than doing away with all financial regulation in the hope that this would make investors and creditors more vigilant.

It seems to me that the root cause of almost all our problems is wishful thinking. No one is ever going to be sufficiently vigilant as long as there's money to be made by remaining ignorant. Anytime someone is getting rich, the question to ask is "who's creating the value that they're obtaining." It the answer is 'nobody' then it's time for the regulators to step in.

It wouldn't be as difficult as it seems except for the degree to which the whole process is controlled by the same people who benefit from the lack of oversight.

KT, are there any federal agencies or commissions that aren't huge messes right now, after eight years of misrule and abuse? Is there one?

Josh has a related snippet. Lurking in the background of the blossoming Madoff scandal has been the name Harry Markopolos, a money manager and investment investigator who began pushing the SEC to investigate Madoff almost a decade ago. Tonight the Journal has a lengthy article out describing Markopolos's quest and -- even more interesting -- the documents Markopolos submitted to the SEC to show that Madoff's record of consistent low-double-digit returns simply couldn't be legit.

Karen,
a couple of threads ago you said
"KT here--
Is this thread still alive? Davemc makes a very important point that those of you who are gloating about the demise of the media should think about. The kind of media that you say you despise (I'm looking at you, J,LA) are the only ones that AREN'T struggling. What is dying is depth and thoughtfulness, or as davemc noted:"
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To which I'd respond, I think you are mistaken. One, I didn't say I "despised" anything. And I don't. I want you and your colleagues to do better work.
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But you are also mistaken that what is dying is depth and thoughtfulness. There is much, much depth and thoughtfulness, it's just that your colleagues aren't the ones providing it any more. It is people like Josh at TPM, Sullivan, Greenwald, Joyner, Amato, the list goes on and on. They run circles around your crowd, Karen. While your colleagues are obsessed with Blago which you LOVELOVELOVE and which you inflict upon your reading audience like a gossip rag, they are talking about things that actually have relevance, and are important.
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I'm really sorry to say that, I wish the mainstream media could do better, but they aren't. And I really feel like they are out to destroy the Obama presidency for their own amusement just like they destroyed Clinton's. The signs are all there. I WANT you to do better. I have tried to initiate a conversation with you to find out how your loyal and interested audience could HELP you do better. We try to give you feedback on how you are doing, which you and your colleagues take as attacks upon your very worth as a person, when they are not attacks, but pleas to do better work.
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Per james, KT's full comment is here:
http://swampland.blogs.time.com/2008/12/16/newt-to-the-rnc-take-down-that-ad/?apage=5#comment-28620
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I responded there briefly and suggested "KT, I'm sure no one would mind if you started a new thread on this topic."
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I think james is overstating this: it's just that your colleagues aren't the ones providing it any more. There is very good reporting in TIME, and there is very good reporting in local and national papers. The blogs would have little to work with were it not for original reporting by traditional media. But I agree overall the analysis I get each morning from Political Animal, digby, and TPM (and certain other blogs) is, by-in-large, far crisper and more relevant than I read elsewhere. Like this Benen piece on Barack Obama's decision to invite Rick Warren to deliver the invocation . . . .
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I utterly agree with james on this point: And I really feel like they are out to destroy the Obama presidency for their own amusement just like they destroyed Clinton's. The signs are all there. But it is important to define the above "they." I take "they" to be the self-important chattering class who are offended that Obama hasn't jumped to meet their every unreasonable request. Folks like AB Stoddard (The Hill):
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They've pushed that off until next week and you know, according to The Wall Street Journal yesterday, they're just choosing to do this. They're choosing not to talk. There is no legal impediment and no injunction against them. Although Patrick Fitzgerald doesn't want them to talk, they're not legally kept from doing so. They're not. They're choosing not to talk. So in some ways, Barack Obama is doing this to himself. He keeps getting those questions and it's going to be a feeding frenzy next week.,

Hopefully Schapiro will come to the conclusion that a special prosecutor is needed to investigate the SEC's lack of oversight. Out here in the wasteland of middle class I am pretty sure most of us believe gifts, money and favors be it hot stock tips, etc. all changed hands in lieu of a be nice policy by the SEC.

What we are witnessing with the mortgage mess, the equities mess, political malfeasance, etc. that our society is profoundly corrupt! While perhaps a majority of this corruption can be blamed on the so called moral majority of the Republican Party, it seeps into all facets of our society. When it is ok to lie, steal, and abuse others for personal profit or political necessity it suggests our society does not have a long shelf life.

The problem is I am not sure if we have the intestinal courage to prosecute all the people we need to prosecute to send the message necessary that corruption and lies will not be tolerated in our society. Are there enough jail cells to house all these white collar crooks, or are there enough court staff available to monitor the hundreds of thousands of people that would sentenanced to house arrest?

