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CNN RELIABLE SOURCES

Has Media Reported on Enron Scandal Responsibly?; Was 'Talk' Magazine Victim of 9/11?; Battle of the 'West Wings'

Aired January 26, 2002 - 18:30   ET

THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.


THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
HOWARD KURTZ, HOST: Welcome to RELIABLE SOURCES, where we turn a critical lens on the media. I am Howard Kurtz.

The Enron story is in our spin cycle this week, as everyone seems to be staging visuals for the cameras.

(BEGIN VIDEOTAPE)

KURTZ (voice-over): It's one thing to read the headlines about shredded documents; another thing to actually see the confetti-like paper. That's why the attorney for Enron shareholders showed up in court with this box, and that's why former Enron executive Maureen Castaneda invited reporters to her home, to see her even larger stash of shredded stuff.

The only Enron outrage in the White House had been expressed by reporters shouting at Ari Fleischer. But the president used the old word as he just happened to mention a previously-undisclosed Enron victim.

GEORGE W. BUSH, PRESIDENT OF THE UNITED STATES: My own mother- in-law bought stock last summer, and it's not worth anything now.

KURTZ: Lawmakers tried to elbow their way into the outrage about Enron media spotlight. Congressman Billy Tauzin subpoenaed a slew of Arthur Andersen officials. The company's top Enron auditor, David Duncan, made clear he'd take the Fifth, but Tauzin's committee need the visuals, so the ritual was staged for the cameras.

DAVID DUNCAN, FORMER ARTHUR ANDERSEN EMPLOYEE: Mr. Chairman, I would like to answer the committee's questions, but on the advice of my counsel, I respectfully decline to answer the question based on the protection afforded me under the Constitution of the United States.

KURTZ: Also under media scrutiny, the pundits, who now admit getting Enron cash for making speeches or serving on an advisory board with former CEO, Kenneth Lay. They include: "Wall Street Journal" contributing editor, Peggy Noonan, $25,000 to $50,000; "New York Times" columnist, Paul Krugman, $50,000; Larry Kudlow of CNBC and "National Review," $50,000; "Weekly Standard" editor, Bill Kristol, $100,000.

(END VIDEOTAPE) KURTZ: And joining us now in New York, Michael Wolff, contributing editor and media critic for "New York Magazine," and here in Washington, Andrew Sullivan, senior editor of "The New Republic" and a contributing writer for "The New York Times Magazine" -- he also runs the web site, AndrewSullivan.com -- and Bill Press, the co-host of CNN's "CROSSFIRE" and author of "Spin This!: All the Ways We Don't Tell the Truth."

Andrew Sullivan, let's start with Paul Krugman. You've attacked him on your Web site every hour and a half roughly, and he disclosed in the "Times" that he had served on an Enron advisory board as an economist before he even joined "The New York Times." So why can't readers make up their own minds about whether he's credible on this issue?

ANDREW SULLIVAN, ANDREWSULLIVAN.COM: They can make up their own minds, and that's what I'm encouraging them to do. All I was doing on my Web site was pointing out that this is true -- that a "New York Times" economics columnist, who's main responsibility now is criticizing Enron, has $50,000 in his pocket that he took from Enron for what he claimed, himself, was doing nothing. He just went there, he said, for a weekend. He said to "The New York Times," "Why was I there. Beats me. I was just another brick in the wall." He said, it was below his going rate.

KURTZ: OK.

(CROSSTALK)

SULLIVAN: Now -- and he's written his own columns, he never disclosed the $50,000 in his own columns.

UNIDENTIFIED MALE: Well, he disclosed that he worked -- he didn't disclose the figure, he was just (UNINTELLIGIBLE).

(CROSSTALK)

KURTZ: Let's talk a look at what Paul Krugman had to say on Friday in the "Times." "Conservative newspapers and columnists have made a concerted effort to portray me as a guilty party in the Enron scandal. Never mind that I disclosed that past connection a year ago, the first time I wrote about Enron in this column. It was part of a broader effort by conservatives to sling Enron muck toward their left, hoping some of it would stick."

