The Press, Market Ideologies and the Irish Housing Crash

0

Henry Silke, University of Limerick, examines media  coverage of the Irish  property market prior to the 2007/2008 crash. The following extracts appear in The Death of Public Knowledge, which argues for the value and importance of shared, publicly accessible knowledge, and suggests that the erosion of public knowledge has worrying outcomes for democracy.

There is a growing, symbiotic relationship among business, communication networks and the mass media. Business depends on communication networks and the mass media in numerous ways; in the actual conduct of business, in the need for market information, for advertising and market creation and as ideological apparatuses that act to naturalise market economies and defend business interests. Such trends have been exacerbated in the media industry in recent decades as media has been increasingly consolidated into massive transnational corporations with interests far wider than journalism. In fact, it is argued that the contemporary mass media, rather than simply reporting on economic issues, have become an integral part of economic processes.

A clear example of this and of the growing links between business and journalism is the coverage of housing and the property market in Ireland. In 2007/2008 the Irish property market suffered one of the greatest crashes in modern history, eventually costing the state tens of billions of Euros in bank bailouts and hundreds of thousands of mainly working class livelihoods. A key discursive element of housing and property news has been the framing of housing as a commodity rather than a social need, as well as a privileging of market needs over society ones. This was the case in much of the coverage of the housing market by the Irish media in the run up to the housing crash of 2007/2008. This framing, as well as ignoring key social problems such as affordability, included an insidious and dogmatic belief in the primacy of the market that blinded much of the Irish media to the possibility of the crash, thus acting both to encourage and elongate the bubble. There is little evidence that this framing of housing as a commodity rather than a social need has changed; most discourse continues to be around ‘fixing the market’ rather than thinking outside of it.

The Irish Business-Media Nexus

The Irish media sphere is becoming increasingly linked to international investor and political interests. Three distinct trends have developed fairly recently: The first is the consolidation and concentration of Irish media groups; second is increased foreign ownership and penetration; and third is journalistic practice affected by technological change (Horgan, McNamara, and O’Sullivan 2007, 35). The prominent broadcaster RTE, although state-funded, is also dependent on advertising revenue. Within the print media sector, the multinational Independent News and Media (INM) group has developed a dominant position. Its interests range across Irish national, evening and Sunday titles, as well as across the regional market. INM titles represent over 40 percent of all daily and Sunday national newspaper sales in Ireland (Flynn 2013). The company is currently attempting to take over the Celtic Media group, which if successful will mean INM have control of no less than twenty-eight regional titles (National Union of Journalists 2016).

However, the connections between Irish news media and business—most particularly finance—are widespread and entrenched, as a study of Irish director and board networks (2005–2007) has shown (Clancy, O’Connor, and Dillon 2010). Through this network, Independent News and Media directly interlocks with Allied Irish bank, Eircom and other interests. Indirectly, this ‘director network’ places INM close to the heart of Irish capitalism, which raises the question of absolute neutrality or objectivity in reporting on the Irish economic crisis. Moreover, INM’s major shareholder, Denis O’Brien, has huge interests in Irish private radio and international telecommunications, as well as an overly close relationship with Ireland’s ministry of communications (Irish Times 2011). His radio holdings include two national radio stations, one of which, Newstalk, supplies news to the UTV group of radio stations.

RTE also has connections with the financial oligarchy such as former RTE chairman Patrick J. Wright (who was also a director of Anglo Irish Bank throughout the boom years), and Mary Finan (who was a director of the ICS building society). Although Ireland’s ‘newspaper of record’, the Irish Times, is a trust, it too has connections with finance capital. For example, David Went, the former chairman of its board of trustees (2007–2014), has also been chairman of Irish Life and Permanent, chief executive of Ulster Bank and a non-executive director of Goldman Sachs (Mercille, 2013b).

The Irish News Media and the Property Crisis
The Irish media system, especially the press, played an important role in the Irish property bubble and following crisis. Newspapers are one of the main sources of market information and act as the main advertising source for property companies. Newspaper groups have also adapted to the online advertising challenge by using their websites as portals in property listings (e.g. the Sunday Business Post and the Independent) or even by buying up property websites. The Irish Times, for example,
purchased www.myhome.ie in 2007 for €50 million (RTE 2007). Newspapers are also an important source of information on the property market, property sales and planning issues.

