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Paddy Manning got it right, Australian business media is failing its customers

Last week business journalist Paddy Manning abruptly left Fairfax Media after criticising his employer in public, and in a rival publication. His departure is not surprising – but there is much more to…

Big Business - like Big Government and Big Unions - should be held to account fearlessly by our media. But all too often the media pick sides.

Last week business journalist Paddy Manning abruptly left Fairfax Media after criticising his employer in public, and in a rival publication. His departure is not surprising – but there is much more to this story.

Manning had criticised the Australian Financial Review for publishing “creeping advertorial” content and more widely, the newly announced Fairfax operational strategy that combines the business reporting of The Age and Sydney Morning Herald (known as BusinessDay) with the Australian Financial Review.

Initial reports said Manning had been sacked. Manning later tweeted he had resigned; in an interview with the ABC, chief executive Greg Hywood said “we had to let Paddy go”.

Whatever the truth, the whole incident should be a warning sign to senior Fairfax management, investors, and subscribers.

What is particularly troubling is that Manning obviously felt that he couldn’t make those criticisms within the organisation. Conversely if he did make those criticisms he felt ignored.

But despite having been removed – Manning was quite right. People just don’t like reading advertorials – I know I don’t. Public relations is a very important business activity – but when business has to pay the media to run their PR then you’ve got to wonder if any real value is being generated.

We have just come through a massive public debate on free speech – there was an attempt to hobble the media’s ability to criticise government under the guise of privacy concerns and accountability provisions. But the role of media isn’t just to shine the spotlight on government – it should be shining the spotlight on everyone.

Big government, big business, big unions, in fact all centres of power should be held to account and subject to criticism. That is the role and function of the media in a liberal society. The media itself is held to account through competition amongst the media itself – articles such as this, for example. A media organisation that relies on advertorial revenue simply cannot perform that function.

The thing is that advertorials are not just another form of advertising. The message from advertising is clear. The advertiser is buying space in the media to sell its own message. The media does not (necessarily) endorse the message – it is a simple arms-length transaction.

Advertorials, however, are complex and messy. Here the media is being engaged to sell someone else’s message. The story ceases to be news, or opinion, and becomes public relations. But the value consumers place on news and opinion and public relations is very different. Here the media must endorse the message contained in the advertorial.

So maybe I’m over-reacting, seeing a potential problem that won’t actually manifest itself. Fairfax could argue that they are very well aware of the AFR’s excellent reputation, and would never squander that reputation by producing dodgy advertorials. Indeed that would be a good argument – their reputation is a very valuable asset and Fairfax is best placed to manage its own reputation. But that simply brings us back to Paddy Manning. He got sacked for saying, in public, that Fairfax was squandering its reputation. Why wasn’t his concern alleviated in private? Why couldn’t Fairfax management convince him that he had nothing to worry about?

When insiders go public in such a spectacular way, outsiders should take notice.

It worries me – as an avid consumer of news and opinion – that the media should see its role as selling PR to its readership as opposed to providing a platform for advertising while providing news content. Consumers should be as well-informed about business and economics as they are about politics.

It is here that I think the Australian business media doesn’t serve its customers as well as it could or as well as it should. One of the biggest economic stories right now is the forthcoming federal budget. Most of the media coverage of the budget will revolve around the political strategy of the budget. There will be little coverage of the economic strategy, and even less basic fact-checking.

Last week the AFR’s John Kehoe had this story (paywalled) about budget revenue where he pointed out that Treasurer Wayne Swan had been misleading the public into believing tax revenue had been falling and not actually rising. But Wayne Swan has been doing that for years – and the media should have pulled him up on that years ago.

In fact the Wall Street Journal Asia criticised Wayne Swan for this sort of thing in 2009. At the time I was struggling to interest the local media in Swan’s extensive abuse of language when talking about the budget. To be fair to the AFR there has been a massive improvement in that paper since a new editor was appointed and new management installed in 2011.

I worry there could be a perception that the AFR decided to confront Swan on this issue is because he is weakened. In fact his poor performance is now so obvious that the media cannot ignore it. However, the idea of “hyena journalism” (that is, going after the weak and wounded) undermines the good work that is done. Holding the government to account is just as important when the government is popular than when it is unpopular.

