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Clear it with SidneyHow our blog got its name >

 
Notes on journalism for the common good
by Lindsay Beyerstein

How our blog got its name

Sidney Hillman was a powerful national figure during the Great Depression, a key supporter of the New Deal, and a close ally of President Franklin D. Roosevelt.

When the rumor spread that President Roosevelt ordered his party leaders to “clear it with Sidney” before announcing Harry S. Truman as his 1944 running mate, conservative critics turned on the phrase, trumpeting it as proof that the president was under the thumb of “Big Labor.”

Over the years, the phrase lost its sting and became a testament to Hillman's influence.

It's hard to imagine a labor leader wielding that kind clout today, but we like the idea—and we hope Sidney would give thumbs up to our blog.

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Fortune and ProPublica Attack The New York Times--Without Any Facts

Fortune Magazine and ProPublica humiliated themselves this morning with a story  by Jeff Gerth and Allan Sloan which purports to debunk the story in The New York Times which said that General Electric paid no taxes in 2010.

Fortune and ProPublica say they were also working on the GE tax story.  Apparently they are unhappy because the Times beat them into print.

These are their two complaints about the Times piece:

1. GE will not receive a $3.2 billion tax refund for 2010.
The poblem with that complaint: as even Sloan and Gerth concede,  the Times never said that GE would receive a tax refund.  The Times said GE would receive a “tax benefit.”

2. The Times said GE would pay no American tax on its worldwide profits of $14.2 billion, including the  $5.1 billion of that total which came from its operations in the United States.

Fortune and ProPublica say that is false.  How do they know?

GE chief spokesman Gary Sheffer told the Fortune/ProPublica team,  "We expect to have a small U.S. income tax liability for 2010.’"

Is that liability $10?

Is it $10 million?

Gerth and Sloan have no idea–and their story says they probably never will: “The number is unlikely to ever be disclosed unless GE goes public with it, or is forced to do so. “

Sloan and Gerth write, “We're certainly not trying to denigrate the Times.” 

The problem with that sentence: there is no other discernible purpose to their story.

The Bottom Line: these reporters have no evidence whatsoever that the thrust of the Times story was wrong--or even any proof that any of the details were wrong,  either.

Isn’t it possible that GE is now recalculating its tax liability so that it has to pay something–“a small U.S. income tax liability for 2010"--just to make the Times look bad?

Gerth and Sloan never ask that question, and their story–headlined “Setting The Record Straight on GE’s Taxes"--does nothing of the kind
 
Gerth’s best-known previous contribution to journalism was Whitewater–which, of course, turned out to be no story at all.  As Tom Fiedler of the Miami Herald wrote in 1996

The first reporter to fall for the tale was The New York Times' Jeff Gerth, an investigative reporter. He produced an almost incomprehensible report on the Clintons' Whitewater land investments in early 1992. But incomprehensible or not, the fact that it appeared in so prestigious a paper as The New York Times insinuated that something must have been wrong. And that meant that every other baying hound in the pack had to give chase.
The tale of the resulting journalistic feeding frenzy is artfully told in a new book titled Fools for Scandal, by Gene Lyons and the editors of Harper's Magazine. . .

Lyons begins by showing how Gerth was duped by Clinton's GOP enemies and how Gerth's original stories were so error-filled, intentionally or otherwise, that one of the key figures, former Arkansas state securities director Lee Thalheimer, called them "unmitigated horseshit."
...Nonetheless, with The Times' imprimatur, the parade of reporters from Washington, D.C., to Little Rock began, and most, like Gerth, ended up dining on the table scraps served up by Clinton's GOP enemies.

Now Gerth and Sloan have used the imprimatur of Fortune and ProPublica to smear The New York Times.

Update: ProPublica CEO Paul Steiger replies:

Charlie, I'm sorry you read it that way. We acknowledge aggressively that the nyt beat us on the story. We make clear that GE uses all kinds of maneuvers to cut its tax bill FAR below the statutory rate. We point out that GE's statements were confused and confusing. We agree that for reporting to shareholders, GE shows no tax liability. But we say that GE will pay some taxes for its 2010 tax year. And we point out how all this complexity, put back into the code since the last great overhaul in 1986, makes reform in the current environment so difficult. I think that is the opposite of shameful.

Comments

Steiger: ==We agree that for reporting to shareholders, GE shows no tax liability. But we say that GE will pay some taxes for its 2010 tax year. == A small-potatoes distinction. If this is the intention: ==we point out how all this complexity, put back into the code since the last great overhaul in 1986, makes reform in the current environment so difficult. == ...the approach seems a bit competitive/accusatory. Since I concur that Jeff Gerth's initial Whitewater story was incomprehensible and "unmitigated horseshit," I'm not sure this report will burnish that reputation.
 

You forgot Gerth's bungling of the Wen Ho Lee case, also.

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