A Letter Not Sent
For a variety of reasons, I decided not to send the following letter to the Mercury News during the last week of April 1994. After reading it over, I think it has some important things to say about the news media in this country and about the intelligence community I proudly served in for almost fifty years. I believe both could learn from my comments.
TO: The San Jose Mercury News, 750 Ridder Park Drive, San Jose, CA, 95190
DATE: April 23, 1994 (not sent)
In my letters to you on Whitewater the past few weeks, I accused the Mercury News of political bias in its coverage of Whitewater in particular and the Savings and Loan Debacle of the 1980's in general. Although I continue to believe there was and is more than a suggestion of this in making Reagan the Teflon President and Clinton the Velcro President, knowlegeable media critics in the media itself have pin-pointed cultural and institutional problems as a major factor in the media's failure to predict and warn the American people of the S&L Debacle. In his Media Circus, media critic of the Washington Post Howard Kurtz identifies both a structural problem (a "big-city newpaper is actually a collection of medieval fiefdoms" competing for "space, money and bragging rights") and a cultural problem where the Metro staff of editors and reporters rank first in the pecking order and all others, including financial reporters, play secondary roles. The political beat is the "pulse of daily journalism" and the political reporters only concern themselves with economic matters when such things forced their way into the political agenda. (p. 48) But as Kurtz notes, cultural influences also affected the financial reporters:
Even financial reporters, however, were not immune to the strain of corporate boosterism that infected the media during the Reagan era. The press, which had looked down its nose at businessmen during the ' 70's, was treating corporate entrepreneurs as the new heroes. Freed from the shackles of government regulation, they would make deals and raise capital and stimulate the economy. (p.49)
Unfortunately for most Americans, and particularly working Americans, Charles Keating of Lincoln Savings and Loan, Michael R. Wise of Silverado, and hundreds of other get-rich-quick "corporate entrepreneurs" knew the prevailing climate of opinion and knew the restraints were off.
How is destructive economic behavior in a democracy regulated? Three of the primary forces appear to be public opinion, the self-restraint of the financially powerful, and government regulation. But public opinion is formed in large part by the media. The "new heroes" knew the powerful no longer needed to restrain themselves (Greed is Good, more Greed is even Better) because there was no government regulation in a government run by supply-siders and the corporate boosterism infecting the media meant it could be deceived. In a post-mortem of the media's failure, Kurtz writes:Picking over the journalistic remains of the savings-and-loan scandal is a bit like embarking on an archaeological dig. From the early part of the era are scattered pieces and artifacts, useless by themselves but important clues to the overall picture.
The clues were staring us in the face for years, yet almost no one in the press managed to piece them together. It was the ultimate study in creeping incrementalism. We chronicled each twist and turn of the story, each bill, each bailout, each quarterly report, drowning in details while the crisis reached disaster proportions. Even in retrospect, it is startling to contemplate how badly the press performed.
The evidence was hidden in plain view.
As usual, we all traveled in a pack, no one daring to suggest the problem might be more than a few billion dollars worse than everyone else was saying. We were trapped by the conventions of objective journalism, the insistence on quoting experts, when what was needed was some old-fashioned crusading. (pp. 47-48)
Forty-seven years ago I began a career in the analysis of foreign intelligence. At the end of this year I am retiring to write a book on the cultural and institutional forces in foreign intelligence analysis I believe were responsible for a number of intelligence failures in World War II. To some degree or another the same cultural and insitutional forces affect U.S. intelligence today. I want to do something before I die to help current and future intelligence analysts understand these things so they can do a better job for our country.
What does this have to do with Whitewater? My initial motives in writing the series of letters to you was annoyance at what I perceived to be an unbalanced and unfair coverage of Whitewater /Madison Guaranty and a moral outrage that most of the really culpable crooks of the S&L Debacle, namely the fat cats of 1980s, have never been caught and punished. (You failed to predict the Debacle; now you are letting the major culprits responsible for the Debacle get away with it.) As I continued to dig into the writings on the Debacle, I was absolutely amazed at the amount of information I was able to uncover in a period of just two weeks, but I became increasingly frustrated because the more I read,
the more I realized the media had failed to follow up on a number of promising investigative leads that were there for the picking.I could not understand the deep anger I felt on this whole matter until about a week ago when I realized what was happening: the problems and frustrations I have encountered over the years in the intelligence business were identical to the reasons for the failure of the media in the S&L Debacle, namely:
• The obsessive preoccupation with the day-to-day job of getting out the product; and in the hurly burly, ignoring the long-term implications of problems that were already quietly signaling their presence.
• The big story of today that is followed by the big story of tomorrow and the big story of the day after with the concomittant "chewing up" of scarce resources to work the ephemeral rather than the substantive.
• The fads; (if you want to be successful, follow the fad of the week).
