The original story:
“Turkey mourns dead Gaza activists”
BBC Online
4 June 2010

Summary of the story:
The BBC reports on  Turkish mourners at the funerals of the “nine activists killed in Israel’s raid on a Gaza aid flotilla”. It then went on to major on the reaction of the Turkish government and the activists. It mentioned that the Israeli’s believed the ships were aiming to break the contoversial Israeli blockade of Gaza.

livingissues comment:
The following comments are intended to be valid whatever the reader thinks about the state of play between the Israeli government and the Hamas-controlled Gaza strip. Equally, they don’t depend on one’s point of view as to Israel’s blockade of Gaza. 

Israel offered to let the ships fulfill their aid mission by unloading most of their material at a port of the government’s choosing. So had the delivery of aid been the flotilla’s primary ambition, it could have been achieved without difficulty. So it is unlikely that this was primarily an “aid” mission.

It seems silly of the Israeli’s to pretend that the ships had a terrorist ambition as some spokesmen claimed. It isn’t even clear how the ships could seriously be thought to be attempting to break the blockade (as though forcibly), as seemed to be the Israeli’s main claim. It’s true of course that the activists wanted to break the blockade in a political sense (in the long term, for instance).

The flotilla might have been allowed through and in that sense might have “broken” the blockade. But isn’t it more likely that the flotilla intended or expected to be stopped and that there would be a lot of filmable outrage as the blockade was enforced and the aid didn’t get through to Gaza? One may say that that the Israeli’s over-reacted to resistance from some of the activists. But that’s what often happens when an armed force under-estimates the opposition and then has to retrieve the situation.  

What seems to be going on here is, in one way, quite commonplace in the world of protest: some naive, strong-headed activists get duped by people with much more sinister motives. Much protest is intended to provoke state violence, just as much terrorist activity is.  

 Also, of course, the level of violence contemplated by the hard-nuts on the Mavi Maramar was quite different to most protests. But this case is complicated by the involvement of the Turkish authorities. This seems almost to have been a government stunt by proxy.

The original story:
“Has capitalist ideology failed us?”
BBC Radio 4 Today Programme (listen again)
23 November 2009, 08.55hrs

Summary of the story:
The Today programme set up their “listen-again” with this blurb:

In his new book How Markets Fail, John Cassidy claims that the economic calamity of 2008 did not shatter principles of capitalism as there is not a static set of capitalist principles to destroy. John Cassidy and Executive vice chair of the Work Foundation, Will Hutton, debate who got it most wrong in the Credit Crunch.

John Cassidy argues that we are at a turning point after 30-odd years of Thatcherite Reaganism which discredits “ultra versions” of the free market especially as applied to financial markets. Will Hutton said that it had been a “giant intellectual mistake” to think that while markets work some of the time, they could work all the time.  Alan Greenspan, both contributors thought, was at the centre of all this, based on an ideological view of how markets work. The result is a “vast problem for Britain”. JC said we would “row back” from the extremes of the market view. WH said that there’s a lot of new economic thinking springing up without a clear left right view and a new interest in behavioural economics. JC finished with the remark that Adam Smith’s view that “we can all leave it to the market has been discredited.”

livingissues comment:
It is certainly true that a good deal of commentary suggests that we are re-evaluating free markets. We are revisiting the idea that markets are in equilibrium, that economic players are both rational and selfish, that deregulation is good. It is also often said that John Maynard Keynes has been returned to favour and Milton Friedman and Friedrich Hayek are out of it and that fiscal intervention not monetarism are the order of the day.

However, it is only fair to say that “old” economics has been discussing all these themes for a very long time and there is no particular hope that some new style of the discipline will spring up and solve ancient problems. For instance, whilst “behavioural” economics does indeed discuss economic players who have consciences and moods, old economics itself spent a good deal of time discussing, for instance, the mood swings which afflict markets. I’m thinking of Keynes’s “animal spirits” and the reviled Greenspan’s “irrational exuberance”, just to cite two sources thought to be at opposite ends of the spectrum.

It is true that market theory discusses the idea of a crowd of perfectly-informed players producing a market-clearing price in a way which can’t be bettered. But even market enthusiasts accept that all players are not likely to be equally well-informed, and that markets are not all-wise (for a start there are “market failures” to do with “externalities” such as environmental issues (which the market doesn’t price properly).

