Typical Media Victims Still Not Typical

     The media continue to feature sob stories from rich families in stories supposed to illustrate the pain the housing “crisis” is causing for middle- and lower-income families.

     “Not since the Depression has a larger share of Americans owed more on their homes than they are worth,” New York Times reporters Edmund Andrews and Louis Uchitelle wrote in a February 22 article [1]. “With the collapse of the housing boom, nearly 8.8 million homeowners, or 10.3 percent of the total, are underwater.”

     In an effort to personalize the “drowning” feeling, the reporters profiled three homeowners including Stuart Breakstone, who recently had to cover the $65,000 he still owed on a mortgage when he sold his house. It's unfortunate, but at least Breakstone had the $65,000.

     Should people, especially lower income borrowers who are struggling, feel badly for the Breakstone family? According to the Times, Breakstone is a lawyer, and his wife Lori is chief of customs agents at Memphis International Airport. Together the couple earns more than $250,000 a year. That's more than five times the U.S. median household income.

     While the Times portrayed the Breakstones as the victims of a "housing collapse," the reporters waited until the forty-six of 50 paragraphs to write that the family took on $670,000 in debt to upgrade to a bigger house. The Breakstones now make a $4,000 monthly payment for their house and another $14,000 in “fixed outlays,” expenses like child support, car leases, taxes, consumer debt and utilities.

     They spend $18,000 a month – still leaving more than $30,000 a year left over..

     Andrews and Uchitelle wrote that “nervousness is evident across the country” and “millions of homeowners [are] already underwater and the prospect that millions more may face the same situation.” The worst-case scenarios presented in the article promoted the idea that everyone is in danger of losing their home.

     The Times used 60-something Collie Tuttle's story. She purchased a $270,000 home near Memphis in 2004. After losing her job and taking another at a lower pay, she “is being forced to choose between her home and the rest of her life.”

     Again, the Times presented the borrower as a victim even though Tuttle was not "forced" to put no money down. Tuttle told the Times she was “relying on her six-figure income … to pay down the mortgage.”

     Tuttle admitted buying the house “was a big mistake,” and even said she can afford the $2,400 a month in mortgage and utilities, but "very little is left over to replace her 11-year-old car, to travel, to pay down her credit card debt, or even to buy new clothes."

     As if two struggling victims weren't enough, the Times found a third family. One struggling to make payments on a house that won't sell, while also dealing with job loss.

     According to the story, Jane and Kevin Naus relocated to North Carolina, but have not been able to sell their Memphis home because they don't want to "cut the price" any more. Mr. Naus also lost his job, and the family is getting by on his severance, Mrs. Naus' disability income, and "occasional dips into their savings, which have fallen below $100,000."

     A couple with one person unable to work and another currently laid off does not reflect the average family situation. But it does make the American economy look even worse.

     The Times selection of anecdotes and its victimization theme is part of a standard media practice of reporting worst-case scenarios [2]. The media highlight tragic stories to slam business or trash the economy and many of those stories gloss over subjects’ failure to exercise personal responsibility.

     In many cases, the media have encouraged viewers and readers to feel sympathy for others who have made bad choices and inaccurately presented extreme cases as representative of average Americans while blaming business or the economy at large for their personal problems.