Kehoe has probably earned the Treasurer’s wrath and I imagine rude telephone calls would have been made – either to himself or the AFR editor. I hope the AFR publishes more of that sort of thing and not less.

The story would have been interpreted as the AFR choosing sides against the government. The Australian has long had a reputation as being anti-government. That is unfortunate – the media shouldn’t be seen as being pro-government or anti-government. Rather the media should be seen as holding the powerful to account for their actions.

I imagine much the same sort of thing goes on in corporate reporting too. If Paddy Manning is to be believed, it does. Now I don’t want to argue that the media should be pro-business or anti-business in the same way as the media shouldn’t be pro-government or anti-government. Rather the media should aim to the job of reporting well. Unfortunately all too often the Australian media don’t do that job well and does pick sides.

Consider, for example, the mining tax – this policy was predicated on the notion that minerals belong to all Australians, and miners didn’t pay enough tax. I found it astonishing that the media did not immediately challenge either of those two arguments – choosing in effect to back the government in what turned out to be a bitter fight with the mining industry. The Commonwealth of Australia is a federation and the minerals belong to the States. I cannot recall any journalist making this point or asking the federal government about the federal consequences of the mining tax.

So Australians got to read a lot about the political strategy surrounding the mining tax but not nearly enough on the economics of the mining tax. For too long large sections of the media, with The Australian being an honourable exception, simply accepted the Treasury arguments that the mining tax was good for Australia and wouldn’t impact mining at all. It was only after a serious error was uncovered that the hyena principle kicked in and media sentiment changed.

In a world where the media is a player and not just an observer, people will always imagine it is picking sides. This further undermines any argument that advertorials can be innocuous.

I don’t think that the Australian media is captured by government or business, but I do think that it is too subservient to authority and power. This is a mistake – there have been some great outcomes when the media sticks to its guns. The Australian fearlessly exposed the waste associated with the 2009 stimulus spending and the Sydney Morning Herald exposed Craig Thomson.

There is a fine Latin expression, “Merda taurorum animas conturbit” and in a world of spin and PR it is the media’s role to highlight and showcase the bullshit. That means less hyena journalism. It also means that the media must be less credulous and more cynical.

A fearless media, however, requires financial stability and deep pockets. Therein is a serious challenge. The long-standing media business model revolving around selling advertising is in trouble. Firms struggling to maintain their own market position are not able to challenge the great and powerful in our society. In fact the recent assault on free speech was the hyena principle working in reverse. The government opportunistically tried to muzzle a weakened media industry.

So where does this leave us? Paddy Manning lost his job for speaking truth to power. That is what good journalism is all about. On the other hand I don’t blame his employer for sacking him. The Australian media generally would be greatly improved if more journalists would emulate Manning’s example – not criticising their employers in public, but rather telling the bitter truth about what is going on in the world around us. It is only through fearless reporting that a media firm could earn enough of a reputation to run advertorials. Of course, no media organisation with a reputation for fearless reporting would ever see the need to accept advertorials.

Join the conversation

47 Comments sorted by

  1. Comment removed by moderator.

    1. Mark Lawson

      senior journalist at Australian Financial Review

      In reply to Michael Shand

      Michael - I wasn't going to say anything at all about this article, although Paddy Manning's comments about my newspaper were totally wrong. You and the good professor can burble all you want about advertorials - if I see any I'll let you know. Beyond that its really a matter for the senior editors.

      As for your idiotic comments about climate change, you've got it wrong. I'm not unsure about climate change, I know for certain that the bulk of the theory is total nonsense. Its a collage of climate models unable to give usable forecasts, but still being used to dictate nonsensical policies about limiting emissions and green energy that will costs millions for no noticeable result. and that's that last I'll say about it in this series of posts..

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    2. Edwina Laginestra
      Edwina Laginestra is a Friend of The Conversation.

