The straw man cometh

Business journalism in the US has what might best be termed a relationship of convenience with informal fallacy. It’s not something that’s ever going to put the profession in a flattering light. But the fact is, it’s worked too well and for too long to expect it to end.  

Unlike its equivalent on Capitol Hill, the financial media is not a designated ‘watchdog,’ let loose to grill people held culpable for serving the public. Moreover, finance, unlike the upholding of democracy, is not centered on an egalitarian doctrine. Finance can be opaque and obfuscating.


In finance, media access can be limited, if not denied. Unconfirmed information may be interpreted as valued information; prognostication as valued guidance; claimed expertise as infallible. Business journalists therefore frequently report what people said happened, or what people think will happen, rather what actually happened or what is in fact happening.

All of that has to be taken into consideration when the financial media is charged with its least favourite task: offering analysis or criticism, while providing commentary and context. That, compared with landing a scoop on a corporate merger or a big hire, is a particularly tall order. It’s also when the business press is most apt to call on the straw man.

The straw man (‘Aunt Sally’ in the UK) has been around forever, and with good reason – especially effective when presented to an audience with little understanding of what’s going on in the first place (and that would arguably be the majority of people who’ve tried to understand finance).

Misrepresentation is at the heart of the straw man. To make a successful straw man argument, you claim someone is supporting a premise he or she never supported. Then, you proceed to argue how said premise is wrong. The financial press likes the straw man, now more than ever in the wake of the global financial crisis.

Having a difficult time recalling how the financial media has applied the straw man in its coverage? How about headlines like:  

-‘Blaming Wall Street greed won’t fix economic woe’
-‘Curbing Wall Street compensation won’t fix economic woe’
-‘Reinstating Glass-Steagall won’t fix economic woe’
-‘Volcker rule won’t fix economic woe’

No single thing, be it regulation, changed sentiment or company policy, can fix the economy. Likewise, no single thing can fix US infrastructure, be it privatisation, a national infrastructure bank or federal funding. Furthermore, no one asset class can save an institutional investor in times like these.

But rest assured, that hasn’t stopped the financial media from using the straw man before, and it won’t stop its application to infrastructure. As private investment in public infrastructure, and the infrastructure asset class more broadly, continue to gain prominence and market share in America, its rendezvous with the straw man is inevitable.

-‘Private investment won’t fix US infrastructure’

That’s bound to rankle the average infrastructure professional – who’s generally more than willing to acknowledge that a toll road concession might not be the best option to construct, repair or widen a specific road. But what’s worse is that it’s a simple turn of phrase that will likely resonate strongly with the public.

“[Fill in the blank] is not the answer” is not a news story. It’s laziness rooted in – and feeding – narrow mindedness. Faulting privatisation for not being the solution would be irresponsible, considering the US public is widely uninformed about infrastructure as an asset class. Couple that lack of knowledge with the sheer magnitude of the nationwide infrastructure need, and factor in the heavily polarised political climate pervading the US, and it becomes gross recklessness.

The infrastructure industry is already facing an uphill battle in the US. It’s clearly not the be-all-and-end-all answer to the nation’s woes. What it can and must do is openly admit to that in the business press, as well as readily explain when a public-private partnership (PPP), be it a toll road or parking lease, is appropriate.

-‘Private investment won’t fix US infrastructure’

Who said it would?