Financial Crisis Commission Scrambles to Find a Publisher at the Last Minute


Last August, the Financial Crisis Inquiry Commission raised many an eyebrow with its announcement that Little, Brown, which is owned by Lagardère Group (LGDDY), would publish its findings on the 2008 economic meltdown. That's because the report, which would be written up by journalist Matt Cooper, would "pay an advance to the government [with] the stipulation that a portion of the proceeds from sales be paid into U.S. Treasury coffers," according to The Washington Post.

That arrangement is hardly the usual way to produce a government report, especially one that that could be downloaded easily, and for free, from the Commission's website once it's available in mid-December.

Now, it turns out that this unusual arrangement will not be. The terms of the deal with Little, Brown were kept vague last summer because the contracts hadn't been signed, and as it turned out, they never were. TheWall Street Journal reported over the weekend that Little, Brown is out, and PublicAffairs Books is in. Commission spokesman Tucker Warren told DailyFinance that terms of the deal are still being worked out, but they "feel PublicAffairs is a good fit to publish the Commission's report and are excited to be working with them." (Little, Brown referred comments to the FCIC, and PublicAffairs did not respond to comment.)

Profit vs. Public Service

When major events happen, and government commissions are tasked to compile a report explaining exactly what and why the event transpired, publishers inevitably climb aboard to release the final version to the public in book form - charging money for a document that can be downloaded for free. But as the 9/11 Commission Report proved, selling over a million copies for W.W. Norton, there's more than a healthy market to pay up for otherwise free reports, which makes publishers happy, as they reap success from what they view as a public service.

But Little, Brown's deal was less about public service than about a traditional publishing proposition. An advance against royalties would need to be earned back, and in the event that more readers chose the free online document over the published edition with a price tag, public service would transform into a potential net loss. It isn't clear what led to the dissolution of the tentative agreement with the FCIC, but when its parent company, Lagardère, can no longer reliably depend on a deep buffer provided by mega-sales of Stephenie Meyer's Twilight novels, a potential public service may not be in the best economic interests of the company.

Even with PublicAffairs on board, it remains to be seen if the FCIC's report will see the light of day in time for its self-imposed deadline. Mid-December is just over a month away, and the 10-member has only about two to three weeks left to reach consensus -- something that's awfully hard to do with the deep divides between both political parties. And if that deadline is missed and the Commission must reconvene under a Republican House and slim Democrat Senate majority, the chances of the report, and the published version offered at a price, even seeing the light of day may dim.