Canwest given more breathing room

Deborah Jones

How long can Canwest Global Communications Corp. balance atop its tightrope? Creditors gave a company subsidiary yet more breathing room; it’s now inching along this lifeline toward a May 5 deadline to pay its lenders. Until then, CanWest announced in a news release,  Canwest Media Inc’s senior lenders have agreed to provide the company with additional access to credit. A recent Reuters story provides details and some context.

Canadian Press had reported that investors are getting impatient and quoted analyst Carmi Levy, of AR Communications Inc., warning, “cats only have nine lives, and at some point they’re going to run out of time … Creditor patience is not infinite and at some point they’ll expect payment – or they will expect them to seek court protection and pursue resolution through the avenue of bankruptcy.”

Still, Canwest’s share price rose giddily Wednesday to 30 cents — 10 cents above its 52-week low, before yo-yo-ing down again as investors sobered up.

Canwest’s little drama echoes the complex global financial crisis — but in Canwest’s case, it’s been building inexorably (and predictably) since the Asper family borrowed mightily, then slashed-and-burned rampantly, in order to buy the former Southam chain of newspapers from Conrad Black’s Hollinger. (In hindsight: What were they thinking?) 

For Canada’s journalists, especially those who so far survived Canwest’s relentless cutbacks including 560 jobs cut last fall even as its newspapers made money, the drama is flesh-and-blood reality.

An earlier J-Source post compared journalism cutbacks to “bloodletting, the medical treatment of barbaric physicians who more often than not killed their patients. In the media’s case perhaps the ‘physicians’ are the bean counters and the financial black wizards who engineered the mergers and acquisitions of the sources of information in North America’s democracies with complicated takeovers and acquisitions, with the winners then imposing ‘efficiencies,’ ‘streamlining of operations,’ etc. on their prey.”

As mentioned earlier, while the fact that any company has the vast influence Canwest wields in journalism can be considered a travesty in a democratic nation — and Canwest’s behaviour has at times been notably noxious to democratic values — there’s no pleasure watching it struggle.

Still, the size and past actions of Canwest raise far bigger public policy questions than its current money crisis. Canada’s media has, by some accounts, the most concentrated ownership in the developed world. As earlier posted on J-Source, harder and more pointed questions about Canwest and Canada’s media structure are overdue from timid journalists, complacent investors and apathetic citizens — especially if the Canadian government finds a way to bail it out indirectly with funding for broadcasters.

The team members dealing with the CanWest debt crisis undoubtedly have money and their job futures on their mind. For the rest of Canadians the big question is about Canwest’s influence on the shape, quality and integrity of journalism.

Deborah Jones is an independent journalist whose work has appeared mostly in Agence France-Presse, The Globe and Mail, The New York Times, Time magazine and other publications. She is currently Town Hall editor of J-Source.

(Photo by iDanSimpson. Used under Creative Commons license.)