‘Lost’ Letters to the Indy Star

June 14, 2012

A Change of Guard

The tour of duty of the earring-wearing, socially hip, corporately charmed editor of the Star is over. Indications are that his replacement, Jeff Taylor, understands that it has become easier, not harder, these past few years for government to lie to a newspaper’s readers.

(April 10) — That politicians are liars should not be news to a journalist, of course, but neither is it mere polemic. It can be statistically demonstrated: A study of 258 government projects found that under-estimates “could not be explained by error and were best explained by strategic misrepresentation — that is, lying.” (1)

Examples of how editors once saved readers from such deception abound in the history of American journalism. (2) Particularly instructive was the hounding from public office of the various city political machines of the late 19th century and early 20th century. Newsrooms of that day, including the one in Indianapolis, not only shot down the lie but also pursued the liar — to ruin, if necessary.

The Indy Star of late, though, has lost the ability to threaten any but officialdom’s lowliest press secretary. Here is a string of enduring official lies bought hook, line and sinker during this passing editorial regime:

The Star newsroom would recoil at the suggestion that the current recession has its roots in liberal philosophy. It was in fact the administration of Lyndon Johnson who, wanting to hide (lie about) the cost of the Great Society, shifted Fannie Mae housing loans off the federal books. Here is the pollster Scott Rasmussen on this historical point:

For decades, official Washington pretended (lied) that Fannie Mae was a totally private company and the federal government no longer owed the money it guaranteed. Government officials knew of the risks, and many reports were written about the dangers that Fannie Mae posed to taxpayers, but nothing was done, largely because of the aggressive political protection afforded both sides of the partisan aisle. (7)

You would have to be an elderly reader of the Star indeed to know that Social Security began with a lie by Franklin Roosevelt, i.e., that it would operate in the same way as private insurance with a payroll tax functioning as a policy premium.

As this lie unraveled, though, the government wove new ones, all accepted by the Star’s unquestioning and now defunct Washington Bureau. Cato’s Michael F. Cannon explains:

If the government knows that there are no assets in the Social Security and Medicare ‘trust funds,’ and yet projects the interest earned on those non-assets and the date on which those non-assets will be exhausted, then the government is lying. If that’s the case, then these annual trustees reports constitute an institutionalized, ritualistic lie. Also ritualistic is the media’s uncritical repetition of the lie. (8)

It is not necessary to go into every lie that flew cover for every Star writer addressing every continuing policy disaster. The Minimum Wage, the Brady Handgun Violence Prevention Act, the Civil Rights Act of 1964, the Prevailing Wage, the War Powers Resolution and most recently the Patient Protection and Affordable Care Act (Obamacare) are a few where the Star had difficulty seeing that results didn’t square with rationale. We almost forgot to mention the newspaper’s inexplicable complacency about a Green Revolution that would destroy advertisers’ bottom lines and inflate readers’ utility bills.

It need only be said that as the keys change to the editor’s office, the Star’s sense of duty to sort the lies from the truth is at a critical stage.

One solution can be found in a reconstruction of the historical American newspaper, i.e., a single publisher-owner rather than endless waves of corporate managers (we called them occupiers, in my newsroom). What seems to work best is a personal, even familial, financial, political and continuing stake in the local community.

The bad news is that this will require a keener appreciation by newspaper investors of the nature of private property and how wealth is created in mass media or anywhere else.

The good news, though, will come whether or not management can set a new course for the Star. The speed and size of the information explosion, plus the disaster that has been the current newsroom model, ensures that competing mediums will figure it out soon enough.

The Pareto Principle and the GOP

The Pareto Principle — after Italian economist Vilfredo Pareto, observing that 20 percent of the pea pods in his garden contained 80 percent of the peas.

(May 30) — As the Star prepares to elect a new governor and perhaps make changes in the Senate and House leadership it would be wise to measure the effect of envy on our democratic process.

As a political or social strategy, formulated either by the envious or by those who want to avoid being its target, envy is utterly corrosive. It permits even the weakest candidate or policy to sound plausible. That is because anybody, once in office, can confiscate and destroy wealth. To create jobs and wealth, by contrast, a politician will need knowledge and judgment.

Envy is most dangerous when an otherwise reasonable leadership shrinks from challenging it, of taking overdue measures of obvious economic benefit to the community because it fears latent envy or the indignation of those who would lose exception and benefit.

