McGraw-Hill Cancels Book Critical of S&P

By Lynn Andriani -- Publishers Weekly, 2/11/2009 10:09:00 AM

McGraw-Hill has cancelled the publication of a book it was set to publish next month—a book critical of Standard & Poor’s, which is a division of The McGraw-Hill Companies. Mary Skafidas, v-p of communications and marketing for McGraw-Hill Education, said Bailout Nation: How Easy Money Corrupted Wall Street and Shook the World Economy by Barry Ritholtz “needed extensive corroboration, and we could not agree on a unified approach with the author. He is free to have it published elsewhere.” 

On Ritholtz’s blog, The Big Picture, the author told his side of the story. He wrote that he understood the risks of having his book—which is critical of the ratings agencies—published by the company that owns S&P and therefore made sure his contract gave him “final edit.” McGraw-Hill took issue with a portion of the book where Ritholtz accused the three major ratings agencies (Standard & Poor's, Moody's and Fitch Ratings) of “payola,” i.e., buying ratings. So Ritholtz rewrote the section, although it still lambasted the ratings agencies. The publisher persisted in its objection, Ritholtz wrote. “I came to the inescapable conclusion that this was an attempt by the McGH corporation to water down my content.” Ritholtz told his publisher they had to accept or reject the manuscript as is. Ultimately, they rejected it.

The publisher and author disagree over why the book was dropped. Skafidas emphasized that problems with corroboration was the primary issue. However, Ritholtz said nearly all of his sources are available online, and others are in books he purchased from Amazon. “Nothing obscure, no sources from deep within some library stacks or any unrecorded interviews with anonymous, now deceased, secret witnesses. It was all online, and readily available,” Ritholtz wrote. Skafidas dismissed the suggestion that McGraw-Hill cancelled publication because the book was critical of S&P, telling PW, “Our company is known for independent editorial voices, and we’ve often been critical of our company and its businesses.”

Ritholtz’s agent, Lloyd Jassin, said the book is completed and a PDF of the typeset manuscript is available. He and Ritholtz are in discussions to publish the book with another house, although he declined to name which one. Portfolio.com reported that McGraw-Hill had already pre-sold 22,000 copies of the book; Skafidas said that as far as she knows, the pre-orders will be cancelled.