Last week the Business & Media Institute released its annual Top 10 list of the worst economic myths the media spread in 2008. The list was broad, ranging from “killer tomatoes,” to the collapse of Fannie Mae and Freddie Mac, to the death of capitalism.
But it was myth number 2 “Welcome to 1929: Great Depression II” that touched a nerve with Cliff Mason, senior writer for Mad Money, because of its criticism of CNBC’s Jim Cramer. By the way, Mason is also Cramer’s nephew according to the disclosure at the end of his bio.
Superhero economist and top-notch investor John Maynard Keynes famously told one of his critics, "When the facts change, I change my mind. What do you do, sir?"
On Mad Money we happen to share that same philosophy. And unfortunately, it's still something of a radical position.
On Thursday, the Business and Media Institute released its list of "The Media's Top 10 Worst Economic Myths of 2008." Jim is mentioned in three of them, but it's myth number 2, "the news media drew hundreds of parallels to the Depression, despite economic data that is not even close," that reminded me of that Keynes quotation.
The glacier on Mt. Kilimanjaro is melting. If you were watching NBC "Nightly News" Nov. 19 you probably would think that ice is declining because of "climate change."
After all, "Today's" Ann Curry said it: "Mt. Kilimanjaro has become a kind of poster-child for climate change. Eighty-four percent of the ice has disappeared in less than 100 years and by 2020, scientists expect as early as that it could all be gone."
Joe the Plumber, the ordinary guy who audaciously asked Obama a question about taxes, is caught in the fierce spotlight of media disapproval.
The New York Times Politics Blog "The Caucus" shined a bright, interrogation light into the background of Samuel J.Wurzelbacher (Joe the Plumber) on Oct. 16.
The post by Larry Rohter and Liz Robbins rushed to point out that Joe "is not a licensed plumber." Armed with the statement from Local 50 plumber's union, Rohter and Robbins attacked Joe for "playing games with the world."
But the bloggers were playing games by burying one easy explanation for that fact.
"Unlike some other states, Ohio does not have a formal statewide licensing system for plumbers. But the city of Toledo and other municipalities do," the blog post said 10 paragraphs later.
The Times bloggers also dismissed Joe's question about Obama's tax plan saying, "The premise of his question to Mr. Obama about taxes may also be flawed, according to tax analysts."
Faiola’s article said, “But the hands-off brand of capitalism in the United States is now being blamed for the easy credit that sickened the housing market and allowed a freewheeling Wall Street to create a pool of toxic investments that has infected the global financial system.” The Post story had no rebuttal from free market economists who say this was not market failure after all.
“The government reported today that 15,000 more Americans joined the line for unemployment benefits. And despite back-to-school bargains, consumers were not in a spending mood in August. Major retailers reported sales were up just over 1 percent from last year.”
Amity Shlaes, a senior fellow at the Council on Foreign Relations, penned an August 18 Washington Post column examining five of the government's Depression-era mistakes that made financial matters worse. Shlaes, author of "The Forgotten Man: A New History of the Great Depression" cautioned today's lawmakers against following in those footsteps.
The media were quick to jump on the story of an emergency airplane landing in Manila, Philippines due to a hole in the fuselage of a Qantas flight. And they were quick to sensationalize the story without mentioning Qantas' impressive safety record.
"Well, nobody's saying that we should be covering up a huge hole in the side of an airplane. But it's important for the media to not sensationalize cases like this, which they are already doing," Business & Media Institute Assistant Editor Nathan Burchfiel told Fox Business Network host Stuart Varney on the July 25 "Fox Business."
Burchfiel noted that British tabloids have already speculated that a bomb in the cargo hold may have blown a hole in the fuselage, even though there was no indication that's the case.
"This morning in the American media on ABC, David Muir said that the plane ‘instantly plummeted' 20,000 feet, which is not true," Burchfiel said. "The pilot descended 20,000 feet, rather sharply, but that was his decision, he did it under full control to normalize cabin pressure."
"They [poor people] could not give a damn about climate change because they want 24 hours a day light," said Luft. He cited the example of people living in slums outside Bangalore, India. (Audio is available here)
"In India alone, 600 million people are not connected even to the [power] grid," said Luft. "When you talk to these people all you ahve to do is drive 10 minutes from the center of Bangalore to the slums there and ask them about climate change. And they'll tell you: 'We want electricity, we want it today, we want it cheap, we don't care how you make it.'"
Whether you are a Starbucks patron or not, no doubt you've heard that the Seattle-based coffee chain plans to close 600 "underperforming" stores and cut about seven percent of its workforce.
Job loss is certainly not something to cheer about, yet Reuters found a unique story to tell on July 6, 2008. No, this wasn't the sad tale of roughly 12,000 soon-to-be unemployed baristas. It was a morbid report about coffee snobs who take "grim delight in Starbucks woes."
Reuters' unbalanced report quoted eight critics of the global coffee seller, including those who are "happy" about the store closures.
