How Media Will Pay for Poor Warning on Financial Collapse

Sometimes, pieces that may not really fit come together in revealing ways, especially nowadays, thanks to immediate distribution and then saturation via the Web. It happened again recently. Several leading newspapers announced new layoffs, furloughs and/or pay cuts. A few hours later, a new Rasmussen poll revealed that one in four Americans now believe that the "faux" news delivered by Jon Stewart and Stephen Colbert is replacing "real" news sources as viable outlets.

Unlike previous polls, this one showed that it wasn't just Democrats and the under-30 crowd who feel this way (actually, more Republicans endorsed this view). After recent press performance, who could blame them? Especially since Stewart seemed to reveal more guts and passion — and even skill — than nearly anyone else in the "real" media in destroying Jim Cramer and some of his blowhard CNBC brethren for their cheerleading role in the financial collapse.

A few days after that, Ben Stein, a friend of Cramer's, in his regular Sunday column for The New York Times, hailed Stewart for "calling us all to account." Why wasn't he praising the Times itself or any other member of the mainstream news media?

But it goes way beyond that.

No one is a bigger booster of newspapers than I, going back to my first job in journalism as a summer reporter four decades ago. I have long defended newspapers from charges of political "bias" and championed their coverage, and credibility, over that found in any other media.

But in the wake of the financial collapse, I wonder if the remaining (if relatively low) public respect for the press is gone for good. Yes, the delivery platform of the future will change — the Kindle, iPhone apps or rubbery plastic may replace paper everywhere — but the content still has to be credible. And now it must be said: The media blew both of the major catastrophes of our time.

I speak, of course, of the Iraq war and the financial meltdown. I wrote a book about the first, calling it "So Wrong for So Long." I could write a sequel on the second disaster, and maybe title it "So Wrong Again."

True, there's more of a consensus around the Iraq failure. The press has circled the wagons on the latest flop, and I agree that individual reporters at certain papers did some fine watchdog work, to no avail. But the defenders of the press in this matter are cherry-picking the good stuff, much like Bush with his intelligence on Iraqi WMDs.

Others admit the press failed but could not have possibly understood how bad things were at the banks and on Wall Street. "No one knew" and "we're only as good as our sources" or "they lied to us" are the common excuses. That sounds exactly like the media defending its Iraq miscues.

Many point to the terrific press coverage of the financial meltdown since September. Agreed, but again, the media also played great catch-up on Iraq — when it was too late.

And to say that some did probe deeply — well, I concur, just as some did on Saddam and WMDs. And, as in that case, the reports were often buried in the paper or the broadcast, or just sat there quietly waiting for follow-up or editorial comment. The watchdogs barked, but often off in the distance, and then went on their way. Why else was the Jon Stewart rant taken as such a breath of fresh air?

History will be the judge, although I suspect the first books that prove my case will appear any month now. But it doesn't matter what I or other commentators charge. It's what the news consumer thinks. And there's no way that most of them, fairly or unfairly, have not already thought: Damn media. Why didn't they warn us of these financial shenanigans in time?

The media miss stories all the time, always have, always will, and there's nothing to be ashamed about in that —you can only do so much, especially in a time of slashed newsroom staffs. But to miss a story of this enormity, with consequences that will echo (like Iraq) for decades, only adds weight to the warnings of doom for the "old" media.

Greg MItchell is editor of Editor & Publisher. His latest book is "Why Obama Won."

Comments

[Vinca]

I read somewhere on the net, that former CIA man William Colby said, :All the major media is controlled by the CIA:.

[rtb61]

Media ownership is actually far more insidious than most people expect. Most of the the large media corporations are in turn owned by other large corporations who actually collude to keep stories out of the public eye. The principle being, you don't report on our corrupt activities and we won't report on your corrupt activities. That of course is added to buying news with advertising placements, really what is the marketing ratio 10 minutes of paid for advertising can get you one free minute of advertising masquerading as news. The bigger news story is how media got 'paid' for turning a blind eye to the imminent financial crisis because it suited their owners and advertisers. What is really different about the current situation and, make no mistake they certainly got away with this kind of reporting in the past, so what will hurt them the most now is the growth independent internet reporting and their rapidly growing reader base. The biggest current news as marketing failure, Fox News pseudo grass roots Tea Bagger's protests. Their actual ability to create news has been demonstrated by the failure of the Tea Baggers protests regardless of the amount of marketing the Fox network has put into it, it is simply dismantled by independent news sources, so what used to be success is now embarrassment.