Grass right wing conspiracy?

SULLIVAN: Totally untrue. In the same week that I went after Paul Krugman, I also -- I actually broke the story that Bill Kristol of the "Weekly Standard," the leading conservative, also got $100,000. The main majority of the pundits who are on the payroll for Enron are on the right. Paul Krugman just happens to be the only liberal.

Now, the question is, I don't believe he was bribed. I don't believe he has written anything he doesn't believe in. The question is if you have taken 50,000, how can your readers not suspect? Some of them suspect you might be unable to be completely independent about this issue.

KURTZ: Bill Press.

SULLIVAN: And he won't give it back.

KURTZ: Are Bill Kristol and Larry Kudlow and Paul Krugman as tainted as Andrew suggests?

BILL PRESS, CNN'S "CROSSFIRE": I don't think any journalist ought to be taking money from any corporation period. But I do think -- I don't know the facts of all of the facts maybe the way Andrew does. I think you can make a distinction between Paul Krugman, the way I know Paul's case, we all have different lives. He worked for Enron before he started writing for "The New York Times." And he severed the connection once he went to the "Times." He revealed that in his first column. He revealed it in "Fortune" magazine. And if you read Paul Krugman and think that he's (UNINTELLIGIBLE) of Enron's, I mean you're reading the column upside down.

SULLIVAN: But that...

(CROSSTALK)

PRESS: So I do think that Paul has distinguished himself by his honesty, but in terms of journalists, who are still working journalists, who are working for a corporation at the same time and moonlighting, I think it stinks. I think it's wrong. I think it gives all of us a bad name.

(CROSSTALK)

KURTZ: Hold on one second, Andrew, because I turn to Michael Wolff. Now, I've been a journalists that -- for about a decade, but maybe you can bring some New York realism for this discussion. Is there anything inherently wrong with journalists taking corporate consulting fees if, when they happen to write about that company, they disclose it to readers and/or viewers?

MICHAEL WOLFF, "NEW YORK MAGAZINE": Well, I don't know if there is inherently wrong. I guess it's a case-by-case basis, but I think the more interesting thing is to look and see what this says about Enron and why it is in the situation that it's in. And the truth is it did try to buy everyone. It tried to buy Krugman. It tried to buy Noonan. That's basically the theory that it has operated on. We will...

KURTZ: For what purpose? To neutralize them? To take them out of the game?

WOLFF: Yes. To make them -- it's both to buy goodwill and to make them complicit. Let's buy as many people as we possibly can, including the president of the United States.

SULLIVAN: In a matter of contrast, Paul Krugman earned, from Enron in one weekend, more than the biggest Senate beneficiary got from them in 10 years. And these journalists are criticizing politicians for campaign finance reform. Bill Kristol supported John McCain and said this system has to be cleaned up. Nobody can get more than $1,000 from corporations, while he's on the payroll of $100,000 from these people...

KURTZ: OK, let's...

SULLIVAN: ... and never disclosed it until every recently?

KURTZ: Let's clarify. Bill Kristol didn't write anything about Enron. He is the editor of the "Weekly Standard." He published a piece -- a very praiseworthy piece by Irwin Stelzer as a contributing editor and who also served on this Enron advisory board, which was favorable to Enron. But Andrew brought up campaign finance reform.

UNIDENTIFIED MALE: Yes.

KURTZ: When we could -- we talk about campaign finance reform, and we say companies give gobs of money to politicians. What do they get in return? But in this case, with the exception of Stelzer, all of these people who took the money have been very critical of Enron. Peggy Noonan said they ought to have a Texas whipping. So what did Enron get for its money?

(CROSSTALK)

WOLFF: Well, wait a minute, wait a minute. They have only been critical of Enron in the last two weeks.

(CROSSTALK)

WOLFF: Up until...

