I have to figure, after looking at the results of this Google News search on "real earnings" (in quotes), that Old Media business reporters found what came out in the Bureau of Labor Statistics' Real Earnings Report too difficult to understand. The search shows that only the Providence Journal among Old Media outlets mentioned the report, which was released Wednesday.
So in the interest of education, I'll break down the BLS report into simpler terms:
This story about Ohio has nationwide application. That's because Ohio's media have been awfully quiet about the tax increases that will be necessary if the Buckeye State's version of "universal health care" comes to pass. The bill was introduced on April 25, according to this Ohio Legislative Services Commission bill analysis, and has flown under the radar ever since. I expect that national Old Media scrutiny of the Second Coming of Hillarycare will also be minimal.
My interest in the so-called "Ohio Health Care Plan" was perked when I heard an ad from the Ohio Chapter of the National Federation of Independent Businesses (NFIB) claiming that the plan would cost Ohio taxpayers $50 billion.
$50 billion. With a "b." In one state.
That's over $4,400 for every man, woman, and child in Ohio, or over $17,000 for a family of four.
A separate fiscal analysis by the Legislative Services Commission is pending, so I thought that the NFIB might be engaging in a bit of reckless hyperbole.
In case you were out of the country and missed it, the Federal Reserve on Tuesday surprisingly cut two key interest rates by a half percentage point - twice what most analysts expected - causing one of the largest one-day rallies on Wall Street in years.
Yet, the folks on the "NBC Nightly News" seemed a tad unhappy with the Fed's move, as anchor Brian Williams wondered "is it good for everyone," and correspondent Kevin Tibbles cautioned, "But experts say beware of the downside of any economic upturn."
I kid you not.
The News began Tuesday evening mostly with the positive side of the rate cut, bringing in CNBC's Maria Bartiromo to discuss the day's events on Wall Street. However, as Williams introduced Bartiromo, he foreshadowed the gloom to come (video available here, h/t NB reader Tim O'Donnell):
Today brings a mixed bag for aficionados of the New York Times. The good news, assuming you enjoy reading the musings of Maureen Dowd, Thomas Friedman, David Brooks et al., is that the Times' house columnists have been freed from behind the paid-subscription firewall of "Times Select."
On the other hand, Paul Krugman has decided that his column isn't enough to contain his wisdom, and that he will henceforth be inflicting his blog on us. He entitles it "The Conscience of a Liberal," which as he notes is also the title of his recent book.
Give Krugman credit for giving us fair warning. He does let us know that "the politics and economics of inequality will, I expect, be central to many of the blog posts." And sure enough, central to today's blog is the chart pictured here, which depicts the percentage of the country's total income earned by the top 10%.
As Brent Baker noted, NBC’s Matt Lauer claimed the "liberal bloggers" were going to have a field day with Alan Greenspan’s new memoir – especially the remarks critical of Bush. But before the bloggers jumped, the whole Bush-bashing publicity cycle began with the Dinosaur Media. Their field day began with the newspapers, in particular, Bob Woodward at the Washington Post (noted here on NB by Matthew Sheffield), and continued in the usual network television bashing cycle, starting with "60 Minutes" on CBS. NBC's "Today" demonstrated its routine appetite to inflict another bad-news bruising on the GOP.
If you watched any television newscasts Friday, or read a paper Saturday, you were bombarded with claims of doom and gloom as a result of the August unemployment report showing 4,000 fewer people on American payrolls than in July.
Yet, what media largely ignored were shifting sociological population dynamics indicating this summer's poor jobs gains could be caused by the smallest percentage of teenagers seeking work since such data started being collected in 1948.
In fact, though the "civilian noninstitutional population" of persons sixteen to nineteen-years-old reached 17 million for the first time in history last month, only 5.665 million of these teens were employed, the fewest for any August since 1965 when the population of such young adults was only 13 million.
Isn't this newsworthy? Well, there's much more that was ignored in this report for those actually interested in facts rather than excessively bearish, pessimistic spin.
Almost everybody within earshot of a broadcasting device yesterday knows that the Bureau of Labor Statistics (BLS) reported a net loss of 4,000 jobs in the economy in August. Unemployment rate, at 4.6%, was unchanged.
Reporting, and misreporting, by the New York Times and Associated Press set Old Media's template for the story. Some reports, including this one by Vikas Bajaj at the Times, laid the entire onus of the loss on private companies:
Companies reduced their payrolls by 4,000 jobs in August, a sudden turnaround from the net increase of 68,000 jobs in July.
1. a. Goods or property seized from a victim after a conflict, especially after a military victory. b. Incidental benefits reaped by a winner, especially political patronage enjoyed by a successful party or candidate. 2. An object of plunder; prey. 3. Refuse material removed from an excavation. 4. Archaic The act of plundering; spoliation.
Something about the weekend seems to bring out the socialist in the New York Times. Last Saturday and Sunday I described how the Times and its Beantown-subsidiary Boston Globe published an op-ed and editorial exemplifying classic liberal-think.
