MOORLACH UPDATE — OC Register Coverage Look Back — September 16, 2019

25th Anniversary Look Back

On Friday, Sen. Jeff Stone (R – Temecula) had reached his limit on the verbal abuse he received from our colleagues in the majority party (see MOORLACH UPDATE — Last Day of Session — September 15, 2019).

I understand his frustration. The September 9, 1994, article by an OC Register reporter brought me to my own “I’m mad as hell and I’m not taking it anymore” moment (see MOORLACH UPDATE — Governor Signs SB 496 — September 9, 2019).

I wrote a letter to the Publisher of the OC Register, David Threshie, and vented my frustrations. Who does one go to when a reporter is bungling a story so badly? Why was the Register still “not getting it”? The Register had a bus stop billboard campaign showing individuals who were not in the know and claiming that “they didn’t get it,” meaning they were not subscribers.

The letter is provided below, in full, with typos and grammatical errors, probably due to preparing it in haste. (Chris Knap’s name has only one “p.”) I don’t believe it’s ever been published before. It may have been a little more transparent than it needed to be, but it is who I am (even 25 years later).

It refers to the Piper Jaffray debacle. Here is a link to The Wall Street Journal, which had an article on the subject in its archives: The Bond Buyer story was mentioned in my last UPDATE (see MOORLACH UPDATE — Last Day of Session — September 15, 2019).

The letter would be referred to in journalistic reviews during the weeks after the County’s bankruptcy filing by Susan Paterno (see MOORLACH UPDATE — LOOK BACKS — American Journalism Review — March 1, 2010) and Jim Wood (see MOORLACH UPDATE — LOOK BACKS — February 4, 2010).

For reference, at the time, R. David Threshie was the paper’s publisher and Ken Grubbs was the editor of the Commentary section. Along with Knap and Ricky Young, they left the paper many years and two corporate bankruptcies ago.


Mr. R. David Threshie

The Orange County Register

As a recent candidate for Orange County Treasurer-Tax Collector, I wanted to share some of my observations regarding my experience with the press.

Let me preface my concerns by stating that I enjoyed my experience as a candidate, felt that I received a credible percentage of the vote (considering my nominal name recognition), and am happy with the results.

I found the reporters at your competitor, the Los Angeles Times, to be mature, professional, thorough, and balanced. Regretfully, I can not say the same for two of the Register’s reporters, namely Chris Knapp and Ricky Young.

Because the race generated national attention, I had the privilege of conversing with numerous reporters and to read their articles. I have no complaints that would warrant a written communication with any of the other newspapers. I also brought a long history of working with the press as a community activist and as a regular columnist for the Newport Beach/Costa Mesa Daily Pilot. Needless to say, I knew what to expect.

By way of background, I am a Certified Public Accountant and a Certified Financial Planner. I am the administrative partner of the Costa Mesa office of Balser, Horowitz, Frank & Wakeling. I have been with this fifty-seven year old firm for eighteen years, ten as a partner (shareholder). I have served on numerous community and charitable organization boards of directors, many as Chairman. I am involved in my community as I want to see a positive environment for my wife and three young children. I hope that I have been an honorable neighbor and citizen.

In 1992 I decided to run for the Orange County Republican Central Committee in the 70th Assembly District. There were twenty-four candidates running for six seats. I placed sixth and, on the night of my installation, was voted in as Assistant Treasurer. I was also appointed to serve on the California Republican State Central Committee by Congressman Dana Rohrabacher.

Because of my varied political activities, I was recommended as a possible candidate for the Board of Supervisors by William Lobdell, editor of the Daily Pilot, in an opinion piece. Another editor, Steve Marble, also gave a positive recommendation in an editorial encouraging me to run for Costa Mesa City Council. In fact, Mr. Ken Grubbs and I became better acquainted on Mr. Lobdell’s cable access program, and you can inquire with him about my involvements and character.

With encouragement from that election, elected officials, family, clients, friends, and even member of the media, I proceeded to research where I could run for office. I wanted to utilize my natural talents, yet not sacrifice my family. City Council would mean too many evenings away from my children and add some thirty hours per week of additional commitments to my already demanding “business owner” work schedule. Supervisor was not suited to my background and experience (and Jim Silva still teases me about Lobdell’s article). State Assembly would have had me away from home several days a week. The Treasurer’s position would allow me to serve my community, be close to home, and, with a leave of absence from my firm, maintain a regular work week schedule.

