06/07/2010 05:12 am ET | Updated May 25, 2011

WaPo's Pearlstein On What's Wrong With Financial Coverage

At yesterday's "Facing The Fracture" conference, the Washington Post's Steven Pearlstein ended up casting himself as a principled dissenter on the panel he participated in (along with the New York Times's Peter Goodman, NYU's Alyssa Katz, Bloomberg's Robert Friedman, and the Roosevelt Institute's Jeff Madrick). He unpacks his thoughts on the conference in his column today:

I attended a conference at Columbia University earlier this week that wound up focusing on how the mainstream business press contributed to the recent economic crisis with fawning, uncritical coverage of the financial sector that ignored the evidence of abusive lending and bought into the myth that unregulated markets are more innovative and self-correcting.

It's a common view these days, particularly on the Internet, and although it's a bit overdone, I'll admit there is a dollop of truth in it. To demonstrate that we still haven't learned our lesson, one of the speakers held up a story from last summer about the close relationship between J.P. Morgan Chase chief executive Jamie Dimon and top officials of the Obama administration -- so close, in fact, that White House Chief of Staff Rahm Emanuel had agreed to speak privately at an upcoming meeting of the bank's board of directors. That these ties were reported without the requisite amount of outrage was cited as proof that "legacy" media continue to glorify and suck up to Wall Street titans.

It was left to Chrystia Freeland of Thomson Reuters to point out that the story was seen by both Dimon and his gleeful rivals as a public relations disaster and caused such a ruckus that Emanuel was forced to cancel his appearance.

Pearlstein is referring to the panel that preceded his, and I agree that Freeland very deftly points out that not all supposedly adulatory press ends up adding to the boosterism. I don't want to get into some sort of drawn-out diatribe defending the purpose of profiles and "beat sweeteners," but to me, the more stealthy example of the fawning coverage of financial titans comes in the form of articles like the one -- inane piffle that clearly went from a flack's lips to some freelancer's keyboard.

Pearlstein continues:

Three years after the onset of what was then thought of as the "subprime crisis," there remarkably is still no consensus on why it happened, who is to blame, how necessary the government bailouts were and what needs to be done to prevent such a cataclysm from happening again. Over time, the issues have been overwhelmed by populist anger, infused with political ideology, distorted by partisan maneuvering and special-interest pleading, and ultimately eclipsed by economic recovery. Any reforms that emerge from the political process are likely to reflect this collective confusion.

And with that, I think I understand the basis of Pearlstein's dissenting positions yesterday: he's simply more interested in getting right what's on the road ahead and avoiding the pitfalls of this "collective confusion" than he is about relitigating the media's past performance, or at least following that litigation down every single alley.

Now, what doesn't make today's piece, is that Pearlstein began his remarks yesterday with a bit of a melodramatic, fist-pounding rant about how the press should concentrate on doing data-driven "dot connecting," rather than ground-level reporting on how the financial crisis affected Main Street types, a form of journalism that he referred to as "bullshit." Needless to say, he found few takers: Goodman immediately, and properly, shot down this you-could-do-one-or-the-other argument, pointing out that there's no reason not to do both. I have to admit, I found Pearlstein's take on this somewhat shocking, since I think of this February 2009 piece as an example of the journalism he seemed to be decrying.

Whatever he was thinking at the time, it was apparently not worth bringing up today, perhaps for the good. Go read his whole column.

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