Continuation of Follow the Money   

While the major papers have most of the resources and get most of the attention, a case can be made that the true revolution in the industry's coverage of business is occurring not in New York or Washington but at many of the nation's regional papers. The best of these are combining heightened professionalism with distinctly local perspectives to create some of the most compelling journalism now on view.

Sandra Mims Rowe, the highly regarded editor of Portland's Oregonian, articulates this spirit. "I care about it passionately," she says of her paper's business coverage. "Business has everything--power, influence, sex, drama--and our job is to pull back the curtain: That bank merger last week? Who got screwed? Who came out on top? This is what really happened. Business news should be handled as finely crafted drama; it's got substance and great meaning.

"Business should be the backbone of the newspaper," she continues, the edges of her voice only slightly rounded by a soft Virginia drawl. "And what readers think of your business report creates a halo effect: If business leaders and opinion leaders think your business stuff is consuming, then so is the rest of your paper. And now that the definition of business has expanded, you get into things that affect people's lives--everyone's life."

During my visit to Portland in August, the Oregonian produced a smart example of what Rowe was talking about. The centerpiece of a Sunday business section was a story by its top investigative reporter, Jeff Manning. It recounted the tale of a shoe designer at Nike who had developed a new, gorgeously hued sneaker, the Air Tuned Max. Brilliantly illustrated with photos and drawings, the story could easily have run in the slick pages of Sports Illustrated, yet it had a nice business edge.

Needless to say, global giant Nike, headquartered in a Portland suburb and one of the Northwest's major employers, "is a big deal to us," says Business Editor Mike Hester. "Here, we talk about the 'Nike footprint' and the 'Nike psyche.' " In other words, the paper values stories that get beneath the company's glossy veneer, as Manning's did. A sports approach to the same story might have focused on the shoe's technical qualities--"feather-light, air-cushioned, reduces shock"--but Manning chose to emphasize how Nike had struck an unusual deal with the financially troubled Venator Group, granting their Foot Locker stores, the largest athletic shoe chain in the country, exclusive rights to the new design. The result: huge sales for Nike and Venator and unbridled fury from competing retailers.

Not many years ago a story like this, if it had been produced by a business writer at all, most likely would have been a stylistically arid affair. But here was Manning's appealing lead: "Sean McDowell, a young Nike Inc. athletic footwear designer, returned to Beaverton from a Florida vacation in October 1997, his mind chock full of images of white beaches and languorous purple sunsets. Little did he know his tropical daydreams would help revitalize the industry's largest retailer, let alone generate a full-blown political brouhaha among the rest."

In tackling the vagaries of the athletic shoe market, the writer's prose, while businesslike, still managed to be vivid enough to attract readers who might normally toss the Sunday business section aside. "The shoe's wild success--and its marketing fallout--shows how an elusive combination of cosmetics and technology can still generate intense demand from young sneaker aficionados," he wrote. "It also demonstrates how marketing strategies that seem deliberate and smart when they happen are often the result of internal politics, shifting corporate alliances and just plain luck."

The Oregonian, like other top metros (its daily circulation is 356,000), concentrates its resources and abilities on stories that hit close to home. Amanda Bennett, the paper's managing editor, is responsible for introducing a more inviting style into business stories, and redesigning the business pages was her first assignment upon joining the Oregonian a year ago. Business is a subject she knows well: She worked at the Wall Street Journal for 23 years, most recently as its Atlanta bureau chief.

Energetic and determined, Bennett says she quickly found that the best reporters at the paper were on the business staff. At the same time, she saw that they were muffling their talent, having bought into the canard that "you had to be deadly dull if you were going to be taken seriously." Too, there was confusion among the reporters covering the region's high-tech industry. "There was no concept of the page," Bennett says, "and the question out there was, 'Who're we writing for, the business community or civilians?' "

Bennett's response? That it's a nonissue. "You write sophisticated stories in a way to capture both," she says. As for the dullness problem, she launched a campaign that she sums up as "pushing every story to its limit." At an early-Monday meeting with the business staff, she singled out Manning's sneaker story as having achieved this goal.

Of course, covering the hometown colossus so tied to your readers' lives and financial well-being is always challenging and often uncomfortable. In the Oregonian's case, it has aggressively reported from Vietnam and Indonesia on allegations that Nike was exploiting workers making sneakers, overworking and underpaying them. In 1992, well before the issue came to national prominence, the paper dispatched to Southeast Asia a business reporter who wrote an overwhelmingly negative piece. According to Hester, Nike founder Phil Knight--intriguingly, the son of the former publisher of the Oregon Journal, since subsumed into the Newhouse-owned Oregonian--"hated" the story and "retreated into a deep hole" as far as future contacts with the paper were concerned.

Two years ago, Jeff Manning returned to the region and produced what Hester termed a "far better-balanced piece." This story related how life had improved for most Nike workers; how most of the cultural clash was between the workers and their supervisors, who were Korean; and how Americans, given their elevated standard of living, couldn't comprehend the willingness of people in some countries to work under conditions that simply would not be acceptable here. Though this wasn't the paper's motivation, the piece had a salutary effect on the Oregonian's relations with Nike. (And having spent 30 years covering Asia myself, I can add that Manning's nuanced report also had the benefit of being true.)