After doing extensive research, and conferring with close friends, clients, and politically involved individuals, I decided to run. It would be my opportunity to enjoy our democratic form of government and shed some light on what the incumbent has been doing with our tax dollars.

My approach was simple. Focus on many issues, the foremost being those of anti-incumbency, registered Democrat versus a Republican, the use of leverage, and the strategy of leverage.

I naturally sought the “blessing” of the Chairman of the Orange County Republican Party, Mr. Tom Fuentes, who was hoping to see someone run against Mr. Citron. I worked hard to obtain endorsements from many of our Republican Congressmen, State Senators and Assemblymen, as a support base for a county-wide race.

I worked hard to raise funds. I campaigned. I also wanted to engage Mr. Citron in debates, but he did not oblige. All the same, I requested documents from him under the state’s freedom of information laws and carbon copied those requests with your newspaper.

The Los Angeles Times was the first to do a story. That was followed by the Wall Street Journal. The Register was a “johnny come lately” that bit into everything that Mr. Citron fed them and acted as his mouthpiece throughout. I was pare of some “Republican” plot . . . I controlled and “fueled stories in the financial press” . . . I was a big, bad, barracuda going after a kind hearted man who had earned such high returns for the county. For a paper that believes in term limits, you guys sure out did yourselves in protecting someone running for the seventh four-year term.

I could give you numerous examples of reporter bias, but I’ve already taken up enough space (or inches). I have been biting my lip throughout. I have patiently worked with Mr. Knapp, explaining as politely and professionally as possible the issues as I saw them. During the campaign I did not request a “referee” to review what I said to Mr. Knapp and what was actually used in his articles. In fact, one technical error that he made haunted me for the remainder of the campaign. And even the correction was editorialized in a snide manner.

The article of last Friday, September 9, 1994, entitled “O.C.’s Sky Didn’t Fall,” is the last straw. I can refute this article literally paragraph by paragraph. Again, I’ll spare you the “inches.” “Hatchet job” and “snide” were observations made by friends and associates. Incredulous is what I would call it.

Why would you allow a political reporter who has minimal grasp on business issues to editorialize in the lead article in the Business section? “Well, the campaign is over, interest rates are leveling out”—oh yeah? They went up that very day in a significant way, up to 7.7 percent for the 30-year bond.

“Reports of Bob Citron’s death spiral appear to have been greatly exaggerated.” Oh yeah? But your Sunday Business section included an article entitled, “’Inverse floaters’ help sink the California Muni Fund.” And don’t think that was lost on a large number of your readers. Be consistent. Look at the Piper Jaffray articles. The parallels are remarkable, with one glaring difference: marking to market (another long topic for debate).

“Moorlach . . . was unrepentant in an interview this week . . . “ Give me a break, the issues aren’t going to go away. And should inflation continue to be a factor, possibly continuing the increase in interest rates, the Register will have lost all credibility in future articles on this topic. It’s too bad. We’re talking about a serious chunk of change in taxpayer dollars. The article would have been more aptly entitled “O.C.’s Sky Didn’t Fall, Yet.”

Either Mr. Knapp is trying to protect Mr. Citron, which even Mr. Citron did not seem to want (I’m not interested in creating another controversy.”) Or he still, as your ironic advertising pitch during the campaign months stated, “doesn’t get it.” Or Mr. Knapp can’t seem to leave it alone and has some personal hang ups. He admitted outright to me that what I said was “political” during the campaign even though I insisted throughout that they were “philosophical” differences.

Let me return to “inverse floaters” once more and I’ll close. Citron has purchased some $3.5 billion (nearly one-sixth of the entire portfolio) of this type of derivative. They are now down forty percent in value, or $1.4 billion! Thus my observation that “I was too conservative in my remarks.” Does Mr. Knapp cover this issue in his hit piece? No. Yet many corporate financial officers and county treasurers are being rigorously scrutinized by the media around the country for making this type, or similar types of investment. An example from yesterday’s “Bond Buyer” is enclosed.

I don’t have time any more to talk to a reporter that is on a personal crusade. From here on out, should you need me to comment on this topic again, please have another reporter contact me. I will no longer answer or return Mr. Knapp’s calls.

The Register is precious resource in our county. Your editorial pages are wonderful. But if I want good journalism, I now turn to the Times.

Thank you for allowing mre to address my concerns.

Very truly yours,

John M. W. Moorlach


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