Although the New York Times circulation  has been plummeting like a lot of other newspapers due to readers switching to the Internet for their news as well as being turned off by the extreme liberal bias at that newspaper, the ultimate failure of that periodical might be due to another reason according to an article in New York magazine.  Sulzberger stupidity. And based on what New York has to say, we aren't talking about the ordinary garden style variety stupidity here.

Sulberger stupidity comes on a massive scale of unerringly poor judgement in almost every major business decision. The prime culprit of Sulzberger stupidity is the Times heir, Arthur Ochs ("Pinch") Sulzberger Jr. although it seems that lack of  judgement is also a trademark with the other branches of the extended family, which includes the Goldens and the Cohens, to the extent that there is a good chance that the 27 members of the fifth generation of the Ochs-Sulzberger family (founded by Adoph Simon Ochs) could well be the last generation of that clan to profit from the Times.

New York chronicles the almost comical downfall of this family newspaper empire through sheer stupidity (emphasis mine):

From an estate in Southampton, 82-year-old Arthur Ochs Sulzberger, the patriarch of the family and father of Arthur Jr., has watched as the company he bequeathed to his son has taken a perilous turn. A significant portion of the paper’s troubles can be attributed to the general difficulties of a business model based on print advertising in the Internet age. But the younger Sulzberger’s management stumbles have helped to speed the company stock price’s decline to around $15 a share from $45 at the start of the century.

First, there was Sulzberger’s decision to use the paper’s excess cash flow when it was making money in the nineties to buy back stock—a practice meant to improve investor confidence—instead of acquiring new properties that could have hedged against print losses. In the last decade, the Times bought back $3 billion of its own stock—more than the company’s present market value. Now that money is gone, and the company has sunk from surplus to deficit. (Sulzberger himself has acknowledged that the buybacks were “the stupidest thing” he’s done.)

I'm wif stupid, uh, I mean Sulzberger. And when Pinch did buy outside assets, those investments almost inevitably turned out disastrous:

When the Times did use its cash to acquire new assets, those bets rarely panned out. Believing that television was the medium of the future, Sulzberger overpaid for the Discovery Times Channel, which failed and was sold. All told, the company’s major newspaper and TV acquisitions since 2000 have lost more than $1.5 billion in value. Sulzberger made what appears to be a smart move in acquiring About.com, a highly trafficked information hub, in 2005, but when the Times had a special opportunity to get in on pre-public financing of Google, it passed—perhaps the single worst business decision of Sulzberger’s tenure, says one Times intimate. 

Actually the worst business decision of Pinch's tenure is probably the decision to take the reins of the New York Times in the first place. However Sulzberger stupidity seems to be spread among the rest of the family:

Sulzberger hasn’t acted entirely alone. His cousin Michael Golden, vice-chairman of the company and until recently publisher of the beleaguered International Herald Tribune (the acquisition of which cost the company $65 million),Times headquarters on 43rd Street—which the buyer turned around and sold three years later for a $350 million profit (enough to fund the newsroom for more than a year, notes one Times oversaw the sale of the old New York veteran). A new headquarters on Eighth Avenue, designed by architect Renzo Piano and costing the Times about $500 million (roughly 25 percent of the company’s total market capitalization), was also his responsibility and is seen as a sign of the family’s dedication but also its vanity. “Man, he loves that building,” says a former Times executive who knows Golden. 

How would you like to have been a fly on the wall when Pinch and cousin Michael were informed that the building that they sold was flipped just three years later for $350 million profit? Meanwhile Pinch stubbornly holds onto bad investments made by his father, Arthur Ochs "Punch" Sulzberger:

Meanwhile, the company continues to suffer the failed strategic investments of Sulzberger’s father, such as the Boston Globe, which, along with another Times-owned paper, led to an $815 million write-down in 2006. Many at the Times believe Sulzberger Jr. hangs on to the Globe only out of deference to his father.

As for any contructive criticism given to Pinch and family, they will angrily retaliate if they hear any advice that suggests they reliquish any control of the Times which they have already put in the doghouse:

Smelling weakness, Wall Street agitators have pressured the family to cut costs, squeeze more value out of the stock, and loosen its grip on management. Last year, London-based Morgan Stanley fund manager Hassan Elmasry presented the board of directors with a litany of criticisms of Sulzberger’s management, suggesting that the stock price might be improved with new leadership and an overhaul of the dual-class stock structure that allows the family to maintain monarchal control over the business. Not surprisingly, neither Sulzberger nor the family members on the board were interested in ceding control of the company. In retaliation, an angry Sulzberger pulled the family’s personal holdings, approximately $200 million in New York Times stock, from an account at Morgan Stanley. 

