Today's Papers

In League Together

The New York Times and Los Angeles Times lead with the Arab League’s vote supporting the U.N.’s resolution on Iraq. In what the papers say was essentially a symbolic flourish, the League also stated “the absolute Arab rejection to striking Iraq.” USA Today leads with a catch-up piece on Iraq, mostly reiterating the reports in yesterday’s papers about the U.S.’s emerging war plan. USAT also gives prominent play to Secretary of State Colin Powell’s statement on a Sunday news show saying that the administration “won’t wait until February to see whether Iraq is cooperating or not.” The Wall Street Journal’s world-wide newsbox (online) also leads with Iraq but focuses on administration officials saying that after any invasion, the U.S. would set up an American military administration, at least for a few months, and then transition to complete Iraqi control within two years. The Washington Post leads with a scary piece detailing how a bizarre Soviet science experiment has left hundreds of radioactive devices scattered across the former Eastern Bloc. The things, which look like “antique milk cans” were designed to irradiate fields in the belief that glowing dirt speeds up germination and increases yields. Problem is, the devices can easily be made into dirty bombs and nobody is sure where most of them are now. This year, Congress realized the scope of the problem and allocated $25 mil to help find the cans.

Both the LAT and NYT’s leads say up high that Saddam appears to be ready to accept the U.N. resolution’s first demand, which is that he agree to let inspectors back in. Saddam has convened Iraq’s Parliament to discuss the demand. As the NYT puts it, that’s “the usual choreography for a simulated public stamp of approval.”

USAT’s follow-up on the Pentagon’s apparent war plans mentions that the leaks could be bunk and simply part of a disinformation campaign. As the USAT reminds, “Just such a campaign before the 1991 Gulf War tricked Iraq into thinking U.S. forces would mount an amphibious landing on Kuwait’s coast.” (Did that campaign purposely mislead American press, because isn’t that against regs?)

The WP fronts word that Republicans are backing off their plan for big tax cuts. Instead, the GOP, not wanting to give the appearance of overstepping their mandate, will go for cuts that the Post describes as “probably more symbolic than substantive.” Among the ones still on the table, Republicans want to make permanent last year’s $1.35 trillion tax cut, which is set to expire in 2010. How is that only symbolic? Because, the Post says, “nothing Congress does is permanent.”

Everybody goes inside with news that Palestinian gunmen infiltrated a kibbutz in northern Israel yesterday and fired into a dining hall, killing five people, including two children. The Al-Aqsa Martyrs Brigades, an offshoot of Yasser Arafat’s Fatah faction, claimed responsibility. A few hours after the attack, Israeli helicopters launched missiles at a metalworks shop in Gaza that Israeli officials say was secretly making mortars. According to residents cited in the  NYT, the shop was empty and nobody was injured.

Israel USAT’s online headline about the attack reads, “MORE VIOLENCE ERUPTS IN MIDDLE EAST.” Could they have come up with a more uninformative headline? USAT has a history of doing this, though in fairness the paper itself gets it right and headlines the killings.

A front-page WP piece argues that Nasdaq contributed to the market dive by having lax standards for listing companies. While the New York Stock Exchange requires listed companies to have $2.5 million of pre-tax earnings, according to the Post, Nasdaq doesn’t require companies to have “any pre-tax income.” TP has no idea whether the Post’s overall thesis is correct, but it sure isn’t convinced by the paper’s evidence. As the WP acknowledges deep into the article—the 22nd paragraph—the lower bars have often helped the economy: When Nasdaq was created in 1971, the whole point was to create it with lower bars so that fledgling companies that didn’t qualify for the NYSE could still raise money. It seemed to work pretty well for the 25 years preceding the boom-bust, helping such little guys as Apple and Intel raise a few bucks and expand a bit.

Meanwhile, one of the Post’s key pieces of evidence suggesting that Nasdaq was too permissive can easily be read as suggesting the opposite: Under the subheading, “Cheap, Easy, and Risky,” (insert sex-ed film joke here) the paper notes that there were “quite literally, thousands of wobbly companies on the Nasdaq” during the boom. The Post explains that while Nasdaq only deslisted 200 companies in 1996, “in 1998 they hit 596, then 440 in 1999 and 630 more over the next two years. All told, from 1996 to 2001, [Nasdaq] delisted 2,116 stocks.” Uh, couldn’t this mean that Nasdaq did exactly the right thing during the days of permissive-accounting: crack down?

The WP headlines the article: “NASDAQ ‘CASINO’ HAD FEW SAFEGUARDS.” Given the quotes around the word casino, it must be taken from a quote in the article, right? Nope, it’s just the paper itself saying it, and trying to cover its toches.

The Post’s article is part of a weeklong series on the bust, each installment blaming a different player in the investing world: the Regulator (“Nasdaq encouraged and enabled thousands of highly risky companies to list their shares on the market”); the Reporter (“covered the market like it was sports”); the Investment Bank ("the prevailing ethos was ‘you never turn down a deal’ "), etc. Curiously missing from the line-up: the Dumb Investor.

Before you dash off that huffy e-mail to TP, be aware: He falls into the last category.