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On Journalists Moonlighting as Big Ticket Speakers for Financial Firms

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Paul Starobin has a useful article at Columbia Journalism Review on the way some high profile journalists receive large speaking fees for appearing before financial services industry audiences, most often conferences for investors, when they write about the same industry. Starobin handwrings on whether taking fees biases coverage. He points out that some organizations, such as Wall Street Journal, Bloomberg, and CNBC prohibit any fees or even expense reimbursement (Bloomberg does make an exception for its opinion column writers).

While some writers, such as Martin Wolf, Michael Lewis, and Gretchen Morgenson, were willing to discuss what they considered kosher with Starobin, most were unwilling to comment for the record:

…most of the journalists I tried to talk to about their speaking appearances resisted comment, or would only talk anonymously—which is a little ironic. One prominent scribe pleaded not to be mentioned at all. (Sorry, no passes.) I still have the bite marks on my neck from a telephone conversation with another who demanded to know whether he was the target of a “hostile inquiry.”

So not surprisingly, the comments come from writers whose acceptance of paid gigs would seem to be less problematic, although Starobin fails to differentiate as to how the different beats of those who were willing to discuss their policies make that so. Morgenson, who dines on the industry, gets paid only when she speaks to universities and screens any financial firms that want a free gig carefully. By contrast, Martin Wolf is a columnist, not a journalist per se, and writes on the economy rather than on companies or personalities, and thus the conflict issue is not really operative. And as much as Tett’s writing now stays comfortably within the confines of orthodox thinking (Starobin stepped in it when he depicted her book Fools Gold as tough on the financial services industry), I’d hazard that it has more to do with her promotion to being in charge of the US editorial operations rather than her speaking gigs.

But the critical point is made in passing:

Unconscious self-censorship could be a factor, too, as journalists who enjoy Wall Street’s money might come to feel more simpatico toward their benefactors’ perspectives on various issues. It’s a pretty typical human reaction, after all. The New York Times reported recently that doctors who take money from drug makers often are more willing than doctors who don’t to prescribe drugs in “risky” ways. Why should journalists be any more immune to this than physicians are?

It goes much further than that. We are much easier to manipulate than we want to believe. Social psychologist Robert Cialdini, in his classic book: Influence: The Art of Persuasion, reported that people who received a gift as minor as a can of soda were more receptive to a sales pitch. There’s a reason drug companies would give doctors pens, note pads, and desk toys.

And journalists have a much more basic problem. Most financial reporters spend a lot of time with senior people in the industry. Big firms already can sway coverage by playing the access journalism game and by artful packaging that seeks to frame the debate (or if you are Jamie Dimon, you just go on loudly and confidently about things that aren’t true). And a few notable exceptions, like Larry Summers, people in positions of influence are usually pretty smart and persuasive. I wrote after my visits to the Treasury that it took a day of two to detox. Journalists are in this every day. It’s not hard to see that even ones who are well intentioned are likely to have the relentless barrage of propaganda influence their thinking (although there are quite a few writers that readers can easily name whose pretenses of objectivity is pretty thin).

So while it is possible to tread a careful line, the number of journalists who refused to talk to Starobin on the record suggests a lot of them have good reason for not wanting their practices aired. And while the excuse is that the reticence is due to concern over reader overreaction, if it doesn’t look right, odds are that it isn’t right.

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50 comments

  1. Phil Perspective

    It’s not hard to see that even ones who are well intentioned are likely to have the relentless barrage of propaganda influence their thinking (although there are quite a few writers that readers can easily name whose pretenses of objectivity is pretty thin).

    I know it’s not finance, but look at Ezra Klein. He still calls Paul Ryan serious, and claims Ryan isn’t intentionally trying to balance the budget(which it doesn’t do anyway) on the backs of the poor. Who are you going to believe? Ezra Klein or K-thug(aka Paul Krugman)?

