How business journalism has narrowed its focus

Dean Starkman of the Columbia Journalism Review writes in the latest issue about how business journalism has become more geared toward professional investors and less toward the general public.

Starkman writes, “But here’s the problem: the interests of investors, even small ones, should not be confused with the public interest, which is much larger and, by definition, more important.

“Business-news organizations often conflate these missions, leading to significant conceptual confusion, not to mention misunderstandings like the one that broke out between Jon Stewart and Jim Cramer. Cramer believes he is looking out for investor interests, particularly the little guy, the retail investor. Maybe. But even if he is, as Stewart pointed out, those interests may have little to do with the public interest.

“For example: during the mortgage bubble, no one was happier about bank behavior than bank investors, retail or otherwise. In 2005, Citigroup posted net income of, wait for it, $25 billion, one of the highest public-company profits in absolute terms in US history. The reality distortion was so great, and the investor perspective so mesmerizing, that Fortune would ruminate in 2007 that Citi’s Charles Prince was in trouble because of the company’s “less-than-stellar” earnings in 2006—a mere $21 billion. As we all know now, such profits were tied to behavior by the banks—predatory lending turned into toxic debt—that would end in catastrophe.

“Given the Savings and Loan Wreck, the Tech Wreck, and, most especially, the Mortgage Wreck, one could argue that investor-oriented business news doesn’t help investors much either. And I would, to a point, agree. But it should at least be clear that investor-oriented news—no matter how well executed—is not the same as public-interest business reporting. If we do nothing else, let’s get that straight.”

Read more here.