Even though its own fans acknowledge that the free market is richer, weirder and less perfect than theory suggests, in the current crisis they stress that financial breakdowns  like the present really might have been avoided if the markets had been freer. In short, financial institutions took risks in part because they were encouraged by governments to do so. There was, for instance, a surplus of cheap money, a surfeit of government encouragement (and even a tacit guarantee) of “bad” loans to customers (who were also voters) who were not good risks.  Besides, the banks fooled themselves that new-fangled and complex financial instruments were safe. This was a mistake which flowed from their not being rational enough market players who ruthlessly sought full information because failure would have been fatal to their own livelihoods. A truly free market would have kept them more fearful and lot less trusting.

In short, it is not as clear as some commentators suggest that there was once an all-powerful freemarket ideology which created a colossal danger and which now be over-ridden in favour of a more statist, enriched, socialised capitalism which would be vigorous, attractive, safe and responsible.

The original story:
“American journalism needs public support”
Leonard Downie
Financial Times
21 October 2009

Summary of the story:
Leonard Downie, a veteran senior journalist, not least with the Washington Post, argues that there is an interesting response to the crisis afflicting the US newspaper market. Funded from all sorts of sources (and even their own pockets), journalists are putting their own journalism, and that of colleagues of many sorts, online. Furthermore, some bloggers - with diverse sources of funding (and none) are putting good journalism on their sites.  

Downie argues that the many varied sorts of funding for this work should include some sort of state subvention too.

livingissues comment:

There is much to celebrate here. The implication is that journalists can:

(1) sometimes become profit-centres in their own right;
(2) usually get their stuff out there very cheaply;
(3) be funded directly to create their journalism.

As Downie says, everyone from universities to philanthropists and special interest groups can fund this new model.

More generally:
We might want to remember that the future of opinion journalism is much less problematic than the future of news-gathering and investigation. Very good opinion can be produced free or is very easy to pay for (by appreciative users of blogs, for instance).

News is not necessarily expensive: many bodies from law courts to firms to armies can produce high quality and invaluable material for virtually no cost and in their own or the public interest. Much of this can be reaily assessed for its accuracy, and outlets will soon gain or lose reputations for accuracy.

But much news is very expensive to produce and the many new outlets may benefit from sort of professional quality monitoring.

Mr Downie’s own piece suggests that there are lots of ways putting that funding in place.(I have argued elsewhere for a National Media Trust).

One could argue that Mr Downie is quite wrong to reach for state support for this burgeoning process. The state’s influence would be stodgy and tend to the monolithic. It could be argued, surely, that this is a case where society could gain strength by informing itself by the involvement of as many voluntary or market sources as possible?

The original story:
“Disadvantaged children failed by British system, warns OECD”
Strapline: Britain’s education and welfare system is failing disadvantaged children despite high levels of public funding, the OECD has warned.
The Daily Telegraph
1 September 2009

Summary of the story:
The papers – including the sensible Telegraph – have got excited by some OECD research (probably not much more than a look through existing data) which purports to show that the UK is failing the younger end of its young, and the poorer end of the younger end.

Here’s the work the papers are referring to: www.oecd.org/els/social/childwellbeing

livingissues comment:
I’ll look at the work in greater detail soon, but even a cursory glance suggests that the UK is an ordinary mid-range big European country in most ways. Our young have a pretty good school experience and are pretty safe. But they are bit hooliganish (they get drunk and have babies a bit more commonly than other rich nation kids). Most other countries seem to fail their young in more ways than we do ours. I think that’s the conclusion one comes to when looking at Table 2.1 (here: http://www.oecd.org/dataoecd/19/4/43570328.pdf).

Of course, we don’t do as well by our children as the Scandinavians. But we compare pretty well with the French and Germans. We do better than the Italians and Greeks, who famously love their children.

The original story:
“Happiness Schmappiness”
David Aaronovitch
The Times
11 August 2009

Summary of the story:
David Aaronovitch has been an important contributor to the Happiness Debate. In this piece he attacks a much-cited piece of work which purported to show that British children were unhappy. He does so on his familiar territories. He says the “data” employed is deployed to produce the result the researchers demand. (The UK the “worst” in the league table of countries.) He implies that the researchers are dishonest in not challenging their own findings. (They happily cite the bits of data which go with their flow, but they don’t tell us where glaring gaps in their knowledge lie.) 

livingissues comment:
It is very useful to have Mr Aaronovitch’s detailed debunking of a piece of “happiness” research, not only because it’s an important debate about well-being but also because the reading public need to know how to interrogate this kind of material in whatever debate it’s employed.

