Not critical enough of housing market

Greg Marx of the Columbia Journalism Review interviews new New York Times Washington bureau chief David Leonhardt about his new job, and one of the things they talked about was past coverage of the real estate bubble.

Here is an excerpt:

I’d love to hear your thoughts on the performance of the Times, or the D.C. press corps more broadly, on the economic policy debates of the last few years. Are there particular episodes where you think the press would have been better served by taking some of the advice your offering?

I think we at the Times did a good job covering the housing bubble, but I’ll also offer a critique there. When major policy-makers at the head of large government institutions were saying there was no housing bubble and there couldn’t be one, and when huge lobbying groups like the National Association of Realtors were saying the same thing, we insisted that there could be—in all kinds of ways, in reported stories on the front page, in columns by people like Floyd Norris, in big takeouts for our real estate section. We said again and again: Look, we don’t know what’s going to happen, but relative to any measure you have, it sure looks like housing prices are really high. And we were at times fairly viciously criticized for that.

What’s interesting is that, in retrospect, we weren’t skeptical enough. We went a lot further than a lot of other people did, but anyone who reads our coverage now, or reads my own coverage now, would conclude that we didn’t go far enough. We were still too affected by the conventional wisdom that even if housing prices fall they probably won’t fall by much, and they probably won’t cause a recession.

The personal lesson I take from that is we can’t just go forth bullheaded, say “We’re on a good story and we’re going to pursue it no matter what.” But we also need to ask ourselves whether we are being overly affected by the conventional wisdom. I do think there are times when that happens, when it seems like everyone smart or everyone in power thinks one thing, and we need to say to ourselves, is there a chance that it’s wrong? When I look back on my 11 years as an economics reporter, I have this weird mix of feelings about my coverage of the housing bubble as one of the things I’m proudest of and also the source of one of my biggest regrets.