Posts Tagged ‘press’

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Bad news bears

Posted: 8 February 2011 in Uncategorized
Tags: , ,

Did the business press cause the financial crisis?

Peter Goodman attempts to answer that question in his review of Anya Schiffrin’s new book Bad News: How America’s Business Press Missed the Story of the Century.

Though the press rarely has the power to dominate events and does not make policy, we are collectively responsible for the understanding that our audience takes away from our words. And it is a fair hit to assert that we are prone to being manipulated and getting swept up in the excitement of the times, rather then stopping to ask the critical, typically difficult-to-answer questions that public service journalism demands. . .

In my own view, and from my own experience, blaming the press for the financial crisis is like blaming January for giving you a cold: You may have a point, but you better be prepared to dress warm again next winter. In both the technology bubble and the run-up to the Iraq War, a much stronger case can be made that shoddy reporting helped nurture disaster. Even by the everyday standards of journalism, bad information was presented as fact. But in the case of the financial crisis, the system did not fail so much as function according to the ordinary rules of engagement.

In my view, Goodman gets it about right. The business press mostly operated as cheerleaders for the financial bubble just as the national press fed the frenzy in the build-up to the invasion of Iraq. They operated that way in print as well as on TV, the radio, and the inernet. And, of course, there was not only a proliferation of business news programs but also a blurring of the boundary between news and financial advice.

The journalists didn’t cause the crisis but they did create a set of understandings that had the effect of “warping expectations, altering the risks people and institutions are willing to bear in pursuit of return on their money, while tilting the balance away from the intrusions of government regulation.”