The reality is we will prosecute just a few of the thousands that should be prosecuted. Basically these crooks behave like a giant herd of Zebras. They pass through the same valley all the time knowing the lions will cull out a few of the herd, but that is just the cost of doing business. As long as the lions pick out someone else who is perhaps too slow or too visable rather than they themselves that is fine.

We will soon witness the corrupt who are beginning to target the new AG because they know the lions will get more if Holder is appointed AG. If they get him it will be business as usual for the Zebras.

Actually, the wires are doing pretty well. Josh, HuffPo and other alt news sites are hooked into wires, who are the ones that do the hard news reporting. And the wires, except to some extent AP aren't the orgs who are so profoundly corrupted by the political journo-opinion class. You have Reuters, Bloomberg, AFP all still doing fine, fine work, and which are run on sites like TPM. So don't think that news reporting will "disappear" with the demise of the DC media chattering class. That's just false.
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The truth is that the business model of traditional media is declining, as Shafer outlined in his piece. Companies like Cox and McClatchy have bought up a bunch of local newspapers and their CEOs have gutted them and sucked them dry. The same thing has happened to Tribune papers including LA Times, my ex-beloved hometown paper. Tribune gutted that newspaper and Zell is finishing the job.
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But people these days, instead of going out to their driveways to pick up the LA Times, can read WaPo, NYT, TPM, Hilzoy, Atrios, Sullivan, AFP newswire, all before they go to work. And meanwhile, the political class in DC is obsessed with trying to flog the Blago issue and tie Obama to it, despite ALL EVIDENCE to the contrary. Why? Because it amuses them. They don't lovelovelove the fact the their Vice President admitted on television that he was a war criminal. That's not amusing. Blago's curse words, and the titillating innuendos that somehow Obama HAD to be involved because he is *from Chicago* that's what amuses these people.
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So we citizens are forced to go elsewhere to seek actual, relevant news. And then are exorciated by these same journalists for not loving them any longer. They have an inflated sense of their own importance. Which is what corrupted them in the first place.
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KT- prove that James,LA is wrong about you and do a substantive piece on the Senate report regarding the use of torture.

He's still right about the vast majority of your colleagues, however. I respect bloggers like Greenwald for the same reason I respect the commentators here- they are good at seeing through dishonest and lazy reporting and exposing it for what it is.

I asked you, Karen, what people might do to interrupt the toxic news cycle that leads to media frenzies and you suggested that disclosure is always the best policy, and gave a couple of examples from the Clinton era in which disclosure might have made a difference. Then I broached the subject of the secretive Bush Administration, and how non-disclosure served them very, very well for 8 years and you disappeared. And it isn't just you. Every journo in Washington suddenly develops amnesia when a question is broached about what happened to you DC journos during the Bush Administration. "Well, our job is to get news" they say. "Accountability is for the voters." But now all of a sudden, is a renewed sense that they have to hold Obama accountable. For what? Well, they don't know, but they are fabricating something. And still, even still, you don't address the questions that are reverberating throughout the internets, by Sullivan, Greenwald, Hilzoy, Cole, Marshall, now Douthout, Larison. Is it fear?

james, la, I was making a distinction for the "demise of the DC media chattering class." They could disappear tomorrow and I would be a happier person, but that would leave many many journalists in traditional media who do fine work. Like the crew at Knight-Ridder that was dead-on accurate about the Iraq, War, but ignored by the chattering classes - which meant that their reporting didn't resonate broadly across the country.
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Which means we need a better class of chattering class to get the real big stories out. And, proving that this conversation is all circular, this means that the actual for real good serious reporters need to also be media critics and not sit silently by as their fellows commit malpractice. For example, I want to hear the first reporter called in Obama's next news conference to state, for the record: "I just want to say that I am embarrassed for my profession that so many reporters keep asking irrelevant questions about you and Blago when it is already abundantly clear that there is no there there, and when you have promised a full accounting of the therelessness next week. So I want to ask you a serious question relevant to the subject of this press availability . . . ."