    1. YankeeFrank

      Ezra Klein is what passes for an intelligent political writer these days. He is a dupe and sucker (suck-up) for the powerful. If someone has power or wealth they gain almost infinite credibility with him, as long as they stay within the bounds of “acceptable” discourse. He is a courtier of the worst kind an embodies all that is wrong with our political class of blue bloods and enervated stooges. Anyone that reads the “thoughts” of this “man” with anything other than disgust betrays their own weak-minded penchant for groupthink and myopia. Its a testimony to the times we live in that people like Ezra Klein, David Brooks, Tom Friedman, Nick Kristof, etc., etc. maintain prominent posts at our most “respected” journalistic institutions.

      I would include Paul Krugman in that list due to his toadying for globalization, his penchant for confident utterances on subjects he knows little about, and for his pathetic economic “insights” such as the notion that credit and debt have no bearing on the economy because “one mans debt is another’s asset”. The idiocy and enforced blindness of that one statement is enough to render every other thought the man propounds as utterly suspect. But if I do include him then there is no one left to read at the august New York Times op-ed pages! Oh wait, Bob Herbert is okay. But he whines in impotence where he should be angry and forceful

      What remains of the intellectual edifice of our dying nation is a pathetic sight. In a country that has given itself over so completely to corruption and decadence its a truism that to succeed is to fail.

      1. René

        My problem with Ezra Klein, David Brooks, Tom Friedman and Nick Kristof is that the singing has become unbearable. If you listen very carefully and hear between the lines, you will hear, “We are Satan’s children, we are Satan’s children, nah nah nah, We are Satan’s children, We are Satan’s children, nah nah nah”.

        I used to just shrug my shoulders and think, “Only in America” and continue reading but ever since they raised the volume a couple of years ago, it became unbearable for me and quite frankly, I think somebody should stand up and call them out for what they are. The only difficulty with that is the fact that those writers are in DISGUISE !!!

        Yes, this is not like this Stephen King movie The Dark Half, where the bad guy really looks and acts like the bad guy. No, at the NYT the bad guys look and act like the good guys. Good luck sorting that out.

        1. craazyman

          there are medications that can help you, but they have side effects like truth repression.

          If somebody has the ability to see reality in terms of energetic relations of metaphors while keeping their general wits about them, it all makes sense.

          This really is very Jungian stuff, and a dude on the internet radio the other night was saying OWS is a gnostic wave rebellion against psychopathic consciousness, which is 1% of the population. so the 99% / 1% is a dual metaphor, on the surface it’s a money thing but deeper and on an energetic consciousness level it is an attempt by the group soul structure to cleanse itself of the psychopath bacteria.

          He went on to say that psychopaths are more successful breeders and have evolutionary advantages as they’re willing to breech normally observed moral structures and women (in some cases) find this very appealing. So they are favored in a Darwinian way, but the higher form of soul energy collects itself to execute an immune system anti-biotic function.

          he also impressed me by understanding David Icke’s Lizard visions as perceptions of these archetypical forces, not literal perceptions of physical reality. I was quite impressed by this guy. He was nailing it right and left, although he was a bit wacko.

          So if you hear things between the lines, no need to question your sanity. If you see it as force of metaphor and archetype it becomes a penetrating vision of the higher energetic realm. After all DNA is winding snakes, winding serpents– and god knows what lives in side our snakes that we hardly perceive except in the most extreme states of mind — but you can’t let yourself fall into the rabbit hole. You have to keep it as perception of the energetic relations of metaphors and their impact on behavior, not physical reality. This is Contemporary Analysis. I was quite surprised to hear this dude doing it on the radio.

          1. jonboinAR

            Conspiracy theory sauted with hallucinogens in schizoid-sauce is spicier and more robust than the plain variety.

  2. YankeeFrank

    I think you give Martin Wolf a pass here (though I don’t intend to single him out either). Any journalist/columnist who receives any monetary or other gift of any value from people/corporations within the field that is the subject of their writing is tainted and a conflict exists. Just because Wolf discusses the “economy” generally doesn’t mean he isn’t swayed by the big shots he hobnobs with to see things the way they do.

    I don’t know when the “thinking” of our intellectual/educated classes became so mushy. It used to be a conflict was a conflict and those who engaged in conflicted activities were tainted and their credibility was shot. If I’m living in la-la-land tell me, but I don’t think so. My guess is the uncompromising thinking I’m describing went out the window about the same time that the general equilibrium theory became respectable.