(CROSSTALK)

SULLIVAN: ... in 1999 was a big puff piece on Enron. Let's be clear -- he wrote a glowing endorsement of Enron as the wave of the future.

WOLFF: Well, it's not only these guys. The truth is they didn't really have to pay to get these kinds of endorsements. Everybody thought Enron was the business. It was the corporation of the moment. It was trading at $90 a share.

PRESS: But the same thing that is wrong with the senators and the congressmen taking Senate, it's even worse for the journalists to take -- I'm sorry -- to take the cash. In this case, it's not campaign cash, but you can't criticize the Congress people and say, "They can't take the cash, because all they're doing is giving access and special treatment to Enron, while they're taking the cash themselves."

SULLIVAN: But Krugman...

PRESS: There should be a rule at any magazine or at any newspaper like there is at CNN, you can't work for a corporation.

(CROSSTALK)

WOLFF: Well, that seems like complete nonsense to me. Obviously if you're a politician, you work for voters. If you're a journalist, I don't know, you work for a lot of different people.

SULLIVAN: Now, at both institutions, politicians and journalists need the public trust. We absolutely depend upon that. We cannot be seen to be tainted now. I'm not saying that he's bribed. I'm saying, unless he gives this money back, even if he's attacking Enron very furiously, there's an implication that maybe he's only attacking them to prove he's independent from this money.

WOLFF: If you had taken...

(CROSSTALK)

PRESS: Andrew is on a tear here against Krugman. I think Krugman is the one honest one of the bunch. I'm just saying as a principle, journalists should not be moonlighting for corporations.

KURTZ: OK. But if you were in a previously life, you were a California political person...

(CROSSTALK)

KURTZ: ... let me go to Bill Press. If you had taken some Enron money, and now there's been a huge scandal here, would you not talk about it "CROSSFIRE?" Would you recuse yourself? Or would you disclose and let people make up their mind?

PRESS: I would reveal that I had once received a campaign contribution from Enron, if I had, which I did not. But if I had, in a past life, five years before I came to work for CNN, I would defy anybody to say that Enron owns me.

SULLIVAN: But there's another issue here. Enron is not just any corporation. It was a criminal racket. This money that they have...

KURTZ: Which obviously was not known six months ago.

SULLIVAN: Not at the time, but we know it now. And that money they have is stolen money. It is money that is really owed to shareholders. Every cent (UNINTELLIGIBLE) of most congressman have given this money back, and they didn't even see this money. It was mainly their campaign finance money. Why...

(CROSSTALK)

SULLIVAN: Hold on a minute, Bill. I think -- tell me if I'm wrong -- that this money needs to go to charities to support the shareholders, and until they do that, these pundits cannot write about this ever again.

KURTZ: OK, Michael Wolff, let me go to one other issue here. Enron, a huge story in Washington and around the country. On Thursday, we had the first congressional hearing, and CNN, Fox, MSNBC, didn't carry it live. They showed some brief snippets. In fact, they devoted more air time to the hockey dad trial.

So from all of the journalistic hyperventilating here by adding to this story is the Enron story too complicated, too dull for cable?

WOLFF: Yes, well, I think it's too complicated. No one can quite explain this story. No one can exactly be sure actually that anyone did anything illegal here. So...

KURTZ: But that's been true in every scandal, the Whitewater hearings were covered. You don't always know a few weeks in whether there's any illegality at the heart of the story.

SULLIVAN: But the pundit scandal is not about what's legal. It's about what's ethical. And the scandal here is not what's unethical. The scandal...

(CROSSTALK)

WOLFF: I know, but we moved off the pundits. We're now onto something else. And I know you like that one, but if the question here is about will this scandal play, and I think it's still up for grabs, whether this is going to become the, you know, the next scandal of the American imagination. I don't know.

PRESS: I think it was a scandal that that hearing was not covered more widely than it was, and I think what's...

(CROSSTALK)

KURTZ: ... because CNN didn't devote more air time.