I'm sorry I am ruining your thread, Karen. I'm not trying to play assignment editor. I do read some of the stuff in the magazine and I must say in my opinion it is largely fluff and stuff that can be found much earlier on other sites. I see nothing there to compare with the hard investigative journalism of say your competitor Michael Isikoff. Your colleague did break the Seligman story, but has done no follow-up, though many others have. If fluff is a good business model for Time Mag then fine. Just because personality profiles aren't my bag doesn't mean they shouldn't be done.
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wv,
we will bet a better class of chatterers when there is some kind of penalty for being wrong. There is no price to be paid in DC for being totally completely wrong 100% of the time. In fact, being wrong is actually rewarded by the chattering class, and the people who have been correct are viciously marginalized. there is something wrong with that model. And I wish we could get a handle on what the remedy might be. I think that would serve to greatly improve the product that we call DC journalism. Marginalize the people who are wrong all the time. What do you think?
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KT: I like the National Park Service. Is that the NPS where the political appointees tried to gut its very essence in every conceivable way and the employees kinda sorta revolted?
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Oh, and I do read TIME, which is why I commented on the very good reporting that can be found in your pages.
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Of course, there is a special responsibility for both you and Newsweek to be extra careful in your content, as you are the gift that keeps on giving in doctor's offices and Jiffy Lube's across the country. Which magnifies the impact of grievous errors on your pages many times over when they occur - like JoeK's on FISA, with the Hoekstra parrot sitting on his shoulder.
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Had Joe first written a synopsis of his print piece and posted it here, within 1 hour he would have known how wrong his central thesis was. Ah, memory lane: In Time Magazine last week, columnist Joe Klein baselessly claimed that Democrats' proposed fix to FISA would require “every foreign-terrorist target's calls to be approved by the FISA court.”

McClatchy has been plagued by their CEO Gary Pruitt who has sucked the lifeblood out of the organization. This spring he took an $800,000 bonus for a year when the value of his company declined by 35%, and just after he laid off 135 journos. How many journos full year salaries would $800,000 buy? I'd say about 10 but my friend said around 15-20. Nevertheless, it isn't just poor journalism that is destroying newspapers, it is bad management as well.
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KT: Also, wvng, that McClatchy/Knight-Ridder bureau that you so admire has been decimated. But the chattering classes are doing just fine. I know, and it is an absolute horror. Fixing this should be a national priority. But then who would endlessly cover the kidnapped blonde babe stories? I ask you, who?

james,la: Marginalize the people who are wrong all the time. What do you think? Well, some of us are trying to marginalize MS by ignoring him. Which is pitiful, but is something. And, that plus $3.50 will get me a Mocha Grande.
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The serious answer is how to do it when, as you stated so well: being wrong is actually rewarded by the chattering class, and the people who have been correct are viciously marginalized? CNN talks to Rush Limbaugh before Obama's first press conference as pres-elect. The media asks John Bolton what he thinks of Obama's pick for the U.N. The list of similar msm editorial decisions endless, and I have no earthly idea how to change the culture that does this.

Here's a piece on the tragic McClatchy situation, including the CEO's compensation package.
McClatchy credit rating falls again; CEO's pay declines - Sacramento Business, Housing Market News | Sacramento Bee
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McClatchy has some of the best blogs from Iraq,, and their Nukes and Spooks blog is a must-read. Their journalism is excellent and it's a shame how their management has run the organization into the ground.

KT: to stay on topic of this thread. The NYTimes reports the Madoff scandal is affecting the commerical real estate market in NY.
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http://www.nytimes.com/2008/12/18/business/18brokers.html?hp=&adxnnl=1&adxnnlx=1229612666-+Tkx3Wln2C+Nc46KSKO8VA
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One of the key quotes from the article:
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“You have a lot of wealthy people who made a lot of money on handshakes,” said Mark S. Weiss, a commercial real estate broker at Newmark Knight Frank, where several brokers had invested heavily with Mr. Madoff. There was “something about this person, pedigree and reputation that inspired trust,” he said.
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As Samuel Goldwyn once said no verbal contact is worth the paper it's printed on.
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I there is protection up to 500K under the SIPC for some of the victims here. However, I would be really outraged if there was an effort to make these multi millionaires whole through some type of federal assistance, while blue collar workers who work for the big 3 and their suppliers are being told to to "pound sand" by key GOP senators.
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I have a lot of sympathy for those who were misled by Madoff. The gutting of deregulation of this past administration is what created this situation.
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Have the victims sue Cox and others in the Bush administration who looked the other way while this was happening.
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Millionaires who choose risky investments don't need to become the new welfare queens of the 21st century.
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This just shows how political and family connections provide unlimited benefits to the real elite in this country.

The list of similar msm editorial decisions endless, and I have no earthly idea how to change the culture that does this.
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Well, that's what I've been trying to get some input from Karen about, but she takes it as criticism of herself, I guess. No journo I've asked has a good answer for that. They are certainly not willing to do it themselves. In my business (which is health research) we have vigorous public debates about our work and how we do it, and in the rare case where there is actual dishonesty, the person is roundly, publicly criticized and their work is no longer taken seriously. That's exactly why it is so rare.
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james, la: In my business (which is health research) we have vigorous public debates about our work and how we do it, and in the rare case where there is actual dishonesty, the person is roundly, publicly criticized and their work is no longer taken seriously. That's exactly why it is so rare. Ditto my field, environmental science. And not just "actual dishonesty" - poor work is shredded.