An example? The envy- and guilt-driven secondary-mortgage policies that led to the current recession. Another one, closer to home but more tacit, is a bipartisan economic-development plan headed for Statehouse consideration next session.

It flies under the banner of “Policy Choices for Indiana’s Future.” It is the pluperfect blue-ribbon panel of experts, the roomful of  smart people. (9) The goal?

Well, let’s call it civically amorphous, a grab bag of “balanced” programs certain to dodge the arrows of envy but accomplish little else:

. . . to start the discussion among government, nonprofit and private-sector leaders about these topics now (an educated workforce, an environmentally sound energy policy, a balanced tax policy) and to provide policy options for action. (10)

This initiative, high on the to-do list of the political class, is remarkable only in how carefully it avoids mention of the efficacy of free markets or any criticism of policies that shift power and wealth from the envied to the envious, i.e., public-sector collective bargaining, government pensions and payrolls, Euclidian zoning, progressive taxation, government consolidation.

It is not surprising that Indiana Democrats, their arguments drowning in a recession, would support such economic-development pablum. The puzzle, though, is why so many Republican leaders and corporate executives would choose to placate rather than challenge the institutionalization of envy.

The answer, one suspects, is in the political calculations of the ensconced. The lowest 40 percent of the electorate vote for candidates and policies that will soak the next 40 percent, the middle-class, who in turn demand consideration from the top 20 percent, the producers whose willingness to risk their own money creates jobs and wealth for the rest.

It is a bipartisan process, then, two wolves and a sheep voting on what to have for dinner. The economist Gary North elaborates:

The middleclass likes to think of itself as productive, but the middle class is productive only insofar as it has been enabled to be productive by the capital, vision, courage and the willingness to bear uncertainty that has been shown by the most-productive 20 percent. This is the Pareto Principle, and there are  few cases in life where it is violated over a long period of time. (11)

Gov. Mitch Daniels violated the Pareto Principle early in his first term. If his proposal to increase the income tax on Indiana’s top earners had been put in place, we would have fit the profile of those states having the greatest difficulty climbing out of the recession. (12)

Breaking down the politics of envy has profound implications. An Austrian sociologist, Helmut Schoeck, whose work predicted in 1966 the failure of Fannie Mae, considers the ability to manage envy and its outrider, manipulated guilt, the key to western civilization:

The historical achievement of the Christian ethic is to have encouraged and protected, if not to have been actually responsible for the extent of, the exercise of human creative powers through the control of envy. (13)

Indeed, the admonishment to “love thy neighbor as thy self” is the perfect guard against envy’s destructiveness. And the tablet read, “Thou shall not steal,” not, “Thou shall not steal except if OK’d by a bipartisan, blue-ribbon panel of  smart people.”

Elizabethan Eco-Devo

(May 12) — Earlier this month a newspaper in my Indiana town ran one of those predictably boosterish “we can do it” articles on the local economy. This one, though, was so wrong-headed on such an important subject at such a critical moment that it requires a challenge.

The news was that economic help was on its way, that the latest in a seemingly inexhaustible string of civic leaders had regrouped to take yet another shot at reviving the downtown.

These men and women, widely respected for their varied skills and achievements, wasted no time rejecting a free-market approach, i.e., allowing the value of downtown property to fall or rise in order to find its best use. They, as their frustrated predecessors, held a vision for downtown so dear that it could not be left to the market.

This latest effort is organized around a private, nonprofit trust that would guide downtown development using a complex, quasi-official fiscal arrangement giving it leverage in certain property negotiations. The group controlling the trust is described in the newspaper as being “ astute,  high-powered.” (14)

This is a breathtaking idea. All any Indiana city need do to revitalize is to gather powerful people in a room to leverage other people’s money in the interest of a grand vision.

But it’s been tried before — more than four centuries before. It resembles mercantilism, a policy that held sway when Shakespeare was writing and the last Tudor reigned, Queen Elizabeth I by name, a selfless capitalist monarch if there ever was one.

Her Highness, though, would be unfamiliar with Adam Smith’s “The Wealth of Nations,” Friedrich Hayek’s “Fatal Conceit” or any of the writings in the now-classical economic schools that inspired creation of the New World. She would assume that wealth is created by authority, not by free markets and countless individual experiments, many of them decidedly lacking in astuteness and high-poweredness.

