Media Salary Wackiness
The business of the news is business--and it's a weird business.
A CJR investigation into the finances of the Intercept isn’t particularly interesting to me in and of itself. But two revelations in the story are.
First, the wackiness of salaries in journalism:
First Look Media Works, Inc.—the tax-exempt 501(c)(3) side of FLM, and parent of The Intercept—paid Greenwald more than $1.6 million from 2014 to 2017, the last year for which there is a financial disclosure. In Donald Trump’s first year in office, his salary dipped to $369,847, during which time he produced a weekly column—over 50 pieces. The recipient of Edward Snowden’s NSA leak also composes more than 40 tweets a day, on average.
Greenwald’s salary peaked in 2015, hauling in more than $518,000, money that supports an envious life in a gated community on the edge of Rio de Janeiro. Betsy Reed, editor in chief of The Intercept, earned $309,243 in 2016 and $368,249 the year after. Overall, The Intercept spent $9.3 million in salaries in 2017, up $1.4 million from the year before. (Jeremy Scahill, an Intercept cofounder, earned $349,826 in 2015, the last time his compensation was included in a disclosure.)
While those salaries are supposed to be scandalous, they don’t strike me as particularly outrageous considering that they’re the name brands around which the enterprise was built. With a caveat that I’ll get to shortly, I don’t much care how billionaires spend their money.
While the salaries at the top may not be unheard of in media, they are large for digital media and noteworthy in the world of progressive, nonprofit journalism. In 2017, Mother Jones, another left-of-center news outlet, paid its DC bureau chief David Corn $171,298 in reportable compensation; Clara Jeffery, vice president and editor-in-chief of the magazine, earned just under $200,000. At The Marshall Project, a nonprofit news site focused on criminal justice reform, the highest paid employee is managing editor Kristen Danis, who earned $198,850, according to its latest 990 filing; Bill Keller, a former executive editor at The New York Times, made $178,675 as the site’s editor-in-chief. (Keller is retiring, a spokesperson noted.)
The contrast is supposed to spark outrage but I’m merely perplexed. I’m not familiar with The Marshall Project or Danis, so the nearly-$200k salary strikes me as good money if you can get it but otherwise doesn’t register. But I’m shocked that David Corn, who has been a star reporter for quite a long time, is only making $171,298; but I guess Mother Jones has always been a leaking ship—most opinion mags are. But it’s truly shocking to me that the top editor at the top newspaper in the country is only pulling in $178,675. I know of academics who make that kind of money.
Second, the story highlights my sense of the weirdness of the nonprofit category. As I say, I don’t mind that Greenwald, who has made himself a household name as a muckraker, is pulling in half a mil from a billionaire. I don’t understand how that gets written off as a charitable contribution, however.
In order to maintain its status as a “public charity,” First Look Media Works must receive “a substantial part of its support from a government unit or from the general public,” according to the Internal Revenue Service. Specifically, it must receive 33.3 percent of its support this way over five years; barring that, 10 percent, with a good enough explanation (“facts and circumstances”). If it were to lose this status, First Look Media Works would become a “private foundation,” and subject to rigorous scrutiny from the IRS.
Private foundations also are required to distribute 5 percent of their assets every year for charitable purposes; in 2017, First Look gave away 3.6 percent of its $25.9 million, and it could conceivably claim its salaries are part of its charitable giving. Foundations must also pay a 1 to 2 percent excise tax on investment income.
Of the $90 million in total disclosed support it has received, $87 million has come from Omidyar, meaning just 2.7 percent of its revenue can be characterized as “public support.” The level of non-Omidyar money to the non-profit side is indeed rising—6 percent in 2017—but First Look Media Works will require there to have been a lot more in 2018 if it wishes to reach the IRS’s more charitable 10 percent threshold.
It’s bizarre, on a number of levels, that an enterprise that is for all intents and purposes the US arm of the Russian intelligence front WikiLeaks is considered a tax-exempt charity by the U.S. government. Then again, I’m generally uncomfortable with the whole enterprise, which treats everything from the Red Cross to the local church to political activist organizations identically, subsidizing them via the tax code.
There is an interesting point that’s not debated anywhere: Greenwald’s husband is an elected Congressman in Brasilia and there is a Portuguese version of the Intercept.