    The same bent toward practical and realistic thinking that led our founders to build a separation of powers into the Constitution and to severely proscribe the powers of the political class used to inform the general ways of thinking of the people. It was part of the fiber of our being as Americans to be skeptical and mistrustful of power. And part of that was an instant distrust of anyone with a shadow or even the merest hint of a pecuniary conflict of interest.

    I no longer recognize this country. We were once a serious-minded people with a hard-nosed and principled ideological foundation. In one generation we have become a squishy soft-minded bunch of sophists and dupes suffering the whims of charlatans and con men.

    1. Suzan

      Bravo!

      Now if we could organize at a national gathering some real journalists to point out the difference and name the offenders.

      And then not have them be ostracized for actually reporting the truth.

      S

      1. YankeeFrank

        Hey Suzan, did you read the Thomas Frank piece from yesterday’s links? Its an excellent analysis of the phenomenon we encounter all the time these days — those who are completely wrong about the most important issues and who have led our nation to ruin somehow maintain their respected position, or even rise above their prior place, while those who were correct are relegated to the sidelines and are mocked or simply ignored. Along with the mushy thinking on conflicts of interest, the fact that we no longer disregard and depose those who lead us to disaster or disgrace are sure signs of a collapsing system. To be wrong is to be right, to lie and shill for money is totally acceptable. Money makes right, and any other considerations are secondary at best. Principles no longer exist, or exist merely to be mocked by those “in the know”. Its bad enough the odious failures, warmongers and fraudsters haven’t been thrown out with yesterday’s trash, but the fact they still occupy positions of power and influence is a disgrace and tragedy.

        1. sgt_doom

          I’m afraid the gist of that story is rather specious given that it covers the American propaganda network: Fox-CNN-NPR-ABC-CBS-PBS, etc.

          The propaganda network will continue to employ propagandists, it is really that simple!

      2. ajax

        I use Twitter, and I’ll only retweet articles on banking, the economy or finance that make sense to me and appear to give a balanced view of “the truth”.

        On-line columns or on-line media very often have a “follow-us” button, but I rarely use that. I like to just retweet what contains a link to a good piece.

        Twitter allows hastags, say #mediabias , and one can search by hashtags. There are of course many ways to amplify and draw attention to good pieces and articles …

    2. psychohistorian

      Once you have been sold Saint Ronnie and the Hollywood version of America the slope gets real slippery.

      So when Copyright runs out on Mickey Mouse does the music stop?

      If TV can convince people to act against their best interests then petty corruption among the puppets for more pieces of silver seems consistent with the narrative.

      1. Hugh

        My best guess is that the copyright on the first Mickey Mouse work Steamboat Willey which came out in 1928 will enter the public domain in 2023. This shows the absurdity of our copyright laws which are meant to privilege corporations at the public’s expense. It is increasingly the case that all the material that was under copyright at our birth will still be under copyright at our death.

        As for Mickey Mouse, that is a trademark and trademark’s can be held forever as long as they stay in use. In general, a trademark is considered to have lapsed after non-use for 5 years. So even in 2023, no one will be able to freely use Mickey Mouse. They can just watch Steamboat Willey, which unless you are a film buff will not include many.

    3. Yves Smith Post author

      Please look at what Wolf writes and tell me where you see evidence of pro-bank bias. He is a long standing personal friend of Bank of England governor Mervyn King and has been consistent in his calls to get tough with banks (not that he writes on that that often).

      Wolf is very self confident, and in general, Oxbridge types think they are smarter than Americans. So intellectually, I don’t think he’s as susceptible. And British journalists don’t have much respect for politicians or corporate types, they assume they are lying until proven otherwise.

      Wolf is far more likely to be influenced by bad thinking of elite economists than bad thinking peddled by banksters.

      1. YankeeFrank

        But aren’t elite economists and banksters viewpoints much the same? I don’t read Martin Wolf that often, and I know he does call for sanity on occasion, I just think he is too embedded in the status quo world to be a real force to shake things up. He’s to busy enjoying the feasts at the palace to ever consider burning it down. But I guess, since he isn’t really a journalist conflicts are not a problem. His idea of getting tough with banks are things like higher capital levels, when the whole structure is rotten and there need to be criminal prosecutions all around. In that way he promotes the status quo and is part of the problem. But getting back to conflicts, a man like him is a walking conflict, albeit with some contrarian leanings. Perhaps in a more skeptical era there wouldn’t be as much prestige attached to that thing he does.

