Cit Media

Director Sydney Pollack is has died. He made many excellent films, but the one that journalists remember best is “Absence of Malice” — a trenchant look at big-city journalism and its practitioners.

Yes, the picture was over the top in key ways. But it had a core of reality, cloaked in fiction, that went to the heart of what we do well and what we do badly. It reminded us of things we need to remember, most notably that our sources use us mercilessly to advance their own agendas, not necessarily the public good.

You’ll find it in New York magazine’s brief Q&A With Thomas Bray, Chair of the Editorial Integrity Committee. Bray and his fellow committee members each get $100,000 a year for their lapdog duties, which involve a meeting every three months and “a fair amount of conference calling and so on…”

Actually, it’s amazing that Bray had the nerve to do this little interview.

Looks like it: ABC “Exclusive” On McCain and the Anti-Islam Pastor: Was MoJo Robbed?

Looking through the finalists for the 2008 Gerald Loeb Award, several things stand out. Despite the excellence of the work being cited, the list of finalists should raise a note of caution about at least one key metric for the ability of American business journalists to look at major problems before negative trends turn to economic calamity.

Several of the finalists, for work done in 2007, were honored for covering the American credit meltdown, in particular the deflation of the housing bubble. The work of these journalists is indeed excellent. But it’s grossly late. The time this coverage should have appeared was several years ago, when the occasional uh-oh story about the blatantly obvious bubble disappeared in the mass of cheerleading that passed for journalism.

Another conspicuous — and related — issue is the shutout of serious online-only journalists, even in the commentary category where in the finalist list is in the new online category, dominated by Big Media online operations. Again, the work cited is for the most part superb. But some of the best economic journalism, especially in commentary, is being done by new-media folks. Perhaps they didn’t know they were eligible for the Loeb awards, but the total absence of their work is noteworthy nonetheless.

If the Loeb team really wanted to spur on great economic reporting, it could add a category: a foresight award for people who were way ahead of their peers in spotting issues that only later — usually too late — are understood by the herd. The Pulitzers could use something like this, too.

In the case of the credit bubble, there would be ample reason to look at some online work, especially among bloggers who saw the bubble early and talked about it incessantly, backing up their work with detailed analysis and data-based evidence. They were too early, however, for a journalistic establishment that rarely acknowledges a crisis until it’s causing or about to cause massive pain. Consider, just in recent history, the savings-and-loan sleaze in the 1980s and the tech/stock bubble of the ’90s, among other missed stories. In each case, there were lonely warnings, generally ignored.

Of course, as Jack Shafer has noted in Slate, journalism awards are generally noteworthy only to journalists themselves. But as long as we do have them, why not honor people who got it right when it wasn’t too late to do something about it.

Holman W. Jenkins Jr., who writes the Business World column in the Wall Street Journal, is one of the more predictable of pundits there — entirely on the side of business people when it comes to their innate right to do just about anything they please.

Today, however, he channels a common refrain in defending corporate executives in their shameful practice of backdating stock options. In this case, writing about Broadcom’s founder and CEO, Henry Nicholas, he says:

Mr. Nicholas did not benefit from any backdated stock options. He was Broadcom’s largest shareholder, thus had no natural or unnatural interest in overpaying employees with backdated stock options. What’s more, Ernst & Young, the company’s outside auditor, appears to have blessed the accounting in full knowledge that option grant dates had been assigned retrospectively to make sure employee options had the intended value.

As I said in a column last fall in PR Week magazine, this is bull:

Let’s leave aside for the moment the fact that the backdating is flagrant dishonesty when not disclosed to shareholders (and that was the norm). Companies have had to restate billions of dollars in lower earnings to account for their lies.

In cases where executives did not personally have any of their own options backdated, the reasons cited for the backdating are pretty much the same: Everyone did it, because it was necessary to recruit and reward employees, and thereby make the company better, which was good for shareholders.

Well, then, so much for the no-personal-benefit garbage, unless somehow the executives’ interests are independent from what their employees’ interests. They’re not.

If backdating options - a procedure that would be legal, if still somewhat sleazy, if disclosed at the time - was beneficial for the company, it was by definition beneficial for the executives.

“Much of CEOs’ bonus pay is tied to reported earnings,” noted Jesse Fried, a law professor at the University of California, Berkeley, in an op-ed column last year in the San Jose Mercury News. “So is the price at which executives can unload their stock. The firm-wide back-dating of options jacked up earnings, and the amounts involved were not trivial.”