"I'm so happy. I'm so not a Starbucks person,' said Melinda Vegliotti, sipping iced coffee at the Irving Farm Coffee House in New York. 'I believe in supporting small businesses. Starbucks, bye-bye,'" she told Reuters.
Only one "defender" of Starbucks was included in that story, and the meager praise he offered was that it is "convenient."
Dan Gainor, Vice President for the Business & Media Institute, blamed part of people's gloomy perception of the economy on the "constant drumbeat" of negativity coming from the news media. Gainor appeared on Fox Business Network's "Cavuto" May 20.
"Almost 23 million people watch evening news every night. That has an affect and that's almost 1/10 of the American population. Those are people who are shoppers, who are buyers. It affects people and just the constant drumbeat of negativity here from the mainstream media affects people even at high incomes," said Gainor.
The show's host Neil Cavuto seemed to agree, "If this continues and this perception becomes reality, we've got hell to pay to here."
When it comes to the economy, "it's not good. Not good," according to Jon Stewart. "But don't take my word for it. Seriously, I'm actually doing very well."
On May 1, "The Daily Show" host was introducing a segment that made light of doom-and-gloom economic reporting on network and cable news. His mash-up highlighted CBS's own "Grim Reaper," Anthony Mason, ABC's Betsy Stark, NBC's Brian Williams and CNN's senior business correspondent Ali Velshi.
Stewart poked hardest at Velshi, whom he called that "Hairless Prophet of Doom."
"Who is that hairless prophet of doom and how can we appease his anger, please?" Stewart pleaded, "If we give you our hair will you give us back our money? Will you do it, sir? I beg of you - Velshi!"
Robert F. Kennedy Jr. wants to ‘abolish’ carbon usage and sees a direct comparison to the end of slavery.
According to Kennedy, “industry and government warnings” about avoiding “economic ruin” should not be heeded because abolishing slavery did not cripple the British economy as was predicted “Instead of collapsing, as slavery’s proponents had predicted, Britain’s economy accelerated,” he argued. Here's how he put it:
CNN's senior business correspondent Ali Velshi had an interesting question for viewers this morning.
Before telling viewers that consumer confidence is at the lowest level in two years, Velshi asked if the media have anything to do with it.
"Do you think we're feeding this thing? Do you think we're fueling this sort of misery?" asked Velshi on "American Morning" November 28.
A question for Newsbusters readers: How would you answer Velshi's question?
The Business & Media Institute has found that the media certainly don't reinforce the soundness of the economy when things are going well. BMI's "Bad News Bears" study that looked at one year of reporting, found that 62 percent of network (ABC, CBS, NBC) economic stories focused on negative news. Those stories were also given more airtime.
Other BMI research has shown that the media have emphasized the possibility of recession since the economic recovery began in August 2003.
In order to make food choices for her constituents, Perry wants to ban new fast-food restaurants from opening in the South L.A. district for at least a year.
CNN's Dr. Sanjay Gupta ate up the plan for regulatory meddling saying on "American Morning" November 16, "[A]lthough obesity may not be eliminated entirely, studies show zoning laws are a good first step to fighting the problem."
Christmas is still nearly seven weeks away, and already the media are offering a “Bah, Humbug” for retail sales and the U.S. economy.
CNN shoveled coal at the positive economic news on November 2 and immediately moved into full Grinch mode.
“You know, just earlier this week the broadest measure of the economy, Kyra, the GDP, came in at 3.9 percent, stronger than expected. What’s working against it, though, the financials, concerns that we’re going to have a lot more carnage coming from that very important sector, consumer spending …” said “Newsroom” correspondent Susan Lisovicz.
On September 24 of this year, Alexis Christoforous of “CBS Morning News” warned, “It could be a blue Christmas for many of the nation’s retailers.”
Well, viewers are in for a treat on NBC this coming week. Okay, maybe not.
NBC is taking a “green” gamble to boost sagging ratings as sweeps month begins, by weaving environmental plotlines throughout its programming lineup including many primetime shows throughout “Green Week,” November 4-9.
Eco-programming will kickoff, literally, as “Football Night in America” goes dark for the final minute on November 4. Yes, because turning off those studio lights for one minute will somehow remedy the stadium lights that will burn brightly over the Dallas Cowboys and Philadelphia Eagles game for the next three hours.
Like the latest runway trend, "green is the new black" according to the media. At least where business is concerned. But it turns out that companies are finding "going green" is an easy way to put themselves in the red.
Back in 2003 FedEx announced it would begin switching to hybrid trucks and won an award from the Environmental Protection Agency, but at $70,000 more per truck the costs got in the way. Four years later, the company has fewer than 100 hybrid trucks, according to the October 29 BusinessWeek.
Other companies like PepsiCo and Caterpillar could face problems with the bottom line because of their support for more government regulation, said Steve Milloy on CNBC's "Street Signs" October 12.
This week marks the unhappy milestone of Black Monday for Wall Street, which had some journalists warning “it could” happen again. Even if it doesn’t, the media hammered home the prospect of a possible recession.