    4. nonclassical

      ..and you once could get a first class liberal arts-political science education for
      $1500.00 per semester…problems are linked.

      When buffoons such as Krauthammer are regular reading, Krystol, anti-science
      nonsense, pax americana blather, (Project For A New American Century), and noone realizes relationships to John Birch Society…founded by one Fred Koch, whose empire founded upon “Teapot Dome Scandal”=dismissal of bought and sold legislators, and truth is not demanded by ameriKan people…when $$$$=$peech, rather than recognition it is property…and courts laud this pathology…Jonathan Swift is invoked…

      1. Blunt

        I was wondering how Frederick Koch was connected to Teapot Dome?

        I dislike the entire Koch Brothers and Koch Industries cartel of right-wingnut practitioners, but this one doesn’t seem accurate.

        Pater Koch graduated MIT in 1922 and Albert Fall was selling oil leases to Harry Sinclair in 1922-23. Koch began his first rendition of Koch Industries with Winkler-Koch in 1925. And in 1922 Fred Koch went to work for the Texas Company (Texaco.) I’m just not seeing the connection your making.

        Please clarify?

    5. Hugh

      Excellent writing. I ascribe the wankery to media consolidation. This filled the media with Upton Sinclair people who were paid not to understand or report on what was going on and not rock any boats, but rather to distract the rubes with missing white girls and celebrity deaths and divorce and propagandize for the powers that be. I see this as part of the larger construction of the system of kleptocracy we suffer under.

      1. lambert strether

        “larger” and quite deliberate. I don’t see “it” as so much as a system or an ecology but as a collection of assets to be deployed as opportunity arises.

          1. ajax

            Just thinking … how about a “Don’t trust the mainstream media!” Campaign, somewhere, someday?

  3. Middle Seaman

    Not a very enriching comments so far. There one argument that seem to be missing from the post on the article. It may be missing because the article misses it. In my opinion, most journalist now a days are a priori biased in favor of the financial industry. The Paul Ryan example is useful. Paul Ryan is a criminal con man who got huge support from the journalistic community. Those supporting him are biased in Ryan’s favor while failing to perform simple arithmetic calculation that would show Ryan’s budget slight of as being nothing short of a major con.

  4. jake chase

    I have always wondered why journalists (people who write for money) are considered objective until proven otherwise. Most journalism is so breathtakingly ignorant and propagandistic as to be beneath contempt, and the higher the journalistic profile the more puerile the output tends to be. Financial journalism represents the creme de la creme of cowtowing fatuity. My own favorite example now trumpets his toadyism every morning on television. I doubt A****** gives a thought to his critics. The money he receives is eviable and a person must understand a great deal to know exactly how his sort are completely full of shit. Those who do understand approach financial journalism only for insight into conventional thinking and for the entertainment value.

    For those hoping to understand financial reality, try thinking hard about obvious facts and reading books by people who are either dead or absolutely devoid of connections to the rich and powerful and their captive institutions.

  5. Richard

    Yves,

    If memory serves me correctly, Martin Wolf served on the Vicker’s Commission that was responsible for proposing how to deal with reforming the UK’s financial system.

    That alone makes him more than just a columnist on economics.

    1. Yves Smith Post author

      Wolf was vocal in arguing the Mervyn King/Andrew Haldane/Adair Tunrer view in his columns that depositaries should be separated from other banking operations. so I doubt he’s adopt a more bank friendly line on the committee. Again, where is the evidence of bias as far as Wolf is concerned?

      1. Chris Cook

        I think that Wolf is not a million miles away from the best UK judges and QCs in terms of his neutral and dispassionate judgement and his ability to express his view clearly and confidently.

        But, like them, he works within a conventional world view and intellectual framework, and that limits him.

        But I believe he IS open-minded and capable of change given the evidence.

  6. craazyman

    Thank you. Thank you. It’s a pleasure to see you all today and have the chance to make some observations about the future of financial services.

