After some brinksmanship, the New York Times finally reached agreement with the unions at The Boston Globe last week. But the Times will still have to take some dramatic steps to get the Globe’s costs under control. Here’s a thought: What if the Globe were to file for Chapter 11? It is a separately incorporated subsidiary. In theory, this would allow management to more dramatically renegotiate its union contracts and restructure the asset. It could allow NYT to reduce losses at a faster pace, which would both provide the parent company with some breathing room and perhaps make the paper more attractive to potential buyers.

While I’m not a lawyer, I talked to one who couldn’t see why this would be an issue. If the NYT wants to alleviate its current cash pressures, this has a nice feel to it. The NYT got some concessions from its labor force, unionized and not, but a bankruptcy could let the NYT reduce headcount a bit faster. We have no reason to believe this would interfere with the sweetheart terms of Carlos Slim’s loan to the Times, unless it leads to a sale of the Globe, in which case proceeds would first be applied to reducing/paying back the loan.

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