PRESS: Absolutely, CNN showed coverage. I think there's a double standard here. If this were Whitewater, we would already out to lynch Bill Clinton as we were in the early days of Whitewater, which was a real estate scandal that happened 20 years earlier.

KURTZ: Let me say this.

PRESS: I believe -- if I may finish one point...

KURTZ: Yes, sure, Bill.

PRESS: ... that there the media today consider, because of 9/11, the White House is the third rail, and they're not -- they're very timid about touching Enron, because they're very afraid of being charged with attacking George Bush, the warrior.

(CROSSTALK)

SULLIVAN: This is a financial...

WOLFF: Well, on the other hand...

SULLIVAN: ... hold a minute, Michael. Let me just respond to that. My point here is that this is not a Bush scandal so far. We don't know it's a political scandal. As a conservative, I think it's very important we expose this stuff, because it is an attack upon free markets. It's an attack upon capitalism. It is a violation of the very transparency that makes capitalism work. And conservatives should be tougher on Enron than liberals, because it is an absolute scandal of the capitalistic system, and they have to be rooted out.

KURTZ: I have to ring the bell and send you all to your corners. Let's take a breath, and when we come back, was it the end of the magazine, or the end of a celebrity era? We'll talk about Tina Brown's "Talk" next.

(COMMERCIAL BREAK)

KURTZ: Welcome back to RELIABLE SOURCES.

Tina Brown's "Talk" magazine generated huge amounts of buzz, when it debut in the summer of 1999. The much hyped launch included a star-studded bash at the Statue of Liberty.

But it didn't last. The magazine shut down last week, just two days before the next issue would have gone to press. Michael Wolff, was "Talk" a victim, as Tina Brown would have it, of 9/11 and a magazine recession? Or was there more fundamental failure here with this magazine.

WOLFF: Yes, I don't think it has anything to do with 9/11. If 9/11 hadn't occurred, "Talk" would still have gone out of business. I think for most observers in the magazine business, from issue two it was very clear that this magazine just didn't have a reason to exist. It didn't have an identity. It didn't really have -- there was never a clear sense of who its readers were. It didn't work.

KURTZ: Well, there were a lot of changes in the direction. But Andrew Sullivan, how could Tina Brown be so fabulously successful as an editor, first at "Vanity Fair," then at "The New Yorker," and then have "Talk" be a flop?

SULLIVAN: Because I think, in fact, it was the same magazine all along. I disagree with Michael...

KURTZ: It was the same magazine over and over again?

SULLIVAN: Yes, it was the same celebrity buzz, superficial, sometimes very good journalism kind of formula. And the trouble is that worked in the '90s, and I think it's tired now. I think people are not looking for buzz. They're looking for substance. They are looking for reality. They are looking for what's actually real and true rather than what's hot and buzzy right now. And I think Tina never was able, although I think she is an excellent editor and she has done some very good stuff, she was never able to rebrand herself as something substantive as opposed to something unsubstantive...

KURTZ: Now, you...

(CROSSTALK)

WOLFF: ... unlike, for instance, "Oprah," which would be a recent successful magazine.

KURTZ: Touche. Bill Press.

PRESS: Well, I see it a little differently than Andrew. But first, I mean, when I heard that "Talk" died, it reminded me of the great line of Alice Roosevelt Longworth, when they told her that Calvin Coolidge died, and she said, "How could you tell?" I mean...

KURTZ: So it was not on your must reading list?

PRESS: This was not on my must -- I never -- I must say, I never felt compelled to buy or read "Talk" magazine, and I read a lot.

KURTZ: Even though Tucker Carlson was writing for it?

PRESS: I'm sorry, Tucker, I didn't even read it then. But...

(CROSSTALK)

PRESS: I think that when Tina went to "The New Yorker," there -- which I read every week zealously -- there's a lot steak there, she added a little sizzle, which I thought helped the magazine. She went to "Talk," it was all sizzle and no steak. I mean -- and I think it proves that you need some substance. You need some gravitas. You need some steak. It just can't all be about my party at the Statue of Liberty.