After the news meeting, Bennett and I have coffee in a shady park near the paper, buff joggers doing their thing on a lovely day. "It'd be hard for any newsroom to be up to the standards of the Journal," she says. "But when I began here I found that there was needless anxiety over bifurcating the audience. So I had to convince [the staff] that all you need to do is look at the quality of the story. If the story is sophisticated, compelling and interesting enough, you'll have no problem with who's going to read it. Everyone will."

Rowe concurs. A primary reason for hiring Bennett, the editor says, was to finish a job Rowe began back in 1993 when she arrived at the Oregonian with a writ to improve a decidedly underachieving paper. Instinctively, she turned first to the business desk. What she discovered was discouraging: reporters and editors who lacked commitment and interest in their work and who, in turn, doubted management's commitment to them. Some, she quickly recognized, knew little or nothing about business, nor cared to know. They were moved to other beats. "In business reporting," Rowe says, "if you can't write with authority, you're lost."

Rowe says her other great news passion is explanatory journalism; no surprise, given that this year the Oregonian won its first Pulitzer in four decades--for explanatory journalism. Business and explanation were fused beautifully in the award-winning series, entitled "The French Fry Connection." The series was produced by Richard Read, who bears the heady title of international business writer. Employing as his vehicle the humble french fry, Read was able to tie the currency implosion in Asia to everyday lives back across the Pacific. His editors explained the unorthodox series to readers with this note: "Anyone can relate to a french fry, but not everyone can stomach detailed explanations of Asia's financial crisis, even when the fallout claims lives, jobs and businesses. We decided to trace one batch of fries back to its Pacific Northwest potato patch and then to follow it to the Far East. The point was to explain Asia's economic meltdown and its effects on the Northwest, the nation and the world. We never imagined the range of people and cultures we would encounter."

Read, who already had extensive experience reporting from Japan and Southeast Asia, and staff photographer Kathryn Scott Osler tracked the potatoes, 20 tons worth, step by step--from a technologically advanced farm in neighboring Washington run by members of the Hutterite sect, to a processing plant which prepared them for McDonald's outlets in Indonesia, to a ship sailing out of Tacoma, to Hong Kong, and from there to Singapore. They followed the fries to Jakarta, hitting town just in time to cover the economic-sparked riots that resulted in the overthrow of President Suharto. Then it was back to Portland, where people were by now feeling the crunch from Asian consumers cutting back on restaurant meals.

What could have been a mere curiosity was transformed into a tour de force that revealed eye-opening glimpses into the $286 million potato-exporting industry: the Amish-like Hutterites who, surprisingly, employ some of the world's most advanced agricultural techniques to produce bumper crops; religious sensitivities among Muslim Indonesians about prepared foods imported from the United States; charges of American cultural imperialism, with fast food high on the list; the disastrous effects of sudden economic reversal on poor Indonesian children; and, finally, how the inability of one Indonesian to pay for a Big Mac and fries ripples all the way back to the wallets of prosperous Portlanders. The region, Read wrote climactically, "hangs in the balance, caught between the resilient U.S. economy and teetering Asian countries."

In a recent report on business coverage, the Freedom Forum's Media Studies Center said that the press' daunting task really boils down to this: Cover a far more complicated universe and make it intelligible to far more people than ever before. The Oregonian's french fry opus was an example of a story that worked. For one that didn't, stunningly, the Media Studies Center report cited AP's coverage of the 1929 stock market crash. Here was the lead from the wire's main story that fateful October 29: "Huge barriers of buying orders, hastily erected by powerful financial interests, finally checked today the most frantic stampede of selling yet experienced by the securities markets, which threatened at times to bring about an utter collapse of prices." Jim Kennedy, a former AP business editor, observed that almost no one other than a market professional could have made heads or tails of that.

But in the market meltdown of October 1987, AP assembled all the data its reporters could put their hands on. Interpretation, including a glossary of market terms and charts of the Dow Jones average over a period of years, made the story comprehensible to almost any reader. Kennedy, who now runs AP's multimedia operations, says he remembers too vividly the knots in his stomach back then, wondering whether his troops were up to making sense of the crash. But they got the story out and onto the front pages of thousands of papers around the world. And, says Kennedy, they've never looked back. "It was a truly defining moment. In essence, the story--the business story--has been on the front page ever since."

While the business news phenomenon has been developing for several decades now, it was the exponential rise in stock investing beginning in 1989 that truly revolutionized business coverage, packing on new muscle and integrating it as never before in the total news package. On the eve of the 1929 crash, only a handful of Americans were investors. Anyone else with a little something left over at the end of the week salted it away in a savings account. In 1965, investors numbered just 10 percent of the U.S. public; most Americans were still savers. In schools, banks handed out imitation passbooks with little slots in which we kids stuck our nickels and dimes; my mother deposited $5 a week in a Christmas Club account. Today, conventional saving is passé; half the entire population invests.

