Posted by Cognito on Thu, Mar 14 2013

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PR Lessons From the Special Inspector General of TARP

Cognito Reads is our new book club. Every month here on the blog, we’ll be highlighting a recent financial or business non-fiction book, and discussing the communications questions and examples raised in the text. Our inaugural edition comes from New York-based Account Manager Oksana Poltavets. 

There are three sides to every story. In the case of “Bailout: An Inside Account of How Washington Abandoned Main Street While Rescuing Wall Street” (Free Press, 2012), there is the U.S. Treasury Department’s take, the view from author Neil Barofsky’s side and, probably somewhere in the middle, is the actual truth. “Bailout,” Barofsky’s debut book, walks through his time as the Special Inspector General (SIG) of the Troubled Assets Relief Program (TARP), the infamous $700 billion bailout package authorized by then-President George W. Bush in October 2008 to purchase assets and equity from financial institutions to strengthen the economy.

Front cover of the

At times taking a frustrated and sarcastic tone, Barofsky outlines the difficulties he encountered setting up the SIGTARP office, his regular uphill battles with the Treasury, and the victories that he and his team were able to achieve. In a particular exasperated moment early in the book, Barofsky quips, “For three days I have been trying to get garbage cabs, and I can’t get anyone to listen. How am I going to build an agency if I cannot even get a place to put the trash?”

Barofsky’s extensive legal background, including eight years as the Assistant United States Attorney for the Southern District of New York, impacted his tenure and behavior as the Special Inspector General in charge of oversight of TARP. This is especially evident in his approach to media relations – which was refreshing compared to the traditional Capitol Hill anecdotes.  

Aside from the debate around whether the TARP money was used to stave off another Great Depression or pushed the economy into a deeper hole, there are lessons that can be gleaned from the SIGTARP’s relationship with the press corps. Barofsky’s press officer, Kris Belisle, spearheaded the office’s approach to dealing with journalists, which focused on several key points aimed at ultimately earning their trust:

  • Never lie – it undermines your entity’s integrity, and could greater damage if the truth is eventually revealed
  • Own up to mistakes – no one is perfect, being honest about occasional missteps and taking immediate measures to correct them builds credibility
  • Be completely transparent – allowing the press access to spokespeople, especially in critical times for the firm, eliminates the veil of secrecy
  • Don’t play the blame game – attacking a competitor in the press diminishes your credibility and makes you look petty and desperate

It was extremely refreshing to see a government office – or any other entity – take this approach to media interaction. In Cognito’s realm of financial services and technology public relations, where relationships with journalists are extremely important, the approach to interaction with editors and reporters mirrors Belisle’s and Barofsky’s tactics. Yet, even with the outlined policies in place, SIGTARP learned its fair share of lessons, such as the importance to proof reading every document multiple times and sending news under embargo to unreliable parties.

It’s clear that during his tenure at Special Inspector General – from late 2008 until his resignation at the end of March 2011 – Barofsky faced monumental challenges and uncertainty in the wake of the regime change in Washington. And although his frustration is evident throughout the book, it is also clear that he took this post seriously. Currently, Barofsky is an Adjunct Professor of Law and Senior Research Fellow at NYU School of Law. Belisle runs her own boutique communications firm.

Cognito, Communications, Financial Communications, Financial Crisis,
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