Can we blame the financial crisis on the news media?

"That is baloney. The media failed totally."

- Member of the audience

“The thing I worry most about in my country – where 40 newspapers have declared bankruptcy – I worry about the ability of most of my competitors to provide the Times’ level of coverage. Competition makes us better!”

- Jill Abramson, Managing Editor, New York Times, New York

"I perceive a growing imbalance between PR and news media. People in marketing are pushing messages through editorial content and newsrooms. We have more to do in the newsrooms. Fewer resources to analyze all the lobbying messages we are getting."

- Mikael Pentikäinen, President of Sanoma News Ltd, Finland

"Silences have not been covered as thoroughly as they might have been. We are here to cover social silences. To challenge the way elites stay in power. We as journalists are here to pierce the social silences. To challenge them. The crisis has raised questions about whether we will actually have the resources to do this."
- Gillian Tett, Assistant Editor, Financial Times and author of Fool's Gold (shown in photo)

Above are a few quotes from my live-blog of a most interesting -- and at times heated -- discussion at the IPI World Congress Helsinki. A panel of news media leaders addressed the question as to whether the news media did enough to warn people about the possibility of a financial crisis. Specifically, panelists had been asked to address such questions as: What are the predicted consequences of the current financial crisis? How will the crisis affect media outlets, already suffering from a decline in readers/viewers and advertising revenue? How has the media reported on the crisis? Has it been getting the story right? Does the media exacerbate financial crises?

The panelists:

• Jill Abramson, Managing Editor, the New York Times, New York
  
• Mikael Pentikäinen, President of Sanoma News Ltd, Finland
• Gillian Tett, Assistant Editor, the Financial Times, London. Author of Fool's Gold.
  
• Tim Modise (Moderator), Presenter, “AM Live”, SAfm, South African Broadcasting Corporation (SABC), Johannesburg

Jill Abramson began with the question: “How does the crisis affect the digital revolution? There are many assumptions, no certainties.”

“The thing I worry most about in my country – where 40 newspapers have declared bankruptcy – I worry about the ability of most of my competitors to provide the Times’ level of coverage. Competition makes us better!”

"I'm trying to merge two themes. I have to say (co-panelist Gillian Tett's new book) Fool’s Gold, in a vivid way gives you the narrative. Concerning the quality of coverage of the New York Times leading up to the crisis, I don’t have any apologies. We had 116 independent pieces on subprime loans (prior to 2003?).”

“Coming from the Wall Street Journal, joined Times in 2007. Our business editor also came from the Wall Street Journal. So we had a senior business editor in a top position.”

“Decision made not to wait a while and do an autopsy of crisis past. I felt we needed to do investigative journalism in real time. A reckoning....”

“Future of quality journalism is very robust. The print circulation of the Times is 1.2 million, and our online readership counts some 20 million.”

Mikael Pentikäinen, the president of Sanoma News Ltd asked whether the future of media was GM – i.e., Government Media.

Gillian Tett, Assistant Editor of the Financial Times said she had noted the “inequality of resources in the business media in the past few years.”

“I felt I had a barrage of banks lined up with guns of public relations to try to dominate the public debate. Not just in terms of what was said. There were few of us in number. Laughably poorly paid. Many of us leaving business journalism to work for the banks. We are not owned by the banks, but we are dependent on advertising and exposed to the vagaries of the business cycle.”

“Fortunately, the past few years have shown the importance of independent media,” she added.

Jill Abramson: “From my perspective at the Times, neither is true. (We don’t have these problems.) Eight hundred thousand subscribe to the Times. Our average reader is 46, which is less aged than that of the cable news network shows. We are blessed with being a family-owned newspaper. The family believes in the cause of quality journalism. That’s why our strategy has been to position ourselves as a national newspaper.”

Comment from audience member: “That is baloney. The media failed totally. The media failed totally. How come a person living in his room watching porn you expose. And a person stealing 50 billion you don’t expose.”

Abramson: I disagree. With Bernard Madoff we didn’t have perfect 20:20 vision. But there was a lot of serious journalism warning about the crisis to come. Not everywhere, but at the New York Times, Financial Times, Wall Street Journal, and some magazines and broadcasters, there was warning of the crisis to come.

Gillian Tett: I agree there has been some excellent coverage. But I think there has been (. . .) coverage. My background is social anthropology, analyzing systems. Pierre Bourdieu said that elites stay in power by defining the things that elites don’t cover. Silences have not been covered as thoroughly as they might have been. We are here to cover social silences. To challenge the way elites stay in power. We as journalists are here to pierce the social silences. To challenge them. The crisis has raised questions about whether we will actually have the resources to do this.

Question from a Hungarian: Addresses issue of "irresponsibility of the papers in crisis time." He says, "during the Iceland crisis the Financial Times published a second article saying Hungary would be next. This did not happen! We (Hungary) did not collapse. But the opinions published by the Financial Times caused much harm to the country. Because the price of the credits we could take rose for that reason. The interest rates had to be raised three times."

Gillian Tett of the FT responded: “Yes, we are walking on a minefield from day to day. We have done our best to try to steer our way through the minefield. The key point is this: we are dealing with a world of imperfect, imbalanced information flows. We have to convey information to ordinary people who don’t have all the info (that the banks already have). Let me give you an example. Iceland called (us and said): Why are you reporting on credit swaps in Iceland? You are undermining us!"

"But I say that the banks already knew about this. We were just making CDS information more public. Why should elite bankers get access to info about patterns developing, but not ordinary investors? I think much of the anger at FT and other media is that they are relating information already known by the elites to a wider population.”