      Jack of all trades

      In reply to Michael Shand

      I see what you mean about Mark, Michael. If he can't see the advertorials, then perhaps a good read on what constitutes critical analysis might help.
      I also find it interesting that someone who would have to understand economics and make predictions based on economic models would have a go about a collage of [climate] models unable to give useable forecasts. I thought the emergency services and insurance industries were using some of the models, and my guess (based on inductive reasoning) is that many predictions have been quite accurate (unlike some of those economic ones).

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    3. Tim Niven
      Tim Niven is a Friend of The Conversation.

      Student at Tzu Chi University

      In reply to Mark Lawson

      Thanks, Mark. Do you do other science too? I've got a mate whose just been diagnosed with cancer. But I reckon it's a vast left wing conspiracy - these doctors just want grant money from the research, and patients. A collage of barely credible studies underpin this despicable propaganda. I've never even seen a "cancer' before - I'm certain they don't exist. And after all that, the doctor says he's only 80% sure the cancer's there! What weak science! I said to him, well mate, given how much…

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    4. John Barker
      John Barker is a Friend of The Conversation.

      Adjunct Professor at Murdoch University

      In reply to Mark Lawson

      Mark- the AFR must be very pleased to have at least one staff member who is guaranteed to not be a management problem.

      Of course, advertorial usually isn't overt- it is embedded in the three deadly sins of news media:

      1. Commission- ie, what is explicitly published that may or may not be verified.

      2. Omission- ie what is not published, but reasonably should be to provide completeness or balance.

      3. Juxtaposition- ie what is published next to what (in space in visual media and time in…

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    5. Henry Verberne

      Former IT Professional

      In reply to Tim Niven

      I like it, a great rejoinder to the dishonest and wrong rants by Lawson and Sinclair Davidson is no less and ideologue!

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    6. Paul Richards

      integral operating system

      In reply to Michael Shand

      Michael Shand wrote; "Mark Lawson ....... he is stil unsure if climate change is real or man made" Interesting comment on the mindset. Given Mark Lawson's reply, the level of thought is apparent. We have a generation still trying to lead us down the wrong path. For our own good it seems, because it will cost us; ".....green energy that will costs millions for no noticeable result." wrote Mark Lawson.
      The precautionary principle completely lost in cognitive bias. Which translates to an understandable media bias that is ultimately counterproductive for our culture.
      "Paddy Manning lost his job for speaking truth to power." wrote Sinclair Davidson. So true and the world is on notice The Finacial Review is an unreliable source. Well done Paddy Manning, your courage has been seen.
      Thank you for your perspective Sinclair Davidson it is appreciated.

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    7. Felix MacNeill

      Environmental Manager

      In reply to Mark Lawson

      Mark, I think it was Dr Johnson who observed that 'a politician is like an ape in that, the higher he climbs, the more you can see of his arse.'

      Your thinking is in the same category.

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    8. Dennis Singer

      Student

      In reply to Mark Lawson

      You are certain, are you?

      Does it trouble you how far your "certainty" is from evidence-based reality?

      I'd be amused to hear how you rationalise your delusion.

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    9. James Hill

      Industrial Designer

      In reply to John Barker

      Thanks John.
      This is the sort of edifying information that readers need.

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    10. Tyson Adams

      Scientist and author

      In reply to Mark Lawson

      And Mark shows why the Australian Business Media is failing its customers with his reply.

      Science has a habit of being right, Mark has a habit of disagreeing with it. I wonder if Mark can do the math on that.

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    11. Yoron Hamber

      Thinking

      In reply to Tim Niven

      Well Mark, Glad you spoke out. At last someone of a sound mind. Doctors, climate scientists, what good are they, I ask? Evil wizards all of them. I find it highly surprising that any man, or woman, or in between, of a sane mind and body ever will listen to them?
      Makes you doubt about the world, doesn't it?

      Well, two cotton wads is all it take, one in each ear. And all will become blissful peace. I use it constantly, and I most sincerely recommend that to your friend too, the next time he is forced to visit one of those, well, let's not beat around the bush, nasties.

      Just remember to smile and nod, and all will be good.
      Your friend in thought and mind..