This has been true since the backdating scandal broke. Why, then, are journalists still being stenographers for the spinners who recite the “didn’t personally benefit” mantra, as if it was the other side of an issue that has two legitimate points of view?

Perhaps the topic is too arcane — but arcane to the Wall Street Journal’s senior business columnist? Right.

Or perhaps it’s just journalistic laziness. Not in this case, either; Jenkins obviously spent some time learning the facts of the situation.

Maybe, as I’d guess in this case, it’s the journalist’s belief that options backdating is simply not a problem. He’s clear enough about that. But he should have the journalistic integrity to acknowledge that Nicholas did indeed benefit from the backdating.

Look, this is simple: If it’s good for your employees, and if your pay depends on their work or you own a substantial part of the company’s stock, it’s also to your benefit. That isn’t rocket science. It’s basic logic. Journalists shouldn’t let executives and their spinners — and Jenkins is clearly one of the latter group — get away with flouting it.

Here’s the Dow Jones “Special Committee’s Statement” about its helplessness — which has been entirely evident from the beginning — in the wake of Murdoch’s ridding himself of the Wall Street Journal’s managing editor, a journalist who was part of the old regime.

Again, it’s his company’s paper now, and he and his team get to make these decisions. But the Not-so-Special Committee was always an unfunny joke, and clearly was designed that way.

These folks get paid $100,000 a year for their supposed work. What a crock.

They are: Susan Phillips, Tom Bray, Louis Boccardi, Jack Fuller and Nicholas Negroponte

They are apparently shameless. How do they look in the mirror?

Portfolio: How Murdoch Cheated ‘WSJ’ Independence Pact. Only the very naive didn’t expect Rupert Murdoch to find some sly way around the agreement he made to respect The Wall Street Journal’s editorial independence once it was his. But when the time came, there was nothing very sly about it at all: Murdoch just did exactly what he wanted, turfing out managing editor Marcus Brauchli in a way that, arguably, represented a concrete and blatant violation of the independence pact.

Actually, only the naive gave this “editorial independence” committee any credibility whatsoever. It’s Murdoch’s paper. He’s doing exactly what he wants to do with it, and no one should ever have given even a micro-second’s thought to any other possibility. Anyone who spends any more time discussing this committee’s meaningless activities is wasting time.

My friend Tom Stites sends along a pointer to the New York Times story, “Insurer Says Economy Has Dented Its Prospects,” which begins:

It is never a good thing if many of your customers can no longer afford what you are selling. The UnitedHealth Group, which announced disappointing first-quarter earnings on Tuesday, said the weakening economy was causing fewer businesses and employees to sign up for its health insurance. UnitedHealth, whose stock fell sharply on the report, also cut its overall profit outlook for 2008.

The Times “outdoes itself in covering the news from an elite perspective with this piece,” Tom observes.

“Reporting and writing the piece from the perspective of people in the third to seventh deciles of the income distribution would all but certainly yield a lede something like: ‘The weakening economy is setting off a surge in the number of Americans without health coverage.’

“People want to know this, not just investors. Journalism needs to inform them, but is failing.”

NY Times: Behind Analysts, the Pentagon’s Hidden Hand. Records and interviews show how the Bush administration has used its control over access and information in an effort to transform the analysts into a kind of media Trojan horse — an instrument intended to shape terrorism coverage from inside the major TV and radio networks.

Analysts have been wooed in hundreds of private briefings with senior military leaders, including officials with significant influence over contracting and budget matters, records show. They have been taken on tours of Iraq and given access to classified intelligence. They have been briefed by officials from the White House, State Department and Justice Department, including Mr. Cheney, Alberto R. Gonzales and Stephen J. Hadley.

In turn, members of this group have echoed administration talking points, sometimes even when they suspected the information was false or inflated. Some analysts acknowledge they suppressed doubts because they feared jeopardizing their access.

It is, of course, a scandal. What’s worse is the non-response of the media companies that have been suckers for this propaganda. Stonewalling is what we should expect from the government, not supposedly responsible news organizations.

Kudos to the NYT for exposing this outrageous behavior.

Tom Shales, Washington Post: In Pa. Debate, The Clear Loser Is ABC. For the first 52 minutes of the two-hour, commercial-crammed show, Gibson and Stephanopoulos dwelled entirely on specious and gossipy trivia that already has been hashed and rehashed, in the hope of getting the candidates to claw at one another over disputes that are no longer news. Some were barely news to begin with.

Just when you thought traditional media couldn’t demean itself more, ABC’s tag-team does it. A dismal performance.