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Bad News: How America's Business Press Missed the Story of the Century Hardcover – January 25, 2011
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"Though the contributors disagree on whether the media did or did not do its job, all present smart, deeply considered analyses that make for fascinating reading."
"A sort of All the President’s Men for our time, and just the thing to lure bright young people into economics graduate programs and journalism school—if only there were jobs waiting on the other end."
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Top Customer Reviews
The book begins by pointing out that 'The Great Recession' came at a time when American journalism was already imploding, thanks to migration of advertising revenue to the Internet. An estimated 28,000 newspaper jobs were lost in 2008-09. In addition, many sources dried up, fearing publicity would make things worse, while those remaining tried even more than usual to provide positive spin - antithetical to the transparency required for well-functioning markets. Prior to the collapse, the business press wrote overly-fawning pieces about those in power - eg. Lehman's Dick Fuld, Merril Lynch's Stan O'Neil, Enron's Ken Lay, and the Federal Reserve's Alan Greenspan. Repeal of Glass-Steagall was heralded, and critics largely ignored. Many new business reporters didn't understand what they were covering, and had to rely on (slanted) sources. Articles also often failed to report, how eg. job losses were measured, the inherent variability of economic numbers, and alternatives measures of the topic of interest. Nonetheless, there still was some excellent reporting - eg. problems at Fannie and Freddie, Greenspan, Summers, and Rubin's role suppressing regulation of derivatives, AIG bailout scandals, excess leverage, etc. This was despite dodgy and complex accounting that was 'blessed' by authoritative CPAs, and non-existent regulation.
Another problem with honest business reporting is that nobody likes negativity, especially when the market is climbing and all one's retirement is tied to it.
The problem was that the collapse came just as the print media was suffering from massive cutbacks, too busy fighting for their survival to see what was going on. "The Wall Street Journal," the long-time leader, was shifted by Rupert Murdoch to doing general news right when a focus on the economy was needed most. Far too many of the younger reporters grew up in a time when the economy was good, not realizing the signs of a bad slump when they were coming and didn't bother cultivating the sources older reporters needed.
The biggest surprise when reading is just how much the media championed the very companies that would end up destorying things. Jim Cramer is singled out for his infamous push for Bear Sterns just days before they went bankrupt and trying to brush it off as an "urban myth" that got him in more trouble. It seemed that the media was hesitant to go after these guys for fears that it would mar the public confidence in the economy, not getting that they were damaging the public with the refusual to go deeper into the truth.
There were people who stood up early, doing investigating but most were ignored, too small voices in the landscape. The advent of blogging is mentioned and how many of them got the inside scoop but were ignored by the rest of the media who arrogantly assumed bloggers couldn't be real press.Read more ›
Most Recent Customer Reviews
Anya Schiffrin has assembled a nice group of thinkers on what seems to many of us a puzzle: how did the press generally miss the looming financial crisis before 2008? Read morePublished 20 months ago by Robert J. Shiller
This book is a collection of essays that the editor ties nicely together. Her opening chapter provides a good summary or the big picture challenges for US journalism--beyond just... Read morePublished on June 11, 2011 by Philip Howard