KURTZ: Well, I think you're...

WOLFF: Well, it's also...

KURTZ: ... hold on, Michael. I think you're being a little unfair in that. There were some substantive pieces printed over the two-and-a-half year life of this magazine. What I want to know from you, Michael Wolff, because you are a part of the New York literary scene, or at least tapped into it...

(CROSSTALK)

WOLFF: ... is the very center of it.

KURTZ: OK. Why is it that so many particularly media types are so joyous that Tina Brown had a failure? There just seems to be this great sense of people taking -- people celebrating over what was unfortunately the death of a journalistic enterprise?

WOLFF: It is really too, well, because I think No. 1, I think that they think it was not a journalistic enterprise. I think that many people feel -- well, there are many people who were snubbed by Tina, so they have their own issues there. But then there are other people, I think, who feel that Tina sold out. Tina made journalism about celebrities and about nothing more than celebrities. Not only that, she made it about wanting celebrities to like you. So it was Tina's efforts were just a big...

(CROSSTALK) SULLIVAN: It's also about money, and this where it sort of ties in with the Enron thing.

KURTZ: I knew we were going to get to that.

SULLIVAN: Well, just...

(CROSSTALK)

SULLIVAN: No, I'm just talking about the way in which Tina spent money. No one knows quite where this came from. It seemed to be unrelated really to putting out the magazine in terms of upping the salaries of every writer, killing other magazines who couldn't survive in this climate.

KURTZ: Well...

SULLIVAN: Yes.

(CROSSTALK)

KURTZ: ... when you were the editor of the "The New Republic," she stole some of your writers (UNINTELLIGIBLE).

SULLIVAN: Well, absolutely, and I sat down and wrote that...

KURTZ: Yes.

SULLIVAN: ... and completely confessed that. If you're writing a serious little magazine that has no real money, and suddenly every time you discover a good writer, he or she is offered gazillions of money to go to New York and write for "Talk." How can you compete? You can't.

WOLFF: But it doesn't even have to be a serious little magazine. My magazine which is an extraordinarily successful magazine, kept losing writers and editors to "Talk," because Tina would come in and say, "I'll double your salary."

SULLIVAN: And at some point...

(CROSSTALK)

PRESS: I don't have any issue with Tina, right? Never met her, she's never done me good, she's never done me bad. And I'm not feeling joyous about the fact that "Talk" died, but I most certainly feel no remorse, because to me, what I saw of it was glitter. It was celebrity glitz, and it really had no substance...

(CROSSTALK)

KURTZ: But some people think that "George" magazine died, "Brill's Content" died, "Talk" has died, but the general interest magazines are having a hard time in this current media...

(CROSSTALK) WOLFF: Well, also -- I mean, they are having a hard time, but you just named three magazines that were basically bad magazines. I mean, magazines that never found -- I mean, even actually Steve Brill had the dignity to say, "My magazine failed because it was a bad magazine."

KURTZ: OK.

WOLFF: Now, Tina, by the way, is blaming everybody else. Everybody did this to her, except her.

SULLIVAN: Well, that's why Tina is so much like Bill Clinton. What Bill Clinton -- I know you're going to love this.

PRESS: How could it get back to Bill Clinton?

SULLIVAN: Hold on a minute -- let me finish. Let me finish. Bill Clinton was, you know, everything in Washington was about spin. Everything in New York was about buzz. Nothing substantial really mattered for eight years. She is tied to that era. That era is over, and that's why this magazine is basically...

(CROSSTALK)

PRESS: Now, that's (UNINTELLIGIBLE) Bill Clinton is not responsible for.

KURTZ: OK, 670,000 people read "Talk," so somebody must have liked it. Before we go, I want to take a look at the current president of the United States, recently photographed -- have we got that picture -- carrying a certain book under his arm. Yes, it's "Bias" by Bernard Goldberg. Bill Press, I'm going to give you the last word. Does this mean that George W. Bush buys the theory that media (UNINTELLIGIBLE)?