And how do they follow their money? On the business agate pages. Marvels Philadelphia's Hank Klibanoff, "Among baby boomers, there's as much excitement in the stock tables as there is in sports agate."

Indeed, one of the more arcane but telling indicators of business coverage in recent years is what has happened to the stock tables, mutual fund listings and related financial data, all printed in page after page of eye-straining agate.

Carl Stepp's content survey found that, in the '60s, the 10 regional papers he tracked had published on average four news columns' worth of business agate, or two-thirds of a page. Now they publish 15 columns, or two-and-a-half pages. USA Today prints five pages or more of the stuff daily, the New York Times 10.

The power of business agate might be intuited from the Times, where a few years ago editors decided to beef up the Saturday business report, which they considered thin compared to the rest of the week. Beyond adding extra space for stories, they enhanced the section's business agate and augmented it with material that had been running on Sundays, such as commodities and metals reports. One motivation was the fact that since the Wall Street Journal and USA Today don't publish on Saturdays, an unusually thorough agate report might appeal to readers around the nation. For whatever reasons, Saturday became the fastest-growing day of the week for the Times; since 1990 sales of that day's paper outside its greater New York circulation zone have risen four times faster than the weekday edition.

At the Washington Post, David Ignatius, who had been recruited from the Journal, took over as AME for business in 1993. At the time the paper had cut back severely on agate, deeming it "a waste for a paper like the Washington Post." But Ignatius determined that this was "a terrible mistake," he says, because the tables "are essential to the mission." He succeeded in restoring them, with some tailoring for the Washington audience. Today the paper publishes more than five pages of comprehensive listings daily.

But the jump in agate is most telling at small and medium-sized papers, many of which once ran either no listings at all or barebones versions--say 25 or 50 stocks of local interest. Overall, according to AP, which provides the listings, usage has nearly doubled in a decade.

"We've never had more papers run stock agate in our history--over 900, compared with 500 [a decade] ago," says Randy Picht, the current AP business editor. That represents nearly two-thirds of all the daily papers in the country. "That flies in the face of all conventional wisdom because the tables have been considered problematic ever since the newsprint crisis [of the mid-'90s]. But advertisers love 'em; they plant their ads in the middle of the tables, and so editors keep asking for them."

About a third of the client papers print an abbreviated setup daily--one-third or one-half page, which amount to 800 to 1,200 stocks in the no-frills format--and about half of these expand to a multi-page listing on the weekend. The other 600 papers run one or more pages every day, Picht says.

Not surprisingly, he says, mutual funds are especially popular, utilized in some fashion by 75 percent of the overall 900 user papers.

Contributing to the agate boom is the computer technology that enables AP to customize tables for each paper, whether its preference is for long or short lists, focused or broad. This is particularly true at smaller papers, which must make the most judicious use of limited space. AP helps them assemble the tables of their choice, often guided by where they want the ads placed, and from then on it's a simple matter of downloading the data with a few mouse clicks.

"What really lies at the heart of this," says Picht, "is that readers want the data. You have readers calling up their local paper and asking for 'that fund that we have in our 401K down at the plant.' The editor reacts to that. And we react to the editor."

There are days, of course, when what the editor really wants is a life preserver, because you can easily be pulled down in this sea of tiny type. There are so many stocks on the major exchanges that only the Journal and the Times print them all (Investor's Business Daily comes close), and new companies turn up constantly. Editors who don't get the extra space to accommodate burgeoning tables much either cannibalize their main newshole or, more often, run listings that only include the most active stocks. That in turn irks readers, who, increasingly sophisticated about stocks, expect to find even marginal companies in their daily paper.

While AP may be pleased with its leadership in agate, neither Picht nor his staffers hedge about having lost ground to brash competitors in some broader editorial areas. Reuters, Bridge News (formerly Knight Ridder's financial service) and, most of all, Bloomberg News, are bones lodged in the throat of the grande dame j of Rockefeller Center. "The fact is that Bloomberg is so comprehensive that they've hurt us," Picht says. "They supply stuff that we just don't offer, and business editors feel they need Bloomberg, even to help them cover local news."

Bloomberg, which only a few years ago was desperately giving its service away in exchange for usage, has made itself indispensable at business desks around the country. A paper in Colorado, for example, uses Bloomberg's mining report to put its own local stories in context; a paper in Indiana turns to the agency for its daily "steel briefs." Editors report that Bloomberg turns up stories in their backyards that they themselves hadn't heard about.

Nevertheless, no matter what service it derives from, at bottom it's just data and information; individual papers and editors still have to make sense of it for readers or lose them to more responsive competitors--be they other papers or, more likely, the up-to-the-minute TV business programs and up-to-the-nanosecond online sites. Nearly all the editors I spoke with consider it their primary job to sift through this incredible cache of material, filter it, interpret and explain it; in essence, paint the big picture for harried readers.