She might feel at home on our downtown trust’s board of directors.

A single councilman dared raise objections to the plan. He wondered whether the group over time might actually become counterproductive, pushing out the less civically correct investments. And he was concerned there would be a disincentive to invest in properties not conforming to the vision and therefore not vetted by the trust to emerge with a lower price. Moreover, he noted that property could pass from public ownership into the foggy legalism of our neo-mercantilist court. And if city-owned property were sold to the trust below market value, taxpayers could not be protected from the cash loss, not to mention the obvious invitation to corruption.

But let us imagine that all can be resolved by the teams of lawyers, architects, bankers and such taking an immediate and suspiciously keen interest in the project. The idea nonetheless runs counter to how Indiana, America and our struggling little downtown were built in the first place.

In one of his last letters, Benjamin Franklin suggests that the genius of America is that it’s a country where “a general, happy mediocrity” is meant to prevail. (15) The idea also intrigued a modern historian, Paul Johnson:

It is important for those who wish to understand American history to remember this point about ‘happy mediocrity.’ . . . America is a country specifically created by and for ordinary men and women, where the system of government was deliberately designed to interfere in their lives as little as possible. The fact that we hear so little about the mass of the population is itself a historical point of great importance, because it testified by its eloquent silence to the success of the republican experiment. (16)

My downtown’s leadership is not encouraged by silence. They want acclaim, and they will wait for prosperity no longer. They must interfere, then, with lives and property. But don’t worry, they will interfere only so much as the astute and high-powered deem necessary.

The Star’s Wrong Horse

(May 9) — Dick Lugar wasn’t the only political legend to fall last night. The Indianapolis Star, once the guardian of the state political discussion went supine, flopped right over on its back.

The newspaper’s featured article three days before the election was “Sen. Richard Lugar Issues Urgent Call for Help in Election.” The editors in effect turned over a top web slot to the Lugar campaign team. Here is the opening paragraph by the Star’s chief political writer:

Sen. Richard Lugar’s campaign came down to one word Friday: ‘help.’ In the political equivalent of an SOS, the Navy veteran urged Hoosiers of any political persuasion who like what he’s done in his 36-year career in the Senate to help him stay there. ‘Every person in Indiana who wants me to continue, every person wherever they might be at this point, I encourage them to come out,’ he said. ‘Come out immediately, as fast as you can.’ (17)

Where was the news in that? Is there such a thing as a politician who doesn’t want help in the last days of a campaign from whatever quarter? Do dogs bite men? Is there a journalistic defense?

No, it was an attempt to manipulate the readership, the voter turn-out, to improve the chances of the Star’s favored man — indeed, so blatant it’s difficult to believe it wasn’t ordered up. At best, it was Hollywood-style reporting, the endearment of political celebrities to curry future access.

How much was it worth? On the political market, it was priceless. Even if one could buy a front page, the cost per column inch couldn’t approach the value of such a last-moment political call to action by as trusted a source as the state’s leading newspaper.

A Roorbach is the name that early American journalists gave to a false or slanderous story devised against a political opponent too late in the campaign to be answered.

Modern journalists will need to list with it an IndyStar, noun, “an expertly focused, highly tactical, election-eve manipulation of voter sentiment disguised as an objective news report.”

The Journalistic Whine

(May 2) — The big bylines in the newsroom are lamenting the changes in journalism. They say it’s becoming a sweatshop. That’s progress, I say.

Causing concern is a technique called “aggregation,” the high-speed, deadline collection of multiple Internet stories on a single topic. The idea is to give a more demanding readership the benefit of “trending,” i.e., what is likely to happen down the road. There are no big ideas involved, so we hate it.

That, however, is how mass media has served its readership since Johannes Gutenberg. The new aggregation desks look a lot like the old news desks: the Bull Pen in Gay Talese’s “The Kingdom and the Power,” Jack Webb’s newsroom in “Thirty” and even the field of cluttered desks in Alan Pakula’s movie set for “All the President’s Men” — all stripped, though, of their romanticism.

