Americans are up to their necks in debt. With credit cards, student loans, car loans and mortgages, the nation owes roughly $2.4 trillion as of July 2007, according to the Federal Reserve. The nation’s media were there to cover almost every drop of red ink.

     Low interest rates helped drive a national real estate boom that began in 2000 and led to record home ownership by 2004. Many people borrowed for “dream” homes, second homes or flipped homes as speculative investments. But rising defaults have prompted bailout plans from both Democrats and Republicans in Congress.

     “I think a lot of the lenders have really taken advantage of what is a really tough economic situation for many Americans,” said Sen. Hillary Clinton (D-N.Y.) in an Aug. 7, 2007, CNBC interview. The presidential candidate said she plans to increase regulation of the industry and “set up a $1 billion federal fund to help homeowners avoid foreclosure.”

     Another presidential candidate, Sen. Barack Obama (D-Ill.) also blamed “predatory lenders” and has said they should be fined and further regulated, in the Aug. 28, 2007, Financial Times.

     The House of Representatives passed an expansion plan Sept. 18, 2007, that would give the Federal Housing Administration (FHA) the ability to guarantee loans for more than 200,000 additional homeowners, according to the Associated Press. President George Bush declared on August 31 that “government has got a role to play” in helping homeowners avoid default.

     But even with the subprime problems, home ownership for the second quarter of 2007 was still at 68.2 percent, only a percentage point lower than the record set in 2004. Though media coverage on ABC “World News with Charles Gibson,” “NBC Nightly News” and “CBS Evening News” in 2006 and 2007 certainly made the situation sound dire – as if every American was about to lose his home.

     When thousands of borrowers started defaulting on mortgages, the networks attacked lenders, ignored the responsibilities of consumers for their own debts and made it appear that the American dream itself was coming to an end.

     “We call it the American nightmare,” homeowner Amy Wood told ABC “World News with Charles Gibson” on March 26. That phrase summed up more than nine months of network coverage of debt.

     That story about rising foreclosures in Concord, N.C., attacked lenders and virtually ignored the idea that borrowers might have some personal responsibility for their own mistakes. It was the first part of a series ABC entitled “The Home Wreckers.”

     Anchor Charles Gibson blamed lenders’ “creative financing” and reporter Steve Osunsami claimed homeowners were “talked into purchasing” homes with “little or no money down” and low interest rates.

     “Their American dream is over,” Charlotte Observer reporter Binyamin Appelbaum told ABC’s “World News with Charles Gibson.” That was a common theme for the network, which blamed lenders four times as often as borrowers (20 to 5) for debt and ignored the issue of personal responsibility in two-thirds of its stories.

     Another family struggling to avoid foreclosure – the Tingley's – were presented in the same segment as victims of evil lenders. Osunsami explained that the couple had seen their mortgage payment increase by 20 percent over the builder’s low-end estimate of $726.68 per month.

     But Osunsami didn’t question the Tingley's assumption that they would be able to pay the lowest estimate forever. He never said they put themselves in debt and assumed they would have no trouble selling the house five years later.

     This gloomy, anti-business, anti-personal responsibility story was the tip of the iceberg. BMI and CMI found news shows consistently ignored the responsibility of borrowers and turned them into helpless victims of circumstance. That left only one villain – business. Reporters blamed “deceptive” lenders and businesses for the failings of those who borrowed the money.

     The analysis covered an ideal time for spending – from Nov. 28, 2006, (Black Friday, the start of the holiday shopping season) to Aug. 31, 2007. Out of 156 stories and briefs on the evening newscasts of ABC, CBS and NBC, researchers found that 114 had a personal responsibility angle, and of those 62 percent (71) ignored the issue. Sixty-two percent of the total stories (97) presented borrowers as victims. Businesses were also six times more likely to be blamed for debt than consumers.

     While the news media pointed fingers at business, industry experts were willing to share the burden for mortgage problems. Harry Dinham, former president of the National Association of Mortgage Brokers, said in the Oct. 4, 2007, Newsday, “We’re getting a lot of the blame [for the subprime ‘crisis’], but there are a lot more players here … Everybody played a part in what’s taken place.”

     Every American who takes out a loan or applies for a credit card makes the decision to borrow. But you’d never know it from watching the networks cover issues of personal finance.

     This was most obvious in reporters’ attempts to explain “subprime” mortgages. On the Aug. 10, 2007, broadcast of “NBC Nightly News,” reporter Maria Bartiromo, who generally does a fair job in reporting finance matters, succumbed to the temptation to sugar coat the personal responsibility angle: “… subprime mortgages are mortgages given to people with under-the-radar credit histories, poor credit basically.”

