which pretty much sums up Part One for me.  As City Hall veteran, Norma Damashek, reminded us:

As you know, Burnham has been a VIP mover and shaker in San Diego for decades.  He’s not stingy with his money.  Some is philanthropy, some is strictly political.

It’s also useful to know that Burnham represents a wing of the local Establishment that has challenged the other, more conservative wing on numerous occasions – with  the back and forth between the different factions going for decades.

David Stutz, a retired local attorney, in a comment left to Part One describes an earlier battle:

In 1970, Burnham bucked the C. Arholt Smith Republican establishment and supported Democrat Ed Miller for District Attorney along with Tom Hamilton – of Luce, Forward, Hamilton and Scripps – , Larry Lawrence, Robert Peterson and Dick Silberman.

Miller’s victory followed by Pete Wilson’s victory for mayor took the power from old guard. Burnham was a stand up guy 44 years ago and made a major contribution to what was then a new San Diego.

Years later, he’s still bucking the conservative Republican establishment. 

For instance, Burnham backed Nathan Fletcher in both of his runs for mayor. He was DA candidate Brewer’s biggest donor in his unsuccessful campaign against GOP stalwart Bonnie Dumanis.  Burnham is said to have called  Dumanis to get her to drop out in order for Fletcher to have a better chance – Dumanis supposedly denies this.  It’s also publicly known that Burnham came out and criticized the Lincoln Club, a local right-wing organization, for its attack ads against Fletcher. Some see the Lincoln Club, as a front for Manchester (or the other way around).

Today, Burnham gives money to Democrat Scott Peters in his reelection bid. In contrast, the Manchester wing supported DeMaio in both his mayoral campaign and today, in his run for Congress.  This demonstrates that San Diego’s establishment has a conservative wing or faction and a more moderate wing or faction.  At times, these wings may include Democrats, environmentalists and independents. Yet, one wing – more than the other – gets along with other politicos.

Burnham’s history show an ability to organize major players from both political parties into projects that he favors.  He went gaga over the redevelopment of downtown from Petco, forming a group of bi-partisan power brokers to ensure the stadium was built in downtown.  And then this same group went on to do more things – goals favored by both sides of the competing wings of the establishment.

In 2000, Burnham and the other major promoters of the downtown ballpark project – Peter Q. Davis, John Moores, Scott Barnett, George Mitrovich, Kris Michell, and Richard Ledford – joined forces in the cause of a “strong mayor” government. In 2004 he put up $50,000 in support of Prop F, the strong mayor initiative.  Six years later, Burnham headed up San Diegans for Accountability and put up $25,000 more for Prop D, making the strong mayor system permanent. This went against the grain of many Democrats who did not support the measure.  Yet, it’s clear that Burnham plays both sides of  the field and love to be a power-broker.

And now he’s done it again. Malin Burnham has organized a handful of movers and shakers into a potential media project.  Will it work?

Let’s take a look at the team, whom Burnham calls “co-equal” partners.

Right off the bat, though, we can see that the five are come from the same cloth; they’re a bunch of old, rich white guys. Burnham calls them a group of potential donors and they’ve been studying the deal for five or six months.

Bill Geppert

Bill Geppert as a member of the Malin Burnham 5, is another high-level wheeler-dealer for the privileged elite. He was the General Manager of  Cox Communications San Diego from 1995 until his retirement in 2011, the past president and CEO of the San Diego Regional Economic Development Corp. and the San Diego Regional Chamber of Commerce. Geppert serves on numerous boards, many of them Burnham-connected, including the San Diego Foundation.

He was named YMCA Civic Leader of the Year and Business Person of the Year by the San Diego Business Journal. He was elected as the 2013 president of the Holiday Bowl and did the same for the Poinsettia Bowl –  both which are money-making endeavors for San Diego. A few years ago, Geppert’s visibility was so high, that some speculated that he would run for mayor of San Diego when Jerry Sanders’ term ended in 2012.

Bill Roper

La Jollan Bill Roper is a heavyweight financier – having been the Chief Financial Officer and Executive VP of SAIC, San Diego’s premier high-tech and aerospace firm. Roper was one of the few at the helm during the 17 year period where the company’s annual revenues, reportedly grew from $800 Million to more than $8 Billion, and it became a global tech powerhouse serving the US Department of Defense and other government agencies.

Today, he runs a La Jolla investment firm Roper Capital Company, a private investment company. After Roper left SAIC, he led several other firms, some of which had millions of dollars of contracts with the Defense Department involving tactical products and logistical services.  A few years ago, Roper was the vice chairman of something called the Citizens’ Fiscal Sustainability Task Force, a private group formed to review the city of San Diego’s finances during the Jerry Sanders years, with concerns of a projected $179 million deficit for the remainder of the 2009-10 fiscal year and for 2010-11.

