NBC Has An Erin Burnett Problem

UPDATE: Jim Cramer and Erin Burnett responded on the air.

One of the big journalistic lessons of the Iraq War was that "embedded" reporters who get one side of the story are not well suited to give accurate information to the public.

Americans now depend on the media for accurate information about the financial crisis. This Sunday's Meet The Press made something absolutely clear: Journalists who are "embedded" on Wall Street and depend on Wall Street execs for access on a day-to-day basis are ridiculously unqualified to give the public good information about the economic crisis.

Indeed, NBC has an Erin Burnett problem. Watch and see for yourself how Burnett consistently serves as an apologist for Wall Street's worst practices:

NBC even (accidentally?) admitted Burnett's pro-Wall Street bias. Just look at the headline they put up after the show, summarizing her main message: "Erin Burnett: We must help banks." Really?

At the end of this post, I'm going to ask you to email Erin Burnett (here) and ask her to reform her ways.

But first, here are a few of her gems from this Sunday--all of which are also in the video.

Burnett got warmed up by talking about how the public is completely confused when we're worried how bailout recipients are spending our money:

It is amazing, when you listen to so much of the commentary out there, that it focuses on bonuses or private jet use or, or also just that they're not lending. None of these things, really, are, are the real issue here...it isn't choosing Main Street vs. Wall Street. That is a completely false choice that is being put out there.

Her "embed" status was on full display when Claire McCaskill's comments about Wall Street bonuses came up. Notice how dismissive Burnett is of populism (aka, politicians speaking to the will of the people -- that quaint and silly notion):

SEN. CLAIRE McCASKILL (D-MO): They don't get it. These people are idiots. You can't use taxpayer money to pay out $18 billion in bonuses. What planet are these people on?

(End videotape)

MR. GREGORY: Fair question, Erin?

MS. BURNETT: I understand the outrage, and you understand the populism. There are, though--well, how should we say this? The taxpayer money is not being used to pay the bonuses. I think people could understand if you work for a company--right? If the three us worked for a company, your guests, and I lost $10 billion but Steve [Forbes] over there, he made a billion dollars. So overall the company actually loses money, but Steve went and did his very darndest for that company and he made money. So should he be paid for his work? That's essentially what we're talking about here. And reasonable people could argue about this, but many reasonable people would conclude, yes, he should be paid for that. And I think, David, you've raised a fair point, which is maybe it's the whole use of the word "bonus."

MR. GREGORY: Mm-hmm.

MS. BURNETT: If you explained to people this is how they are compensated, that might make a difference. But there is also a fundamental misunderstanding. The taxpayer money isn't being taken and paid out in the form of bonuses. It goes in a, a separate pool, shall we say, a separate account for banks. So maybe people don't care about that distinction, but it is there.

Say it with me: Wow!

First of all, I hope you caught the channeling of Sarah Palin in there. Knowing that Wall Street execs are doing their "darndest" to make money shines a whole new light on things, doesn't it?

Second, isn't it good to know that you're, how should I say this, stupid? You thought an executive's "bonus" was a bonus! Silly member of the public. If only you understood.

Third, can I borrow ten bucks? Thanks. "Hey, everyone, watch me make a paper airplane with this ten bucks, and...there it goes away!" What? No, I didn't just throw away your ten bucks. That came from a "separate pool." Who are you anyway? Oh, a member of the public. That explains it. You just don't, how should I say it, understand anything. Can I borrow another ten bucks?

I've worked with a lot of reporters, and most of them are very nice people. I'm sure Burnett is pleasant as well. But what she's doing here professionally is a real problem, and it's NBC's problem at the end of the day. The public simply can't afford to have economic news given to us by Wall Street "embeds."

We need Burnett to listen to her Wall Street sources, be skeptical of them, ask them very tough and sometimes uncomfortable questions, and be willing to report negatively on them when they abuse the public trust. If they never talk to her again, so be it. Donald Rumsfeld won't talk to some reporters either -- and where is he today? Disgraced in history.

Please email Erin Burnett today and let her know we need responsible reporting here.

(It's also worth noting that the guests Meet The Press invited on to discuss the economic crisis were Erin Burnett, Steve Forbes, and Moody's Mark Zandi -- all Wall Street voices. There was no progressive voice like Paul Krugman there to stick up for the public. If you want more balance on Meet The Press roundtables, take a moment to give them feedback here.)

