The Jon Stewart Effect: When Entertainment is News
Some time ago, I did a presentation (video here, slides here) arguing that American politics has been transformed into just another form of entertainment. And that blurring of news, politics and opinion, I contended, posed a grave threat to American democracy as a well-informed citizenry devolved into what Al Gore deemed the "well amused audience."
Which is why Jon Stewart's demolition last night of hedge fund manager turned CNBC host Jim Cramer was so important. In an age when news has been converted into entertainment, our enlightenment now seemingly depends on those rare instances when entertainment is news.
To be sure, it's easy to overstate the meaning of Stewart's indictment of the financial press and a media culture that glorified Wall Street's often duplicitous high-stakes gambling with other people's money. But when the media, Congress and federal regulators failed to police key players in the financial system, Stewart reminded viewers "it's not a f**king game." In a nutshell, a comedy show has emerged as the watchdog of the watchdogs.
As the Atlantic's James Fallows put it in joining the online consensus lauding Stewart's week-long dismantling of Cramer and an entire financial news network:
"It's true: Jon Stewart has become Edward R. Murrow."
That is has come to this is both a credit to the Daily Show and a commentary on the sad state of affairs in American government, finance and journalism. As I noted in "That's Entertainment: Politics as Theater in Campaign '08":
Politics must now compete with an oversupply of entertainment and information sources, from television, radio, books, newspapers and magazines to web sites, blogs, online video, Podcasts and more. The result is a 21st century "infotainment complex" where politics, news, opinion and entertainment merge. Politics itself is now entertainment, part drama and part competition in a passion play where confrontation, conflict and good versus evil rule the day. The journalistic search for objective truth is replaced by the presentation of ideological clashes with two - and only two - sides.
In case there was any doubt, viewers just needed to flip over to the CBS Evening News last night. While Jon Stewart was grilling the hapless Jim Cramer over the roots of the Wall Street implosion, Katie Couric converted her segment on Ponzi schemer Bernard Madoff into a talk show. Playing the role not of Edward R. Murrow but of Oprah Winfrey, Couric led a group discussion with about a dozen, mostly very wealthy Americans who had been defrauded by Madoff.
In one of his few sound observations of the American political landscape, Republican National Committee chairman Michael Steele to his later regret aptly concluded, "Rush Limbaugh is an entertainer," adding, "Rush Limbaugh's whole thing is entertainment." Steele could well have been speaking for American politics and news in general.
But for one night, at least, entertainer Jon Stewart delivered the news.
While I enjoy watching Cramer every night, one must remember the show is primarily entertainment. The financial networks exist to promote their advertisers financial and investment products. Who would expect them to warn about the credit bubble or coming Washington national debt collapse which will destroy much of the remaining private wealth in America today or what this will do to the dollar, the stock market, bonds, gold or the real estate market?
China is now worried about their dangerous over investment in US Treasury obligations. Washington ’s long-term choice is either repudiation or monetization. For monetization to be effective, the depreciation in the dollar would have to be substantial and this in turn would dramatically raise prices of imports for American consumers which would mean a tremendous drop in foreign imports. Debt monetization would cause more disruption to exporting nations than selective repudiation of Treasury debt.
The Campaign to Cancel the Washington National Debt By 12/22/2013 Constitutional Amendment is starting now in the U.S. See: http://www.facebook.com/group.php?gid=67594690498&ref=ts
Thanks,
Ron with 30 plus years in the investment business and banking industry.