Since the stock and credit market turbulence began in July, NewsBusters has been informing readers that media continually predict recessions that never happen.
On the sad flipside, bearishness in the press can become so pervasive that an economic downturn ends up being an unfortunate self-fulfilling prophecy.
NewsBusters affiliate the Business and Media Institute made this very point in a late-November article by Amy Menefee entitled "Talking Ourselves Into Recession."
This concern is shared by business leaders like Craig Hester, CEO of Hester Capital Management, who during an interview with CNBC's Erin Burnett and James Cramer Friday spoke an inconvenient truth about media's impact on the economy that folks in the press sadly don't recognize as they disseminate pessimistic after pessimistic predictions often leading to people unnecessarily losing their jobs - or worse:
When Larry Summers suggested in early 2005 that, as paraphrased by Slate's William Saletan, "innate differences between the sexes might help explain why relatively few women become professional scientists or engineers," the outcry was immediate, furious, and went to saturation level virtually overnight. The controversy ultimately led to his resignation a year later as Harvard President.
On Wednesday, Mr. Summers, a Democrat who was once Treasury Secretary under Bill Clinton, made a recommendation in his area of expertise -- that is, that a tax cut would be a good idea to protect against a possible recession. (Yours truly doesn't believe that a recession is anywhere near occurring. But hey, I've said since May, and several times since [here, here, and here, among others] that a tax cut is needed anyway to keep the economy chugging along at a good rate. So if panicked pols want to enact a tax cut for the wrong reason, I'll take it.)
Old Media reaction to Summers has been virtual silence.
"The economy is slowing down so fast this quarter you can see the skid marks as it slams on the brakes," Stuart Hoffman, chief economist at PNC Financial Services Group, said in an Associated Press story on December 20.
The story also quoted former Federal Reserve Chairman Alan Greenspan, who isn't optimistic either.
As Chief White House correspondent for NBC, there is no doubt David Gregory has danced his way through a lot of fast breaking stories in Washington, DC. Little did we know just how much practice Gregory had been getting of late.
On December 19, Gregory danced around the economy's "Naughty and Nice" list with Jim ‘Cramer Claus.' But while filling in for ‘Today' host Matt Lauer on December 20, Gregory pulled out all the stops. Demonstrating what looked like an audition for ABC's ‘Dancing with the Stars,' Gregory expressed his enjoyment of guest Mary J. Blige's performance by dancing along.
"He is a guy that doesn't get regular coal - I'm giving him high-sulfur stinky coal," Cramer said. "He is in the end an academic who is over his head frankly. I hate to say that. He's a volunteer official who is trying to do his best. But he had his chance and he's lost it."
The Democrats were finally able to get something passed in Congress, a new energy bill that mandates car gas mileage and bans the incandescent light bulb, and on Wednesday’s CBS "Early Show," co-host Julie Chen described it as, "Congress's historic move to get rid of gas guzzlers." Co-host Harry Smith began the "historic" theme at the top of the show:
Later this morning, the president will sign a new energy bill, that will radically change the way we drive, the fuel we burn, and the way we light our homes...This morning for the first time in 32 years we will have a new energy bill. The Energy Independence and Security Act.
No one objected to the idea that everyday light bulbs would be banned with this new legislation. Instead Smith joked holding up a light bulb: "So guess what, will we see the end of the incandescent light bulb? Remember, was it Uncle Fester who put it in and it lit up?"
Barely four years after California's historic recall of sitting Governor Gray Davis and Arnold Schwarzenegger's landslide election to replace him, the Golden State is, again, in a budget crunch of its own making.
The state's Old Media, as would be expected, is moaning about cuts that might have to be made, obsessing over the possibility that "universal health care" might be derailed, and of course giving visibility to anyone and everyone who thinks even more taxes will solve the problem.
As has been the case for well over a decade, nobody that I know of in California's Old Media is considering the idea that the state is paying the price for failing to sufficiently go along with the rest of the country in aggressively reducing welfare rolls. But the numbers support the idea that if the state had done what the rest of the country has "somehow" done without visible suffering, it would be in a much better situation.
(A table and graphs illustrating the situation are after the jump.)
"[I]f you look at the history of this substance, ["American Morning" co-anchor] Kiran [Chetry] - I think this is very important - we subsidize a lot of corn production in this country," Gupta said. "We've been subsidizing it for a long time to support the corn farmers, which is a good thing. If there is a problem in all of this, it is that maybe we make too much corn and some of that corn gets turned into this high-fructose corn syrup."
