How 'Clever': AP Item Calls Fed's Bond-Buying Program 'Stimulus,' Avoids Correct Term ('Quantitative Easing')
The search for ways to rehabilitate the Obama administration in the eyes of the public is seemingly a never-ending enterprise at the Associated Press.
Oh, they slip up occasionally. Late last week (covered yesterday at NewsBusters; at BizzyBlog), in an item primarily about how Congress really, really can't stop planned stimulus spending (uh-huh), the wire service's Brett J. Blackledge let slip that President Obama's stimulus program is "politically unpopular." In noting that the government wasn't able to spend the funds as fast as intended, Blackledge also indirectly confirmed an obvious truth the President admitted to the New York Times that he needed almost two years to learn: "there’s no such thing as shovel-ready projects."
So what do you do if you're "The Essential Global News Network" and need to recover? Why, you find something that appears to be working (sort of), and rename it "stimulus." Voila! See how easy that is?
The AP's Jeannine Aversa, with the help of her item's headline, performed the sleight-of-hand today:
Fed official: Stimulus plan should be reconsidered
The Federal Reserve should "quite seriously" rethink whether its $600 billion bond-purchase program is needed given the strengthening U.S. economy, a Fed official said Tuesday.
Jeffrey Lacker, president of the Federal Reserve Bank of Richmond, said more spending by consumers and businesses means the economy probably will grow at a faster pace of around 4 percent this year, compared with 2.9 percent last year.
Inflation should stay in check, he said in a speech in Newark, Del. But rising prices for commodities, such as oil, need to be closely watched, he added.
Lacker participates in the Fed's policy discussions, although he isn't a voting member this year. Differing views from within the Fed about the size and pace of the bond program could make it harder for Fed Chairman Ben Bernanke to build consensus.
The Fed at its March or April meeting likely will the Fed will probably want to signal whether it will end the bond-purchase program on schedule in June or extend it.
Note that Aversa, given about 375 words, devoted not a single one to the correct term for the Fed's bond-buying program: quantitative easing. Quantitative easing, or "QE," is not just a shorthand term of convenience; a search on the term (in quotes) at the central bank's web site returns 177 items, including this May 2010 speech by Fed Chairman Ben Bernanke, in which he uses the term six times in the space of two paragraphs.
So you see, in AP-Land, "stimulus" isn't some $800 billion program that has accomplished nothing. That's so 2009. "Stimulus" is what the Fed has been doing recently. At least for now, it's sort of working -- "sort of" because during quarters 2 through 8 of the post-recession Reagan-era recovery in 1983-1984, the economy roared, averaging an annualized 7.1% during that seven-quarter period (Q183-Q384). Now we're supposed to be impressed if the 2011 economy coming out of a deeper recession (i.e., presumably having more bounce-back ability) manages to get to 4%. Uh, no.
I hope for their sake that Aversa and the AP have a contingency stimulus renaming plan in place if the higher inflation many economists believe is a substantial risk of the Fed's quantitative easing efforts rears its ugly, financially destructive head.
Cross-posted at BizzyBlog.com.