The Dow Jones Industrial Average nosedived Oct. 19, 1987, when panicked selling cost investors 22.6 percent in one day of panicked selling. But do investors in 2007 need to be worried about another crash?
According to the media's parade of children who need government assistance for insurance, President Bush must really just hate children. After all, he vetoed a bill today that would have expanded the State Children's Health Insurance Program (SCHIP).
Leading up to the October 3 veto, the media couldn’t resist scripting it as a vote against children.
What’s at stake, though, included a proposed $35-billion expansion of taxpayer-funded insurance made possible by a huge tax increase on tobacco users many of whom are poor -- burdening the same families the program is designed to help.
"Good Morning America" asked "What is going on?" with the stock market on August 16. Anchor Chris Cuomo asked Bianna Golodryga if the market drop is a correction or a recession.
"There seem to be two schools of thought here, those involved in all this sophisticated mortgage lending are saying this is the beginning of the end. But stock analysts are saying it is just a correction. Where are people's heads down there today?" said Cuomo
An on-screen graphic read, "Very Nervy Wall Street Correction Or Recession?"
CNBC’s Jim Cramer went on an impassioned rant August 6 calling for the Fed to reduce interest rates.
“Bernanke needs to open the discount window. That is how bad things are out there … in the fixed income markets we have Armageddon,” said Cramer on “Stop Trading!” Following Cramers’ rant, NBC brought him on “Today” to analyze the economy August 10.
NBC’s Meredith Vieira asked “Are the markets about to crash?” on the August 10 “Today” show.
“Crashing” stock market? “Legalized gambling”? ABC’s “Good Morning America” berated the stock market for trampling on a supposed individual right to a mortgage.
Chris Cuomo’s August 13 story on a couple who had their mortgage pulled due the recent “drama on Wall Street” started like this:
“To a certain extent the stock market has always been a form of legalized gambling, where Wall Street tries to cash in on bets made on the right companies. But for many financial institutions, the chips were the mortgages of hard-working American families, in danger of losing their homes, or now never getting a chance to live the American dream.”
Sen. Edward Kennedy (D-Mass.) earned the scorn of "The Daily Show" on August 7. Show reporter Jason Jones mocked the senator's opposition to a wind farm off Nantucket Sound.
With typical "Daily Show" sarcasm and melodrama Jones remarked:
"It looked bad for the native population, until one man stood up ... Yes. Ted Kennedy – noted man from Nantucket and co-sponsor of dozens of renewable energy bills – took a stand—against the wind farms."
Okay, we’ve all heard that hybrid vehicles are better for the environment. But how do they measure up when it comes to the green in your wallet?
Even starlet Paris Hilton has boarded the hybrid bandwagon, as reported by BPM Magazine.
“I came in a hybrid car because I think that’s the way to go – to save energy and to save our earth from all this – you know pollution so I think if everyone just takes the steps to do it will make a difference,” said Hilton.
However, Hilton probably wouldn’t be as concerned about the cost of owning one of these hybrids as average people. But you wouldn’t be aware of any higher costs after reading Chris Woodyard’s August 8 USA Today story.
“It’s not just good public relations,” wrote Woodyard. “Since the Supreme Court ruled earlier this year that the EPA can regulate greenhouse gases, General Motors, Ford Motor and Chrysler have joined the U.S. Climate Action Partnership, a coalition of corporate executives calling for CO2 restrictions.”
It would be even better public relations if hybrids made economic sense, but they don’t. It turns out hybrids cost more to maintain than regular cars.
Inflation? Forget about it. Let the economists and policy wonks worry about it.
The Federal Reserve’s decision not to drop interest rates drew the ire of “CBS Evening News” correspondent Kelly Wallace on August 7. Wallace’s story about the “credit crunch” centered on Amanda Michalko, a 26-year old Michigan resident, who would not benefit from lower monthly payments on her pending mortgage because of the Fed.
As six miners are trapped in a collapsed coal mine ABC “World News Tonight with Charles Gibson” took it the opportunity to kick the coal industry while it was down – but this time in the name of global warming.
“The criticism of coal is that it’s a dirty energy source. Although many of the pollutants are being scrubbed out – it’s still high in carbon, the greenhouse gas blamed for global warming. The industry is promising some new expensive technology to remove that carbon.” said ABC correspondent David Kerley on August 8
Diane Sawyer kicked "Good Morning America" off this morning with economic worries about Wall Street, the "credit crunch" and "record" foreclosures.
“We do begin with the week on Wall Street, where the Dow took another huge hit, plunging 280 points in just two hours. The cause of the worst credit crunch in almost quarter a century and you’ve seen it in the neighborhoods – a record number of foreclosures,” said Sawyer.
But according to the Mortgage Bankers Association (MBAA), foreclosures are not at a record when viewed by percentage. GMA’s one-sided talk of a “record number of foreclosures” misled viewers. Foreclosures are up compared to 2006, but so are the number of home loans.