'Financial press failed'

The world’s financial press had failed to predict the financial crisis,
and had not done a good job reporting it once it had begun, Columbia
University journalism professor Anya Stiglitz said at the University of
the Witwatersrand, writes Jocelyn Newmarch in Business Day.

She said business journalists relied heavily on expert sources as they often lacked the skills to analyse information independently. This reliance on sources meant they were vulnerable to a particular interpretation of news, Stiglitz said.

“Any information you get is tainted; why would someone give it to you? To get information, journalists often have to mislead sources.” She called this a process of “seduction” in which sources often felt betrayed if their information was used to cast a negative light. Yet the absence of betrayal was equally problematic, when journalists uncritically repeated what they had been told.

“This pressure is endemic to business and economic reporting, where, if you want access, you have to report favourably,” she said.

This reliance on sources, which inculcated reporters into mainstream business points of view, helped to explain the press’s failure to predict the crisis.

Stiglitz said very few people had predicted the crisis, and these voices tended to be outside the mainstream. At the same time, the media industry, particularly in the US, was dealing with its own crisis.

“Some estimate 60000 jobs have been lost in journalism in the past few years,” she said. “People who have been laid off expect never again to get jobs in journalism.”

Click here to read the full report, posted on Business Day's website.