If you watched the news in the last 24 hours, you'd think women's clothing sales were the barometer for the economy. All three major networks reported a 6-percent decrease in women's apparel sales this holiday season, calling the figure "ominous," "worrisome" and "a big deal."
The only problem is that the corporation reporting the figures, Mastercard, didn't say it was that big of a deal. In fact Mastercard's SpendingPulse showed a "modest increase" in holiday sales overall, and "extraordinary growth" for eCommerce sales.
But for the MSM, good news is no news, so they zeroed in on one negative to suggest Christmas 2007 is a retail failure. And since Christmas is all about shopping, we might as well declare the whole season over before it started!
On the "CBS Evening News" Dec. 17, Anthony Mason reported "an ominous sign:
You'd hardly expect the chief Washington correspondent of business channel CNBC to negatively stereotype economic conservatives. But appearing on today's Morning Joe, the urbane John Harwood did just that.
JOE SCARBOROUGH: [Huckabee is] a different type of evangelical. It's not the evangelical in American politics that's traditionally been very conservative economically. Obviously a lot of people at the Wall Street Journal don't like this guy.
Time Magazine will announce its 2007 "Person of the Year" in its December 31 issue and Jobs is listed as one of the candidates. According to Time.com, he has several things going for him, but one glaring thing working against him:
"Pro: The iPhone is a triumph while iTunes expanded its reach as the dominant source of online music. Oh, and Apple stock is up a mere 100% in 2007.
Con: Not exactly a figure of global change. He's a businessman, albeit a great one." (emphasis added)
It is and it was showcased on the December 16 "World News Sunday" in a disturbing human interest segment about freeganism - a radical-left anti-capitalist movement.
Madeline Nelson, an executive-turned-freegan, was featured on "World News." The segment showed Nelson serving a four-course meal, which included a mixed green salad, stuffed peppers, and a tofu cheesecake with strawberries.
"The grocery bill for such an elaborate feast? Zero," said ABC correspondent Ryan Owens. "That's because this food doesn't come from inside a store, but outside of it."
Prior to her "tear" question, which Mika Brzezinski asked only minutes before on MSNBC, CNN’s Kiran Chetry did direct one tough question to Hillary Clinton on Monday's "American Morning," concerning the Boston Globe’s endorsement of Barack Obama and the paper’s criticism of her campaign. "'The Boston Globe' endorsed Senator Obama, saying about you, in fact, 'her approach is needlessly defensive, a backward glance at the bruising political battles of the 1990s.' Is 'The Globe's' statement fair?"
Hillary tailored her response to make it about the debate over the economy.
The top headline in Saturday's Washington Post underlines the tendency for displaying bias by practicing future-tense journalism. "Bush's Budget Wins May Cost Him" is the headline on Jonathan Weisman's report. Inside, the headline is similar in tone: "President Could Pay a Price for Victories Over Democrats." He may -- or he may not. He could -- or he could not. But it's hard to escape the notion that the Post thinks he should. Or perhaps the Post is afraid that a series of wins by Bush may make him look powerful and boost his approval rating, and they want to keep following his image around with their own cherished personal collection of dark clouds of text.
Why can't the newspapers simply report what has already happened, and not bog down the reader with their own biased impressions of what could or should happen next? Why must reporters always get out a crystal ball and wear a silly fortune-teller's hat? Weisman's soothsayer story began this way:
As an exemplar of a government-run enterprise stuck in the mud, it’s hard to come with a better example than what is happening in the area that was the subject of the infamous Kelo v. New London ruling in 2005. Nearly 2-1/2 years after the US Supreme Court ruled that the city could evict Susette Kelo and other holdouts from their homes, and 17 months after the final settlement between the city and the final two holdouts, very little has been done in the affected area.
Make that "nearly three years" (New London Day link requires registration after a short time, and a paid subscription after that):
Yes, the viciousness is being directed at Democrats for not being spendthrift enough.
It's too early to tell whether President Bush and congressional Republicans have outmaneuvered the Democratic congressional majority, but it's looking that way. Old Media doesn't like it, and their inability to successfully buck up their side, one bit.
In the Washington Post's "Dems Blaming Each Other For Failures," Jonathan Weisman and Paul Kane are clearly critical:
According to ABC reporter Claire Shipman, dreary economic news and a slow Christmas could be a real plus for the Democrats. Filing a segment for Wednesday's "Good Morning America," Shipman lamented, "It may be that no amount of hall decking can convince Americans to be jolly about the economy this holiday season."