PRESS: I think he's sending a message to the media, "Watch out, because I know you're all liberals. I know you're all against me, and I buy that myth," which is the oldest myth in the business. It does not...

(CROSSTALK)

SULLIVAN: The only correction was it's not a myth, it's a fact. And only people in denial are denying it.

KURTZ: OK. Well, Bernard Goldberg is No. 1 on "The New York Times" best seller list, and we will have to leave it there. Michael Wolff in New York, Bill Press, Andrew Sullivan -- thanks very much for joining us.

When we come back, inside the "West Wing" with both presidents in Bernard Kalb's "Back Page."

(COMMERCIAL BREAK)

KURTZ: Now for a look at the world of media news. Connie Chung has left ABC News for CNN. Chung will anchor our world news cast at 8:00 p.m., filling the slot recently left by Greta Van Susteren who jumped to Fox News Channel.

First there was Stephen Ambrose. Now another historian has come under media scrutiny. Doris Kearns Goodwin acknowledged this week that she reached a financial settlement several years ago with the author of a book about Kathleen Kennedy. Several passages from the book were used almost verbatim in Goodwin's book, "The Fitgzeralds and the Kennedys." The plagiarism episode was disclosed by "The Weekly Standard."

And finally, Fox News anchor Brit Hume reported earlier this month that the group, People for the Ethical Treatment of Animals, has -- get this -- given a bunch of deer the kind of orange vests that hunters wear so they won't shoot each other. Hume apologized on the air the next night for being taken in by a hoax.

Well, time now for the "Back Page." Here is Bernard Kalb.

(BEGIN VIDEOTAPE)

BERNARD KALB, CNN CORRESPONDENT (on camera): ... brag or anything like that, but can you name any other country in the world that has two presidents?

(voice-over): Well, we do, at least we did the other night, this one at 8:00 p.m. Eastern, this one at 9:00, two presidents competing against each other, a kind of presidential Olympics.

But it would be unpatriotic to ask which one won the gold, and just as unpatriotic to ask whether this was a case of reality imitating fantasy. Inside the real "West Wing" versus the "West Wing," where nothing is classified and the script is filled with political and personal conflict.

(BEGIN VIDEO CLIP, "THE WEST WING")

MARTIN SHEEN, ACTOR: Please, God, Leo, let him be right.

(END VIDEO CLIP)

KALB: By contrast, the day in the life of 43 was all milk and honey. It gave us chance to follow the president to watch him in his role as commander of chief, shuttling between policy and politics, between diplomacy and the war against terrorism. And at one point, the president offered some unintentional advice to American kids who might be wondering what to do when they grow up.

BUSH: I really, really like being the president.

KALB: A bit self-conscious perhaps, but all very cozy, very friendly, but all on camera, which of course, gets you thinking about some other presidents and what went on off camera, and the things you never learn until later when their own secret White House tape recordings gave us a more accurate and more complete picture of themselves. For example, back in the '70s, Richard Nixon and his secret tapes that ultimately forced his resignation over the Watergate cover up, examined once again in a recent book by journalist Richard Reeves. And back in the '60s, L.B.J. and his secret tapes that revealed his private doubts about the war in Vietnam, even as he sent more and more troops into battle, analyzed in a recent book by presidential historian, Michael Beschloss.

But to get back to the TV day with George Bush. Ari Fleischer was quoted in the "Times" as saying that only two things were off limits to NBC's cameras. Anything that occurred in the Situation Room, and any documents stamped "classified."

(on camera): Fair enough, Ari, but as you know, that is just the kind of challenge that reporters love.

(END VIDEOTAPE)

KURTZ: Wonder which "West Wing" got higher ratings. Bernard Kalb with "The Back Page."

Well, that's it for this edition of RELIABLE SOURCES. I am Howard Kurtz. You can catch this program tomorrow morning at 9:30 a.m. Eastern. Thanks for watching.

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