The Financial Crisis Inquiry Commission talked to state regulators—the only ones with credibility on the predatory-lending issue and you might say the crisis generally—and the business press barely even notices. Of course they wouldn’t!
At least the Journal gave them three sentences—at the bottom of its A4 story.
Take a little time to revisit our Audit Interview with John Ryan from a little more than a year ago about state regulators and their frustrations with the press:
It was clear that a powerful industry was doing its best to eliminate all obstacles to a very profitable model of lending to vulnerable homeowners.
Perhaps the greatest frustration is that some federal regulators were working side by side with the industry to push aside state laws or enforcement efforts to address the sorts of abusive or unsustainable lending we were experiencing at the local level. It seemed outrageous to us that a regulatory agency could preempt these laws without any clear authority. I spent a lot of time talking with the press—first trade press and then national media—about this assault on consumer protection and federalism. But the federal regulators would tell them that nothing new was happening here, and the press wouldn’t challenge them on that. At best, it was treated as a “he said, she said” situation.
— This has to be some kind of record.
Pooja Bhatia had a front-page byline in The Wall Street Journal yesterday from Port-Au-Prince on the same day The New York Times ran an op-ed column from her.
Richard Perez-Pena of the Times has more on this.
The Associated Press and Reuters already had journalists based in Haiti, but the major newspapers in the United States did not, forcing them to scramble to fill the gap. That was how Pooja Bhatia, several years removed from her days as a newspaper reporter, became one the world’s windows into the disaster, with her writing prominently displayed in The Wall Street Journal and The New York Times.
On Wednesday, when no Journal reporter had yet been able to reach the scene, former colleagues suggested recruiting Ms. Bhatia, 33, a former Journal reporter living in Haiti on a fellowship, and hers was one of two bylines on the top story on the paper’s front page on Thursday. The same day, The Times published a first-person article by her on its Op-Ed page. She was also interviewed as a witness to the destruction by the Christian Science Monitor and the public radio program “The Takeaway.”
— Speaking of the Journal, Kate Kelly’s story today on the Obama administration ignoring Paul Volcker is a good one.
In a series of appearances in recent months, the former Federal Reserve chairman has excoriated the conflicts of interest within the nation’s biggest banks, criticized the Fed for nearly overstepping its bounds, and railed against financial innovation as a harbinger of doom, telling a panel late last year that “the most important financial innovation that I have seen the past 20 years is the automatic teller machine.”
On Thursday, he was at it again, telling members of the Economic Club of New York in a lunchtime speech that banks which blend high-risk trading with traditional consumer lending face “unmanageable conflicts of interest” and should be broken up. Such steps would result in the dismantling of the likes of J.P. Morgan Chase & Co., Bank of America Corp. and Citigroup.
A few hours before, President Obama was at the White House, announcing less severe steps: a special tax on the nation’s largest financial companies intended to make taxpayers whole for the bailouts of recent years.
The two speeches highlighted Mr. Volcker’s predicament. Having been viewed as a crucial supporter of Mr. Obama during his presidential run, he appears to have diminishing influence in the White House. And while revered by Wall Street critics on the left and right, his most deeply held views are having limited influence among policy makers.
The press is good to keep writing these stories as long as it appears the White House is listening to Tim Geithner and Larry Summers as opposed to Paul Volcker. There are few more respected voices in business and finance and he actually has credibility and independence the other two can’t pretend to have.