What has been the role of the media in this present and extended crisis?
What most people, me included, want to believe is that jouranilists are like Woodward and Bernstein – brave seekers after truth. Fearlessly willing to uncover the truths that will hold the powerful accountable. Sadly this is very rarely the case among the mainstream media journalists. For far too many journalists investigating the wine menu seems to be the acme of their ambition.
Financial journalists want access. Access means being on reasonable terms with financial institutions. Which means, in turn, being seen to share certain assumptions, sympathies and outlooks. So perhaps it shouldn’t surprise me that from Larry Elliott at the Guardian to Oliver Camm at the Times the range of assumptions shared with the Financial class and their in-house experts has merged into one seamless chorus of agreement. Such coziness of shared and unquestioned assumptions stultifies and blinds and is one step away from press-release journalism where you simply repeat what the pr person hands you.
It was noted during the Iraq war that because every journalist wanted access to the inside story and the best pictures, and the only way to get it was to be ’embedded’, that the bulk of the coverage of the war was therefore rather tightly managed by the US army. Journalists in that war were a far cry from their heroic forebears in the Vietnam war.
Say nasty things, take forbidden pictures, question the stories you were fed and you would find your pass to anywhere was revoked. And so we got an outpouring of military propaganda – Jessica Lynch the Hero, who later said the army had embellished the entire thing. We had Pat Tillman hailed as a hero killed in heroic circumstances which later turned out to be killed by friendly fire in an act of “gross negligence”. We had files ‘uncovered’ by Journlist David Blair of the Telegraph which smeared anti war MP (and rather silly man) George Galloway, which were later proved to be forgeries. As he said himself, how utterly impossible for the file to have been forged and then left for a passing journalist to just happen to look. Quite right Mr Blair. Utterly implausible. The only way is for the ‘finder’ to also be the person who planted it. Which rather means I suspect Mr Blair of working for more than just the Telegraph.
Should we have been surprised by this? Not really. It was one of those famous sayings from WWII that the first casualty of war is the Truth. There was a propaganda desk run by the UK government in WII which from memory was called RN17. It’s job was to feed false stories into the European and British press. I met one of the people who fed the British press false stories. He did so right through the Cold War. Two of the people who worked at that desk went on to become Editors of major UK papers.
This problem with lying, even in a good cause, is that it is habit forming. Once a form of government starts to lie, it relies on it, it becomes a temptation not to stop. Justifications come easily.
I think we are being lied to every day in this financial crisis, because it has become a war – for survival – in the minds of those whose wealth and power it threatens
Some of the lies are fed to journalists who rely on being on close terms with ‘the city’ and are simply not accustomed to question what the people they admire tell them. They are dupes. Others I belive are more aware of their complicity. When I hear politicians, financial grandees, experts AND the journalists all talking about the importance of restoring confidence – alarm bells ring for me. Isn’t restoring confidence what propaganda is all about? Tell comforting lies. Report only the good. Ignore or play down the bad. Emphasize the positive, dismiss the doubters. Be quick to write about positive figures and don’t dig into the less impressive small print.
There are a thousand ways to lie and we are being fed them all.
Laziness, coziness cowardice and comforting lies spring to my mind when I think of financial journalism.
The deepest indictment of them is that debate and dissenting views have taken the better part of two years to gain any traction at all. And even now they are peripheral. What real debate about the nature of this crisis has there been in any newspaper? Have we been allowed a debate about whether this crisis is really one of liquidity or in fact one of insolvency. Have we been allowed a debate about Marking to Market versus Marking to Model? Or about the regulation of leverage or of whether CDS contracts should be restricted to a central clearing house which insists on collateral being posted? Have we debated the rest of the armature of jargon which protects the status quo? WHY NOT?
Television has been far worse. On television we have had nothing but apologists passed off as impartial and no radical questioning at all.
That the debate continues to be marginalized to the point where people like me and places like this become the last and tenuous refuge of enquiring minds, is a terrible state of affairs. We deserve better than this in a democracy.
Yes, this is a most disturbing area of concern, the "shared assumptions" between the financial press and the financial class. How very pertinent of you to draw upon similarities with The Other Grand Deception and naming people in the press of obviously bad faith. But I beleive that once we are able to communicate with clarity and persuasion that it's we against them, them getting to keep their stack and we loose all our pensions and saving because of their actions if we cannot enforce the principle that financial actors pay first until utter ruin before the public purse is bothered 1 cent. We need your analytical and rhetoric skills to formulate the exact demands in this respect, so that your followers can follow this up versus their own goverments and politicians.
