Wall Street Bailout Has Been

Wall Street bailout has been one of the largest ongoing stories in the past couple of years. The plan came in the face of multiple bank failures and the threat that further bank failures would derail the financial system. The bailout split the American public between those who wanted to see the economy stabilized and those who opposed government spending to prop up the large financial institutions that created the economic crisis in the first place.

The arguments surrounding the Wall Street bailout included many examples of cognitive framing. Over the course of the coverage and debate about this issue, the viewpoints of many different stakeholders were given voice in the media -- politicians on both sides of the aisle, taxpayers, economists, regulators and the bankers were all given voice. For the most part, each side attempted to use media coverage of this issue to push their own take on the situation and their own agenda for dealing with the bailout.

An interesting example of such framing comes from Paul Krugman, who writes as an economist, but frames the argument more from the perspective of a taxpayer. Arguing against the bailouts -- or at least against the structure that was proposed in September, 2008, he asks readers to view government involvement in the financial sector the same way that private investment money would. The government's plan was a cash infusion with no equity upside, whereas if private money flowed into a bailout there would be equity upside.

The use of these blogs -- ones written by columnists that serve roughly the same purpose as a column -- has become prevalent in media in recent years. Most serve a specific agenda. In terms of cognitive framing, this particular piece takes melds two or three perspectives to focus on specific elements of the argument at specific times. The taxpayer perspective is presented, in that the question is raised about the benefits of the bailout to taxpayers. The government perspective is also raised in the discussion about specific policy responses. The blending of these two perspectives functions well because it calls upon the reader -- a taxpayer -- to view government as an agent of the taxpayer. Ultimately, that is the role government is supposed to be play. By framing the piece in this manner, Krugman is effectively asking the reader to critique the government's strategy, while simultaneously providing the grounds for such a critique. The reader is inherently guided into Krugman's critique framework, such that when the reader considers the issue in the future, that framework of the taxpayer and the government as agent is the perspective from which opinion is derived.

As the reader is naturally guided into critiquing government response to the bailout, it is worth considering the underlying context. In September 2008, in the middle of an election campaign, an openly left wing columnist is framing a critique of a Republican government's response to the financial crisis. There is a specific reason that the taxpayer perspective is used in conjunction with the government-as-agent perspective in light of the upcoming election -- the taxpayer should consider what kind of government he or she wants. In this case, is a government that is willing to throw money at Wall Street the desired choice? Krugman could have used his perspective as an economist in this piece, and simply explained the economics behind the bailout, but instead chose a perspective that would resonate with a much broader audience.

Taking another perspective on the bailout, the Wall Street Journal featured an article that made the case for the bailout. This article was framed from the perspective of financial industry regulators. As with Krugman's article, this article discusses the role of government, but this time in relation to the government's role in managing the economy. There is very little direct connection presented with regards to the electorate, and what is presented is in a brief, fear-oriented snippet: "factories would shut down, people would lose their jobs."

By framing the article from the perspective of regulators, the article portrays the Wall Street bailout as economic necessity. The public is being asked to sympathize with the regulators, who are portrayed as working hard to stabilize a difficult situation. The article does not carry a strong political perspective in its subtext. What it does carry, however, is a view favorable to Wall Street, the Journal's target audience. The Journal is, however, an influential paper likely to hold sway with voters, who want to see Congress and the regulators managing the stability of the economy effectively. At the time, the chaos of the recession was not portrayed as a given, indicating that such action as taken by the regulators would likely salvage the economy.

This article is not a column or blog, so the tone is more even-handed than the Krugman piece, but the choice of people to quote, and the way that the argument was framed, clearly lend sympathy to the role of the regulators. They are portrayed as defenders of the economy, rather than as agents of the government willing to spend hundreds of millions of taxpayers' dollars on Wall Street. Indeed, the framing of the article is geared away from Wall Street and towards the overall economy.

For the reader, the Wall Street Journal piece takes on a more sober-minded tone, but this can easily attributed to the fact that there is less of an implicit call to action in the article. Krugman as a blogger has more license to make emotional appeals than do the authors of the WSJ piece. Yet those authors do make use of emotional appeal. They portray crisis and impending doom in almost every sentence. Accompanying the article is a photograph of a very worried-looking Henry Paulson. There is actually little need for a call to action given the tenor of the article. The implicit call is to support the bailout because the health of the economy depends upon it. There is less focus on the long-term perspective because the situation is portrayed as dire and immediate. The Krugman piece, because it is implicitly aimed at voters, is framed in a more distant, long-term manner.