The credit crunch and how it affects reporters

Credit card companies are starting to reign in credit.

For example, American Express is starting to raise interest rates, eliminate the sign-and-travel option, and/or, put a cap on how much liquidity businesses and individuals have access to, among other things. I know of people who have had some or all of the above happen to them individually, and they are not delinquent on their bills. It's mostly related to the credit freeze, though banks are also squeezing credit card companies to squeeze their customers so the banks can tap cash flow.

I bring this up here because many writers use their own personal accounts to fund business expenses, especially travel and food, and are later reimbursed for it. However, if there's a credit freeze and the access to credit is severely limited, it doesn't matter whether you're reimbursed or not if you can't access credit when you need it because of limits, etc.

How are media organizations going to handle it? Travel is already being severely limited at some shops as it is.

This is not even factoring in the very likely contigency that the newspapers' own credit lines could be getting squeezed in a similar manner. And Lord only knows what that could mean.

 

I propose handling it the way the owners of my paper have handled it. They simply aren't paying their debt anymore. They bought the place with massive loans and now openly default on their payments, figuring no bank is going to foreclose on a newspaper. How, pray tell, would it unload the damn thing?

 

This has happened to me. American Express, "no pre-set limit" and all, put a cap on how much I could charge each month. After the third month that they changed said limit without telling me, and the third embarrassing moment where my card was declined in a business situation, I said "screw it" and cut up the Amex. I'm using my MasterCard now; at least I know where the limit is, and yeah, I get perilously close to it every month while waiting for reimbursement.

 

That's all well and good, but I imagine that while Podunk Times vs. American Express is one thing, that plan of attack wouldn't work in a Joe Williams vs. American Express fight, which is the scenario I'm putting forth here.

 

Never assume, Bubbler. I feel like I would drop American Express in four rounds, max.

Nah, just funnin' with you.

This one is easy, though. You tell the boss that you can't be extending your own personal credit to the newspaper anymore -- not simply that you won't, but that you cannot, if in fact your credit is frozen or your card limit is decreased. Whether you're a good enough journalist to handle an out-of-town assignment shouldn't have anything to do with your personal credit score. It wasn't that long ago, really, that newpapers would send out reporters with good-sized cash advances to pay for their travel costs as they incurred them. I used to go to the Accounting dept. and walk out with $2,000 or more, half of it in Traveler's Cheques, in advance of a spring training trip.

Mingling your personal finances with newspaper expenses is a bad practice beyond the unavoidables (mileage, parking, small shit like that). When my joint switched to corporate plastic, I missed the bonus air miles and hotel points that I got through my own Visa cards but it sure did unsnarl my personal cash flow.

And if a newspaper doesn't have pockets deep enough to travel, it shouldn't go on the road.

 

The problem isn't mine, but I see your points.

Sadly, I think the answer is going to be no cash advance and no travel.

 

I'm convinced that, with a growing supply of freelance journalists (i.e., unemployed newspaper sportswriters) all over the country, travel will be seen as less and less cost-effective. Getting easier by the day to find qualified stringers for a fraction of what sending a staffer on the road costs. ;D

(Yes, I'm aware of all the intangible benefits that come from staffing your team's away games, and no, I don't advocate my network-of-stringers vision. But if the beancounters rule -- and we all know they do -- and "quality" both in the short- and long-term is a dying priority, why should the brass even think twice about slashing travel costs? If they're determined to throw something else overboard, what's left?)

 

My chain does not do cash advance - and it is a pretty major chain. Our paper has also cut travel quite a bit, but that is just so we can avoid layoffs.

I do know when I moved across country recently, I tried to get my credit limit raised so I could put the move on my credit card and then pay it off when I got money from my paper. I have a limit of $2,600 right now and I asked to get bumped to $4,000. I was denied, despite having sterling credit. They sent me a letter that said they are not raising any limits for anyone presently.

 

Had the same thing happen to me. AMex sucks.

 

It has affected me because I rarely travel anymore. The high school beat is the only beat we have, and management went with stringers on most assignments, even state playoffs/tournaments. I refuse to charge hotel or other travel on my personal card. If they want the coverage, they have to pay for it. I'm not doing this out of the kindness of my heart. I'm doing it because it's a job. If they want to ax me for being a difficult employee, fine. I'm sick of the place anyway.

 

They just decided to cut back drastically on travel at our chain, shortly before I was to take a big trip next month. The plane ticket, quite costly, was already bought and paid for, though, and was by far the biggest expense on the trip. So I'm not sure how much sense that makes, since it's a non-refundable ticket.

 

We're done traveling, so I guess that solves the problem.