In this issue
Messengers face news challenges
|Kevin Rafter on how journalists have had to adapt to the complexities of business reporting|
Most business reporting in Ireland has moved beyond ‘elite-to-elite' coverage. News on the business pages, for so long targeted at a core constituency, now fills the main press sections and TV and radio bulletins - a consequence of the economic turmoil of recent years. While there was some criticism of the media's ‘boosterism' in the good times, it is interesting to see complaints about excessive doom and gloom in more recent coverage.
Financial journalism in Ireland emerged as a separate strand of news reporting in the 1960s Lemass-Whittaker boom. This first group of specialist reporters operated in a very different world. Reporters were for a time even banned from attending many company AGMs. Business supplements showed up in the 1980s, while the arrival of the Sunday Business Post confirmed the increased market for economic and financial information. There was news in business journalism and money to be made from it.
As reporting became more investigative in its nature, the Irish media has had a decent record in rooting out financial wrong-doing. But not all these exposes have come from specialised reporters. Cliff Taylor and Sam Smyth uncovered the unethical relationship between certain businessmen and politicians like Charlie Haughey and Michael Lowry. Liam Collins in the Sunday Independent put the spotlight on the DIRT scandal of the 1990s. RTE duo Charlie Bird and George Lee outed malpractice at National Irish Bank.
But in relation to the current economic crisis, journalism has played a fairly passive role. The boom was chronicled and recorded but little of what is now known was exposed as it was happening. Few commentators predicted the crash but like boys ‘crying wolf' their message lost its impact with repetitive articulation. In truth, financial journalists had a problem in standing up speculative forecasts especially as until September 2008 there were few official voices or experts willing to predict the end of the Celtic Tiger era.
From the media world, Richard Curran is one of the few to have emerged from this period with credit. Curran's Future Shock programme on RTE, analysing a property collapse, was originally criticised for spreading gloom. Today, however, it is worth a repeat viewing for its accuracy. The experience elsewhere was similar. A report on British financial journalism by the London School of Economics asked: "How can you expect journalists to be brave, independent, fearless and intelligent when most of the people running our banks and treasures appear to have ignored the warnings as well?"
Journalists certainly were not the only ones to incorrectly call the banking crisis and the meltdown in the public finances. Back in 2002, Standards & Poor, the international credit rating agency, said there was concern about Irish bank's exposure to potential bad debts in the property market. In reply, Michael Casey, the then assistant director-general of the Central Bank, said the S&P assessment was "a little over the top".
Three years later, in November 2005, David Duffy, an ESRI economist, forecast that house prices would increase by 4.5 per cent annually until 2010 at which time they would experience a soft landing. To recall one of the choice quotes from former Taoiseach Bertie Ahern: "The boom is getting boomier." That was in 2006, the time we now know the economy was moving from boom to bust and the banks were skirting with ruin.
Richard Curran presented Future Shock on RTE 1 about the collapse of the property and construction industry. After it was broadcast media critics slammed the programme for using shock tactics and being unduly negative. One property observer said it was like showing Jaws to a bunch of five-year-olds and then telling them that sharks bite.
One lesson from the last decade in particular is that business reporting has become more difficult as the financial world has become more complex. Even experts with specialised knowledge are left baffled by some financial instruments. Robert Peston, the BBC's business editor, remarked: "For many months I was very concerned about the explosive growth of CDOs (Collateralised Debt Obligations) and I tried to explain them through my reporting. Doing so was a challenge, when even bankers creating CDOs were unable to describe them in terms than make sense to non-specialists."
Business journalists face the same challenges as their counterparts covering other areas of Irish life, mainly a lack of resources, both financial and time. One concern is the huge imbalance in resources between struggling media outlets and the companies about which they report. Most newspapers and broadcasters lack the resources to commit staff to serious ongoing investigative work and this impacts on the quality of news reporting.
The situation is compounded by the avalanche of information now available and which arrives at instant digitally-driven speed. At a DCU seminar on business journalism at the end of last year, Irish Independent deputy business editor Emmet Oliver spoke about the amount and scale of information facing reporters and the task of dealing with this volume of detail. Financial data is not just increasingly complex but new communications technology and 24/7 news demands mean reports are published earlier than ever before. The time for analysis has shortened. Verification times have been reduced.
One consequence is increased power for the PR industry which interprets and explains stories for journalists. There is a real danger in this co-dependency between financial journalism and PR exec. The ultimate objective of the two sides is very different. Journalists perform public interest functions. PR executives work for the legitimate but vested interests of their client. Assessing the lessons for journalism from the boom era is a worthwhile area for analysis, but so too is asking how well equipped is financial journalism in Ireland to deal with the current crisis?