Those who think it was just pure meanness that caused McClatchy to lay off 70 people at The News & Observer and another 1,300 nationwide need to read this:

Newspaper publisher McClatchy Co reported a more than 40 percent drop in quarterly profit on Thursday as advertising revenue plunged, but shares shot up 5 percent after the company said it still will be able to pay its debt.

Too many reporters and editors have little understanding of rudimentary economics. They don’t understand that the bottom line is, well, the bottom line, that you have to have more money coming in than going out. And if you have things like huge mortgages for buildings and payments due on new presses, then you have to have a LOT more coming in than going out. Otherwise, the banks get nervous. So, you cut costs, and employees represent the biggest line item by far.

This is the part of capitalism and free markets that most left-leaning journalists consider “cruel,” when, in reality, its this natural winnowing and pruning that keeps an economy healthy. That newspaper employees could turn out to be the buggy-whip makers of this century is unfortunate for them, but good for everyone in the long run.

Adapt or die is as much a law of economics as biology. Many buggy-whip makers became auto upholsterers, and many bicycle shops became auto repair businesses and filling stations. Newspaper companies are doing what they can to adapt before having to chuck it all. Some will succeed and some won’t.

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