Terri Cullen, one of the founders of The Wall Street Journal Online, was announced as the wealth management editor at Reuters less than a month ago. Now, she's gone due to a story that required a White House-requested retraction. Huh?

To recap, Cullen writes a story headlined "Backdoor taxes to hit middle class" that runs on February 1st. Reuters has tried to make it disappear, but it's still available via the magic of Google Cache here. The lede:

The Obama administration's plan to cut more than $1 trillion from the deficit over the next decade relies heavily on so-called backdoor tax increases that will result in a bigger tax bill for middle-class families.

Except, as it turned out, that wasn't the case. First came the Reuters feedback page on the story, which was mostly made up of notes like this:

This story is filled with errors that truly offend any sense of even-handness, accuracy and diligence. The budget only rolls back the Bush tax cuts for those making over $200k in some instances and $250k in others. The rates for the tax brackets below that are not being rolled back, which is the whole underpinning of this story. What an embarrassing mistake. Also, calling the Estate Tax the Death Tax is straight from the conservative playbook.

And then, the retraction:

The Feb 1 story headlined "Backdoor taxes to hit middle class" is wrong and has been withdrawn. The story said lower-income families will pay more under tax provisions scheduled to expire Dec 31. The Obama administration's budget calls for the extension of those tax provisions for households earning less than $250,000. There will be no substitute story.

Unfortunately, that didn't stop the story from becoming a Republican propaganda talking point party. Drudge tried to spin it, but kept covering as the story got pulled further and further from the public eye. Crafty. And yesterday, the blog E&P in Exile announces Cullen's departure from Reuters:

The reporter who wrote that article earlier this week alleging an Obama "back door" tax hike for nearly everyone, which became a rightwing cause — and then was withdrawn by Reuters — has now left the company. Jumped or pushed?

Good question, but the better one—and what makes this story so fascinating—is: How the hell did this happen? Reuters is a massive wire service. Their stories go through check, after check, after check before they run. As Ryan already mentioned, this is the second high profile fracas this year regarding a Reuters story; the first was when their editor-in-chief spiked a story about billionaire hedge fund manager Steven Cohen without providing his pissed off reporters with kind of reasonable explanation for doing so. Barely a month later, Cullen—a seasoned financial reporter—gets a story pulled after a pissed off White House calls up the wire service and tells them how wrong their report is. The operative term there being "seasoned." Again, via MediaBistro:

In 1995, Cullen was instrumental in the launch of The Wall Street Journal Online, and for the 13 years following, served as an editor and columnist overseeing personal finance and financial markets coverage for WSJ.com. She also produced its award-winning "Fiscally Fit" column and was the author of "The Wall Street Journal. Complete Identity Theft Guidebook," published in 2007.

Put it like this: given a lineup, Cullen wouldn't be your first bet to flub a story like this. Which leads to a few questions, mainly: Why did Cullen make a mistake this large? How did it get through to print? Did Cullen leave, or was she fired? And what the hell is going on at Reuters when a high profile hire screws up a pretty easy story to such an extent that it merits a call from the White House and a departure less than a month after she was picked up?