Intelligent debate is restricted to the odd Newsnight discussion – sometimes featuring a testy Hugh Hendry (sad times that it comes from a hedgie). Or the priceless contribution from Nassim Taleb last week. When someone like that tells it like it is, mind, the reaction is usually stunned incredulity from the economist or politician sitting opposite. You can see them wondering how a supposedly chummy studio opponent could be so ill advised as to break rank and undermine the fragile nation's confidence. I hope it is something of a new trend. It's a start, and the narrative about the crisis will surely have to change eventually. Other than that, I've read a few stirring 'comment' pieces about the crisis, but it's usually buried deep inside the newspaper – never on a page which the unconverted will actually chance upon.
Still. What starts as a trickle…
There is change coming, it just moves a little too slow for most of us.
My kids -aged 23 to 16- are similar to lots of kids nowadays, they don't read newspapers, and they don't watch tv. They have Ipads, Ipeds, Ipids, Ipods, Ipuds…. and seek what they want word of mouth. They have no faith in government, financial markets, Murdoch press, or Simon Cowell.
It is clear that the newsagents' printed media buys its text from Associated Press or Reuters, and just has some embedded 'signature' writers for authenticity. There is no independent mainstream press.
The emasculated BBC is still way too timid to make any ripples of independent thought, and ITV only seems to care about late night phone-in gambling and why Britain has got no talent (Did I flick channels last night and see a leprechaun?)
The future that we will wrest from those smug PTB will come because more and more of us are turning off and tuning out from the spoon-fed muzak.
When the youth of today wake up and realise it is their world, that a 'Friends'-lite existence just isn't enough, then the walls will crumble.
All we have to do is resist the inexorable tightening of civil liberties and the right to dissent –cos they see us coming.
That is our middle-aged role in this war.
Hope it is my lifetime.
Stifling debate, although nothing new, really has been the theme of the 2000's.
"Keep you doped with religion and sex and TV,
And you think you're so clever and classless and free, "
Agree with you GolemXIV, but aren't we also always told that markets run on "sentiment"? (see Fortunte and Bird: "We're all rich! BUY BUY!!!"; "Ah no, I think we might not be so rich! Aaaargh! SELL SELL!!!").
If that's the case, I can kind of be more understanding of false stories planted in the press. Where you are right of course is that debates are only allowed within a very tight framework and articles, debates, etc, questioning the whole setup from a practical basis are few and far between.
By the way, congratulations on the blog, enjoying it immensely (not sure if "enjoying" is the right word, given the somewhat depressing nature of the events you discuss!) (came here cos someone posted your link on CIF, where I used to look out for your posts, which were always interesting).
Nopackdrill, your post is encouraging, let's hope it's true.
So, where does a person brainwashed by craven journalism – that's me – go to get rehabilitated? I've made the first steps to recovery, by weaning myself off the BBC Business and Guardian web pages.
However, my vision remains blurred and I still have trouble discerning between sycophants, fanatics and sages.
Getting a balanced view seems impossible – 'establishing a happy medium' must be an oxymoron, because bad news attracts the public's attention like coprophiles to a freshly laid cowpat, yet the 'green shoots' offered by vapid journalism barely tickles the qi.
I had better stop babbling and go and queue for my Soylent Green …
Peter above, uses the word "crisis".
Well, we've had two years of official acknowledgement running an economy based on borrowing as much or more than is being earned is maybe a bad idea.
( if national borrowing for industrialised countries is running at between 50 and 80%, add private borrowing to get past the 100% mark)
Calling it a "crisis" is saying its a unique event rather than the inevitable outcome of globalisation ( cheaper and cheaper labour / higher and higher living costs = more and more private borrowing) + economies based on endless growth ( more and more public borrowing) + deregulating/ decoupling the financial markets from the " real " economy to maximise market speculation ( profits of which rely on the value of something growing/shrinking rather than being " intrinsic") ?
In the 80's alot of found it cheaper to throw their crops away and be paid european subsidy than to sell them, because of trading regulations. This is part of the same "crisis".
Restrictive trading + public borrowing + free money to stop people complaining. A mate of mine whose family were farmers declined to follow in his fathers footsteps and grow crops, instead he went into the city and traded into "potato futures" – he could make more money guessing the future price of spuds than by growing the spuds themselves.