Patrick Shea

Just this year, San Diego Magazine named Patrick Shea the Top Lawyer 2014 in Commercial Law, which gives us an idea of who he is. For decades, Shea has been an influential and well-known bankruptcy lawyer and business wheeler-dealer in the circles of San Diego’s elite, an arch Republican insider. He has represented or advised many of the nation’s largest financial institutions. In 1994, he was appointed by a federal court to represent 170-plus municipal entities  with investments of over $5 billion in the Orange County, California Chapter 9 bankruptcy, the largest municipal bankruptcy in U.S. history.

in 2005 Shea ran for Mayor of San Diego on a platform of filing a Chapter 9 bankruptcy for the city in order to restructure its troubled financial condition – a fairly naive political stance which garnered him something in the low, single-digits.

Shea has many friends and connections; his former law firm the mighty Pillsbury Winthrop, his friend and former classmate at Harvard, George W. Bush; Shea and his wife Diann Shipione were close friends and advisers to then City Attorney Michael Aguirre.  (Diann Shipione is the former City of San Diego pension-board member, who in 2002 was the first to say the city’s finances were vulnerable due to the city pension debacle.) He was general counsel and corporate secretary to the San Diego Host Committee for the 1996 Republican National Convention in San Diego.

Usually working behind the scenes, Shea’s activities burst out into the open while he was President and CEO of a company formed to convert the Brown Field Airport into a regional airport cargo facility.  After a bitter fight that tore friendships apart, the City of San Diego elected not to complete the cargo airport conversion.

Shea also served as Chairman of the Board of Directors of the San Diego Convention Center Corporation and Chairman of the San Diego Ballpark Task Force. At the time, observers were not surprised that all this led to the development and construction of Petco Park, thanks to Pat Shea.

Mark Stephens

The fifth member of the Malin Burnham 5 is another lawyer, Mark Stephens. Up till his retirement in 2012, he was the managing partner for Ernst & Young LLP’s San Diego office, where he’s been for 36 years. The world-renowned firm is seen as  a global leader in insurance, tax, transaction, advisory services and strategic growth markets, and claims a staff of 141,000 staff in 140 countries, with more than 200 located in San Diego.

It’s clear that these guys are high-rollers, know how to raise and manage lots of money, and have connections to heavyweights.

The State of the U-T

So, with these movers and shakers by your side, someone like Malin Burnham might just be able to pull the whole thing off. Supposedly, Burnham is fairly optimistic about the current U-T finances, and has stated that the newspaper is more financially sound today than it was in the last days of the Copley family’s ownership in 2009. Some analysts reportedly agree that because Manchester poured money into the paper, it has a definite operational and financial stability, after being de-valued after the Copley sale.

Doug Porter, one of the editors of the San Diego Free Press, thinks there’ s too much optimism over Burnham’s plan.

It strikes me as odd that people are taking the claims about UT-San Diego’s profitability at face value. Burnham somehow thinks this entity will be a cash raising machine for good deeds around town. I’ll hazard a guess is that these profits might exist on paper.

KPBS, another non-profit local media, adds to this by raising the issue that one of the key motivators behind Manchester turning the paper over to Burnham, may be because Manchester is running low on cash.  They say that the money given by Manchester to the GOP this year is “peanuts” compared to the funds he funneled through various Republican committees during the race for mayor by Republican Kevin Faulconer.

Doug Porter explains his reasoning where he thinks Papa Doug is really at – and makes a prediction:

What this story really tells me is that Papa Doug is tired of his media toy. His delusional business approach has failed. Circulation is dropping, credibility is gone, and the advertisers that the UT still has are there only because they are out of touch with the market. Obama got re-elected, Obamacare happened and the world didn’t end, and Manchester’s best buddy Dinesh D’Souza just went off to work on a book about life at an Obamacamp.

If he can’t find a buyer in the next two years, I predict he’ll just close it. Despite all the cutbacks and economies of scale that have been put into place in Mission Valley going back over the past couple of decades, the dead tree media model for daily newspapers just isn’t working anymore. And he needs to move quickly on redevelopment of his Mission Valley property while he’s assured of smooth sailing in the City Planning Department.

Some of the optimism cited sardonically by Porter, could no doubt be based on spite, spite against the Reign of King Manchester. David Rolland of CityBeat told us in an email:

I don’t have an particular insight into Burnham or how his plan would play out, but it would be near-impossible for any human being or nonprofit entity to be worse than Doug Manchester.

