After Moody's threatened to downgrade the New York Times Company's debt to junk status Thursday, Standard & Poors went ahead and actually made such a move, bringing to reality a development foretold fully two months ago by Bloomberg. The Times Company is only now considering reducing its outsized dividend to shareholders, including most prominently to the Sulzberger family that controls the company. Having failed one test, involving credit, the Sulzbergers now face another, involving their hold on arguably the most important journalism franchise in the country.

The Times has $46 million in cash and about ten times that much debt, just counting what's due over the next two years. And yet it pays close to $132 million each year in dividends.

That money helps keep the family behind publisher Arthur Sulzberger Jr., whose tenure has featured a series of comically bad business decisions, including spending more on stock buybacks than the company is now worth, passing on the chance to invest in Google, the overpaying for and then failing at operating the Discovery Times Channel and the sale of the old Times building for hundreds of millions less than it was worth.

When the Times Company at long last cuts its dividend, which it must, it is unclear whether the family trust will remain united behind the paper or its current regime. Will the family allow Sulzberger to spare hard-news operations from the worst of future cuts? Will it allow him to keep running the paper at all? Will the Sulzbergers even want to still own it?

Before now, Sulzberger had actually been increasing the dividend — and going into debt to do so. Now he must cut the family allowance. He'll be lucky to avoid being cut himself.