    But before I begin, I’d like to make a few personal remarks. First, as I look around the room I have to say I’ve never seen so many larcenously shallow kleptocracy-enabling money addicts in one place in my entire life — except maybe the last Obama fundraiser but that’s another story.

    And second, and what’s even more impressively nauseating, as that most of you think you have talent. (Speaker starts laughing uncontrollably). Sorry about that, but I need a minute to get a grip on myself here. It’s incredible. A talent for destruction? Yes. A talent for fraud? yes. A talent for lies and obfuscations? Yes. A talent for preydation and deceit? Yes. A talent for unctuous self-delusion, self-promotion and self-justification? yes. A talent for taking other people’s money and making it your own.

    Actually, you are a very talented bunch. Perhaps I’m too quick to judgment. But none of us are perfect.

    And third, are there any economists in the room? (A few hands reluctantly go up). It’s actually astonishing to me, and few things astonish me anymore, that your entire profession makes money the object of your study, but you don’t have the faintest clue what it really is. This is a situation worthy of psychoanalysis, that’s another gang of frauds by the way, if it were done right. But it rarely is.

    So far we’re three for three. So let’s talk about the future of the financial system, but first let me put this image up on the screen. Yes, that’s the apocalypse from the book of Revelations. And all those bodies falling into the fiery pit of hell made by God for the special purpose of administering your damnation, that’s all of you!

    ahha ha ahhahaha ahahaha hahaahahaha

    Yeah!

  7. F. Beard

    Social psychologist Robert Cialdini, in his classic book: Influence: The Art of Persuasion, reported that people who received a gift as minor as a can of soda were more receptive to a sales pitch. Yves Smith

    To show partiality is not good, because for a piece of bread a man will transgress. Proverbs 28:21 New American Standard Bible (NASB)[bold added]

  8. Brooklin Bridge

    Hey, what’s with all these sneaky links that are nothing but advertizements (speaking of dubious journalistic practices)!

  9. Back In Line

    Very little investigative reporting takes place. Consider Lois Lane at the NYT. She ends up touting the barbarian falacy that the unworthy were given loans because the Gov’mint forced the hand of TBTF. This horseshit has been debunked continuously. Embedded, mployed and sinister, how boring. Ruthlessness includes indifference to suffering.

    “By the Reagan era, the “culture of poverty” had become a cornerstone of conservative ideology: poverty was caused, not by low wages or a lack of jobs, but by bad attitudes and faulty lifestyles. ” – Barbara Ehrenreich

    We all have to whore to survive, but it’s amazing how some willingly mutilate accuracy so they can make a buck. I’d call that robo-writing and robo-speaking. Activists, people on the front lines, whistleblowers – these are journalists.
    http://www.democracynow.org/2004/12/13/investigative_reporter_gary_webb_who_linked

  10. ep3

    ya know what I notice Yves, especially with our state capital paper (gannett owned and disseminated), is how the lack of content has affected the influence of the editorial page. For example, a front page article may be written about budget woes, with the typical he said/she said emptiness and political sideshow. And then a person can turn to the editorial section (always coincidentally at the end of the front section), and read a blurb from either a local or national columnist spewing their opinion about overtaxed small business persons and lazy state gov’t workers with fat pensions, and broke finances. Of course, these rants are full of “facts” and evidence from studies done by, whoever. So the average reader would say “well it’s in the paper, they have editors and proofreaders, it must be true”.

  11. Simple Simon

    I am surprised there has been no mention of Sorkin of the New York Times. He has a couple of times disclosed himself to be a shameless flack for the financial oligarchy. Surely you remember the piece he wrote about ‘Occupy’ at the behest of a certain CEO of a financial conglomerate who was concerned about his personal safety. And then there was the disgraceful interview with Paul Levy, a notorious shark,in which Sorkin mindlessly regurgitated what Levy had shoved down his throat, namely the many deceits of the PE industry about what fine guys they are. Sorkin is no journalist; he’s in PR.

  12. EmilianoZ

    So, Michael Lewis claims that it never occurred to him that corporations paying him to prattle on stuff would want anything in return.

    If you read yesterday’s linked article from the Baffler, you find that the same Lewis “mocked people who were worried about risky derivatives”.

