The trade publication that broke the S&L scandal story

Rob Wells is a PhD student at the University of Maryland and a former business journalist for the Associated Press and Dow Jones Newswires.

His paper, “A Strong Sense of Outrage: Stan Strachan, The National Thrift News and The Savings and Loan Crisis,” recently won first place in the student division for history for AEJMC, the Association for Education in Journalism and Mass Communication. He’ll give a short presentation about the paper Aug. 8 during the AEJMC annual conference in San Francisco.

Here is an excerpt:

Strachan and reporter Stephen Kleege wrote the story, with Muolo reporting on the details; National Thrift News obtained a transcript of the event from a person present at the April 1987 meeting. Pizzo later remarked the transcript was so detailed it appeared to be from a tape recording (Pizzo, interview, 2014). This was an explosive political story, one that would remain an issue for McCain during his presidential runs in 2000 and 2008. The reaction from the rest of the press corps? Mostly silence. Major media largely ignored the Keating Five exclusive for the next two years.[1] The Associated Press declined to pick up the exclusive. The Los Angeles Times carried an item inside its business page the day after the story broke. The Washington Post followed up in May 1988. No other major media covered the story until regulators seized Lincoln in April 1989. “It wasn’t until nearly two years later — in July 1989 — that the Keating Five became a major national story,” according to Columbia Journalism Review (Ross, 1990). By the end of 1989, Lincoln failed, and press coverage became heavy: The New York Times mentioned the Keating episode in 27 articles, the Washington Post in 24, USA Today in 15 and the National Mortgage News in 14 articles.[2]

Strachan, appearing at a May 1, 1989 National Press Club forum on the savings and loan crisis, faulted his colleagues for the lack of follow-up to this major political story. “When reporters from other papers called about the story, they were told by the spokesman for Federal Home Loan Bank Board, this was not at all unusual,” he said. But in fact, such a political intervention in a bank examination “literally had never happened before. But most reporters had accepted that this was run of the mill political business, for five senators to intervene in the examination of a savings and loan institution” (“Where Was the Press During the S&L Crisis?,” 1989).

“The press could have been a little more aware of what was happening there and a little less trusting of officialdom,” he said. “I think that’s been a major problem.”

National Thrift News went on to win a George Polk Award Financial Reporting for its 1988 savings and loan coverage. The paper broke another major story in 1989 involving then-President George H.W. Bush’s son, Neil Bush. It showed the political influence in the delay of closing Silverado Savings and Loan in Denver, where Neil Bush was a director. Strachan began appearing on television to discuss the savings and loan crisis, and was a regular guest commentator on CNN; veteran broadcasters Stuart Varney and Myron Kandel were among Strachan’s friends. Strachan was awarded the New York Financial Writer Association’s Elliott V. Bell lifetime achievement award in 1990 “for a distinguished career as a reporter and editor in financial journalism.” Other winners included journalists as the Wall Street Journal’s Vermont C. Royster, television pioneer Louis Rukeyser and columnist Sylvia Porter.

Columbia Journalism Review, Newsweek, and The New York Times were among those celebrating National Thrift News work on the Keating Five case. Richard Lowy, in his recap of the S&L scandal, High Rollers, cited the National Thrift News’s influence on the July 1990 U.S. Senate Judiciary subcommittee investigation led by former Sen. Howard Metzenbaum, an Ohio Democrat. “Most of what Metzenbaum’s subcommittee found out – at who know what cost to taxpayers – had been published in the National Thrift News a year earlier,” Lowy wrote (Lowy, 1991).

Strachan seemed to take the praise in stride. He told the New York Times in 1990, if his newspaper ”wasn’t way ahead of everybody else on this story, I’d be asking myself what was wrong… We’re supposed to see the trends and have the best connections” (Quinn, 1990).

[1] Database searches in Lexis-Nexis, Factiva and Proquest; search terms in bibliography.

[2] Lexis-Nexis search, researchport.umd.edu, search terms: “Keating and McCain and DeConcini and Glenn and Cranston” all newspapers 9/25/87-12/31/89