However, the GMA correspondent saw good news in this for the Democrats. She asserted, "Traditionally, of course, problems in the economy would help the Democrats." After allowing that GOP candidate Mike Huckabee's "populist message" could resonate, Shipman gushed, "Among the Democrats, John Edwards has the message that's most consistently appealing to people suffering from economic woes." Not wishing to leave any Democrat behind, she rhapsodized, "But at the same time, the Clinton brand has a strong economic reputation."
Hillary Clinton's performance in her interview with Maria "Money Honey" Bartiromo of CNBC last week was so bad that she must have sent a double (stop shivering at the thought, will ya?).
After all, the genuine Smartest Woman in the World couldn't possibly have said the things she said, as noted at Rush Limbaugh's site last Thursday. It got so bad that Bartiromo, who seemingly has barely cracked a smile since George Bush became president, felt compelled to challenge her.
Here is one of the choice offerings Mrs. Clinton served up:
(There are ) lots of people who come on your show who, you know, are gung-ho, protect the tax cuts for the wealthiest of Americans, that will not work if the economy slows down. You need to get money in the pockets of tens of hundreds of millions of Americans, and that's what I intend to do.
"I'm no longer fiery," Cramer said. "They had their chance," he said four months after the big tirade.
On the December 11 "Street Signs," Cramer's mood swung 180 degrees the other way after the Federal Reserve cut interest rates only 25 basis point to 4.25 percent - viewed as a disappointment by the shock stock picker.
In 2005, I sensed that journalists in general prefer to call this time of the year in commerce that of "holiday shopping" instead of "Christmas shopping," but that when it came to people losing their jobs, they preferred to describe layoffs as relating to "Christmas."
My instincts have been proven correct for two years running, as you can see below from the results of three different sets of Google News searches in November and December of 2005 and 2006 (links to 2005's related posts are here, here, and here; 2006's are here, here, and here):
Steve Fraser might look mild-mannered, but when it comes to economic doomsaying, he is the Rocky Marciano of recession, the Tiger Woods of turndown, the David Beckham of depression.
Speaking of bending one, Fraser's LA Times column of today, "Symptoms of an Economic Depression," twists U.S. economic data into a harbinger of impending doom. Fraser begins by falsely claiming that "no one wants to utter the word 'depression.'" In fact, Fraser himself, a left-wing labor historian, wants not merely to utter it, but to bellow the word with a 10,000 megawatt bullhorn. Why? Because, as he gleefully predicts in that same column:
This perfect storm [of a bad economy] will be upon us just as the election season heats up, and it will inevitably hasten the already well-advanced implosion of the Republican Party.
"The Senate's 88 to 5 vote" on a one-year reprieve for middle class taxpayers on the Alternative Minimum Tax (AMT) "blew a $50 billion hole in the Democrats' promise not to pass any spending or tax measure that would add to the deficit," Washington Post's Jonathan Weisman and Jeffrey Birnbaum reported today. The staff writers then rounded up three "conservative 'Blue Dog' Democrats" from the House of Representatives to rail against the Senate for lacking the courage to "take a tough vote," in the words of Rep. Mike Ross (D-Ark.).
But just how conservative are these "conservative" Blue Dogs? Try slightly left of dead-center.
Is the New York Times changing? In an article about Old Havana's rebuilding, NYT reporter John C. McKinley, Jr. bucked the media habit of inserting leftist messages into articles about Cuba. Instead, he exposed the average Cuban's poverty, giving the state-run socialist economy as the cause--all without mentioning “free” health care or the US embargo.
The article described how Havana historian Eusebio Leal Spengler “rebuilt and refurbished more than 300 landmark buildings in Old Havana, from fortresses built in the colonial days to famous nightspots and hotels of the city’s swinging era just before the Cuban revolution.“
McKinley countered that by explaining most Cubans don't have money for drinks at the bars made famous by Hemingway or the upscale inns favored by celebs like Jimmy Carter and Jack Nicholson (bold mine throughout):
Just a half block from the Bodeguita del Medio, another famous eatery favored by Hemingway that is constantly mobbed with tourists, Cubans troop into a sparsely stocked government store to get their monthly rations of beans, powdered milk, cigarettes and soap.
Business & Media Institute Director Dan Gainor appeared on the Fox Business Network December 6 to discuss how the media is choosing sides in the subprime housing problem.
"All throughout this whole year and actually if you go back in the last year and before [the media] have been pointing out that the lenders are the bad guys...CBS News who actually did an okay report last night, then the example they use is someone who has a 6.6% adjustable rate adjusting up to 9.6%, they've got a house the size of a mansion and they've got horses."
Gainor said the important thing that journalists fail to do is to get both the lenders and the home buyer's viewpoints.