How is that sustainable, that the leverage is worth more than the thing itself ? Everyone has to be mortgaged up to the hilt to buy houses priced at double triple (or whatever) their actual value…is that a " crisis" ? The prices were levered by the markets to benefit the markets.
How can it be called a crisis when its been international governmental policy for 30 odd years ?
Even down to currency itself….The Euro itself was and is an exercise in spread betting and risk dispersion.
In NOV 2008, when Lehmans went down, Golem used an anlalogy….imagine the banks/ financial intitutions as a row of people on a sheet of ice roped together to an "anvil of debt". One person falls through the ice. The obvious thing to do is cut the anvil free, to stop the other people being dragged down the same hole. Why don't they do this ? To mix at analogies, it's the monkey with it's hand in the jar….
its not a crisis, as golem says, it's one big big confidence trick … if I had a quid for everytime someone working in finance has said to me " you don't make money by being honest", I'd be as rich as they are…ditto governments. They can't afford to be ethical. That's become a synonym for " naive"……
Until leverage is declared illegal , or % limits set, in international trade law, then its not a "crisis", it's just business as usual.
I don't think I'd quite agree. Admittedly people like Anatole Kaletsky have been an utter disgrace, but other economics correspondents like Larry Elliot and Hamish McRae have consistently hinted at the worst case scenarios. But there's a very fine balance between reporting and expaining things and exacerbating them, (given the power of the media to influence the markets) and I think they've done a difficult job reasonably well under the circumstances. And there are plenty of gloomster commentators like Fergerson and Merryn Webb, the Alex strip in the Telegraph (which has probably had the best commentary of the crisis in the mainstream media), various articles in the FT or even Kunstler who have a pretty high profile. The problem is of course that these articles are always tucked away in the financial pages which most readers don't bother with. I think the root of the problem is how uninterested most people are in economic issues until it starts affecting them directly
I agree with you Golem and to extend the comparison, arent Associated Press and Reuters the rating agencies, the Moody's and Standard & Poor's, of the Media?
Both, and others, shaping how the market (read public) value and assess news.
There may be differences in media corespondents and different media houses, but they a small differences much like how different rating agencies assess companies and nations – all still support the grander edifice and do not critique it in any serious manner.
Dylan,
Great point.
I am greatly enjoying reading this discussion. Thank you all.
Another interesting thing to mention is that the refusal of the mainstream media to discuss such uncomfortable issues isn't restricted to the present or the west.
There used to be an obnoxious but always fascinating satirical English language expat magazine published in Moscow called The Exile, (you can find its archives at http://www.exile.ru; they're where the now famous Matt Taibbi started and it's still well worth a browse if you have a strong stomach).
One thing about the magazine that really struck me was that they were apparently the ONLY Russian based publication to have predicted the late 90s Russian credit default the week before it happened.
Smart as the writers were, I very much doubt they were the only people to have considered such a thing so presumably the rest of the media didn't want to bring it up for fear of causing it / scaring the horses whereas they could get away with it because they were a small magazine in a foreign language (and didn't give much of a fuck anyway).
My point, (insofar as i actually have one) is that I suspect the mainstream media reluctance to bluntly address economic problems is (to use a programming analogy) more of a feature than a bug…
i would like to add something to what i wrote above about the use of the word " crisis" to describe debt ridden economies.
What changed in autumn 2008 through Lehmans and Northern Rock and RBS etc failing, was that the mechanisms that banks and financial institutions use to generate profit for their traders became more transparent for the general public…& what has changed this year is that western governments modus operandi – we're skint but if we borrow enough from each other we won't look skint – has become more transparent. So the " crisis" is that banks and institutions can't anymore hide from the public the corrupt mechanisms by which they profit at the expense of the public purse, and governments are no longer able to hide that they have gambled their nations wealth – our money – on those same mechanisms. It's not a "crisis" for any of the people writing on this website, only for those who are profiting from them ( us). Frankly it's more of a huge relief than a crisis that some of these people are being forced to lie slightly less. Clearly it's not in the interest of media corporations to encourage truth telling, where do you think they get their kick backs from?
Whats Lord Ashcroft doing anywhere near a government when he takes his money out of the country he seeks to represent?
Is it a crisis, to call put up or shut up on a busted flush ?