Although there is some evidence that some minor elements of the news media did ask questions about the property bubble, the wider evidence suggests they most often took a cheerleading role. RTE, the Irish public service channel (and arguably the only media company not overly dependent on property advertising), did belatedly produce a documentary on the possibilities of a housing crash (RTE/Animo Productions 2007). One important article was published as an opinion piece in the Irish Times in December 2006, written by the academic Morgan Kelly (Kelly 2006a). The op-ed piece, and the academic paper it drew from (Kelly 2006b), did warn in no uncertain terms of the oncoming crisis.

Newspapers and editors have also defended their roles. For example, former editor of the Irish Independent Gerry O’Regan maintained in his evidence, to a government tribunal on the banking crisis, that there was no ‘hidden agenda’ to ‘artificially bolster the property market’, while former Irish Times editor Geraldine Kennedy claimed that the property sections in the newspapers maintained the same level of editorial standards as were applied to the rest of the paper (TheJournal.ie 2015). Tim Vaughan, former editor of the Irish Examiner, stated: ‘“If we were guilty of anything, and I believe we were, it is that we believed and accepted that institutions, such as the financial regulatory authorities, were doing their jobs and doing them competently with due diligence and with appropriate compliance policies, and with proper political and departmental oversight”’ (Hilliard 2015).

At the same time, the RTE documentary and Kelly pieces were widely derided across the Irish press (O’Donoghue 2007). The Taoiseach himself infamously made clear his sentiments towards those who ‘talk down the economy’ in a public speech (Finfacts Ireland 2007), declaring, ‘Sitting on the sidelines, cribbing and moaning is a lost opportunity. I don’t know how people who engage in that don’t commit suicide’. Alongside its documentary, RTE also produced a reality TV series in which an estate agent turned presenter shamed the populace into the property ladder, in the insidiously named I’m an Adult, Get Me Out of Here! (RTE/Animo Productions 2007). RTE also produced and broadcast standard property improvement reality television shows and more recently began running a ‘property porn’ series entitled Home of the Year, sponsored by the Permanent TSB bank (RTE 2015).

Thus far, there has been little discussion about the news media’s role in the property bubble in the Irish mass media itself. The media did get a dishonourable mention in the 2011 Nyberg Irish state report on the Irish housing crash (Nyberg 2011, ii, 6, 50). The media’s role is also being investigated by the state inquiry into the banking crisis (see Critical Media Review 2015 for video of inquiry proceedings).

In addition, there is a small but growing area of academic research into the role of the media in the Irish economic crisis (Fahy, O’Brien, and Poti 2010; Cawley 2010; Preston and Silke 2011, 2014; Mercille, 2013a, 2013b, 2014). Cawley’s (2010) study found that news coverage framed the public sector as a cost while presenting the market economy as the sole ‘reality’. Preston and Silke (2014) argued that the media took part in an ideological re-framing of what was a private banking crisis into a fiscal crisis, which then helped lay the political justification for severe austerity measures; see also Mercille 2013a). Mercille (2013b, 2014) found a hugely favourable view of the property market before 2008, which helped sustain the rise in house prices. Some of my own PhD research, on financial journalism and the housing crash between 2007 and 2009, supports these studies and is discussed ahead (Silke 2015).

….

Conclusion
Research demonstrates that Irish newspapers covering the property industry did not report objectively or fulfil their public interest ‘watchdog’ role. Rather, their key function was to act as advertisers for the industry, facilitating exchanges of uncritical information among industry players. In the process, they normalised the hyperinflation of housing, celebrated high property prices and, crucially, acted to play down the contradictions in the Irish system that were directing it towards a crash. With some exceptions, particularly in a few opinion pieces, they reported not for the public but instead for rather narrow sectional and economistic interests. The main reporting patterns and frames point to a ‘captured press’—that is, a press in the service of a narrow, elite class-based interest, operating under key structural, institutional and ideological biases.

A key element of this process was the framing of housing not as a social need but as a commodity, used to create wealth rather than supply homes. This celebrated rather than questioned the hyperinflation of housing and rental costs. The market-orientated framing also supported the neo-classical and idealistic belief in market self-regulation, either denying or playing down the possibility of a crash. The lack of critique may well have helped to both build and prolong the bubble itself. That is not to say the media caused the crisis; there were long-term material and political structural issues at its core. However, the newspapers did play the role of facilitator, supplying ideological and political cover to an economic elite that profited greatly from the hyperinflation of housing and the sale of associated financial products. This assisted in laying the grounds for the housing crash, the economic crisis and the subsequent financial bailout, alongside the severe austerity policies that then followed.

Henry Silke is a lecturer in journalism at the University of Limerick and an author at Critical Media Review. The Death of Public Knowledge is edited by Aaron Davis and published by MIT Press. 

Subscribe to FuJo’s Newsletter

Share.