Reading business-press coverage of Henry Paulson over the past few months was disorienting. Something was missing, but you couldn’t put your finger on it.

“Paulson attacks ‘shameful’ lenders,” The Financial Times reported in October.

[Paulson] said the conduct of some mortgage market participants had been ‘shameful’ and called for consideration of a nationwide licensing and monitoring system for mortgage brokers.

USA Today also relayed Paulson’s concerns in a story headlined “Criticism Rains Down on Mortgage Industry”

Reading these accounts, it’s almost possible to forget that Paulson is treasury secretary of the United States, one of the nation’s two top banking regulators with broad powers to stop unsafe and abusive banking practices.

The USA Today story also says that Sheila C. Bair was “frustrated” at the “slow pace” of loan restructuring for subprime borrowers.

‘Washington needs to push hard on this,’ she said. ‘Our message is, “Prioritize these folks, if they can convert” (to fixed-rate loans). That will free up more time to deal with some of the more challenging cases.

That’s fine, except Bair heads the Federal Deposit Insurance Corporation.

She is “Washington.”

And here’s one more, from Dow Jones News Service, on a speech last May by John Dugan, comptroller of the currency, who reports to Paulson:

Income Checks Needed For Loans, Regulator Says (1)

The story says the comptroller testified that banks should check borrowers’ incomes before giving them loans. Apparently, this wasn’t done before. Wow.

The business-press is paddling hard to catch up to a mortgage crisis that, I’m guessing, is bigger than most non-business-press readers understand.

We have to consider the possibility that the housing price downturn will eventually be as big as that of the last truly big decline, from 1925 to 1933, when prices fell by a total of 30 percent.

Who wrote that? Hint: it’s not one of those radicals we have running around up here at Columbia. (2)

I think the press is now doing well on the mortgage story and seems fully alive to its responsibilities to shine a light on a financial problem of such rare scope that people who normally take no interest in this type of thing are turning to the business pages to find out what happened—this time—on Wall Street.

The business press has written about the mortgage crisis as a predatory-lender problem, a naïve borrower problem, a compromised rating-agency problem, an irresponsible debt-buyer problem, and, first and foremost, a problem manufactured on Wall Street, which fueled the subprime expansion with loans to front-line borrowers, sold the bad paper into the global markets—and, to keep the fee-engine going, bought much of its own product.

If the business press has a blind spot, it is that it failed to understand the crisis for what I think it really is: a regulatory failure of mammoth proportions.

Now comes The New York Times this week with a devastating account of regulatory failure, under the headline: “Fed Shrugged as Subprime Crisis Spread”

The piece is strong. It effectively pulls together material that had been in the public record and advances an equally strong piece from last May, and other work over the summer, by The Wall Street Journal.

One of its chief merits is that it reveals even more about Alan Greenspan’s failure to act on urgent private warnings. In one passage, he seems paralyzed by his own ideology as he explains why he had parried pleas as early as 2001, from the late Fed governor Edward Gramlich and the FDIC’s Bair, to use powers the Fed already had.

‘I got the impression that there were a lot of very questionable practices going on,’ he said. ‘The problem has always been, what basically does the law mean when it says deceptive and unfair practices? Deceptive and unfair practices may seem straightforward, except when you try to determine by what standard.’

The Times makes a point that has appeared elsewhere but is one that nonetheless bears re-emphasizing: supposedly independent watchdogs—this time government banking regulators, no less—are funded by those they regulate.

Because each agency receives its funding from fees paid by the banks or thrifts they regulate, critics have long argued that they often treat the institutions they regulate as constituents to be protected.

But even as we celebrate good work, it’s fair to point out that the piece comes fully eight months into the crisis, advances only marginally what is already in the record, and includes material that was publicly available at the time the events were happening. It is, in the end, a particularly well-executed example of explanatory reporting, a time-honored and respected journalistic form that has but a single limitation: it is, by definition, late.

Dean Starkman Dean Starkman runs The Audit, CJR's business section, and is the author of The Watchdog That Didn't Bark: The Financial Crisis and the Disappearance of Investigative Journalism (Columbia University Press, January 2014). Follow Dean on Twitter: @deanstarkman.