Politico announces exit of site’s co-founders following November election; Japan takes interest rates into negative territory
Morning Brief: Owner Robert Allbritton announces that the political website’s co-founders will be leaving to start-up a new venture that will supposedly not compete with Politico
While the political media was preparing to cover the GOP debate and the competing Trump Show, Politico briefly stole the show by shocking the media with news that its founding editors would be leaving the online publication. Just before 7:30 ET, owner Robert Allbritton released a staff memo informing readers that Jim VandeHei, Kim Kingsley, Roy Schwartz, Mike Allen and Danielle Jones would be leaving Politico, though the editors would be staying on through the November election.
Co-founder, John Harris will assume the publisher’s role, in addition to being editor-in-chief.
But Politico’s losses will be huge: VandeHei was the high profile recruit that made people take the media start-up serious, coming over from The Washington Post where he was the national political reporter; Michael Allen is chief White House correspondent for Politico, previously holding the same role with the Post; Roy Schwartz has been chief revenue officer at Politico, coming over from Gallup. Now all three will be starting a new venture following the election.
Danielle Jones has been serving as Executive Vice President, Expansion, while Kim Kingsley has been chief operating officer.
Editor Susan Glasser will also be leaving Politico at the end of the year in an unrelated move, as the former editor-in-chief of Foreign Policy magazine moves to Israel (her husband, Peter Baker, will become The New York Times’s Jerusalem bureau chief, the paper announced today).
What has precipitated the mass exodus of Politico’s high profile talent is only speculation, with both the NYT and CNN saying there have been clashes within the management team over budgets and expansion plans. The Huffington Post got a source to claim that “Robert had enough with them spending shitloads of money,” referring to owner Robert Allbritton.
But Politico has lost some talent recently, with executive Editor Rick Berke in the fall of 2014 and who pointed to disagreements with Jim VandeHei and John Harris as the reason.
Politico came to be when Robert Allbritton, CEO of Allbritton Communications, which owns seven ABC affiliates, let out word that he might start a political newspaper to be called The Capitol Leader. Starting a newspaper was not such a strange idea as Allbritton had once owned The Washington Star, which shuttered in 1981. According to reports at the time, VandeHei said he would join the venture if he were given a big budget to do as he pleased. He was, and Politico grew from a handful of staffers to around 500 today.
But Allbritton is a veteran media owner, and it is likely that his desire to see Politico more profitable led to some tension within the management team. After previous rounds of turnover VandeHei was left to defend Politico saying that the company was profitable in 2014 and had grown revenue that year 25 percent, all the while continuing its expansion. But while 25 percent revenue growth would be impressive for a legacy news organization, that was pretty modest for a start-up (though t what point something stops becoming a start-up is an open question).
“There is no media company growing with more conviction and muscle than us. We are investing heavily in going deeper and wider in Washington politics and policy – and expanding nationally AND globally, so the state of POLITICO is strong as hell,” VandeHei wrote in a staff memo a year ago.
It should be remembered that Politico would not even exist except for the failure of the Post’s owners to have any digital publishing vision. Not only did much of its political team bolt to the new venture in 2006, by eight years later Ezra Klein bolted the Post to help launch Vox Media along with another set of journalists. Since then, though, the Post has been acquired by Amazon CEO Jeff Bezos, who I am sure would love nothing more than to find a way to put Politico in its place, maybe by funding a start-up? We’ll see in 2017.
The Bank of Japan, desperate to stimulate the Japanese economy, announced that it was taking interest rates negative. Now, if banks want to park their money they will earn, if that is the right term, -0.1 percent interest – they will essentially be paying to put their money away.
The idea, obviously, is to get the banking sector to start loaning money to businesses at a greater rate.
“Global financial markets have been volatile against the backdrop of the further decline in crude oil prices and uncertainty such as over future developments in emerging and commodity-exporting economies, particularly the Chinese economy,” the BOJ said in a statement. “For these reasons, there is an increasing risk that an improvement in the business confidence of Japanese firms and conversion of the deflationary mindset might be delayed and that the underlying trend in inflation might be negatively affected.”
Asian stock markets boomed on the news, with the Nikkei index climbing over 400 points, or nearly 3 percent. Dow futures are modestly up in pre-market activity.
Japan is not alone in having negative interest rates. Denmark, Sweden and Switzerland also are in negative territory. The US Fed recently raised rates for the first time in many years, but may hold back on its planned slow interest rate hike strategy as the US and world economies continue to show signs of weakness.