Wall Street Journal V. GM: A Public Battle For Editorial Independence

Once upon a time, The Wall Street Journal faced off against General Motors over editorial independence, and won.

According to ProPublica president Richard Tofel, who wrote an entire chapter about the story for his book, “Restless Genius: Barney Kilgore, The Wall Street Journal, and the Invention of Modern Journalism,” the conflict between the two giants began over 60 years ago this May.

The story goes that GM CEO Harlow “Red” Curtice happened upon a report in the WSJ about the tactic of selling excess inventory through smaller independent dealers at cut-rate prices – bootlegging – a tactic used by his company and his competitors in Detroit. The report also covered the editorial policies of the newspaper’s local competitors – which had banned advertising of non-franchise dealers involved in bootlegging – citing the Detroit Three’s influence in advertising departments had begun to creep into the newsroom.

As a result, Ward’s Automotive Reports had cut the WSJ off from its weekly newsletter subscription. However, an exclusive published in late May – styling renders of the 1955 models from the Detroit Three – was the straw that broke Curtice’s back.

Fearing that sales of 1954 models would crash as a result of the exclusive, GM cancelled all of its advertising with the newspaper that day and barred access to its weekly production figures; the Associated Press was also barred when GM learned the Journal had tried to go through the media organization to get the figures. Editor Barney Kilgore later told Time magazine his paper declined to attend the “off-the-record” new-model briefing that year, citing the Detroit Three’s tendency to go “off the record” nearly all the time as the reason for not playing the game.

What followed was two months of editorials defending its stance on the two stories, letters to the editor from readers who either weren’t happy with Kilgore’s decision or stood behind the newspaper, and a number of other publications, such as Ad Age and Tide magazine (an advertising trade journal, not to be confused with Time), calling out GM and Curtice’s behavior in the matter.

Speaking of the letters, Kilgore chose one from a reader to pass along with one of his own – calling for a way to settle the issue reasonably – to Curtice. The letter, by Roy Brenholts of Columbus, Ohio, stated that Brenholts would trade one of his two Cadillacs for a Ford instead of trading the Ford he owned for a Chevrolet, adding that he would avoid Cadillac until GM stopped their “Hitlerite attitude” toward the newspaper.

The meeting between Curtice and Kilgore led to two letters being published back-to-back in early July. Curtice wrote that breaking off relations with the WSJ was better than suing – though he wouldn’t hesitate to consider the latter next time – but that he never intended to interfere with editorial. Kilgore, in return, noted that the flow of information – weekly sales figures, news releases et al – had come back to normal, his paper had the right to publish news from authorized and unauthorized sources, and he, not the advertisers, would be the final arbiter in what was published in the first place. This established the WSJ as a newspaper with unflappable independence and integrity before the public in so doing.

[Photo credit: Robert Emperley/ Flickr]