I think the solution here is to make the expenses required to perform charity work deductible, but eliminate the difference between for-profit and non-profit foundations. Legitimate charities would not be impacted since they spend almost all of their revenue on bona fide charity work anyways, but sham charities would be forced to contribute to taxes again.
Politically, this would be a non-started though, as most churches spend shockingly small amounts on actual charity and would have to start paying taxes again.
@Stormy Dragon:
I don’t know how the legal stuff works, but not all non-profits are charities. “Charity” is a sub-category of “non-profit” (or “not-for-profit” as the common term seems to be these days).
The easiest example I can thing of are performing arts companies. The local symphony, ballet troupe, or opera company is almost certainly a non-profit. They’re not (and aren’t claiming to be) a charity. There’s also organizations like libraries, historic societies, museums, etc. that are non-profit.
Dick Dale; King of the Surf Guitar.
RIP…
@Yixiao:
But then you get the question of why the local symphony deserves to be non-profit, but the local bar band does not, other than the politically powerful like classical music more than they like garage rock.
@Just Meg:
He refused to ‘go along with the Russian collusion nonsense’ because he was actively aiding that collusion. Wikileaks is GRU/FSB and Greenwald is their instrument. And probably unintentionally, so are you.
I’ll ride my hobbyhorse here: religious organizations should not be tax exempt (and de facto un-auditable). For the most part they are social clubs and perform little to no charity work with their own funds. The charity work they actually do is usually volunteer work from their members. The Lions Club and the Shriners give actual money to things like children’s hospitals, while the average mega-parish allows the old ladies club to use a meeting room to knit beanie caps for new borns.
In fairness, the Catholic Church and Seventh Day Adventists and the like do build actual schools and clinics in developing areas, but those are run as charities separate from the church itself (thank god).
OT…
Last week Dennison, the white supremacist currently occupying the White House, threatened civil war against his political opposition.
https://www.outsidethebeltway.com/i-have-the-support-of-the-police-the-support-of-the-military-the-support-of-the-bikers-for-trump/
Over the weekend noted white supremacist, and House Member, Steve King got in on the act on Facebook.
https://www.facebook.com/KingforCongress/photos/a.169008886506462/2552012808206046/?type=3&theater
These are becoming dangerous times…
@Just Meg:
Do you people ever get new lines to spout or is it always the same 3 year-old b.s.? Are you allowed to come up with new b.s. or do the cult rules require you to stick to ‘you said he’d lose,’ and ‘lock ‘er up’ and ‘build the wall’? Is it that you lack any capacity for independent thought? Is the rule that you can’t say anything that doesn’t fit on a bumper sticker?
Trump’s first national security advisor: awaiting sentencing on felonies.
Trump’s campaign chair: heading to federal prison.
Trump’s campaign co-chair: awaiting sentencing.
Trump’s lawyer: on his way to federal prison.
Trump’s foreign policy advisor: served two weeks in jail.
Trump’s best friend: awaiting trial.
Trump’s first Secretary of State, Tillerson: “Trump is dumb as a rock….a fucking moron.”
Trump’s domestic advisor Bannon: “Like an 11-year-old child”
Trump Economic Advisor Cohn: “Less a person than a collection of terrible traits”
Trump’s second NSA McMaster: “An idiot [with the intelligence of] a kindergartener”
Trump’s CoS Gen. John Kelly: “An idiot.”
Trump’s Sec. of Treasury Mnuchin: “An idiot.”
Trump replacement for Obamacare? Nope.
Big effort on opioids? Nope.
Infrastructure? Nope.
4% growth? Nope.
Deal with North Korea? Nope.
Wall? Nope.
@Michael Reynolds:
Oh and let’s not forget SecDef Gen. Mattis: resigned in protest.
And of course over 8,000 documented lies.
EDITOR’S NOTE: “Just Meg” is the latest incarnation of MBunge. While none of “her” comments were particularly trollish, the deception does not amuse me.
@James Joyner:
I had not realized the bung was transgender. I think we should honor her request to be treated as a woman.
Honestly, these salaries aren’t crazy. What’s crazy is the media personalities making millions while actual reporters are being kicked to the streets.