[vidian6]

This is why nobofy believes what they here from the media anymore because they take to much money from these corporations to be considered impartial.

[lynettema]

What do you mean? Newspapers ARE corporate America. They don't want to see Republican fiscal policy end even though it means the end of newspapers - go figure. Just like those who vote Republican, they do it against their own best interest.

[TwistedNibbler]

News media have always been a part of the corporate world in America, but in the past 30 years the ownership of the media has become largely centralized. Whether or not there is a direct causative link between this centralization, and the current "Bland Voice" that the media broadcast at us, is up to the individual to decide.. but in *my* eyes the central point to this issue lies not in the fact that "nobody said anything," rather in the fact that the general consensus was one of indecision.

Our media outlets, between them, as an aggregate, ran 95% programming that loudly said to us "EVERYTHING IS ALL RIGHT!! EVERYTHING IS ALL RIGHT!!" when in fact, nothing could have been further from the truth.

Because the networks (and the papers) refused to take a chance of being "the one" who stood up for what was right (I am Spartacus!!) they have all joined each other in being wrong, drowning (momentarily, at least) the names of those individuals who may well HAVE lit the lanterns that long ago would have been kicked over to start the wildfire of indignation needed for us to avoid letting this nation's system of economic safety checks be dismantled by our former Fearless Leader's savage posse....

Stewart was the only one with courage to say the blunt reality as it is, rather than try to couch it in a hidden message of how OK life is still going to be...

[TwistedNibbler]

Bottom line is, every single one of us enjoys absorbing information in different ways, at different paces. Packaging all the info vital to the day into one of two or three shaped containers is a sure fire way to oversimplify the channels of information, and make them easier to manipulate for those in Power. That being the case, maintaining a corporate Empire in this field in the modern day will take more packaging than can be accomplished in one paper, or one half hour, or even one website. Diversity of Source is the new watchword, folks... Glory Be!!!

[Levity]

Several credible brands are growing by leaps and bounds:
* Democracy Now! has quadrupled in viewership - for daring to actually report the news.
* The Daily Show and Colbert Report have grown by truth-telling - i.e., refusing to edit out the irony.
* MSNBC's Olbermann and Maddow have likewise benefited
* and of course, the Huffington Post.

All the news organizations that suck -- CNN, Fox, NBC, CBS, and many newspapers - are tanking.
I guess the free market works.

[baddadd49]

lol Fox is way aahead of all of the so called news orgs you mentioned and they double msnbc, lol maddow and olberman are losing to larry king and colbert and the daily show pahlease they are comdey shows no news.

[Maria Alvarellos]

Fox is not funny and not news.

[philistine]

Since we are abandoning those news sources which have been so unreliable, I'd suggest the title "So Wrong - Now, So Long" for the title of your second book.

Cheers!

[RButler]

Let's see. Americans weren't saving any money, were maxed out on credit cards, jobs were being outsourced to other countries, were we borrowing from China like crazy, illegal immigration was depressing wages for unskilled labor in this country plus costing billions in social services, were buying gas guzzler trucks and SUVS for years, then during the sub-prime mess were buying homes they couldn't afford while wages were barely keeping up with inflation, health care costs were rising way faster than inflation, voted in Bush for 2 terms who gave big tax breaks for the rich and so on. What could go wrong. I was legally blind for those years after eye surgery and I could see where we were headed. How come the journalists and the politicians 'didn't see it coming'?

Hey, and I left some stuff out. The war, for example.

[Maria Alvarellos]

Whew! That's a more honest summary of events than most "credible" news sources will give me. Good job! It's a wonder we've been blindsided, really it is.

