The Most Important Financial Journalist of Her Generation

By Dean Starkman, The Nation. Posted July 9, 2009.

Not everyone does, of course. A handful of bloggers, including the late Doris Dungey (known as Tanta) of Calculated Risk and University of Illinois law professor Larry Ribstein, have created large bodies of work debunking and mocking her and picking her apart. Ribstein, who calls her Morgenscreed, particularly objects to the Times allowing her to write both an opinion column ("Fair Game") and straight news, sometimes on the same subjects. In a column last November, the Times's public editor, Clark Hoyt, tut-tutted the paper for the practice (Andrew Ross Sorkin, among others, is also allowed the dual platform) but not very convincingly. The critiques, most centering on Morgenson's alleged oversimplications, come across as arguments about wallpaper design in a burning house. Bloggers, for instance, hit the roof over a Morgenson column last September arguing that the newly nationalized Fannie Mae and Freddie Mac should be made to disclose details about the individual mortgages they'd bought or guaranteed in the past decade. Ribstein found the idea an example of her "extreme idiocy." Others would wonder what's wrong with it.

In the Times's famously baroque culture, some people are known to have power, and others aren't. Morgenson has it. She's not known as a shmoozer but as one of the most efficient staffers at the paper: in at 9:30; out, incredibly, around 6. And while she's a cheerful and cooperative colleague by all accounts -- helping out younger staffers, waiting her turn at the salad bar, etc. -- she doesn't hesitate to assert her undefined but very real prerogatives. Editors ask her questions and make suggestions. They don't give orders.

The downside, according to a midlevel editor, is that Morgenson is not particularly open to nuance or different points of view. This person says the system can lead to a kind of orthodoxy and groupthink that deadens reporting. Morgenson's views on executive compensation, for instance, are hardly out of step with the "way people think" around the Times, the person notes.

That said, her clout has its limits. In 2003 the Times business section was getting an overhaul. Its editor, Glenn Kramon, was moving up and out. Jockeying began for a successor, with internal candidates including Jim Schachter, now editor of digital initiatives at the paper, and Winnie O'Kelley, a business editor with whom Morgenson has been particularly close.

Instead, executive editor Bill Keller chose Lawrence Ingrassia, who had run the Wall Street Journal's "Money & Investing" section. While many believed Ingrassia had breathed life into a stale operation, some at the Times viewed him (unfairly, in my view) as a cheerleader for the tech bubble, mainly because of his frequent appearances on CNBC during the late '90s. Some also believed he didn't "get" the investigative, accountability-oriented journalism Morgenson practices, favoring instead the kind that depends on access to power.

When Keller asked Morgenson about hiring Ingrassia, according to people with knowledge of the conversation, she told him flatly that it was a bad idea. But she also promised to make it work. (Keller, through a Times spokeswoman, declined to comment.) For his part, Ingrassia, now 57, has nothing but praise for Morgenson. "She knows Wall Street and how it works better than any reporter I've seen," he says. "She has great sources, and she's passionate. She cares deeply about making sure that individual investors are treated fairly. Basically, she believes people in positions of responsibility should act responsibly." Ingrassia said he and Morgenson have "quite a good working relationship, now."

Says Morgenson, turning cautious and speaking slowly: "Larry Ingrassia has been extremely supportive of my work this year."

However one parses all that, few would argue that the business section has not dramatically improved in recent years. Despite a relatively small staff (the Times has about 110 business journalists; the Journal, about 700), it is reasonably competitive on major stories and has assembled a cadre of reporters capable of strong investigative work, including Diana Henriques, Charles Duhigg, Vikas Bajaj, Louis Uchitelle, Stephen Labaton, Louise Story and Peter Goodman, supplemented by Jo Becker of the investigative staff.

Morgenson, Ingrassia and the Times business staff have produced some of the best coverage of the crisis, particularly the "Reckoning" series at the end of last year, which included exposés on major themes: the predatory practices at Countrywide, Washington Mutual and other brand names; compromised regulation; skewed compensation incentives; even the role played by the person in charge of the regulatory system, George W. Bush. The paper's news coverage has been complemented by strong editorials, many written by Teresa Tritch, a former staffer at Money.

Morgenson's approach has obviously been vindicated by the crisis, and she continues to help steer the public agenda. A story in April (with Becker as the lead byline) deftly revealed Timothy Geithner's longstanding social and professional ties to some of the leading culprits in the financial mess, including Robert Rubin (a longtime mentor), Sanford Weill (who, the story revealed, pushed Geithner to head Citigroup) and executives at money manager BlackRock (which got a no-bid bailout contract from Geithner's New York Fed). A June 1 story peeled back Wall Street lobbying efforts to dilute the regulation of derivatives, and unearthed a key lobbyist's memo that has helped shape the Obama administration's policy-making.

See more stories tagged with: new york times, financial crisis, gretchen morgenstern

Dean Starkman is an assistant managing editor and the Kingsford Capital Fellow at Columbia Journalism Review; he runs "The Audit," CJR's online business-press section.

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