“Journalists” are the new no-money-down mortgages

“Journalists” are the new no-money-down mortgages

A whole lot of money is chasing the new cool kids, the newly name-branded “journalists” like Ezra Klein and Glenn Greenwald, who bring their friends along with them to the bottomless internet money pits.

Eric Wemple at WaPo describes the superlative feeding frenzy growing the bubble in the trading of journalists, American journalism, brimming with once-in-a-generation talent:

Earlier this week First Look Media, the startup general news venture bankrolled by eBay founder Pierre Omidyar, announced the hiring of longtime Wall Street critic and Rolling Stone contributing editor Matt Taibbi. Such situations demand the use of the superlative, and First Look Media Executive Editor Eric Bates spilled forth, “Matt is one of the most influential journalists of our time.”

First Look Media is driven by the compulsion to spurn the conventions of the mainstream media, and in announcing Taibbi’s accession, it succeeded. By a hair. Traditional news outlets have settled on a fairly standard mode of implausibly praising colleagues and soon-to-be colleagues.

Late last month, for instance, The Post announced the hiring of the New York Times’ Catherine Rampell and called her “one of the smartest, most original journalists of her generation.” Uh-oh — she may have to compete with Politico’s Todd Purdum, who at the time of his hiring was “one of the most perceptive reporters and elegant stylists of his generation.” Politico is full of generational leaders, too, as Editor-in-Chief John Harris said of “Playbook” author Mike Allen: “One of the most exceptional journalists of his generation.” (Allen has a more humble view of himself as “one of Washington’s top journalists.“). Politico Magazine editor Susan Glasser was feted upon her hiring last year as “among the most respected thinkers and editors of her generation.” As opposed to Steve Coll, who was hailed as “one of the most experienced and respected journalists of his generation” upon being selected as dean of Columbia Graduate School of Journalism. Coll has written a great deal about the war on terrorism, so he’s doubtless familiar with the work of Gregory Johnsen, who, upon his selection as a BuzzFeed Michael Hastings fellow, was celebrated as “one of his generation’s wisest and most original voices on national security.” [Go to the link for more examples.]

I suppose the founder of First Look Media, who also was the founder of eBay, doesn’t much care if he loses tens of millions of dollar to buy ego-journalists, but what about the others.   How will traditional media deal with the raising of everyone’s boat from the combination of ego-journalism and superlative-mania?

The bidding up of mostly mediocre journalism has to end badly.

Bubble always do end badly.  And no one expects it.

From the Preface to the 1852 Edition of Charles MacKay’s Memoirs of Extraordinary Popular Delusions and the Madness of Crowds (caps in original):

IN READING THE HISTORY OF NATIONS, we find that, like individuals, they have their whims and their peculiarities; their seasons of excitement and recklessness, when they care not what they do. We find that whole communities suddenly fix their minds upon one object, and go mad in its pursuit; that millions of people become simultaneously impressed with one delusion, and run after it, till their attention is caught by some new folly more captivating than the first.

I’m not old enough to remember Tulipomania, but I am old enough to remember the inflation-readjusted real estate crash of the 1980s, the eyeballs-to-price ratios of the 1990’s tech bubble, and the no-money-down no-income-verification mortages of this century’s first decade.

This chart pretty well demonstrates the stages of a bubble, with the peak being the view that whatever it is people are bidding up is a new paradigm:

New paradigm.  Hmmm.  Where have I heard that recently? (emphasis added)

But as the Polk [Award] judges rightly recognized, Greenwald meets the definition of journalist – joining the long line of reporters who have broken accurate stories after sifting classified documents purloined by whistle-blowers. And he’s still working the Snowden material, as evidenced this morning on The Intercept, the new online magazine bankrolled by eBay billionaire Pierre Omidyar. Greenwald has decided to hang his digital shingle on that site. In a revolutionary era of new journalistic paradigms, who needs the old media?

Journalists should play an important role in exposing bubbles before they get too big.

But what if the journalists are the bubble?

Update 2-22-2014 — Can I call it, or what? Three more Washington Post staffers leave to join Klein venture. This is beginning to remind me of the law school bubble, where law professor prices were bid up in the demand for big names. For law schools, cheap federal loan subsidies fed the bubble, now it appears to be wealthy tech titans.

[Featured Image Source: Wikimedia Commons, Pamphlet from the Dutch tulipomania, printed in 1637]

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