The Gray Lady is back at it again today with its editorial, "The Employment Tea Leaves." In perhaps the most revealing essay of all, the Times makes clear its view that the fruits of Americans' labor, risk and ingenuity are mere "spoils" to be distributed at the whim of politicians.
In a subscription-only editorial yesterday, Wall Street Journal Editorial Board member Stephen Moore notes that many countries in the rest of the world, including a few you'd never expect, are adopting the tax-cutting policies of Ronald Reagan, to their benefit:
Earlier this year the cover of Time Magazine depicted Ronald Reagan with a tear running down his cheek -- the message being that the political class has abandoned the Reagan legacy.....
Ironically, the Reagan economic philosophy of lower taxes, less regulation and free trade has never been more in vogue abroad -- so much so that it has become the global economic operating system.
You're a liberal. You've identified a problem -- the massive loss of manufacturing jobs in the United States; a net loss of 4.6 million jobs over the last 20 years. You've even done a decent job of identifying the causes of the problem: "Companies lose market share to foreign low-cost producers . . . or move their operations overseas in search of lower wages . . . or apply production techniques that require fewer workers."
So, what's your solution? Measures like reducing taxes and regulation to make U.S. manufacturers more competitive, perhaps? Of course not! Remember, you're a liberal. No, your solution is what you yourself describe as a "massive" new welfare program for affected workers and communities that will contribute to making U.S. manufacturers even less competitive and destroy even more jobs!
The week had a gusher of economic news, and most of it was favorable:
Thursday, 2nd Quarter Gross Domestic Product (GDP) was revised sharply upward to 4.0% from July's initial estimate of 3.4%; the final GDP number for the second quarter comes out in late September.
The most comprehensive quarterly housing report issued, from the government's Office for Housing Enterprise Oversight (OFHEO), showed that home prices nationwide increased ever so slightly during the 2nd quarter, and were 3.19% higher than a year earlier. That year-over-year result is greater than inflation during the same period.
The only really bad news I can think of at the moment: Consumer confidence took a hit in two different reports during the week (here and here).
Well of course consumer confidence was due for a hit. With the press, especially Time Magazine, working overtime to make the housing situation look like the crisis of the century, it's a wonder that anyone's getting out of bed to face the day.
Most Americans understand that unemployment declining is a good thing.
Yet, the folks at the Associated Press seem confused about this economic statistic as evidenced by an article published Saturday entitled "Help Wanted Ads Go Unanswered in West."
In fact, contrary to a media fixated on bashing corporations and business owners as greedy little devils, Matt Gouras' piece actually elicited sympathy for folks normally in the press' crosshairs while oddly downplaying the benefits tight labor markets typically bring employees (emphasis added throughout, h/t to an NB reader in Hawaii):
You read that right (or left), Baker says the heck with the 5th Amendment protection against being "deprived of life, liberty, or property, without due process of law." If someone borrowed too much or won't pay the mortgage, that's OK with Baker, the co-director of the left-wing economic think tank the Center for Economic and Policy Research.
“Now we switch to the housing market and the U.S. economy and this is a big story,” said NBC “Nightly News” anchor Brian Williams on August 23. “Listen to this number on mortgage foreclosures in this country. They’re up 93 percent nationwide last month from the same period last year. This situation is dire. It’s creating a lot of anxiety about how that’s going to affect a great many homeowners and the economy as a whole.”
The powerful "manufacturing is in decline" meme won't go away soon, but it should.
It apparently isn't enough that the Institute for Supply Management's Manufacturing Index has read "expansion" in 48 of the past 50 months. It has become an article of faith among reporters and opportunistic politicians that American manufacturing has been, and continues to be, in a long-term decline.
The fact is that government reports also show the exact opposite. Why apparently no one, including the sector's supporters, has done, or at least published, the simple math involved to debunk the myth of "deindustrialization" is indeed a mystery.
There has been support by anecdote. For example, on August 6, Joel Kotkin, a presidential fellow in Urban Futures at Chapman University, wrote an op-ed piece for the Wall Street Journal ("The Myth of Deindustrialization"; link requires subscription). His column led as follows:
The Los Angeles Times reported a run of Countrywide Bank by its customers as more and more are panicked about the potential of the nation’s largest home lender to go bankruptcy – something fueled by many of the reports in the media.
“[S]ales of existing homes fell in 41 states from April through June,” said CBS correspondent Susan McGinnis on the August 16 “The Early Show.” “Meanwhile, foreclosures continue to soar. And there are growing worries about the nation's biggest mortgage lender; Countrywide Financial could be forced into bankruptcy.”
But some experts seem to think this scare from the media over Countrywide’s bankruptcy is a little premature.