The original story:
“Making Allowances”
Leader Comment
The Times
9 May 2009

Summary of the story:
The Times‘s leader writer ran the gamut of argument on the problem of finding the right people to go into politics, especially how to reward them properly.

livingissues comment:
The nation has been indulging in an orgy of dislike of Members of Parliament and their allowances. Interestingly, The Telegraph is not universally admired for its expose. It was seen in some quarters as a witch hunt which risked taking our eye of the real issues. As The Times remarks, the upshot is probably that the MPs’ “take” is quite small and not very corrupting.

MPs will have to rethink how they pay themselves.

Actually, though, the public has more rethinking to do than the politicians. We have been so busy wanting everybody in authority to be responsive to the point of submissiveness that we haven’t noticed that we want to be informed and led by an elite.

We won’t be led by serious and worthwhile people until we signal that we admire public service. (Nick Stacey told A N Wilson (FT, 9/10 May 2009) how badly we were lacking this sense.) Of course, public servants have to be well-rewarded. But they’ll need respect too.

The failing is partly in the leadership cadres. For all the humbug and arrogance that has always littered the elite – the professional classes – there was also a more widespread understanding of the idea of vocation. Helena Kennedy made something like that point on BBC2′s Newsnight (11 May 2009).

We need to build a new sense of professionalism and the vocational pleasures it can bring.

So it’s a reciprocal matter. The led need to understand their obligation to their leaders and the leaders need to have quite a strong sense of their duty.

This sort of ethos was once quite openly discussed and taught. It wasn’t the preserve of the public school, though public schools certainly took it very seriousy and still do (as the headmistress of Roedean reminded the FT (9 May 2009). Actually, it ran right through society as a value and was taught at every point. It was, for instance, accepted that adults had a leadership role, and it didn’t really matter how poor or uneducated they were.

The original story:

Why did so few stand up to the spin machine?
Guido Fawkes
The Times
17 April 2009

Summary of the story:

Guido Fawkes gives his side of his exposure of Damian McBride (a senior aide to the Prime Minister Gordon Brown) and the “dirty tricks” media campaign he seems to have proposed for the Reg Rag website which was allegedly to be launched by Derek Draper, an erstwhile New Labour media man.

In particular Fawkes takes the mainstream media to task for knowing that there was a poisonous media operation at the heart of government but keeping it under their hats.

Here is a key quote from the piece:

The explosive proof of a smear and spin operation in the heart of Downing Street was met with a universal lack of surprise inside the Westminster village. Everyone who was interested knew it existed. Labour Party rivals to Gordon Brown had long been on the receiving end of poisonous briefings retold by pliant lobby correspondents.

livingissues comment:

It is hard to dispute that the political media is part of a noxious world at the heart of British life. Perhaps inevitably, there is an important cadre of journalists whose entire career depends on their being “in” with ministers and the spin doctors who control the flow of information out of Number 10, Westminster and the ministries. They are in an invidious position.

Tellingly, when a corner of the carpet is lifted (as by Guido Fawkes) journalists then pop up to say they knew this sort of all along. In this case, one such was James Blitz in the Financial Times who told us that he had known for years that Mr McBride was out of order much of the time.

There are two ways to go on this.

One could argue, as Mr Blitz implies, that this new smear campaign by Mr McBride was of a different order to his earlier poor behaviour. That carries the implication that it might have been wrong to expose Mr McBride’s earlier behaviour and that it is right to expose him now. Besides, spin masters and journalists have to be able to communicate in an off-the-record way, so it is very likely that these channels may sometimes be very colourful without – say – a bit of bad language in a conversation being much of a scandal,

But, alternatively, one is very tempted to see the journalists’ behaviour in a more severe light. This is Guido Fawkes’s line and in his case it is not without self-interest and self-promotion.

