Is the Media to Blame for the Bailout Bust?

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In the postmortems of yesterday's failed congressional bill to right the credit markets, I'm noticing a repeated refrain: Representatives voted against it because their constituents hated it, and their constituents hated it because they didn't understand the consequences.

But if that's true, isn't there someone at fault besides voters and their elected Representatives? Say, for instance, the mainstream business press who might have made those consequences plain?

Specifically, couldn't they have better answered the simple question: What are we getting (or more important, avoiding) for $700 billion?

Mind you, I'm not saying that business reporters failed at their jobs by not adequately foreseeing the disaster. I'm not saying they didn't, either — the thing about media criticism is that you can't possibly be an expert on everyone's beat, and I don't pretend to. (The Columbia Journalism Review says business-journalism failure was a possibility, though.)

What I'm talking about is not predicting our predicament in advance, but simply describing it — in compelling, clear and unhedged terms — in the present.

For a business-news layman, I follow these issues fairly closely, especially as they affect consumer areas like the housing market. (I even wrote a TIME cover story in 2005 on America's obsession with home prices — with considerable help from our business staff — so it's not like I was unaware of the housing bubble and home-lending spree.)

But for months (as my colleagues whom I've been buttonholing with questions can attest), I found the coverage of the credit situation and its possible effects on the rest of the economy to be frustratingly vague and Wall Street–centric. I felt like I should know what was going on, and I didn't. Just what exactly were we facing, and who could be hit in what way?

It's not like the financial press has swept the story under the rug, certainly. But what we've generally heard are either dire — but very vague — warnings or the general argument that, if credit dries up, that affects loans to businesses and little guys, and people start to lose jobs.

That's all well and good as far as it goes. But it doesn't get to the question of degree. Businesses will be hurt — O.K. But businesses are hurt in a lot of economic downturns, some of them mild, some of them so catastrophic, they threaten our civilization. Which is this? How badly will businesses be hit? Like in a typical recession? Or like in 1929?

That's not a small consideration — especially when you're looking at a $700 billion rescue package. If your mechanic tells you that it will cost thousands to fix your car, you may reasonably want to know: if I don't make the repair, could I die? Or will the wheel just keep making a funny noise?

Likewise: Seven hundred billion to avert the collapse of the world economy and a new Great Depression? Sure. Seven hundred billion to avert a recession? People are reasonably going to doubt that. Economies have recessions; you don't necessarily go into hock and restructure the economy every time that happens.

Now, there are many reasons mass-market business reporters might not answer this question of degree. Maybe nobody really knows. (In which case, they have an obligation to say unambiguously: nobody really knows.) Maybe they fear creating a panic, and at the same time fear not having anticipated a disaster if it happens, so they cover all bases, leaving their audience confused in the process.

[UPDATE: Separate but related: Maybe they fear that describing consequences will seem like they're advocating an action, which will in turn seem like bias — in which case, it's a classic instance of letting the appearance of "balance" get in the way of actual, vital information.]

Or maybe they're too close to their own beats. Maybe the effect of a credit freeze is so obvious and transparent to them that they can't quite comprehend how anyone could not understand its impact. That's not a service to the audience, but it's the impression I've gotten at times even from business journalists I normally admire. Last night on PBS's NewsHour, for instance, an anchor put the question to the New York Times' Joe Nocera. I've heard him discuss business news in layman's terms masterfully on NPR for years; if anyone could put this in perspective succinctly, I thought, it would be him. But his answer was yet another of those general explanations — businesses lose access to money, people lose jobs — that avoided that essential question of degree.

Whatever the explanation — caution, confusion, failure to communicate — the upshot is that the straight business press has left a vacuum in explaining the consequences to the public. And that vacuum has been filled by professional gabbers like Glenn Beck and James Cramer, both of whom were predicting a possible Great Depression yesterday. They might well be right, but we've heard them get so excited about so much for so long, who can possibly know? The vacuum has also been filled by political columnists and pundits, some of whom (like Paul Krugman) actually know a lot about the subject. But again, when the most specific predictions about the bailout bill — that it's unnecessary, or that its failure would be a disaster — come from partisans, it's impossible for an audience not to take their motivations into account.

Where there's a vacuum of information, the loudest voices fill the gap. As does confusion. As does suspicion. If those things are hobbling us from making vital decisions right now, then it's time for the business press to step up.

[UPDATE: I should admit to one real possibility: Maybe I've been reading and watching all this coverage and yet I'm just too dense. In which case, please set me straight.]

[UPDATE 2: My comrade Justin Fox, a.k.a. a guy who actually knows something about this subject, responds over at the Curious Capitalist.]

(See the ten steps to the financial meltdown here and TIME's photos of the global financial crisis here.)

(See TIME's Pictures of the Week here.)