    I guess gratitude can be “subconscious”.

  13. political economist

    The comment on the can of cola reminded me of the laborer who refused breakfast, only accepting water, as UPS tried to persuade him and others at the meeting that it was in a “joint partnership” with them. This impressed his fellow workers as well as impressing/depressing the UPS representative. (Needless to say, regretably he did not rise far in the corporate bureaucracy of US unionism.

    The point is that REFUSING these little “gifts” can likewise have a major impact on consciousness. Moreover, it can make people aware of attempts to manipulate them.

  14. starburns

    it’s hard to imagine that this flattery wouldn’t influence a journalist’s reporting. i suspect that many bankers hold finance journalists beneath them and that they suppose these journalists would be bankers if they were in fact smart. it must be very gratifying when a bunch of rich bankers want you to show them how much you know. it’s absolutely absurd for a journalist to so brazenly consort with those he or she purports to cover.

  15. Hugh

    Kleptocracy is a system and it takes care of its enablers. Journalists and columnists get speaking fees. Politicians get contributions and even if they lose well-paid sinecures. Academics get tenure and if they have big enough names as shills speaking fees and perhaps a star turn at some corporatist “think” tank or center.

  16. Peter in Brooklyn

    Another important factor is the importance of access to the successful journalist. Assuming that Sorkin-types are well-meaning guys/gals who really believe they write hard hitting stuff, they got where they are because they started writing stuff people in power liked, who then gave them access. My hunch is that this is a little more important than speaking fees, etc. Sorkin, for example, seems like a guy, who, even if you took away any compensation coming to him from the financial industry, would pay his own way to tag along with people he admires, and whose accessibility he “needs” to write his columns, etc.

    The folks who write things that really are substantially critical, e.g. NOT “sometimes so-and-so’s utter genius would get him in trouble, especially when his good intentions led to overreach . . . yada, yada,” they just can’t get access, and never get much of a chance to get influenced by money to change their stories.

    1. ajax

      Chris Hedges, who used to work at the New York Times, got a
      formal reprimand not for something he wrote, but for
      something he did. He had been invited to give a
      valedictorian(?) address to a graduating class at a
      relatively small liberal arts college. This was in the
      aftermath of the US invasion of Iraq. His speech was booed,
      because he was very critical of US in Iraq. Subsequently,
      Hedges left the NYT (a resignation, I believe).

  17. Jim

    It may be worthwhile to broaden the scope of the discussion from the behavior of financial journalists to questions about the more general role of intellectuals, power and knowledge in what Yankee Frank calls “our dying nation.”

    Is it conceivable that in our increasingly corrupt contemporary situation, which seems to be evolving into some type of post-democratic police state, that culture and politics rather than economics becomes decisive?

    Is it conceivable, as Lambert implies, that the media is a collection of assets to be deployed as opportunity arises but that its deployment is the responsibility of not only a powerful corporate and state elites but also of a type of post-industrial professional class of intellectuals (running from right to left) whose job is to assist in our proper management?

    Is the old base-superstructure model according to which all issues are reduced to economic conflict now completely outmoded?

    Are most intellectuals today part of a managerial social formation​ with direct links to both powerful public and private sector institutions?

    What does direct democracy mean under such conditions?

    1. Synopticist

      Don’t imagine, for a fraction of a second, that any UK journalist has any integrity on any subject whatsoever.

      British journos are the very lowest of the low, worse than politicians and lawyers, and on a par only with bankers. Truly, they are absolute scum. The whole News International/bugging scandal thing is the tip of the iceberg.

      Any article you read in the British press should be interpreted in those terms. Once in a while you’re pleasantly suprised, but it doesn’t happen often.

      This goes especially for financial journalists. They may not have a lot of respect for bankers types, but they sure want slice of the good life they represent. Although most will be from priveleged backgrounds, they don’t get particulary large salaries, and they’re probably paying big mortgages on pretty modest houses. A nice fat speaking engagement to bankers in Chaminix or Frankfurt, paid under a different tax code, will cover a good couple of months worth of salalry.

      So to lie or lick backside in a few articles, for the sake of a sixth of your yearly income? Thats a total no-brainer for a British journalist.

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