It is very possible to argue that the New Labour administration has been bad for government because it has been so good at manipulating the media. In the end, of course, the machinery has been exposed. It happened first with Mr Blair, whose work with Alistair Campbell, his press officer, was detected and analysed. Mr Brown’s media operation was in a way both more brutal and more subtle. His spokesmen seem to have been if anything rather rougher than Mr Campbell. But they also more successfully “spun” Mr Brown as intellectual, moral, and solid. In short, they span Mr Brown as not needing spin. It has taken a while for it to become clear that the “real” Mr Brown may be a very complicated mixture of rootedness and storminess, and profoundly interested in the frothy world of perception.

The issue is whether the media has been any good at conveying how poisonous things had become. One way into this is to insist that the personal and the party political be kept separate from the formal and the institutional. Sue Cameron, in the FT, draws this distinction and makes it stick by saying that the tax-payer should only pay for employees – for officials – whose function is highly respectable and in (to use an old-fashioned formulation) the service of the Crown.

The merit of this approach is to recognise that politicians may be vicious, scurrilous, neurotic, gossipy, profane and malicious, but when they put people to work on their behalf in this vein, they or their political party should pay for it. The State, the Nation and the Crown should be kept well away from this sort of thing.

Actually, “special advisers” like Mr McBride always were supposed to steer away from party-political spinning. The Civil Service has just re-iterated the distinction. From now on, the test of whether journalists are doing their own job will be whether they police those old decencies the way they were supposed to all along.

The original story:
Seeds of its own destruction
by Martin Wolf
8 March 2009

Summary of the story:
Martin Wolf opens an FT analysis of the state of capitalism in The Crunch with a piece which supposes that free market capitalism ruled the roost for a while and that government was once despised and now isn’t.  The tone of Wolf’s piece then changes somewhat to suggest that whilst things may get very much worse, and government interference will certainly be needed, capitalism may not be quite as dead as the opening paragraphs imply.

livingissues comment:
It is worth pointing out that capitalism is and always has been an unruly beast. We should admire it for its energy much more than for qualities it couldn’t really have, like niceness or stability. What’s more, capitalism is premised on the idea that energetic and greedy people are important and can be harnassed for good. (Nice unambitious people can also be harnessed, but that’s not controversial.)

This is not a process in which governments are neutral. Indeed, they regulate so much that what they don’t outlaw they seem to condone. If government slackens the reins, that’s a government decision about the form of economy they want.

It is entirely possible for free-market fans to argue that it was over-regulation which caused the present crisis, as Eamon Butler points out in the Times.

But it is also and rather differently possible to argue that regulation matters and that the present crisis arises not because capitalism is a monster and an enemy of the state, but because it always presents a challenge to regulators.

There always was an understanding that markets are prone to “animal spirits”, as another FT piece notes. They overdo things.

The point is that managing capitalism is something which is always difficult and interesting.

We can’t seriously blame financiers for being greedy and enthusiastic. They are Alpha Males and being over the top is what they are for. On this line, the current problems were caused by governments wholly misreading the world they were dealing with.

In short, governments failed to do government much more than capitalists failed to do capitalism.

Of course it is also true that a generation of capitalists have failed: they destroyed the institutions they were employed to run. To that extent, they misread their own greedy self-interest.

But the free market did not fail and capitalism certainly didn’t. The free market and capitalism don’t exist independently of government and society. Indeed, they take the form allowed to them by government.

The lesson may indeed be that governments should not resile from their role in governmening capitalism, but that still places the present problem as a government failure as much as a failure of capitalism.

The original story:
UN backtracks on claim that deadly IDF strike hit Gaza school
Amos Harel
Haaretz
3 February, 2009

Summary of the story:

Haaretz’s reporter began his story:

The United Nations has reversed its stance on one of the most contentious and bloody incidents of the recent Israel Defense Forces operation in Gaza, saying that an IDF mortar strike that killed 43 people on January 6 did not hit one of the United Nations Relief and Works Agency schools after all.

livingissues comment:
[This is slightly amended from earlier versions of this blog - apologies, RDN 14.45hrs, 4 February 2009.]

Haaretz’s story mostly checks out at a site referred to by the UN as an official source, ReliefWeb. See their story here. The story is buried by the UN low down in a document, without headline or signposting. So it looks like multiple apologies are in order.

The British media pushed out powerful elements of the original untruths with a great deal of emphasis, and presumably they believed that such allegations if true would do real hard to Israel’s reputation. Using that logic the British media ought to put the record straight – and with a great deal of emphasis.