The Manchester squad came in with mandates to turn reporters into TV celebrities and the sports pages into a cheering section for the Chargers and their quest to build a new headquarters with public tax dollars. The paper’s right-wing editorial page, which had moderated considerable under the ownership of Platinum Equity, is now completely out of step with the county populace.

Ernie McCray, a former school principal  and a member of the newspaper’s Community Editorial Board, prior to Manchester’s purchase, is very critical of the wealthy hotel owner:

I had hope that the U-T could be a paper representative of our community-at-large. That was during a brief period just a few years ago when I was on its Community Editorial Board, a group that actually got to sit down with writers before editorials were written and give input that we thought might make it more balanced newspaper. We actually were actually listened to and our ideas were used. I can’t describe how good that felt.

And then along came Doug Manchester who bought the publication and killed every single dream we held about how the paper could truly become a positive influence in our city. He was all about propping up the rich and greedy in San Diego, non-stop, and with no shame whatsoever.

 Also, part of the optimism that folks have could be based on Burnham’s pledges and promises:

“I see a newspaper as an idea factory. Let’s get all the ideas on the production line. For example, the Malin Burnham Center for Civic Engagement, a part of the San Diego Foundation, is designed to do just that.

The whole concept is to involve people from all walks of life. If they think they have a good idea for the community, bring those ideas into the center, and they’ll be welcomed. If the idea has merit, we’ll provide resources to explore them.”

And more promises:

“We would, in effect, take the profits of the newspaper, and instead of giving it to an owner, we would take those same profits and help many other projects in the community to advance the quality of life here in San Diego. That’s the main purpose,” he said, adding that editorial policy would be as inclusive and community-focused as possible. “Almost by definition, if not by law, a nonprofit has to be nonpartisan.”

 Burnham, in various interviews with local media, has said that there would be a firewall between the nonprofit and the editorial board, and he would expect the board to be nonpartisan and less aggressive. It would continue to endorse candidates and political initiatives but on an individual basis, not a partisan one, and make decisions based on “the best interests of San Diego.”  Burnham has stated:

“Hopefully that editorial board would be a cross-section of the community.”

 Still, doubts remain. Doug Porter reasoned:

Were it not for the fact that Burnham has set up and funded so many non-profits (you can’t walk around UCSD without seeing some sign of his largess) I would just say this story is just boosterism for attracting investors. BUT–he’s not cash poor and at his age the “legacy complex” tends to become important.

 New Model of Journalism

At least a couple of local media pundits have already declared – sin el carne – that what Burnham is attempting to do is produce a new type of newspaper, a new type of journalism. KPBS submits that Burnham will be “a new breed of owner”, investing in the newspaper “as a gesture of civic goodwill” and would join the owners of “… the Washington Post, The Boston Globe and Star-Tribune of Minneapolis who act largely on a belief that newspapers perform a public service.”

Liam Dillon at the Voice of San Diego wrote:

If Malin Burnham has his way, San Diego would have a new model for how journalism is done here. … Burnham envisions the paper as a blend between a traditional nonprofit and a traditional newspaper. The paper would solicit donations, but also accept advertising and subscriptions.

He got most excited talking about how the paper’s profit would be distributed. “Instead of it going to the owner for the investment, we will, in effect, reinvest it into the community,” Burnham said.

Would Burnham Continue Manchester’s Objectives?

Despite any new breed of journalism and new breed of owner, one question that has to be is raised about Malin Burnham and his plans is: would he continue with Doug Manchester’s objectives – the public funding of the Chargers stadium and the expansion of the Convention Center?

Do we  have any clues about where Burnham stands?

For one, Burnham was very enthusiastic when Padres owners wanted to build a stadium downtown, and viewed it as the catalyst for the entire renovation of that area of the city which would boost property values. For another, recall that in the early 1970s Burnham was an influential member of San Diegans, Inc, which :

believed it was essential to slow down growth at the periphery long enough for tax-driven redevelopment projects – a proposed Horton Plaza mall, a convention center, a marina village, a “gaslight district” along Fifth Avenue, and so on – to resuscitate downtown property values.”

Please  note that all these were built, Horton Plaza, the convention center, Marina Village, and the gaslight district.