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    12. Trevor Kerr

      ISTP

      In reply to John Barker

      Thanks, I'm glad someone else rates Kahneman's latest. Mine is in the mail, after recommendation from http://www.psandman.com/
      The great (and inevitable) risk of monopolised media is that powerful probes will be directed according to the business interests of the proprietor, while many other potentially newsworthy stories will be ignored.
      As Julian Disney says, when media deliberately (or, incompetently) misdirect, then the essence of 'freedom of speech' is betrayed, in that the public is deprived of the knowledge that enables broader discussion based on reason. We all jump to conclusions, and overlook important facts, through innate bias. Effective media help to correct, not inflame, our biases.

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    13. William Raper

      Retired

      In reply to Tim Niven

      Brilliant Tim,

      Can I please plagiarise it to use for other similar purposes? It is so good!

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  2. sarah olijnyk

    woman of the world

    I recently signed up for the weekend financial review believing that it might provide 'a good read' because I love hard copy newspapers but have retreated from all of them as they embrace mediocrity and less. My memory of an occasional read of the UK version of FR was that the journalism was good.

    After the second weekend of advertorial and right-wing writing I cancelled my subscription. It did give me an insight into how the regular readers must see the rest of society and that is with no understanding at all of circumstances different from their own concerns with cars and watches.

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  3. Laurie Strachan

    Writer/photgrapher

    If you're going to write about the media you really ought to understand that the word "media" is the PLURAL of medium; therefore to say "the media is" is like saying "the newspapers is".

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    1. alfred venison

      records manager (public secotr)

      In reply to Laurie Strachan

      i logged in from work, Laurie Stachan, to give you a star for that observation. -a.v.

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    2. Paul Cm

      logged in via email @gmail.com

      In reply to Paul Cm

      (Sorry, singular)

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    3. alfred venison

      records manager (public sector)

      In reply to Laurie Strachan

      looks like we're too late, Laurie Strachan, the tools in the language tool box have been blunted and necessary & useful differentiations are lost.

      people who don't know better are coining "medias" & "mediums" in response to the continuing need to differentiate plural and singular.

      i have forgotten my new year's resolution had been to give up on all this and as the oxford entry for "media" shows it was a good resolution. -a.v.

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  4. Chris Saunders

    retired

    "I don’t think that the Australian media is captured by government or business..." To state the obvious they are a business and therefore subject to all the impulses and constraints of a business; including group think.

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  5. Trevor Kerr

    ISTP

    Newsprint outlets seem to be either the stumpy tails on huge corporate beasts, or the potential recipients of significant funds for advertisements from corporates & their lobbyists. Not players?
    The events of today will be good guide to how Australian media go about their business. How many will drop promising leads in order to flood the public channels with creating incessant demands for on-the-spot "news" about a single crime in the USA? Is anyone left to watch the falling dollar? More to the point, in the case of AFR, is anyone analysing "authoritative" statements on the meaning of falling oil prices, or do they keep churning out the party line?

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  6. Glen Sheather

    telecomunications Technical officer

    If the media wants to make money out of subscriptions (paywalls) and out of advertising they must keep the 2 completely separate. People are not going to pay for news or articles if they can not be sure that what they are reading is fact. I will not pay for news if I perceive to be biased or if there is a political agenda.

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  7. John Barker
    John Barker is a Friend of The Conversation.

    Adjunct Professor at Murdoch University

    What's new? As Lord Northcliffe, a British publishing mogul, said, about 100 years ago:

    "News is what somebody,somewhere, wants to suppress. Everything else is advertising."

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  8. Peter Ormonde

    Farmer

    Reasonable article ... until we get to this: On the other hand I don’t blame his employer for sacking him.

    It's all very well to be encouraging journalists top speak truth to power - bit expensive though isn't it. All we'll be left with is the forelock tuggers and climate skeptics who know what side their bread is buttered on - and even bring their own butter to the party. Seems that's pretty much all that's left already really.

    Seems to me that journalists who are willing to sound the alarm should be deserving of some whistleblower protection for at least having some passing concerns with the AJA's code of ethics for the profession. Even suicidal ones like Manning.

    But it's not a profession any more is it? It's a job. At best a trade. With the standards set by the proprietors and their management minions.

    Freedom of the press - freedom of speech - is owned. It is owned by Rupert, soon to be owned by Gina. And we all should just stop listening to them.

