Sunday, 29 May 2011


It is perfectly understandable that mainstream media must depend on advertisements for its operations, just as it is perfectly understandable that the role of media in an open society is to report and analyze news stories from any ideological and political perspective it wishes. What is not so clear is the role of mainstream new organizations in publishing stories that lack journalistic integrity because the author has not cross-referenced the story, and has deliberately published something knowing in advance that it would yield profit to a certain group of speculators.

On 6 May 2011, Spiegel Online published a sensational story claiming that according to German government sources Greece was considering leaving the Eurozone. It is true that the scenario of Greece leaving the eurozone is part of unofficial discussions in case that it fails to carry out the IMF-EU-imposed austerity measures, but it is also true that there has never been such discussion at any official level whether by the Eurogroup, the European Central Bank, or any official entity representing the EU. This much we know because EU officials rushed to categorically deny there was any truth to the Spiegel story.

That some German official mentioned the possible scenario of Greece leaving the eurozone was all that Spiegel had, but it presented that piece of gossip-style scenario as serious news, prompting a temporary drop in the euro and allowing certain speculators to make a great deal of money. Now Spiegel has gone one step further. Before waiting for the IMF-EU report on Greece scheduled to receive the fifth tranche in August,  Spiegel has come out arguing that the findings are that Greece does not meet the criteria to receive the installment. IMF and Greek government categorically stated that there is no final report and that the work is ongoing to determine the fate of the fifth tranche. That the IMF disputes the Spiegel story about Greece missing its targets as patently false raises the question about Spiegel.

Spiegel has done some good journalistic reporting on Greece. One of the best stories was on the manner that Goldman Sachs helped Greece cover up its true deficit with a 'derivatives deal' that circumvented EU rules. One can understand that Spiegel may be overly anxious to publish unsubstantiated stories that are in tune with the German government position, or with the position of many Germans who believe that their taxes are helping to bailout Greece, or with speculators who need exactly the kind of stories Spiegel publishes to make quick profits.

Greece has a serious public debt problem, with debt-to-GDP ratio of 153% or roughly half-a-trillion dollars that cannot possibly be serviced from market sources as it will grow to 200% at the current rate. It is also true that Holland, Finland and Germany are reluctant to provide more money unless Greece adheres closely to stiffer austerity and privatization measures. Of course what the politicians in Holland, Finland and Germany do not reveal to their tax payers is that by bailing out Greece, they are only transferring capital to private banks. EU money never reaches Greece, for it goes to service the public debt held by banks.

Given that Spiegel has now published a number of stories that turned out to be unsubstantiated and denied as having basis on facts by official entities like the IMF, ECB and Eurogroup, why does it continue on this course? One answer could be that its readers want to reinforce a preconceived notion they entertain about Greece's role in the eurozone; another reason is that Spiegel itself become the object of press stories for having published an unsubstantiated story; another is that it has 'minimalist' journalistic standards, and a rumor is sufficient to print a story; another is that is what the German government wants printed; another is that it helps financial speculators.

1 comment:

Anonymous said...

"[W]hy does it continue on this course?" Might the link be found somewhere in here?