In a windowless room at the Westin Hotel in downtown Denver, leading business journalists and editors explained how the media “blew it” in covering the economic meltdown. They admitted, on one hand, to falling under the sway of free-market ideology and celebrating risk-taking financial leaders and, on the other, to missing the complex story of the rupturing system by only reporting it in parts and to almost no effect for the past decade.
Although not planned as confession, the discussion, which kicked off the annual conference of the Society of American Business Editors and Writers (SABEW), quickly descended into an unburdening, with the panelists taking turns voicing their own explanations and excuses for the failure. Former Wall Street Journal managing editor and current ProPublica.org chief Paul Steiger moderated the impromptu journalistic penitence.
“We drank the Kool-Aid,” said Jane Bryant Quinn, personal finance columnist for Bloomberg and Newsweek. “We believed that free markets were the best kind [of markets].” She said it had become “unfashionable” over the last three decades to write about regulation, so they didn’t.
“We could say things were risky … but we never said ‘Where’s the Fed?'”
University of Michigan business professor Greg Miller said that the finance beat had simply grown too complex and compartmentalized for journalists to cover well in the traditional way.
“No one banker could walk me through securitization in 2006,” he said. “They’re all specialists.” He said bankers rely on other specialists to take up the slack. “They don’t know even know each other’s names,” he said.
Miller suggested journalists should specialize and then work together to create more comprehensive coverage.
But veteran TV journalist Allan Dodds Frank, who now writes for the DailyBeast.com after a career with CNN, Bloomberg and ABC News covering white collar crime, said that complex economic stories were virtually impossible to sell to his editors.
“Fannie and Freddie were not covered on TV because there’s no visual,” he said, referring to the country’s major lenders, Fannie Mae and Freddie Mac, which made billions in the run up to the collapse by doling out increasingly high-risk loans.
He said journalists couldn’t figure out what “Wall Street was doing” and that high-rolling CEOs and fund managers were never compelled to answer tough questions.
“We soft-balled them because we wanted them to come on [our shows] … we let them hide the ball on us.”
Frank pointed out that there were no representatives at the conference from CNBC — the business channel ridiculed recently for its celebratory coverage of Wall Street — and said it was no secret that “in broadcast financial journalism, corporations are sexy.” Coveted interviews with CEO celebrities had moved investigative pieces off of edit calendars.
“The glamorization of business news [led us] to adopt a posture of reverence [toward our subjects] … We knew it was nonsense,” he said.
Of the journalists on the panel, New York Times Business Editor Larry Ingrassia was the least bowed. He read out a list of stories The Times had run over the last decade that treated the escalating loan crisis and executive compensation, for example.
“The regulators were asleep but we reporters were not,” he said.
He later explained that the stories were there even if readers didn’t heed them. He explained that his writers are looking to explain problems and maintained it was unfair to judge coverage based on whether people act on the information reported.
In the end he seemed to undermine his argument, though, agreeing that they missed an important story that would have targeted a group that could have made a difference. The laxity of federal finance regulators went unreported in The New York Times and in other publications, he admitted.
“The [finance industry] lobbyists had more impact on the regulators than we did,” he said, pointing indirectly to the expanded influence the financial sector came to wield in Washington over the past three decades — the story many now argue is at the heart of the collapse.
SABEW conference organizers said that, even though other journalism organizations canceled events this year, they decided to go forward despite the ongoing crisis in the newspaper industry.
“There is a huge need for business journalists to become more knowledgeable and versatile — for the sake of readers and viewers and for their [own] personal livelihoods,” SABEW President Bernie Kohn wrote in the conference program.