professional negligence

Simon Dumenco isn’t all that excited about the economic meltdown, and he points a finger at—who else?—the media for its hysterical trumpeting of the “crisis” now that it’s upon us and its failure over the years to report on the hazards of high finance and Wall Street.

Really, you could argue that Wall Street, during the subprime boom, was simply doing its job: getting away with what it could get away with. (Hey, if regulators were willing to turn a blind eye to the dubious profiteering and financial smoke-and-mirrors … well, if the government says it’s OK, it’s OK, right?) But you can’t say the same for much of the press, which spent a lot of time over the past few years celebrating the feats of financial “wizards” — and not enough time peeking behind the curtains and questioning the too-good-to-be-true magic.

Granted, there’s been increased sensitivity in the past couple weeks among some media in regard to, at least, semantics. For instance, in The New York Times last week in a piece titled, “Amid Market Turmoil, Some Journalists Try to Tone Down Emotion,” Richard Pérez-Peña noted that some reporters are steering clear of terms such as “meltdown” and “panic” to avoid further inflaming an already-twitchy market.

Don’t get me wrong: Politely tip-toeing through the apocalypse after the fact is a nice gesture! But it hardly makes up for the fact that few financial journalists really questioned the meaning and ramifications of toxic Wall Street voodoo such as “credit-default swaps” and such until it was way, way too late.

No one has been covered in glory since this meltdown began to show its ugly face—least of all our elected representatives, beginning with Bush, who is clearly out of his depth and “out of juice,” according to David Brooks, who is being way too kind.

I certainly agree with Dumenco that the MSM comes in for a lot of the blame, but irrational exuberance is a widely known human weakness.

In early January, as Obama was ascending, I wrote:

… mundus vult decipi. (You could look it up.)

People want to believe in magic, as P.T. Barnum, for one, knew.

Despite its prominence in Barnum lore, historians agree that he probably never said, “There’s a sucker born every minute.” What he said was less cynical and more astute: “The people like to be humbugged.”

The Times piece from which I took the quote above goes on to note:

Barnum humbugged the highbrow as well as the low. In 1850 he brought the opera diva Jenny Lind, “the Swedish Nightingale,” to Manhattan for the start of an American tour. Neither he nor anyone else in America had heard her sing a note.

“Jenny Lind’s story is perhaps Barnum’s single most extraordinary accomplishment,” Ms. Maher said, “because he took something that was absolutely nothing in American society and created a frenzy, a mania, very much equivalent to today’s rock stars.” [e.a.]

People with their feet on the ground should always know how to protect their interests, even in times of irrational exuberance. Maybe that’s what we have to teach both our children and the nation’s “journalists”—how to reason. Now that we’re enmeshed in a world of 24/7 deceptive and/or ignorant “news” and marketing and advertising, this seems more important than ever