P.S. If you're a bold progressive, feel free to stay in the loop with the Progressive Change Campaign Committee. I actually didn't write this post in my capacity as co-founder of the PCCC, but if you are progressive and enjoy fighting back, please do stay in the loop with us.

Comments

[onenation]

This is the same person who said ' . . . . getting low priced toys . . . " trying to put lipstick on the lead paint China toy deaths. See Morning Joe when that was a news item.
Question- Why did that story disappear??? Was it WalMart??

[Ronald Sorenson]

Feel Betters Best

Dreams live real choose play living
Finish line myth truth see life limit not
Music sound soul happy knows one be all
Confusing total control free in sync sharp
Release holds none love in comes caress
Deep listen hearts beat of story break thru
Sings the guitar in speed rip out in control
Make made what get how same every knowledge
Crawls up deliver place waits proud to make
First love family have dna same bind bond life
Waste miro returns cost priceless live heaven is
Touch inside blind eyes peace see hear see feel
Watch not the end be life enjoy till earths last breath

-Ronald Sorenson
September 17, 2008
www.a-d-d-free.com

[Jachyra]

*** Ok so I lied... comment 4 of 4 ***

Lastly, lets not forget that all this bailout money is not a gift to any of these companies... they're essentially loans (technically they're structured as collateralized investments that pay dividends, but without getting too technical, they're essentially loans collateralized by company stock). GMAC is paying around 8%, and the other banks are paying 5% for the first 5 years, and then it increases to 9%. So while I can certainly understand the American public's desire to make sure they want to get paid back, I would urge any reader to just ask yourself how you would feel if your mortgage company called you up one day to give you a hard time because they ran your credit report and noticed that you had been eating out at restaurants a little more than they were comfortable with this month. Would you feel like it was any of their business? I would suspect that the average response would be "not unless I started being late on my payments or I was getting close to default." Well, if that's the case, why is how the banks choose to spend the money LENT to them any of our business until they at least start missing their interest payments?

I hope none of what I just said is grounds to revoke my status as a progressive... I just think it doesn't help the cause to be misinformed.

[Subversive]

While I found your comments informative, you also missed the point of the overall discussion (and so did Ms. Burnett). Many banks and companies are now "too large to fail" which is part of the problem. If a smaller company goes down, who cares? You file bankruptcy and lay off your employees. If GM, AIG, or Citi threatens to go under, suddenly it's the end of civilization as we know it. This shouldn't be the case, but it is because politicians wanted banks to "get big" and deregulated. So "getting big" and deregulation meant engaging in risky behavior that smaller banks don't engage in. Upon failing, the government gives these big companies money--OUR money, yours and mine. Using public money means that the people are entitled to make the rules. WE are entitled to make the rules. And rule #1 is: If you mismanaged your company by buying risky derivatives that you couldn't cover, then no extravagant pay, no bonuses, no Las Vegas trips--for ANYBODY. If Sally had a bad year, but Dick had a great year--TOUGH. Rule #2 is: You pay US back with interest. Rule #3 is: Be thankful you're not in jail.

[Jachyra]

I see where you're coming from and can certainly appreciate your position, but I can't really agree with it because with all due respect, in my opinion, its a vast oversimplification of not only the problem, but also the activities that have been going on, almost to the point of not really being very accurate.

[Jachyra]

*** Comment 3 of 3 ***

Now, because of federal regulations, for every $12 in deposits that they lend out, they are required to have at least $1 of capital on their balance sheet. Since deposits are the property of the depositors (customers of the bank), if a loan is defaulted on, the bank has to deduct that loss from their capital in order to repay the depositor. So when the economy rolled over last fall, and the banks got a much larger number of loan defaults than what they expected, they found themselves in a position where they were no longer in compliance with federal regulations, since instead of having $1 for every $12 lent, they had somewhere between $0.55 to $0.75 for every dollar lent. The bailout money provided to them for recapitalization was so that they had enough capital to be in compliance with federal regulations... $1 on the balance sheet for every $12 of depositor money that had been lent... plus a little bit more probably to resume a little bit of lending (which has happened). If the public wants a bank to lend more, then that bank doesn't need to raise capital, rather, they need to raise deposits -- which means either getting more customers or getting their existing customers to deposit more money. To criticize the banks for not lending more, simply because they were recapitalized, in my opinion, is not only completely unfair, but nonsensical.

*** continued in next post due to character

[Jachyra]

*** Comment 2 of 3 ***

If one of these highly critical TV personalities had a provision in their contract that entitled them to a bonus if their show was able to pull in a certain level of viewer ratings, I seriously doubt they would take too kindly to not being paid just because the parent company of the network had other business ventures that lost money by no fault of the employee.

