"Pick up The Wall Street Journal today, and the business pages are full of stories about the men and women who built the stock market bubble," writes business journalist Philip Longman. "But there's another sector of the economy, deeply implicated in the collapse, whose conflicts of interest, ethical lapses and naive enthusiasms have so far received little press attention: business journalism itself." Longman examines the conflicts of interest and delusions that led journalists to hype the stock market bubble.
Marjorie Kelly, editor of Business Ethics magazine, reflects on the "perfect storm in ethics" that has unfolded despite a burgeoning corporate social responsibility (CSR) movement. CSR has failed, she says, because "fluff is not enough." It's time, Kelly says, to begin "talking about system design, understanding why corporations behave so single-mindedly. And that means focusing on power.
If you're wondering how corporate America was able to bamboozle so many people into throwing their life savings away on worthless investments, part of the answer lies in the Private Securities Litigation Reform Act of 1995 (PSLRA), which was lobbied into law by the National Investor Relations Institute.
Halliburton Corp., Vice President Dick Cheney's troubled former company, has hired spin doctor Michael Sitrick, whose firm was most recently hired by the Archdiocese of Los Angeles to manage its pedophile-priests scandal. "Halliburton, being sued by shareholders for alleged fraud, is under investigation by the Securities and Exchange Commission and might face a financial meltdown if it can't negotiate a global settlement over asbestos litigation," notes the Washington Post.
Life is tough these days for corporate executives, sighs US News & World Report. "After being lionized by investors and the media and showered with money and perks for the past decade, corporate officers and directors are now feeling the heat," writes Matthew Benjamin. "To many executives, the job may not be worth the hassle," and many are worried about the legal liabilities that now come with the job.
The maker of Sam Adams beer is following the standard PR script for crisis management and offering a public apology for encouraging people to have sex in public places, including St. Patrick's Cathedral in New York.
"After learning that some celebrities who talked on its news programs about their health problems were being paid by drug companies, CNN has issued a new policy and will tell viewers about the stars' financial ties to corporations," New York Times' Melody Petersen writes. In an August 11 Times article, Petersen revealed the widespread testimonial practice. Petersen reports stars like Lauren Bacall and Kathleen Turner "had been paid to help promote drugs or other medical products" on network morning "news" programs.
"'If you really want to hear about it, the first thing you'll probably want to know is where all these profits came from, and why all these acquisitions went sour, what our net income is, and why WorldCom stock prices are in the toilet, but I don't feel like going into it, if you want to know the truth. In the first place, that stuff bores me. . ." So begins the opening paragraph of the winning submission in the "Best Fictional Earnings Release Contest," sponsored by Gregory FCA, an investor and public relations firm, based in Ardmore, PA.
Dot-com CEOs, day traders and other leading icons of the roaring 1990s are passing from the scene along with the economic bubble that created them, but Baffler editor Tom Frank notes that "one group remains untouched: the public intellectuals of the bull market. The writers of Dow-worshipping books and commentators who handed down daring pronunciamentos from the silicon heights are still cruising from one posh gig to the next.
During the roaring 90s, big media missed the big story about corporate America's excesses. "Reporters spent a lot of time covering PR news releases instead of looking behind the curtain," says investigative journalist Lowell Bergman. But corporate CEOs themselves seem to have had a pretty good idea what was lurking there.