@Hal_10000:
My sense is that the MSM salaries cited were shockingly low. I think “media personalities making millions” is really a different question; they’re entertainers and they’re paid according to their ability to draw eyeballs.
@Michael Reynolds:
To quote the inimitable Groucho Marx: He may look like an idiot and talk like an idiot. But don’t let that fool you. He really is an idiot.
@Kathy:
Chicolini? Bung is Chicolini?
Duck Soup is 86 years old and still one of the best political satires ever. I could damn near recite it.
https://www.youtube.com/watch?v=DEabC9WzHck
@Michael Reynolds:
I was thinking of Dennison, but sure.
The only name brand or personal name in any of this story that I had ever heard of before is Mother Jones. I don’t think “household name” means what you think it means.
And I am not really shocked that an explicitly socialist magazine doesn’t pay stupid money to its management. I do have a hard time with any tax-exempt org that pays interchangeable-parts management prima donna salaries.
That’s big money. Greenwald getting $1.7 million?
No wonder working class voices are only heard on social media.
@DrDaveT:
I guess that’s fair. Greenwald broke a lot of the stories and, most notably, was the conduit for Edward Snowden. He’s certainly a household name in national security circles but probably less so in ordinary households.
@James Pearce: $171k is more than I make but it’s not “big money” by DC standards. It’s about what an Army colonel makes. A kid right out of law school can make twice that.
@James Joyner:
Actually, that Army colonel makes well over $200k in the DC area. You’re forgetting to add in the 20% of her compensation that isn’t basic pay — the Basic Allowance for Housing, the Basic Allowance for Subsistence, the value of the tax exclusion on those allowances, the value of TRICARE, the value of BX privileges…
That said, agreed that $171k is not big money (or even noticeable money) in the DC area. Which is part of why it’s so hard to hire top people into federal service, which is capped at $164k by Congressional whim at the moment.
ETA: …and that’s not including the astonishing value of the pension, since that colonel pretty clearly has 20+ YOS.
@DrDaveT: Yes, fair. I tend to include base salary + BHS + BHA into the calculation but not any of the other benefits, since we typically don’t count those as salary for normal folks. But, yes, it’s all out of whack. A colonel and a GS-15 are ostensibly equivalents but the former makes vastly more in salary and benefits.
And yes:
I’ve long argued that we ought to do annual COLAs across the board based on inflation or whatever. But the colonel should get the same % as the congressman, Social Security pensioner, GS-5 file clerk, etc.
@James Joyner:
Sure, but DC has the highest average salary in the country and $171K is over twice that. Is that just what Mother Jones is paying him? How much does he get from Harper Collins? From speaking fees and other appearances?
I don’t begrudge him his money. But more should be said about the rich liberals who do all the talking and the working class they claim to speak for.
@James Joyner:
Normal folks can’t have them, or anything like them. The only comparable benefit I can think of is Veterans’ Disability Benefits, which are also federal tax exempt.
Were you aware that a significant number of senior officers qualified for the Earned Income Tax Credit during OIF/OEF, on the basis of combat zone tax exclusions? These were not people anywhere near the fighting, for the most part.
Similarly, I was only counting the value of TRICARE subsidies beyond the value of federal civil servant medical coverage. For a family of four, it’s about $20k. There’s no “market value” for that, because TRICARE-like coverage can’t be had at any price on the open market.
In a sense, it’s a horrible failure of DoD recruiting and retention that most uniformed personnel really have no idea how much total compensation they are getting, or how it compares to the private and civil sectors.
What should be said?
@DrDaveT:
I wasn’t! I knew that we had vastly increased the amount of pay that was subject to tax inclusion. When I deployed for Desert Storm, the ceiling for officers was $150/month, a rate that hadn’t changed since Vietnam. (I believe all enlisted pay was tax-exempt.) So, I actually wound up paying a tax penalty, since there was no money at all withheld from my check and I then had to pay back taxes when filing.
Yup. I honestly think it’s intentional, in that they maintain the illusion that people in the military are grossly underpaid. It’s part of why uniformed military pay has skyrocketed while civil service pay has actually declined relative to inflation.
@An Interested Party:
For starters, “Thanks for electing the first ____ to Congress and working so hard on increasing representation in the media, but how about building some damn houses?”