[jimmyaj]

People have been warning of this collapse ever since the deregulation brought about by the repeal of the Glass-Stiegal Act. People predicted this catastrophe and the growth of "derivatives" and other speculative investment vehicles. The hazards were foreseen. Somebody (BODY or group of privilidged idividuals) planned the whole thing and just robbed the whole country. This DEMANDS an investigation.

[MassInsanity]

It took me forever to find this, so please read if you haven't already.

It's related to the article, an Investigative Journalism piece...

http://www.salon.com/opinion/greenwald/2009/04/21/pulitzer/index.html

[MichiganAccomplished]

Thanks for posting this. I missed it the first time around. I guess that's the point, right?

[siegfried89]

The paper pushers at the Wall Street Journal are the worst offenders and they are still at it. Objecting to the President's plans to restart the economy, urging the average person to throw more money away in the stock and bond markets and promoting the very thing that started this economic meltdown--an unregulated so-called free market.

This, of course, is their agenda and how they sell papers. But they were so wrong in the past how can they ever be trusted again?

[RenoSage]

What we really need is diversity in news reporting. Unfortunately the bottom line, profit motive,
the political bent of the owners and publishers, and the fickleness of the advertisers are ruling factors.
My local newspaper shorts the readers on financial news and emphasizes movies and sports.

[bigkay]

If only we had a news channel with reporters from Huffington Post that gave the apathetic American public the facts. MSNBC Rachel Maddow is a start but since Comcast put the channel at 266 many people can not access unless they have the more expensive "package"

[lynettema]

Cable has placed MSNBC where it is for the simple reason that they lean to the right. They want to continue the Bush fiscal policy.

[midasw]

I have been pondering this question for 20 years. since I started writing a column for Manhattan Inc and later for the New York Observer. Part of the answer may lie in my apothegm: Nowadays,j­ournalists seem mainly interested in dining WITH people they ought to be interested in dining ON. Mostly, I think it's fear combined with uncertainty. And a refusal to build on the work of others. Makropolous took his Madoff story to WSJ, but the late John (?) Wilke was unable to move it along. I can't tell you how many bigtime journos I tried to interest in James Grant's credit-mar­ket/deriva­tives analyses back in 2005-07. Is it a fear of lawsuits? A fear of being wrong? Boredom with business? Whatever it is, if you miss a story this big, you don't deserve to be in business - which seems to be what the market is saying.

[RenoSage]

Newspapers report news on a daily basis. Books paint on a bigger canvas.
Two weeks before the crash, I read "The Trillion Dollar Meltdown" by C. Morris. It explained
the mortgage crisis, hedge funds and derivatives. I had time to move my savings to a safer place.

Where newspapers and commentators fail, the library and the internet is our salvation.

[historymatters]

About the financial mess, I'm not a financial expert of any kind. But I read MSN Money pretty regularly, and saw articles here and there for years about how crazy housing prices were getting, the worrisome aspects of the sub-prime market, abuses by credit card companies, and the huge amount of personal debt American households were accumulating, all of which contributed to the recent financial meltdown. These stories were never more than temporary blips, but even as a non-expert, I knew things weren't right and I wasn't in the least surprised when the housing bubble blew up and sub-primes dragged the mortgage industry down.

Admittedly, I was taken aback by the under-capitalizaton or over-leveraging or whatever you call it that brought about the collapse of Bear Sterns, Lehman Brothers, etc., but then I have no idea how large corporations should structure their finances. You'd think, however, that an expert could've taken a look at all the stuff even us non-experts knew were wacky, then looked at the more specialized stuff, and deduced that things were about to go really, really badly. But nope, the media dropped the ball completely. Too busy keeping their corporate sponsors happy to do their job of informing the public.

It's just that conflict of interest - spinning content to please advertisers rather than inform the public - that means I take anything I hear from corporate-owned media outlets with a big ol' grain of salt.

[tomsemioli]

Bravo Mr. Mitchell - you hit the nail on the proverbial head. With more and more Americans steeped in debt and facing unemployment and under employment, how long before they will no longer be able to afford to pay their cable TV bills - or afford the products that are advertised on cable TV? The other shoe is about to fall...

[Stevealmi]

MSM, bought and paid for by the Rethugs. They lie and the MSM repeats it and makes it the truth for the ignorant.