• The rolling of eyes when an investigator wants to follow up on a lead (important stories are not immediately obvious; a good investigator has "gut instincts" developed from experience that says "go after this.")
• The need for so-called objectivity when what is required is a fire-in-the-belly determination to find out what really happened.
• The creeping incrementalism Kurtz so aptly describes above.
The many cynics who populate most newspapers today will say so what? and go back to reading the sports page. And that is part of the problem. The Romans understood the role of bread and circuses in controlling the political and social agenda of their society. In recent years, George Orwell recognized the role of organized sports in serving the same function. Yet from the 1930s through the 1970s, newspaper people continued to do substantive newpaper reporting and sports were kept in perspective. Today, organized sports is a major entertainment and news journalism is becoming an entertainment at an increasing rate.
But journalism must never be degraded into entertainment. Intelligence and journalism are two different ways of acquiring information and of selecting and presenting it so that decision-makers can make the best-informed decisions possible. Intelligence and journalism can be perverted so that they indoctrinate rather than inform. The results are bad decisions or decisions that come too late and after the damage is done. The customers of intelligence are national decision-makers. The customers of journalism are national and local decision-makers -- the citizens of this country.
Consequently, both intelligence and journalism are critically important to the future of this country and the American people. For years I have looked upon my work and the work of the intelligence community as an early warning system to alert us to external threats to our country.
What you don't know can kill you. These past few weeks I have come to better understand the absolutely critical role of the media, and in particular the role of newspapers, as an early warning system alerting the American people of major internal threats to our country. What you don't know can seriously damage the country. Witness the $500 billion dollar cost of the Savings and Loan Debacle. How many schools would that have bought?With some exceptions, the Mercury News is failing as an early warning system. The news hole in your paper has been reduced to make room for larger ads and pitches for your on-line system, Mercury Central. What is left of substantive news reporting is being degraded through the extensive coverage of a rock star's suicide, the self-indulgent discussions of the memory maps of Santa Clara County's elite and the front page coverage of the San Jose Sharks. And yet you continue to lose readers. When I see the waste of valuable news space on trivia, I can only shake my head. When does a newspaper stop being a newspaper and start becoming something else? Do you really believe you are going to increase your circulation (and advertising income) by dumbing down the paper? It won't work.
For the last few weeks I have been telling you that the pattern of alleged illegal acts in Whitewater/Guaranty Trust closely resembles the patterns of known or alleged illegal acts in Silverado and Lincoln Savings and Loan. One of the rules I have followed over the years in my branch of the information business is to look for common characteristics of seemingly unrelated events. If you do this enough, you develop an instinct for linkages (patterns) in the material you read. A tool to expose these linkages is a matrix of rows and columns where the common characteristics (the rows) are related to several sequences of events (the columns). This is not an infallible technique and I have had my share of failures. But in a number of cases, I learned how to develop new targets for intelligence collection and analysis, new ways to look at old data so that I could extract intelligence from it, and new ways of analyzing data. In a few cases I was able to take a rather small nothing and develop it into a rather large something.
Can you understand my frustration when the media persistently misses potential leads that could lead to important stories?Using the limited information available to me I have constructed a matrix listing the known or alleged illegal acts in each of the three cases. (Whitewater, Silverado, Lincoln) One thing comes out loud and clear from the matrix.
Because of the lack of media interest, the media has missed past acts of probable political corruption in the regulatory agencies and in the Reagan-Bush administrations. In addition, my previous letters to you list a number of questionable occurrences in the Federal Home Loan Bank Board and its successors, the Reconstruction Finance Corporation and the Office of Thrift Supervision that should have sent up danger signals three and four years ago.
But as I continue to dig into the books on the S&L Debacle, I see a more frightening pattern emerge - a cozy relationship between the regulatory agencies, certain law firms and certain accounting firms, many of whom had been involved in the Debacle. This would not pose much of a problem if someone was there to watch the watchers (the regulators). However, oversight by the Clinton Administration would be construed as interference in the Whitewater investigations. Is this completely accidental or was it planned? The media must begin to look into the present cozy relationship.
You missed the first S&L Debacle, are you also missing the second?
Franklin R. Mancuso
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Any information you care to provide on the Crime of the Century should go to my E-mail address
franklin@netmagic.net.LIST 1: LOOTED S&Ls; AMOUNTS LOOTED
LIST 2: LOOTED S&Ls; NAMES OF DEFAULTERS
LIST 3: LOOTED S&Ls; PROPERTIES TO SPECULATORS
LIST 4: LOOTED S&Ls; "FORGIVENESS OF LOANS"
LINCOLN SKIMMING AND SHREDDING
FOUR TYPES OF POLITICAL CRIMINAL ACTS
WHY WAS THERE A WHITEWATER INVESTIGATION?
http://www.netmagic.net/~franklin/SM3.html
SAVINGS AND LOAN LOOTING TECHNIQUES
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