In a recent blog post by CBS Evening News correspondent Cynthia Bowers we find that she has had some problems with the housing market herself. Bowers apparently didn’t grasp the fact that her Adjustable Rate Mortgage (ARM) can actually adjust:
“For a while we were okay. Then that Fed rate started going up, and so did our ARM. Over a five-month period it increased the cost of our monthly mortgage by nearly 40%!” Bowers wrote.
But Bowers shouldn’t have been surprised about her rate adjustment. According to Nexis, Cynthia Bowers has been reporting on the mortgage and housing market since at least 1997. With a decade of industry reporting under her belt, you’d think she’d be able to anticipate the fact that rates shift and payments adjust.
Today's Washington Post story about the latest legal filings in a securities case echoes the bias of liberal blogs and publications on the case.
The Post leads the story this way:
The Bush administration yesterday sided with accountants, bankers and lawyers seeking to avoid liability in corporate fraud cases, arguing that investors must show they lost money after relying on deceptions by third parties in order to proceed with private lawsuits.
"The Bush administration yesterday sided with U.S. manufacturers and their 14 million employees, arguing against a reinterpretation of securities law that could lead to an explosive rise in litigation."
“But fundamentally it comes down to where you’re having the toys made. They’re being made in China, you don’t have oversight, there’s tremendous pressure for them to cut corners and keep costs down, because that’s how you make money. So allow me to ask you sir, how much money are you saving having these toys made in China?”
"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.
“Do you fly to San Francisco by any chance?...OK, I have to go out there, are you going to promise me, guarantee me, that if I buy a ticket at the end of August you won’t cancel that flight?”
That was NBC “Today” show host Meredith Vieira’s final question in an interview with Northwest Airlines CEO Douglas Steenland. Vieira phrased the question as though it was Steenland’s faultthat a high number of flights had been cancelled earlier in the summer. To Vieira weather, mechanical problems, and Air Traffic Control apparently played no part in it.
Vieira spent almost the entire five-and-a-half-minute interview berating Steenland.
The New York Times' reliably pro-illegal immigrant reporter Julia Preston, fresh from using a survey compiled by a (unlabeled) Hillary presidential pollster to make a pro-illegal immigrant argument, returned to the beat Saturday with "Farmers Call Crackdown On Illegal Workers Unfair," which located another odd angle to defend amnesty for illegals -- it will hurt agribusiness.
"Facing the prospect of major layoffs of farmworkers during harvest season, growers and lawmakers from agricultural states spoke in dire terms yesterday about new measures by the Bush administration to crack down on employers of illegal immigrants.
"'This is not just painful, this is death to the American farmer,' Maureen Torrey, who runs a family dairy and vegetable farm in Elba, N. Y., said in a telephone interview.
“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.”
At OpinionJournal.com on Thursday ("Fair but Unbalanced -- How the media promote false pessimism about the economy"), Brian Wesbury, who has written several times on the disconnect between the strong economy and the public's perception of it (previous references here, here, here, here, and here), had another generally stellar column about what is nonetheless a relatively small piece of the problem.
Wesbury ascribes much of the disconnect to TV's need for "balance," when giving positive and negative views equal weight is often in reality unbalanced:
If one guest or expert is a "bull," then the other must be a "bear," to keep things fair. Or, if there is a single guest on air, the host often takes the other side of the issue in order to keep things balanced. Get some sparks between guests, a little argument here or there, and it's even better for the ratings. The bigger the audience, the better the show, that's the way the advertisers see it. It's basic supply and demand.
But this idea of presenting both sides of an issue, while entertaining, informative and seemingly balanced, may paradoxically create a warped perspective of the economy.
The Kids Are All Right Economic literacy test: High school seniors beat Congress.
Excerpts (bold is mine):
Since its founding in 1969, the NAEP has become something of an annual exercise in American educational masochism. Last year, only 54% of students met NAEP's "basic" standard--the equivalent of a passing grade--on the science test. The previous year tested history; a mere 47% passed. But when knowledge of economics was tested this year, well, let's just say the supply curve shifted. NAEP reported this week that 79% of twelfth graders passed this first-ever national economics test. Holy Hayek.
..... The depth of knowledge shown by ordinary seniors suggests that they have been able to absorb basic economic truths from their daily experiences. Now, if this wisdom can only survive four years of instruction by your average college faculty.
Overall all the tax questions pushed Bush towards hiking taxes. Notice the first question out of the gate was on raising the gasoline tax, not about oh, how the gas tax funds are perpetually raided by Congress for non-infrastructure spending. The question on corporate tax rates and carried interest also come from the left, pushing Bush on the matter of tax "fairness." I particulary find the questions in bold obnoxious vis-a-vis fiscal policy.
11:18: president concludes news conference.
11:14, unid'd reporter: Given the decision to commute Libby, is it fair for people to ask about your commitment to accountability?
11:13, unid'd reporter, citing Libby pardon, Al Gonzales hearings: Can you give clear examples of how you've held people accountable during your presidency?
11:12, Ann, followup: So you're confident you can continue to sustain the level of spending in Iraq?