New York Times caught copying financial blogs

Here’s my take on a recent story of apparent plagiarism at the New York Times.  Some are probably conjuring up memories of Jayson Blair.  However, I see something different, namely a battle regarding the credibility of independent financial blogs like mine as a news source.

The fact is most American newspapers and television stations are owned by media empires that depend, not on subscribers, but upon big business and advertising for revenue. This creates a certain conflict of interest for them.  I believe the natural inclination for American media therefore is cognitive capture by the business, government and financial elites that injects a bias into their reporting.

This apparent bias was on full display in the run-up to the War in Iraq as outlets like the New York Times were used by the Bush Administration as tools for propaganda. During that time, media watchers in America learned to use the British media in particular to get a more balanced view of the goings on in Iraq. This was a boon for the likes of the Guardian, the BBC and the Times of London and a net loss for the Washington Post and the New York Times as credible news sources. This was also the genesis of the netroots and the political blogosphere as a credible alternative news source.

I should also point out that the Washington Post was caught red-handed in a dubious pay-for-play-type deal involving healthcare lobbyists and access to government officials in the run-up to votes on the Health Care overhaul proposed by the Obama Administration. See WaPo cancels paid White House-Congress-lobbyist hook up from last July. This particular story is emblematic of the media-lobbyist-government official-business leader nexus which thrives due to the mainstream media’s need for ‘access’ to both government officials and business leaders in order to produce their product.

Looking at the recent subprime meltdown and subsequent credit crisis, I see the financial blogosphere as playing the same role in this crisis that the netroots played during the Bush Administration’s prosecution of the War on Terror, namely as a credible alternative source of news when the mainstream media was largely silent on the housing bubble (again in my opinion, because of the cognitive capture that is part and parcel of the access upon which the MSM’s product depends).

So, this was the background for me when I heard of the allegations of the New York Times ripping off the Implode-O-Meter sites’ content. Yes, there is the Jayson Blair precedent at the Times, but I see this as incident as more a case of the New York Times seeing the independent financial blogosphere as a threat and actively diminishing the credibility of the blogosphere as a credible news source. That more than anything is what led to the Times lack of attribution.

I have written about the Implode-O-Meter sites in the past. See Government coercion in the financial blogosphere for how the American courts are used in this ‘business-friendly’ atmosphere of American jurisprudence to intimidate journalism not affiliated with big business, as most of the mainstream media (MSM) now is. However, now the Implode-O-Meter sites and another independent blog, Dealbreaker, appear to be the victims in a case of plagiarism.

Here is the unfolding story as reported in the Connecticut Post:

The business media was shocked to see the New York Times issue a quasi apology to the Wall Street Journal yesterday over one of its Dealbook reporters, Zach Kouwe, copying story lines and not sourcing original reporting to other news publications. There was also mention that ‘other publications’ had fallen victim to story lifts by Kouwe and a note that the New York Times was investigating the situation. The New York Observer printed a copy of the letter from the WSJ editors to the NYT editors detailing the specific infractions…

On Dec. 26, 2008, an online publication covering the housing market, Mortgage Implode-O-Meter, published an exclusive news report that a group of financial services firms, led by Steven Mnuchin of Dune Capital, would be buying failed IndyMac Bank from the FDIC. IndyMac was one of the first large thrift banks to be seized by the FDIC at the start of the financial crisis.

A day later, Kouwe reported for the NYT’s Dealbook that Dune Capital was expected to buy IndyMac and added two other names of buyers, JC Flowers and John Paulson, to the story. Kouwe’s report did not credit Mortgage Implode-O-Meter for first breaking the fact that 1) a private equity group was buying IndyMac 2) Dune Capital was involved.

Wire services picked up the NYT’s story and the rest of the business press ended up sourcing Kouwe for breaking the news on the sale of IndyMac to a private equity group. Aaron Krowne, founder of the implode-o-meter sites, noted that an NYT follow could have added significant viewership to his niche business publication, and said that when the NY Times had followed previous exclusive news stories traffic increased to 300,000 viewers…

Kouwe also wrote:

For instance Dealbreaker and other blogs report on a lot of stories, but I don’t think anybody has ever cited them as being first with a particular scoop. I’ve had it happen to me a bunch of times at The Post and it really didn’t bother me because most readers just don’t care. They don’t read bylines and they don’t care about whether one paper cited a website or another paper in their stories.

A few weeks later on January 12th, 2008 Dealbook followed a news report that had previously been reported first by online Wall Street publication Dealbreaker, but did not credit Dealbreaker for reporting the story or the memo first. The story centered on an internal memo talking about Citibank’s Smith Barney being merged with Morgan Stanley. According to people familiar with the situation, Dealbook was claiming the memo came from their sources, but after being presented with proof of the plagiarism, Dealbook backtracked and admitted the original report should be credited to Dealbreaker…

I guarantee you that Kouwe would have attributed anything he saw in the Wall Street Journal or the Financial Times.  These are credible and well recognized news sources – with some very good blogs of their own I might add.  However, Kouwe thought he could get away with copying news from Dealbreaker and Implode-O-Meter because they were just independent blogs – and hence not credible sources.  His comment in the section above says as much.  The source doesn’t matter: LA Times or National Inquirer. It is plagiarism any way you look at it – and now he has been caught.

How long did New York Times editors know of Kouwe’s story copying? – Teri Buhl, Connecticut Post