CITY COP BUSTED IN STING

Sorry folks, I have nothing to report here other than the bare fact that a City of Milwaukee police officer attached to the Third District has been arrested in a sting operation. Apparently he did not turn over all money from one or more incidents. Captain James Harpole of the Third District referred milwaukeeworld to Anne E. Schwartz, the department's spokeswoman, who has not returned our phone calls. Maybe she's hurt because she didn't make the esteemed Milwaukeeworld list of best spokeswomen, but now you know why she didn't make the list.

--Michael Horne

J/S "RESTRUCTURING" TO COST 130 JOBS

Are You Ready for "Managed Attrition"?

Journal Communications, Inc. [JRN], the publisher of Milwaukee's only remaining daily newspaper, announced a "restructuring" today, Wednesday, July 2nd, 2008, that will involve the elimination of 10 per cent of its workforce, or 130 employees. All employees, with no "years of service" requirement are eligible to apply for the package, which includes a cash payout and health insurance benefits. Employees have been notified that there is a three week window for them to ask questions and study the proposal. About 25 cuts are expected in the newsroom. This is particularly tough, since there are scant opportunities for journalists in this city, and I can't think of any that come with a regular paycheck.
Publisher Elizabeth "Betsy" Brenner said in a press release that the move was made to "address the impact of a challenging advertising environment," and added that the goal would be accomplished by voluntary and involuntary separations, as well as "managed attrition."
"No one could have foreseen the downturn in our local economy that has only deepened" since the first round of buyouts was announced last October, Brenner wrote. (How could they, with no business reporters around to pay attention?)
In a letter to staff announcing the move, Brenner said traditional advertisers like "car dealers, real estate agents, hiring officials, retailers and mortgage banks" have been "battered by a 'perfect storm' of deteriorating credit, slowing home sales, contracting company size and higher gas prices."
As a result of these and other factors, Journal Sentinel revenues are down 12 per cent in the past year. On a happy note, that is only a fraction of the decrease in the price of company shares.
Journal Communications stock has lost two-thirds of its value in the past year, and trades at $4.60 per share. It pays a whopping (and unsustainable) dividend of over 6 per cent.
The company, never profligate with its funds, has introduced cost-cutting measures that border on the surreal. For example, it is severely limiting the number of copies of the print newspaper that are available to the newsroom, where the paper is written. Reporters are now provided pdf versions of the "paper" on the company intranet. However, as a practical matter, many reporters often use printed notes when composing their stories. When the Journal Sentinel pages are printed out in standard 8-1/2" by 11" paper, they are not legible. So, the copies must be enlarged, and six sheets of copy paper are required to do the job of one page of newsprint.
The Journal Sentinel will be rolling out a new internet site around September or October. This interface will more closely resemble the look of the existing print newspaper, and may signal its demise.

-- Michael Horne

HOW McGEE COULD LAUNDER GANG MONEY

The Milwaukee Journal Sentinel noted today, Tuesday, July 1st, 2008, that jailed former alderman Michael McGee told a fellow inmate he used wire transfers to launder Vice Lords drug money. A headline referred to $15,000 McGee wired illegally to an agent to book rapper "The Game" [a.k.a. Jayceon Taylor] at the Rave nightclub. This transaction is similar to a concert money-laundering scheme explained to me by law enforcement officials about a year ago when McGee was first busted, and has been sitting in my files awaiting today's story.
The process is not exclusive to Milwaukee, is widespread, and explains how gangs, the music industry and the "don't snitch" counterculture are intertwined.
Generally speaking, a concert promoter with gang ties contracts to rent a concert hall for an evening at an agreed-upon rent. A performer or deejay, usually also with ties to the gang, is engaged for the evening's performance, and the event is promoted, usually by word-of-mouth and with inexpensive "rave cards" dropped off at suitable locations, announcing the event and its admission cost.
On the night of the performance, thousands appear for the concert, and virtually all are admitted for free as part of the scheme. (A few kids from the suburbs might pay to get in, but not many more.) Let's say that 2,500 people attend a concert in a large hall, with a list ticket price of $20, although most pay nothing. The next morning, the promoter makes out a deposit slip for $50,000 representing the night's receipts, grabs $50,000 drug money from under the mattress, brings it to the bank, and voilla! The money is laundered.
--Michael Horne