     Reporter Armen Keteyian did a story on an alleged mortgage scam in Maryland during the July 13, 2007, “CBS Evening News.” Again, the missing element was personal responsibility. This time the glaring omission came from the expert Keteyian used in the story, Elizabeth Renuart from the liberal National Consumer Law Center. She said, “financial distress is the weakness that they exploit, because people are so concerned about losing their homes, they’ll do almost anything to save them.”

     Both stories highlighted the failure of the news media to lay responsibility for debt problems at the feet of the consumers themselves. In stories where there was a personal responsibility angle, 71 out of 114, or 62 percent blamed someone else for the consumer’s financial problems. It didn’t matter whether the story was on consumer debt, retirement, student loan debt, or subprime mortgages and foreclosures; all three networks were reluctant to point the finger at the true culprits.

     Night after night, people were “lured” into bad loans, families were “left in a lurch” when their adjustable-rate mortgages adjusted, and retirees who never bothered to save for retirement now “have to” keep working to pay their bills.

     ABC and NBC did the poorest job. Two-thirds of the stories involving issues of personal responsibility stories ignored the concept (66 percent, ABC 22/33; NBC 26/39). CBS did better, but still ignored personal responsibility 54 percent (23/42) of the time.

     Perhaps the most striking example of anti-personal-responsibility reporting on the debt issue was a series ABC “World News with Charles Gibson” ran in March 2007 called “The Home Wreckers.” Here’s how anchor Gibson teased the story at the top of the March 26 broadcast:

“The Home Wreckers. Locking families out of the American dream by offering mortgages too good to be true.”

Later in the broadcast he pitched the story again:

“And when we come back, the easy home loans leading more American families down the path of financial ruin. Is there any way out?”

     The two-night series never addressed the responsibility of the homeowners who decided to take advantage of “easy financing.” Instead, reporters depicted homeowners as victims “talked into” purchasing their properties. The second night of “The Home Wreckers” series featured a favorite liberal theme, government intervention, by profiling the efforts being made by the city of Chicago to rescue homeowners with mortgage problems.

     On July 12, 2007, “NBC Nightly News” profiled a town in California where foreclosures had hit hard. Reporter George Lewis set up the story with the line, “Too many people with variable-rate mortgages obtained when interest rates were rock bottom now find themselves in a bind, unable to meet rapidly rising house payments.” Lewis went on in his report to say, “Some critics blame unscrupulous lenders for pushing people with shaky credit into mortgages they now cannot afford.”

     No consideration was given to the fact that these borrowers chose to take the loans and whether they researched what their payments would be in the future. Instead, to further downplay the personal responsibility of the borrowers, Lewis used a sound bite from a Los Angeles city councilman, who said, “It’s too tempting for someone to try and get these lower rates, thinking that they could be a part of the American dream and not anticipate what problems can occur in the future.”

     While CBS did a slightly better job addressing personal responsibility, the network still ignored the topic in more than half of its stories. In a July 11, 2007, story about fees banks charge on overdrawn accounts, business correspondent Anthony Mason featured a college student surprised by her bank statement. The woman had been charged for overdrawing her account. Her response? “I think they’re sucking money out of the consumers.” The woman was never held accountable for the fact that she spent more than she had in her account.

     Unlike the network evening news shows, financial experts, including some who appeared on TV, touted personal responsibility. Dave Ramsey, a financial planner and author, is a frequent contributor to CBS’s “The Early Show.” On the April 3, 2007, broadcast of that program, Ramsey was interviewed by anchor Russ Mitchell about subprime mortgages. Ramsey’s comments drummed the personal responsibility beat again and again.

“You ought to kind of have a clue in your own life. If you’re behind in your bills, you have no money, your income is not great, you’re probably not getting the best mortgage.”

“Pay your bills on time or early for a couple of years. You are then ready in your own heart, in your own character, plus your credit, to purchase a home.”

“… being on the b-word, the budget. Living on less than you make, having a goal and saying, I don’t have to do this today. It could be a two-year goal to buy a home….It’s OK to rent for a little while, while you get your act together.”

     Producers and reporters choose the experts they include in their stories. Clearly there are people in the field, like Dave Ramsey, who bring the message of accountability and responsibility to a story. The inclusion of this point of view provides more balance but doesn’t fit into the networks’ “blame business” mentality.

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Executive Summary