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    1. James Hill

      Industrial Designer

      In reply to Peter Ormonde

      Don't insult the trades Peter, they don't build houses out of straw or fill your engines with sand.
      If they did you might manage a comparison with contemporary journalism.

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  9. Trevor Kerr

    ISTP

    Julian Disney said "... There is a worry, I think—the link between commercial organisations and media organisations is increasing for different reasons. Media organisations are getting more involved in commercial activities and commercial organisations like the AFL are getting more involved in running their own media operation. That is going to create big problems for who is a journalist and who is entitled to privileges and ensuring adequate standards. ..." at the recent Senate Inquiry http://www.aph.gov.au/Parliamentary_Business/Committees/Senate_Committees?url=ec_ctte/media_reform_bills/hearings/index.htm

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  10. Ronald Ostrowski

    logged in via Facebook

    "This is a mistake – there have been some great outcomes when the media sticks to its guns. The Australian fearlessly exposed the waste associated with the 2009 stimulus spending and the Sydney Morning Herald exposed Craig Thomson". Really? Many have written contrary analysis to the so called fearless Australian expose, and I still believe that while waste was inevitable the tone of the Murdoch news outlets are distinctly fact-impaired and blatantly pro-LNP biased. As for the Thomson expose…

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    1. wilma western

      logged in via email @bigpond.com

      In reply to Ronald Ostrowski

      Missed that one ( ref to IPA )- explains quite a bit about the statements in the article.

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  11. Robert Tony Brklje
    Robert Tony Brklje is a Friend of The Conversation.

    retired

    Business media should always favour the investors and they need the truth in order to be able to properly manage their investments. As soon as business media starts favouring the senior executives of companies, that's when truth is abandoned in favour of excessive bonuses falsely generated, wildly over the top golden parachutes and of course major bankruptcies.
    So the lie is that business media favours business, completely and totally untrue. In the most fraudulent manner imaginable business media either favours corporate executives or the shareholders. Of course insider traders also get to join deceitful corporate executives in the game of bleeding companies and their investors dry until it all explodes in massive debt and another failed business.
    So is it really corporate executives buddies, favouring corporate executives buddies in the joint game of screw the investors, the staff and the customers.

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  12. Pat Moore

    gardener

    Despite your support for Paddy Manning Sinclair Davidson, the more I read of your article the more topsy turvy and a.... about your statements became and i was about to begin to point out the errors of many of your claims.

    But then i saw the words "Institute of Public Affairs" which explained it all of course...tanking... and there was no need to bother with that futile exercise. Politiking whilst hopping on the populist bandwagon and attempting to conscript/re-enlist a brave and morally principalled individual for your cause? Redeploying the populist rebel back to the service of the establishment fold? Rupert Murdoch is indeed the master of these media arts...he's taught us all so much. But how does Paddy Manning feel about your support?

    The plot's thickening on The Conversation.

    And tell me, in your book, are "the customers" of "the Australian business media" the readers or the businesses or both? How was the birthday party?

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    1. John Gillam

      Physicist

      In reply to Pat Moore

      I agree completely . The title and subject of the piece prepared me for something wholly different from the result when read. In fact, it feels almost like an advertorial itself - but to a certain extent, that is what I have come to expect from IPA-productions these days.

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  13. James Hill

    Industrial Designer

    The "bitter truth about what is going on in the world around us" is precisely that when the much deferred GFC finally comes to Australia, bursting the housing bubble bloated by Howard's middle class welfare, it will throw the local business community customers of the AFR into penury for years and years.
    Despite all the evidence that a returned majority Labor government will continue to protect business, employment and the economy and that the Coalition will not, indeed, can not.
    We can thank the palace eunuchs of the Murdoch Empire for the Abbott PM outcome, self-engrossed idiots that they are.
    There is nothing "magic" about Australia which will stop the Coalition's economic incontinence burying us all under "The GFC we, apparently, have to have".
    All so that journo's can claim a PM for their ranks.
    Sad, bitter truth that all the tired bluster of the article fails to hide.