Is your position that if Time Warner, who owns CNN, is unable to turn a profit in a given year due to losses in a completely different subsidiary, like America Online, that CNN would be justified to involuntarily reduce pay and/or withhold contractually obligated bonuses to Anderson Cooper or Lou Dobbs even if CNN actually made money? Its fine if the answer is yes, but if your answer is no, then I think you might be applying a double standard.

Secondly, i think there is a lot of misinformation regarding the bailout money in general, which has helped to exacerbate the public backlash, some of which has been echoed on this blog. First of all, if I hear one more person ask why the banks aren't lending money now that they've been recapitalized I'm going to scream, so I'll say this one time for the record:

BANKS NEVER LEND CAPITAL... THEY LEND DEPOSITS

*** continued in next post due to character limitations ***

[Jachyra]

*** Comment 1 of 3 ***

I consider myself a progressive, but I have to say that personally, I thought Erin Burnett made an EXCELLENT point... although articles, blog postings, and comments like this prove that the point she was trying to make was clearly misunderstood.

First of all, you have to understand, that almost all large companies, including banks and large financial services institutions, have dozens, if not hundreds of different divisions, departments, and or/ subsidiaries. The vast majority of the time these subsidiaries are even legally structured as separate companies that are owned by the same parent holding company... and quite often the bonuses that they're entitled to (often contractually) are based on whether or not goals are met on a subsidiary level. So if you work a typical 15 hour day for Merrill Lynch's Mergers & Acquisitions division (15 to 17 hour days are quite common on Wall Street), and the subsidiary you work for made money and hit ALL of their goals, and based on your employment contract you're entitled to a bonus or some sort of compensation for hitting those goals and doing what was expected of you, why should you be forced to not get what was not only promised to you, but what you've rightfully earned just because one (or some) of the other subsidiaries, like the Proprietary Trading Division, just happened to do a terrible job and lose money that year?

*** continued in next post due to character length limitations ***

[ptgkc]

How out of touch is she? She didn't know what the "Snuggie" was. On air someone had to attempt explaining it to her.

OK, if she's a type A person, no time to watch TV; maybe she doesn't keep up with the Snuggie, the Sham-Wow guy, or Pajama Grams.

Oh wait, after Countrywide, Merrill Lynch and other big financial firms failed, CNBC lost premium advertisers scamming the public with predatory loans and overpriced services. Today, the Snuggie is one of CNBCs biggest advertisers and is making sure Burnett's payroll checks don't bounce.

Oops.

The next day she was extremely knowledgeable about the Snuggie.

[Starbrighter]

Hey also didn't you watch that CNN Money Summit they had superbowl weekend, they had some Wall Streeters saying it was not their fault but the PUBLICS fault for not seeing this coming & saving up for it. What's more interesting is that Ali Velshi & his panel agreed..So are you saying CNN & Erin Burnett are in on this together?

[newshound2A]

Interesting that soon after this observation that SVP Jonathan Wald is now leaving CNBC.

I agree that on "Meet the Press" that Erin was acting like a supporter of the banks. And the bonus payouts do not work like she implies they will. In prior years, I have known traders at major banks who have made a good deal of money, but who did not get their bonus because of the bank losses in other divisions, yet senior officials of the bank were still paid out generous bonuses during the year of the losses. So even the profit-making divisions do not necessarily get the money as she argues, it still goes to head honchos.

It appears that Mark Haines can barely tolerate Erin Burnett sometimes and I too find she is a very ineffective and yet gets an enormous amount of PR about her abilities. I favor Dennis Kneale and Michelle Caruso-Cabrera as well as the morning team of Carl, Becky & Joe.

[alejo]

Adam, here you have it. This person prefers uber republican Michelle over Erin. You attacked the wrong person which is why this is so annoying.

[Adam Green - Huffpost Blogger]

Was Michelle on Meet The Press, the show that helps set conventional wisdom in Washington DC for the next week? No.

Didn't attack anyone. I critiqued someone -- and in this case, I critiqued the right person.

[sierrasky]

Dennis Kneale? He is the biggest defender of wall street bonuses on CNBC. He tried to defend John Thain's re-model by saying that Merrill Lynch had revenues in the billions. He forgot to say that they had overall net losses in the billions. He must think all viewers are idiots.

He is far worse than Erin Burnett...

[texastrixie]

I think of Erin Burnett as eye candy for male viewers of CNBC - no intelligence required.

