How Network News Helped Bring About the Crash
When we seek out the causes and culprits of our current economic crisis, there is one area in need of reform that should not be overlooked: the mainstream news media. It is not too much to say that the people in the NBC, ABC and CBS news operations were major contributing factors to the crash of 2008 and are helping to pave the way to future economic troubles now.
In the book Reckless Endangerment: How Outsized Ambition, Greed, and Corruption Led to Economic Armageddon, authors Gretchen Morgenson and Joshua Rosner tell how, in the early nineties, faulty or skewed studies by ACORN and other groups fed the idea that there was pervasive racial bias by mortgage lenders, with blacks and Hispanics being unfairly rejected for loans. “The findings lit up the media, confirming many people’s suspicions about banks’ lending practices,” the authors write of one such study. In fact, properly interpreted, the data suggested that banks were making their loans not on the basis of race but on the basis of credit-worthiness. But as the misinformation confirmed left-wing ideas, the media pressure was on for a government fix.
To put it in simplified but not inaccurate terms, what happened as a result was this: The Clinton administration essentially gave orders to lenders to give unwise loans to people based on their race. Those orders required banks to adopt bad lending practices. The dangerously easy credit made house prices rise. And unscrupulous sharks on Wall Street and elsewhere rushed in to make a profit off the housing bubble by luring investors into funding the crummy mortgages. Thus the poison of the government-mandated bad loans flooded the system. When housing prices inevitably fell, the system collapsed.
At the center of all this were Fannie Mae and Freddie Mac, dishonestly run lenders with government backing and a mandate to make housing somehow affordable to those who couldn't afford it. You can watch videos here and here to see Republicans, including George W. Bush and John McCain, warning of the coming disaster and calling for regulatory legislation to bring the madness at Fannie Mae under control. The videos also show Democrats — most especially and most perfidiously Congressman Barney Frank of Massachusetts — repeatedly claiming nothing is wrong.
If our mainstream news media had not been so politically one-sided, all of this might have been prevented. The reports that falsely claimed racial discrimination in lending could easily have been debunked. The entire premise of giving loans to people who couldn’t afford them might have been questioned. And the warnings of honorable men like Bush and McCain would have been given at least equal weight with the po-faced distortions of the awful Frank. It was the left-wing assumptions of the news media that prevented proper reporting and created at least some of the pressure on politicians to act irresponsibly — and then provided them with the cover of silence when they did.
Look. The chief political correspondent of ABC News is George Stephanopoulos, a former Democrat operative who says Barack Obama’s Mr. Bean presidency is going “remarkably well.” NBC anchorman Brian Williams once implied Jimmy Carter was the greatest American president of all time and suggested the founding fathers were essentially terrorists. And CBS has just replaced the leftist Katie Couric with Ted Baxter lookalike Scott Pelley, who once called Mahmoud Ahmadinejad “incorruptible” and compared global warming skeptics to holocaust deniers.
These are not fair brokers of information — and I’m willing to bet that none of them steps out from behind the camera to find a phalanx of conservative staff members waiting to question their assumptions or challenge their “facts.” No, they work in an echo chamber of agreement where opinions are more likely to become radicalized and important stories that challenge leftist assumptions simply become invisible. For the reasons given above, this echo chamber is partially to blame for our current economic troubles, and is currently contributing to future woes by skewing the story of the debt ceiling negotiations against Republicans rather than telling it from both sides.
All it would take to reform a news industry that is collapsing under the weight of its own bias would be for them to change hiring practices and work to bring in new voices and new minds. There are plenty of brilliant right wing writers and reporters out there. Hire some of them.
For the good of the country and for the sake of the truth, the mainstream news media needs to reform.