Don Bauder : Burnham Wanted Taxpayer Money to Support the America’s Cup Race

Don Bauder, the well-known columnist for the San Diego Reader and former columnist for the Union, remembers an exchange with Burnham about tax-payer funding of Burnham’s sweetheart endeavor – the America’s Cup racd in San Diego. He wrote the OB Rag in response to our query:

 I do remember Burnham telling me that taxpayer money should be used to support the America’s Cup race in San Diego.  So his claim that he is not a corporate welfare mendicant is not true.

In a recent story in the Union-Tribune, Malin Burnham remarked that he is accused of being tied to downtown interests. Burnham claimed the only connection he has to downtown is his office.

There is a major split among San Diegans.One group believes that money should be steered downtown to subsidize corporate welfare projects.

Another says the money should go to the rotting infrastructure and neighborhoods.

Burnham is basically saying he is not tied to the downtown corporate welfare crowd. I beg to differ. I can remember his calling for taxpayer money to support a hosting of the America’s Cup, which is an upper 1 percent entertainment if there ever was one.

 Bauder summarizes:

 If Burnham runs the Union-Tribune, it will continue to promote a convention center expansion, despite a massive national glut in convention space, and a subsidized Chargers stadium. Realistically, the taxpayer subsidy will probably come to at least 70 percent of the total cost of the stadium.

The editorial page may move from the far right wing to a moderate Republican position, but it will continue to pump for downtown corporate welfare.

 So, part of what this all means with Burnham potentially stepping in and taking over the paper, is that despite the competing factions or wings of the Republican establishment, there is a certain unity overall. Lori Saldana reminds us:

Even though Burnham is known for doing better things versus, say, Manchester, certainly both have benefited from close relationships with the GOP power structure, and these deals often make no economic sense for the city.

Advice In Anticipation

Despite all this, despite all of Burnham’s wealth, connections – and handicaps as the potential purveyor of the news and views of San Diego – there is a certain low-level excitement, expectation and anticipation. For if the U-T exchanges hands for the fourth time since 2009, there is a hopeful sense that the major media in San Diego will become instantly improved and reflect more of a cross-section of the area.

Typical is Arthur Salm’s response – Salm used to write for the Union-Tribune:

I don’t know the first thing about Burnham. Still, just about any semi-sentient bipedal organism would be an improvement on Manchester and Lynch. And I’m not even sure I want to defend “bipedal.”

Edwin Decker, the columnist from OB who writes for CityBeat, is more enthusiastic:

From what I understand, they’re a long way from any kind of deal actually going through but, if it does, and Burnham does what he says he’s going to do – operate as a non-profit with proceeds going back to the community–well, then – wow. Wow, wow, wow.

 Dan Hallin, a professor in the Department of Communication at UCSD, has a positive view of it all:

 It sounds like they don’t have a clear business plan at this point, but basically I think this sounds like a potentially positive development for the U-T San Diego. I think the model of non-profit ownership for newspapers is a good one, and I think it would be good to see a change from the more politicized ownership of Manchester.

 In response to our queries, Mr Burnham received plenty of advice.  Community advocate for Sherman Heights, Remigia Bermudez had this to say:

Should Malin Burnham acquire the U-T, it is imperative that from the top down and from the bottom up, he surrounds himself with administrators, columnists, reporters, photojournalists and classified personnel of diverse political angles and culturally conscientious folks to give power back to our communities.

On the other side of the political spectrum, Barry Jantz, a write for  Rostra, had more observations and advice for Burnham:

With traditional mainstream and print media dynamics continuing to change, it’s difficult to know whether ownership transitions mean anything of significance anymore. Diminished resources and reduced staffing have gutted much of the local news coverage that was once a staple of print media.

I don’t know that a change at the U-T San Diego — even Malin Burnham — will change the fact that the paper as well as other major metro newspapers continue to struggle, while seeking the right balance of print vs. online news against a backdrop of alternative news sources for readers.

The U-T in particular has found the ability to continue its excellent investigative “Watchdog” role, which is something I’d hope a new owner like Burnham would continue while trying to strengthen localized community reporting.

 Longtime community activist, Jim Bliesner, who now lectures at the Center for Urban Economics and Design, UCSD (and an occasional columnist for the SD Free Press/ OB Rag), offered Burnham a lecture:

Mr. Burnham is doing a great job of placing himself in the pantheon of San Diego civic leaders stretching back to Spreckel’s et al.

However, I would hope that he would not make the same mistake that the current owner did by surrounding himself only with people who know what he does and thinks the way he does.

He has the opportunity to be inclusive and establish leadership of the nonprofit with divergent knowledge and social/economic perspectives.

In addition I would imagine at least an editorial advisory committee with authority to make decisions as well as methods for community based ownership.

