Secrecy, journalism and the Federal Reserve

David Warsh of EconomicPrincipals.com writes about the concept of secrecy and the Federal Reserve Board and how it affects journalists who write about the economy.

He pays particular attention to the departure of longtime Fed reporter John Berry from Bloomberg News in the wake of the news organization’s push to get the Fed to release information about what banks it loaned money to.

Warsh writes, “Berry was sloughed off by Bloomberg during the crisis. The details do not matter here. His stock fell as Pittman’s rose. His editors refused to clear his columns as Bloomberg’s special projects team blazed away at the secretive Fed for pandering to the banks. In April 2009 he resigned.

“Eventually he found a way to call attention to what had happened. Last spring, he published ‘Bloomberg vs. the Fed‘ (scroll down) as an article in The International Economy, a controlled-circulation magazine widely reads in Washington, D.C. What is known about the problem of stigma and the FOIA owes mainly to him.

“As a specialist myself, I’m inclined to take Berry’s side. Last spring, I wrote a somewhat ill-tempered weekly about the episode, In Which the Bloomberg Kids Put on a Show, speculating that Bloomberg had nominated the series for a Pulitzer Prize, a conjecture a Bloomberg spokesman would neither confirm nor deny. (Bloomberg’s Amanda Bennett had just finished seven years of service on the Pulitzer Board.) I haven’t added much to it that story here. I bring it up in connection with the renewed interest at meetings of the Allied Social Science Association this year in the role of journalists as mediators between experts and the public. Best practices and all that.

“Tensions of the sort that existed between Mark Pittman and John Berry have been a standard feature of newsrooms as long as I have been in the business. Usually the editors know how to cope. Bloomberg News is a somewhat special case, the creation of a fantastically profitable financial data company, itself a start-up, whose staff has grown in twenty years from scratch to something like twice the size of The New York Times. In 2009, it added BusinessWeek magazine to its holdings.”