Of course, the 43 dead remain dead and their families’ grief won’t be diminished by this “news”. Nor, perhaps, their sense of grievance.

It is worth noting that early reports of the incident on 6 January 2009 were often headlined in terms of an attack on a school (for instance, the Independent‘s). But the stories themselves (including the Independent‘s) often then noted that the shells fell outside the school. It was then often left ambiguous as to whether the fatalities and casualties from those shells were inside or outside the school.

Some accounts did report at least one UN official saying that the shells were outside the school and that there were no fatalities (but some casualties) inside it as a result. Indeed, the UNRWA seems to have got itself into a muddle and reversed its account quite early on. So the latest UN account confirms what some said, and corrects others. Namely, that the shells definitely landed outside the school, killing no-one.

One is now looking forward to evidence on the two other main allegations against the Israeli military and its New Year operations in Gaza: that they used phosphorus and “herded” a group of civilians into a building and then shelled it and them.

The original stories:
Sub Prime – A crisis in journalism?
Paul Lashmar
The UK Press Gazette
18 July 2008

Predicting the Crash : an online debate
Ann Pettifor, Paul Lashmar,  Michale Blastland, Gillian Tett, chaired by Paul Mason
The Real News Network
7 November 2008

Summary of the stories:
Paul Lashmar has embarked on a rare project. He seeks to identify which journalists were any good at warning the pubic about the forthcoming credit crunch.

The answer seems to be that there was rather little warning, though Gillian Tett of the Financial Times in 2007 did write something useful and prescient. (Unease bubbling in today’s brave new financial world, FT, 18 January 2007).

The online debate was staged by the Frontline Club. Two of its participants thought the financial crisis was caused by irrational market exuberance and panic (Blastland), or by chronic regulatory and political failure (Pettifor).

There was little consensus about the role of journalism. Tett thought that journalists found the new financial instruments hard to research and analyse, not least because the people who knew the most (financiers) were too frightened to speak, and because the City firms’ PR was a barrage.

Besides, she believes that too much journalism is interested in glamorous subjects like Mergers and Acquisitions and this new stuff was obscure and complex.

Pettifor made the clearest opposite case. She thought journalists should have been looking around, and they would have seen plenty of economists who thought the problems were serious.

livingissues comment:
The debate was invaluable but its particpants were not often talking about the same thing. Tett was mostly discussing why journalists didn’t spot the problem in new financial instruments (such as Collaterlaised Debt Obligations) which had indeed been little discussed; whilst Pettifor was often talking about large international imbalances (which had been discussed quite a bit).

There were at least three main causes of the present crisis and the regulatory, professional and journalistic failures were a little different in each.

(1) The Sub Prime Mortage house price bubble
In the UK but especially in the US too many institutions lent too much money to too many poor people on too high a percentage of their homes which had acquired too much paper value. It only took a fall in house values or in earnings to make the whole edifice wobble and for bits to fall off.

(2) Banks with unknown debt problems
Many of the instruments by which debt – including the dodgy mortage debt (above) – had been packaged up and sold were little understood and it only emerged in 2007 and 2008 what huge numbers were involved. But the degree to which these instruments were liabilities was (and is) an unknown and when confidence suddenly disappeared it became easy to imagine them bringing banks down.

(3) International imbalance between debt and saving
For years, there has been discussion about the “irrational exuberance” of the world market. There was lots of discussion about the need to try to engineer a “soft landing” when the boom turned downwards. For years, too, there was discussion about the national debts of the UK and the USA and the surpluses of China and other “developing” countries.

Putting it all together….
Only the issues of the weakness of many mortgages (item 1) and (especially) the odd, new financial instruments (item 2) were seriously under-reported. And it turned out that the latter that really exploded. These two items were interlinked, as the housing “crash” made all the paper derived from mortgages dodgier.

Even then, it is not at all clear that the present situation could have been predicted. There is a view (put in the Frontline Club meeting) that the US authorities made a bad situation when they let Lehman Bros bank crash.

In short, it may be that this situation was not remotely inevitable and therefore predicting it would have been rather difficult. What’s more it is that difficult animal, a perfect storm in which several big problems knock into each other and create a wholly new phenomenon.

And then of course there is the difficulty of not known what is going to happen next. Some participants in the Frontline Club debate argue that alarmist journalism may be making a bad situation much worse. So it is genuinely unclear who much doom we want from our writers.