The WSJ's Unhelpful Aggression

The front page of today’s WSJ has a big headline: “A President as Micromanager: How Much Detail Is Enough?”. The lead anecdote?

In briefing President Barack Obama one day this spring, White House economist Jared Bernstein delved into such arcana as the yields on different forms of credit relative to the risk. Later, Paul Volcker pulled Mr. Bernstein aside. “Why would the president want to know that level of detail?” asked the former Federal Reserve chairman.

“That’s what he wants,” Mr. Bernstein replied.

This is astonishing stuff, coming from the Journal. Any other US newspaper might be forgiven for underestimating the importance of credit spreads. But for the WSJ, in its lead paragraph, to characterize credit spreads as “such arcana as the yields on different forms of credit relative to the risk” is not only inaccurate (”relative to the risk” makes no sense) but also comes across as unpleasantly faux-naive, in the service of a contentious thesis.

This is part of the new Murdoch Journal, of course — the same paper which has for months been desperately trying to drum up some kind of Congressional expenses scandal by leveraging the power of its front page, to almost no visible effect. It’s aggressive, yes, and that’s normally a good thing. The problem is that it’s aggressive in a particularly unhelpful and often disingenuous way, and there’s no reason to believe that anybody at the Journal is going to stop this carrying through past the silly season of August.

The Journal is clearly desperate for a big political scoop, or at very least a scalp. But it’s sad that it’s letting its desperation show so obviously.

Comments

[Robert Perrego:]

Funny how fishy did not go into the fact that Obama really does not need that kind of info. Obama has never ever run a successful business much less anything to do with Wall Street or credit spreads. The White House's intrusion into the management of financial firms only underscores the fact that a little information can be dangerous and the last thing we need is a neophyte gumming up the works even worse.

Volcker seems on point. Obama's tendency to decide how business should be run and stimulated (read: cash for crappers) could be dangerous. This could all prove out if we end up with some kind of interest rate level legislation soon. I wouldn't be surprised.

Aug 12 10:57 AM

[ain't no fo...:]

Just wait until the "Urinal" has bylines by O'Reilly, Beck and Hannity, with a weekly guest piece by Limbaughhhh.

Then you will know the full definition of desperation.

That's if you even bother to read it.

Aug 12 12:40 PM

[notsosmart:]

&how about the 2 adulterers that constantly show up with the same bs.too bad the conservatives cant do better but the same old tired faces with the same old bs. as an independent i just ignore these fools.

Aug 12 04:38 PM

[Phillip Jain:]

Basically, WSJ is saying get out of our Wall Street buddies faces & don't mess with derivatives, CDS, etc.

Of course, it could be worse. Maybe WSJ post-Murdoch has like broad cast TV become kindergartenish. If so, WSJ should not be read, if it cannot understand the importance of these "arcana".

Aug 12 08:39 PM

[Mr. Ed, Jr.:]

Your objection seems to be that the WSJ has mischaracterized the degree of "arcana"-- is that it ?

First, since we do not know the details that were presented to the President, we (you) are not in a position to determine whether the WSJ has mischaracterized the "arcana". You may feel that there is no detail of credit spreads too small to be slighted by that description, but I am fairly sure there is. And the target audience-- in this case, the President-- is also relative to the discussion.

The story is written from another perspective-- that very few of Obama's predecessors would have been interested in the yields. In fact, that is the point of the quote by Volcker-- the President's time is extremely limited, and is not generally absorbed by discussion of economic technicals. Typically, staff takes notes after the meeting and presents a concise summary to the President, thereby saving his valuable time.

The WSJ article is fair and objective. It has no discernable agenda. But you seem to have one, as you nitpick that the WSJ should not be calling credit spreads "arcana". But it is simply the perspective of the article, which is not being written from an economic technician's viewpoint.

Not every story in the WSJ has to be from the point of view of an economist. And not every detail of credit yields has to be treated as though it is passed down from on high. Sometimes, "normal" people read the WSJ.

Aug 12 11:29 PM

[Alan Young:]

Why would the President ask for details on yields, when he is not an economist, and previous presidents have ignored such information? Obviously, because one of his advisors told him that the information was important. And Obama is a smart guy who could easily learn enough in a 15-minute study to ask the right question and understand the answer (that's how you get to the head of your class at Harvard).

That doesn't mean that Obama wants to run Wall Street; it means that he wants to have a clear picture of what the banks are doing.

So, looking at WSJ's reaction, they must have drawn the same conclusion.

If someone of importance takes an interest in your work, and it's good work, you should be proud, and celebrate the attention. If it's shady work, you resent the attention. It doesn't take a genius to figure this out. Why isn't the Journal praising the president for wanting to be better informed?

Aug 13 12:10 AM

[Albert Meyer:]

The WSJ today, is a shadow of its former self. It has become a mouthpiece for the neocons. Murdoch has his hand firmly on the helm. Karl Rove is "the star attraction." Yes, soon Hannity et al might well join the team. I have bridge in Brooklyn at a real bargain price for those who believe the Journal is objective in its reporting. That said, there are still some first class journalists at the Journal. Figure that out for yourself and skip the rest.

Aug 13 10:04 AM

[casey00001:]

Felix: Your speil is getting so old, why don't you just apply for a job with the Obama Administration. Maybe you did and got turned down?

Aug 13 01:37 PM

[John Lounsbury:]

I'll side with Alan Young in this discussion. I would add another reason, though. Maybe Obama wants to understand enough detail to be able to detect when he is being fed BS. That is something new for Presidents in recent decades, who appeared to be "gut instinct" executives. I do think he (the President) had better get some more tutoring quickly, however, because I think some BS has already established too much credibility. This man has the intellect and the temperment to tackle big problems. He is and will be hampered by those who hand out misleading generalities if not challenged to defend themselves.

Aug 14 12:08 AM