The late Robert Bartley, defining editor of the Wall Street Journal editorial page, taught us that successful information systems throughout history — before they could assume a posture or champion a cause — had to demonstrate objectivity and thereby earn trust. That trust has been squandered in recent years by a journalism driven by mere advocacy.

Certain news organizations are trying to win trust back. Newly trained digital journalists are reading stories on a given subject from different publications, summarizing and rewriting them, providing links and adding a local angle. No secret meetings with the assistant director of the FBI in a Washington parking garage. Boring.

But the old journalism included a large measure of drudgery, performed by desk-bound wretches (some of them sober) building that hard-earned trust paragraph by paragraph under merciless supervision, working with unreasonable deadlines, story counts and standards of accuracy.

Even so, there seems to be even more gloom in the newsroom these days. Here is the ombudsman of the Washington Post relating the core complaint:

They (the new journalists) said that they felt as if they were out there alone in digital land, under high pressure to get Web hits, with no training, little guidance or mentoring and sparse editing.

Guidelines for aggregating stories are almost nonexistent, they said. And they believe that, even if they do a good job, there is no path forward. Will they one day graduate to a beat, covering a crime scene, a city council or a school board? They didn’t know. So some left; others are thinking of quitting.

Perfect, I say, especially when you consider that one out of every two recent college graduates is unemployed or underemployed.

And this new newsroom fits the standard set by a famed publisher, a Hoosier, William Rockhill Nelson, founder of the Kansas City Star (1841-1915). He told his editors to hire newsmen who live close to the office (to walk to work) and date waitresses (to gather the news).

Granted, that is Dickensian. Yet, members of journalism’s greatest generation (circa 1920-1950) didn’t set out to change the world. Rather, they hoped only for a weekly paycheck and at least the illusion of advancement.

All said, it should be clear a couple of decades into the computer revolution that an information system dependent on 20-something social engineers, the marvels of Internet media aside, cannot produce the prescient or even factual journalism to justify advertising rates.

Must we go back to Linotypes, copy spikes and paste pots, young friends ask, can’t there be progress?

Not if your idea of progress requires suspending the laws of economics and human nature. The skills, organization and personalities of our information systems will change to regain the trust of those subscribers whom advertisers value, be they print or Internet.

That’s progress, too.


1. Bvent Flyvbjerg, Mette Skamris Holm and Soren Buhl. “Underestimating Costs in Public Works Projects: Error or Lie?” Journal of American Planning, summer 2002.
2. Marvin Olasky. Central Ideas in the Development of American Journalism: A Narrative History.
3. Craig Ladwig. “Covering ‘Variable Costs’ in the Daniels Administration.” The Writers Group, Oct. 17, 2011.
4. 2010 Financial Report of the United States Government.
5. Charles Freeland. “Public Education Without Romance.” The Indiana Policy Review, winter 2001.
6. Andrew Coulson. “The Effects of Teachers Unions on American Education.” Cato Journal, winter 2010.
7. Scott Rasmussen. The People’s Money. Threshold Editions, New York, N.Y., 2012.
8. Michael F. Cannon. “Sometimes, Governments Lie.” Cato@Liberty.com (last viewed April 9, 2012).
9. Jim Arnold and Brandt Hershman. “Agenda for a Stronger Hoosier Economy.” The Fort Wayne Journal Gazette, May 28, 2012.
10. http://www.policyinstitute.iu.edu/PolicyChoices/index.aspx (last viewed May 30, 2012).
11. Gary North. “Conservatives who Hate the Free Market and Hate the Rich Even More.” Gary North’s blog, http://www.garynorth.com/public/9558.cfm (last viewed May 28, 2012).
12. Arthur Laffer and Stephen Moore. “A 50-State Tax Lesson for the President.” The Wall Street Journal, April 20, 2012.
13. Helmut Schoeck. Envy: A Theory of Social Behaviour. Liberty Press, Indianapolis. 1987.
14. Sherry Slater. “Trust Has Plan to Fill Downtown Vacancies.” The Fort Wayne Journal Gazette, April 29, 2012.
15. Benjamin Franklin. “Information to Those Who Would Remove to America.” Writings, viii 603ff, 1784.
16. Paul Johnson. A History of the American People. Harper-Collins e-books, 2012.
17. Mary Beth Schneider. “Sen. Richard Lugar issues urgent call for help in election.” The Indianapolis Star, May 5, 2012.


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