The next Federal Reserve Chairman will be Janet Yellen. President Barack Obama plans to nominate her on Oct. 9. Ahead of the announcement, Yellen, the liberal Fed vice chairman, was considered the most likely candidate to replace Ben Bernanke ever since Larry Summers, her chief rival for the nomination, bowed out of the race on Sept. 16.
She was a frontrunner even before Summers’ withdrawal. But between July 12 and Oct. 8, the networks paid very little attention to Yellen and the Fed candidacy. In fact, they spent more time covering Miss America in one day, than in three months of coverage of the future Fed chairman.
Yellen’s role will be significant. The New York Times called the nomination for a new chairman “the single most important economic policy decision that Mr. Obama will make in his second term.” In spite of that, the three broadcast networks largely ignored the liberal candidate before her nomination. ABC actually spent 25 times more airtime on Miss America than on Yellen. National newspapers covered the possible chairman, but focused more on her gender than her favored policies.
Between July 12 and Oct. 8, Janet Yellen received barely 10 minutes of news coverage on ABC, CBS, or NBC. By contrast, on Sept. 16, alone, these same networks spent more than 11 minutes discussing Nina Davuluri, the 2013 winner of the Miss America Pageant.
ABC was the worst, sparing only 18 seconds on its Sept. 19 broadcast of “Good Morning America” to talk about Yellen. They spent more than 25 times that discussing Davuluri on Sept. 16 – a whopping 10 minutes and 27 seconds. That segment included an interview with the new Miss America.
The major networks’ apathy is disturbing, considering Yellen’s left-wing views. Bob Janjuah, global head of tactical asset allocation at Nomura International PLC, once said of her “if Karl Marx was in charge of the world, he’d have Janet Yellen as his central bank governor.”
In what little time ABC, CBS and NBC talked about Yellen and the Fed candidacy, they failed to discuss the policies she supports. Most simply mentioned that she was a contender to head the Federal Reserve and would be the first woman to do so.
Of all the broadcast network mentions the Aug. 17, CBS “Evening News” devoted the most time to Yellen. That story focused almost exclusively on her gender, talking to multiple people who emphasized the fact that she is a woman, at the expense of any substantive discussion of her policies. CBS even suggested that the debate centered on misogynistic stereotypes. Dr. Lara Brown of The George Washington University argued that “[banking positions] are important roles that are seen as sort of men’s issues.” This one minute 23 second segment spent a pathetic 15 seconds on her policies, merely mentioning that she was Wall Street’s pick for the position.
Media Focus Mostly on Gender Politics instead of Policy
The Federal Reserve is in a particularly important position now for two reasons.
First, after a long period of aggressively pumping money into the economy, called quantitative easing, there is a widespread expectation that the Fed must begin phasing out this strategy. This important policy change could decide the fate of the already weak recovery.
Second, in 2010, Congress passed the controversial Dodd-Frank financial overhaul, and the next Fed chairman would preside over the beginning of the many major changes resulting from this legislation.
Yellen, a Brown and Yale educated economist, has a long history of serving in the Federal Reserve. She left a teaching career at the University of California Berkeley to become president of the San Francisco branch of the Federal Reserve in 2004. Later she advanced to vice chair of the Federal Reserve in 2010. As chairman, she would be responsible for directing Fed policy and leading its Board of Governors.
Even the print media that discussed Yellen’s candidacy consistently failed to delve deeply into policy. Both The New York Times and Washington Post suggested that opposition to Yellen was rooted in sexism and the idea that a woman is not strong enough to head the central bank.
Discussing Yellen’s potential for nomination and confirmation, Simon Johnson of the Times asserted: “If Ms. Yellen were a man, we would not be having this conversation.”
Ezra Klein of the Post went further, accusing opponents of a “subtle, sexist, whispering campaign against Janet Yellen.” Certainly not all of Yellen’s opposition view her as weak, given a recent statement by former Federal Reserve COO Dick Anderson that “Yellen’s abrasive, intimidating style is probably more suited for a ‘Mad Men’ era as opposed to a modern office environment.”
Appointing a woman as chairman of the Federal Reserve would be a historic event, but arguing that opposition must be based on sexism ignored valid criticisms and concerns over her policies. With Yellen’s progressive record, conservatives have reasons to be concerned with her becoming the most powerful financial regulator in the world. But this left-wing record has remained mostly unknown to the public thanks to the news media.
Yellen Earns Praise from Lefties, Promotes Spending and Regulation
Yellen is widely regarded as extremely “dovish” on fiscal policy. She greatly prioritizes controlling employment, over the Fed’s other goal of controlling inflation. She’s also been heralded by lefties like Sen. Elizabeth Warren, D-Mass., as a “terrific choice” for chairman of the Fed.
The Telegraph (UK) was aware of Yellen’s fiscal views on Oct. 9, when its headline about the Fed nomination proclaimed: “Rejoice: the Yellen Fed will print money forever to create jobs.”
Yellen’s prioritization of jobs has lead many to believe that Yellen would not work hard enough to control inflation. She has also been an outspoken proponent of increased government spending and the unprecedented level of quantitative easing employed by Bernanke’s Federal Reserve.
She also supported increased government regulation, including the Dodd-Frank financial overhaul. She publicly stated in January 2013 that Dodd-Frank did not go far enough in pursuing banking regulation and argued there is a need for “more, and not less, data disclosure” garnered by regulation of the financial market.
On April 24, Binyamin Appelbaum of the Times admitted Yellen’s critics “worry that she would not be sufficiently concerned about the possibility that inflation will accelerate as the economic recovery gains strength.” By actually mentioning policy concerns about Yellen, his piece was an exception from the national newspapers coverage.
Yellen has been a significant force within the Fed in promoting the “story that inflation could be too low,” according to former Fed governor Laurence H. Meyer.
But inflation would have devastating effects on ordinary Americans. Pete Comley, writing for The Telegraph (UK), pointed out in July 2013 that increased inflation would raise housing prices, reduce the value of savings accounts and increase costs of everyday goods.
In a speech to the AFL-CIO on Feb. 11, 2013, Yellen declared her support for increased stimulus, saying “I expect that discretionary fiscal policy will continue to be a headwind for the recovery for some time.”
Liberal economist Paul Krugman heralded Yellen’s statement as support for his belief that “one main reason for the sluggish recovery is that government spending has been far weaker in this business cycle than in the past. We should be spending more, not less.”
In spite of the broadcast networks and national newspapers’ failure to provide in-depth coverage of Yellen’s support for liberal policies. She has not escaped scrutiny from conservatives.
The Cato Institute’s Director of Financial Regulation Studies, Mark Calabria, has questioned Yellen’s ability to predict economic danger, in an analysis of her 2010 Senate confirmation hearing. He argued that she would not be able to predict a bubble in the economy, given her inability to do so as head of the Federal Reserve’s San Francisco Branch in 2008. She would, therefore, not know when the Fed ought to act to control inflation and prevent an asset bubble.
Methodology: Business and Media Institute examined every mention of Yellen on ABC, CBS and NBC news shows including newsmagazine shows between July 12, when the media began reporting her candidacy for chairman of the Federal Reserve, and Oct. 8. The time tallies were derived by counting the length of each segment discussing the next chairman, even when the focus within the segment shifted from Yellen. BMI also examined the same programs for mentions of Miss America. BMI timed each discussion of Miss America that discussed winner Nina Davuluri, counting the length of the entire segment devoted to the pageant, as long as she was discussed after being crowned Miss America.