Having a broad based board will insure commercial success as well as providing the San Diego region with open and balanced news coverage.

 San Diego political consultant, Larry Remer, had this caveat:

Malin is a very well-meaning patrician. If he had his way, he’d revive the glory days of Pete Wilson and Helen Copley, when the corporate Republicans ruled the roost and everyone supposedly knew their place.

 Jim Miller is a City College professor, a weekly columnist for the OB Rag, and collaborated with Mike Davis on “Under the Perfect Sun”. He cleverly summarized this about Malin Burnham:

He’s a softer face of the local conservative establishment. He’ll take the cartoon fangs off the San Diego U-T editorial page but will still be a reliable and perhaps more effective purveyor of the local hegemony.

What Does It All Mean?

It was a month ago that Matt Potter over at the San Diego Reader mused about the reverberations in San Diego politics if Burnham did acquire the U-T, and asked:

If Burnham can pull off his ambitious effort to assume control of U-T San Diego … will it change San Diego’s game of politics as currently played?

His point was not particularly good news for the Republicans.

Republican Manchester’s U-T coverage and his hefty six-figure personal campaign donations have received much of the credit for the victory of GOP mayor Kevin Faulconer over Democrats Nathan Fletcher and David Alvarez.

Faulconer holds office until 2016, when he again faces voters. The absence of Manchester at the city’s biggest media power switch might prove problematic for the former public relations executive as he fights for reelection.

 But looking beyond the implications on local political races if Malin’s Gang creates the nonprofit and takes on the operation of San Diego’s daily, and trying to smooth out the wrinkles of the Big Picture, we have illustrated how Burnham represents one of the wings of the local ruling Republican establishment, a wing opposed to extreme GOP partisanship. He represents the wing that is willing to join hands with other members of the privileged elite from the other political party and continue to manage this sunny Paradise.

The apparent Republican in-fighting over the future of San Diego and who is elected to represent the area is between these two different opposing camps. One, the DeMaio-Manchester  camp want to make government so small, a la Grover Norquist, that it can fit in a bathtub.  The other camp, the Burnham team, the Jacobs  – want to use government to make money, the public subsidization of the corporate welfare projects.

This is part of that major split that Bauder described, ” One group believes that money should be steered downtown to subsidize corporate welfare projects. Another says the money should go to the rotting infrastructure and neighborhoods.”

In the end, perhaps there was a deep realization within the highest levels of San Diego society that because the region’s daily newspaper that for generations had successfully favored Republican policies and politicians without alienating the peasants was faltering big time. And they’ve pinned it on Manchester’s extremely aggressive bully-pulpit partisanship, in that it was failing the Establishment. Readership was down, subscriptions were down, ads were down, the cable television project failed, and it looked like Manchester was losing so money he couldn’t support the GOP as much as he had.

Key also to this realization, was that the newspaper’s direction was antagonizing the growing Democratic base of the city’s residents, reflected in the makeup of the City Council. The fangs that Jim Miller described were out and they were turning off droves of subscribers and potential readers.  Bottomline: this was bad for business.

Something had to be done.

Out from the shadows, emerged Malin Burnham, philanthropist extraordinaire. The Establishment had to correct the situation, take over from Manchester and ensure that the only large city in California with a Republican mayor had a freaking newspaper.

The moderate wing of the privileged had to re-assert itself, had to resurrect itself from the burning embers of what was left of Manchester’s paper empire.

The major goals of the aristocracy were being dirtied, stymied, sullied by the very vehicle that was supposed to ensure their deliverance – the daily newspaper. Manchester, perhaps, in turning so many off – was becoming too personally identified by the public with the projects desired by the elite – the Chargers stadium and the expanded Convention Center – funded in part at least by taxpayer monies. So much so, that apparently, somebody powerful believed that the goals were being jeopardized.

Expect then, that under Burnham, any new Union-Tribune will possibly have a more inclusive editorial board and policies, publishing views that are shared by a larger cross-section of the community – except for the stadium and convention center, and other projects of privileged elite who want to benefit from socialism – socialism for the rich.

As we’ve see in the past during similar times in San Diego where partisanship gets buried and toleration for different perspectives is allowed – at least temporarily, the Burnham-era could open up possibilities for progressive views, policies – even politicians – to develop and even thrive.

The peasants await. Anticipation is high.

Sources:

San Diego Reader, Matt Potter

U-T San Diego, Fred Dickey

The Times of San Diego

KPBS

Voice of San Diego, Liam Dillon

“Under the Perfect Sun – the San Diego Tourists Never See“, Mike Davis, Kelly Mayhew and Jim  Miller