Okay, so the New York Times is suffering bigtime due to Sulzberger stupidity so how are other members of that extensive family reacting to the great loss of New York Times value? Apparently they have been lulled into apathy due to Pinch buying them off with trinkets in the form of stock dividends:

In order to keep the family—and shareholders—happier in these lean financial times, Sulzberger has quietly ramped up the amount of cash they receive in a quarterly cash dividend. This, more than the sale of stock, is the source of the Ochs-Sulzbergers’ working wealth. Sulzberger and CEO Janet Robinson raised the dividend by an extraordinary 31 percent last year—even as the stock price declined. Of the $132 million a year the paper gives to shareholders, about $25 million of it now goes directly into the coffers of the Ochs-Sulzberger trusts.

But the payoff exacts a harsh price: The company is going deeper into debt to pay the high-yield dividend. In the last four quarters, the paper has made less money than it has paid in dividends, and debt-ratings agencies like Moody’s and Standard & Poor’s are threatening to downgrade the company to “junk bond” status, which would paralyze the paper’s ability to borrow money. In August, an analyst for Moody’s suggested the company could quickly improve its rating by lowering the high-yield dividend—a report that sent the stock down 6 percent. Emile Courtney, a credit analyst for Standard & Poor’s who currently has the Times at the lowest investment grade possible, says that even with changes to its cost structure, “there’s a greater than 50 percent chance that [the Times] will go lower to non-investment grade.” If that happens, the paper will have even less money available to climb out of its hole.

Luckily for Pinch, most of his relatives seem to enjoy living life of the idle rich...as long as those dividends which support them keep flowing:

The other cousins have mainly deferred to Sulzberger, enjoying relatively placid lives as philanthropists, conservationists, and charity-board members. Susan Dryfoos serves as the family historian; Lynn Dolnick was a director of the Smithsonian zoo; Cathy Sulzberger is a real-estate developer; Arthur Golden wrote the best seller Memoirs of a Geisha. 

Perhaps the apathy of this family can be explained by the indoctrination sessions held regularly on how they are so very special:

Sulzberger has said that his clan starts going to family meetings when they’re 10 years old and by 15 they understand their roles as caretakers of the New York Times. There’s also a one-day orientation session for kids turning 18 or 21—or people marrying into the family—to learn about the legacy of the Ochs-Sulzbergers. For the last several years, the entire family has converged annually on the Times headquarters for a review of the company’s fortunes. Afterward, they break into groups and powwow with top Times editorial and business executives. It’s the younger members who ask most of the questions, “more about the mechanics of the paper than debating this or that policy,” says a former Times executive. People who have been involved in those sessions say they’ve never seen family members express criticism or dissent. 

Younger members of the family are also inculcated in the beliefs of the Sulzbergers on private annual retreats to places like Hawaii. One Timesman compares the indoctrination to Skull and Bones, but it seems more the stuff of summer camp. They sing songs together like “We Are Family” and keep abreast of each other’s lives through a newsletter called The Lookout. A surprisingly large portion of the family stays connected through the social networking site Facebook, including Punch Sulzberger’s sister Ruth Holmberg, the 87-year-old mother of the Golden brothers, who lives in Tennessee. The Cohen boys compare favorite movies with the Golden kids, who are friends with Arthur’s 26-year-old daughter, Annie.

Your humble correspondent wonders if one of those Times editorial and business executives will ever have the guts to tell the young Sulzberger family members the truth to shake them out of their apathy: "Your uncle Pinch has blown your family fortune through sheer stupidity so enjoy the good life while the dividends last." Actually someone did say something like that but it was a former Times executive so he didn't have a chance to tell the painful truth directly to the young family members:

One thing that would cause the fifth generation to take a sudden interest in the family business is a decrease in trust income. “Once that dividend is cut, then all hell will break loose,” says a former Times executive. “Because that’s what the family lives on. Then it’s over. It’s going to unravel. They’re going to be forced to look for external professional management to run that company.” In a brief phone call, Stephen Golden (cousin of Arthur Jr., brother of Michael, father of Dave) cautioned against assuming that the younger relatives’ interests and careers away from the newspaper mean that they aren’t engaged with its plight. “If you follow that through, what you end up with is an assumption, you say that everyone who is not engaged in the paper is unconcerned. That’s a dangerous assumption.”

And that dark economic cloud looming on the Times horizon has moved ever closer. Once those dividends decrease drastically, as they inevitably will, the party will be over for the Sulzberger family. Conservatives would like to think that liberal Times bias will be the reason for that newspaper's eventual downfall but don't discount the factor of Sulzberger stupidity as an important cause of its failure.

A man's got to know his limitations. ---Dirty Harry ("Magnum Force")

—P.J. Gladnick is a freelance writer and creator of the DUmmie FUnnies blog.