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  14. Sean Lamb

    Science Denier

    "The Australian being an honourable exception"
    I wonder if Professor Davidson has been absolutely transparent in his disclosure statement. It is not clear if he receives money from News Ltd or not.
    Certainly from his blog he promotes Sky News so assiduously that I assume there must be some commercial arrangement behind it.
    On the other hand as he mostly works on his blog during the hours when he is paid by RMIT, I guess following the money isn't everything.
    I assume he also gets funding from the Mining lobby groups as he had what it pleases him to term "his research" published in some of their publications. If so, that would be relevant in terms of the material in this article.

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  15. Andrew Smith

    Education Consultant at Australian & International Education Centre

    Both print outlets in Australia are guilty of advertorialising on behalf of their corporate and or political interests.

    In the case of News it is obvious, constant political campaigning and opinion polling, while Fairfax it is advertisers.

    In Fairfax's case this is exemplified by supposedly innocuous stories in mainstream news suggesting population growth, interest rate cuts etc. in addition to lifestyle, home renovation pieces influencing prospective buyers of real estate (ditto cars, finance…

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  16. Guy Cox

    logged in via email @guycox.com

    "Unfortunately all too often the Australian media don’t do that job well and does pick sides."

    Please, doesn't the Conversation have sub-editors? I know that although media is plural some people treat it as singular, but you really can't have it both ways in one sentence!

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  17. Peter Hindrup

    consultant

    I don't mind advertorials provided that they have a banner line indicating that 'this is a paid presentation', in which case I don't bother reading them.

    What really irritates me with The Australian is that they never so depict Greg Sheridan's contributions, which clearly indicate that he has at least two pay masters, and I am assuming that he pays for the page space that he uses.

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  18. Terry Reynolds

    Financial and political strategist

    Sinclair Davidson, the media has far more herd instinct than a valley full of stampeding bovines and expells far more bullshit, if I may use the vernacular. You "bullshit" to us when you wrongly criticise Treasurer Wayne Swan for allegedly saying that "taxation revenue has been falling when actually it has been rising". You have access to Treasury and RBA statistics. If you check, then you will find that though in monetary terms taxation has been rising, the real measure is its proportion to GDP…

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  19. wilma western

    logged in via email @bigpond.com

    Looked up the MEAA"s code of ethics today and had a good .laugh. Saved it for future reference. Not sure where this writer(S. Davidson )stands but he seems slightly myopic about the few specific examples he gave. OK, so someone supposedly unmasked C Thomson. When ? During the Rudd regime or after J Gillard was in charge of a minority government? That's when everyone got interested. Thomson's situation was known to Rudd but not considered worth media coverage then it seems. As for "no journalist" mentioning that "the States" own the minerals - well quite a few pointed out that the States constitutionally have mineral rights ,but doesn't that mean they "own " them in trust for the people of Vic, WA ,SA , Tas , NSW., Q'land etc? Do the states own school education etc too? Glad the writer disapproves of hyena journalism - we've seen lots of it over the last 3 years.

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  20. Baz M

    Law graduate & politics/markets analyst

    I have to ask was it really Mark Lawson whom wrote that comment?

    Surely his views cannot be that simplistic. I must confess, I am no advocate for climate change although I fundamentally trust in the science which does advocate it. Regardless of my personal views I find it hard to fathom that the head of such a established business insight newspaper would declare such simplistic views that goes against the bulk of the research on the matter.

    I truly hope that comment is not the name attached…

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  21. Trevor Kerr

    ISTP

    AFR published 'White-collar criminals in ASIC’s sights' in Feb '12. Has there been an article that looks at the annual performance of ASIC in relation to pursuit of corporate crime?
    http://www.counterpunch.org/2013/04/11/the-unmentionable-topic/ looks at articles on 'corporate crime' in the US.
    "We found only one mainstream U.S. story that had the phrase “corporate crime” in the headline. That was a New York Times headline titled “Top Prosecutor of Corporate Crime to Resign.” The story was about…

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    1. John Barker
      John Barker is a Friend of The Conversation.

      Adjunct Professor at Murdoch University

      In reply to Trevor Kerr

      As I said in another post- the three deadly sins of the media are commission, omission and juxtaposition. Trevor has given a good example of the sin of omission.

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