The business shows on both CNBC and FoxBusiness (plus all the cable news like CNN and MSNBC) it is almost always older men (or at least in their late 30's up), and young nubile women. There are a few women who are close to 40 and above (Sue Herrera, Maria Bartaroma) who even make an appearance. It is evident they think women only consider the market as a place to get groceries. Why would I want to subject myself to stupid comments from people who doesn't have a family, and actually seems to think of the working class simply as units of consumption.

We were listening to MTP on Sunday, making the traditional vension chili for super bowl. My husband asked me who this stupid woman was who was talking, and I didn't have to even look - it had to be Erin Burnett. He said to me, "She sure sounds cold." and I laughed and told him she comes with an ice pick on a diamond cord for the benefit of her dates.

It galls me that CNBC is now on a mission to prove to the public that even if we are starving, homeless and ill - the bankers are due their bonuses! On the CNBC noon show, I once saw "Dennis" decrying why people needed air conditioning. Why the worker bees can just suffer, that's their place in the grand

[ptgkc]

"I think of Erin Burnett as eye candy for male viewers of CNBC - no intelligence required."

So does CNBC. With the original Money Honey (TM), Maria Bartaroma at least ten years Burnetts senior, the network is grooming her to eventaully replace Maria in the top rated hours, Erin will move from the split 3 hour shift, mostly mornings; to taking over the closing hour and solo host the market close between 4 and 5 eastern.

They aren't going to dump her, they will promote her. How she will decipher earnings reports on the fly is beyond me.

[megl]

I was very glad to read this piece, Adam. I watched Ms. Burnett's performance on MTP and was appalled. She seems to be getting more and more airtime on news programs, passing as a journalist,
when she behaves much more as a pundit. Thanks for pointing out her obvious bias in favor of those in the business sector most responsible for the financial meltdown. (And her arrogance toward viewers and the public is really quite insulting - I agree.)

[momtotwo]

I watch CNBC a lot and Erin doesn't come across on a day to day basis as a hack for Wall St. You really need to watch the "reporters" that are on in the afternoon if you want to hear pro Wall St boosters. Dennis whats-his-name, Melissa Francis and Larry Kudlow for instance. I think Erin just did a terrible job reporting. If her point was that we are supposed to feel sorry for Wall St, well I don't think it worked. I agree that most people don't understand how Wall St gets paid but still, when you are talking about millions of dollars in a bonus its really hard to feel sorry for those people. And of course, no one would want the people lower down on the food chain to get hurt but really, the bulk of the money goes to the folks at the top. I was disappointed they had Steve Forbes on. WTF? I detest that man.

[bucketboy]

On the CNBC money / gilded class worship scale, Burnett seems to rank somewhere in the middle.

[Starbrighter]

Interesting viewpoint, but at least there is someone hoping the economy doesnt fail ultimately. Do not forget there is no law that says other countries 'have to buy our debt or invest in a country that is either attacking them or passing laws against them. It is a rather difficult balance to maintain, if they all stopped investing for one day just watch that market fall faster than the Titanic!

[aloha43]

I just don't understand it.

Everyone else is fighting, day to day, to afford to live. We are losing millions of jobs, housing, retirement, etc., and some of us can't even afford food and medical expenses.

Most companies that are in that bad of shape are cutting back on expenses, employees, health care, etc.

Why should we, as taxpayers want help them out of their financial troubles, only to watch them give their employee's billions of dollars in bonus's or "so-called wages".

They say they need to, to keep the "good professionals" on their payroll to keep them happy. That is BULL.

How great can they considering the situation they are in now? And where would those employees go if they were told "no bonuses"? No where, because there isn't anywhere for them to go.

That is a chicken s#$t excuse to justify those outrageous bonus's. There is NO excuse for that.

[Joe Bayen]

My email to Erin,

Unlike others I am going to follow through with a polite rebuttal. A
competent CEO, ( I am a CEO by the way), in effort to hold a company
afloat during financial hardship will proceed to use several or a
combination of the following options.

1. Salary Reduction
2. Workweek Reduction
3. Early retirement
3. Layoffs

But using Taxpayers money as a way to survive a crisis,which is by the
way a really tempting proposal (please bail me out too!), is morally,
ethically and even economically completely inadequate.

As far as the populism argument...well if you think about it, isn't it
elitism combined with a nice mix of arrogance and greed that guides us
in this mess in the first place...this might indeed be the right time
to listen to populism

Keep up the good work though!