[Jotman: that's was a key point.]

Mikael Pentikäinen said he was concerned about the “growing imbalance between PR and news media.” He said: “People are pushing messages through editorial content and newsrooms. We have more to do in the newsrooms. Fewer resources to analyze all the lobbying messages we are getting.”

Gillian Tett: “it would be a grotesquely unequal world if we didn’t report just because banks -- or governments – don’t want it.... We have to keep trying to dance.” (applause).

Question: News agencies. Mainly accidents, wars crisis from abroad. What kind of picture are we giving to our readers?

Mikael Pentikäinen, President of Sanoma News Ltd, Finland, replied “The big agencies have been growing, increasing role in the landscape.”

Abramson: “AP, Reuters: vital. Especially since so many news organizations are making such steep cutbacks. We have a fully staffed Baghdad bureau. Our full time correspondent in Pakistan -- Jane Perlez is our only full-time correspondent in Pakistan. In Afghanistan the world depends on (Korlata Gal?). In terms of a full-time experienced reporter, who develops sources, and has the staff necessary to develop sources -- few. They deserve our full support. It is more expensive and more dangerous than ever.

Question (retired Reuter's correspondent): Will you please talk about Reuters and Bloomberg with regard to financial crisis?

Gillian Tett: Did a good job. Weren’t forced to choose whether to cover debt or equity markets; covered both. Not whether newspapers cover it, but whether it gets on front page. Agencies don’t have to make this choice.

Jill Abramson: "Bloomberg fascinates me. It has a muscular reporting team. Built one of best Washington bureaus. Al Hunt left the Wall Street Journal joined Bloomberg, built a team of more correspondents than even Times has in DC. Even the biggest Washington bureau in the US. Much at the government agencies. Few agencies have full time reporters. Bloomberg has reporters at all the agencies."

Question: Were you watching the credit bubble?

Gillian Tett: "I was writing columns in 2005 about the credit bubble. It didn’t burst in 2006. Maybe the bankers know more than we do, I wondered..? We did cover it, but we should have pushed the story more than we did."

Mikael Pentikäinen, spoke of the need to publish less for free, offer better services for the paying customer. "Need to differentiate good costs from bad ones. Need to increase good costs that increase value over time. Need to manage better. It's not easy."

Jill Abramson: Analogy to time of Gutenberg is illustrative. Revolution on that scale. Must remain nimble. Passion and commitment to high quality information is vital. People crave quality news. They need it in lives daily. For their job. To get jokes on late night TV. I can’t assure you in 10 years many people will be getting news from newspapers. For now healthy and smart news organizations will embrace diversity of platforms, but cling to the idea that quality information and news is a good business to be in. There is a lot of interesting new business models (Pro-Publica which employees a staff of reporters and publishers that give it away for free these. Politico.com is a great website, started by WaPo journalists. Took off during election. Part of my daily read. Maybe non-profit or online only will take off. Need the smartest minds in our business to study all these approaches. I don’t expect the perfect model to come down from the sky.

Gillian Tett: I echo that. Need to move into the different channels, juggling different channels.

Question for Tett: What is the big thing we are not covering well enough? Chasing tails. We need to think about that.

Jill Abramson: In the US under-covered story, most unsexy of topics, are the slow wheels turning at various regulatory bureaucracies in Washington. No DC reporter would choose to cover the SEC over the White House. But the big story happening now, badly covered, is the financial services industry lobbying like mad in DC against many of the reform initiatives that Obama administration has promised. Number one industry in terms of giving campaign contributions. It is scrambling to undo or adjust new legislative proposals that are supposed to stop crisis from happening again.

Mikael Pentikäinen: People ae starving because of financial crisis in poor countries. That’s not being covered enough.

Question (S. Korean): Question for Financial Times. We in Korea have concern that our country has been unfairly targeted like Hungary.

Gillian Tett: We try not to use inflammatory words. We try to report CDS market, reporting how people -- investors -- price in chance of a country defaulting into price paid.

Question (Iceland journalist): Free newspaper distribution seems to discredit the whole media industry. Lobby groups getting too powerful.

Jill Abramson: Metro is the company in the US -- a European company. Tried hard in NY but it didn’t catch on. Chicago Tribune tried to make one of its own. Not popular in the US. In terms of lobby groups, are advertisers more muscular? Pressuring us? In subtle ways, yes. In the US, it’s not the big problem. In some ways yes, though. The best news organizations in the US are more vigilant, more embracing of watchdog role than in immediate aftermath of 9/11.

Moderator: should we tone down coverage, so as not to exacerbate the crisis?

Gillian Tett: Absolutely not! We’re not going to become cheerleaders for the government! It’s good that we are having a discussion about the way the media operates. It’s a pity there hasn’t been more discussion in past. Let’s make sure there is better coverage for another crisis to come.

Jill Abramson: CDS have been called “weapons of mass destruction” by Buffet. That was no exaggeration. I’m surprised so many questions suggest media has been too harsh. In fact, when it comes to crises in history, usually media not harsh enough. During Kennedy administration, Kennedy called in the Times, urging it not to run the story of the Bay of Pigs invasion. The Times did not run the story. Later Kennedy said he wished Times had been less compliant. He said it would have been better for country had the press run the story. Snooze control is the bigger danger.

Jotman live-blogged the following panel discussions at the IPI World Congress:

• How to interview terrorists and survive kidnapping
• Technology and innovation: Climate change Rx?
• Asia's future: Capitalism sans freedom?
• New media lessons for television and print
• What kind of bear is Russia?
• Can we blame the financial crisis on the news media?
• Is the Nordic model worth emulating?