I think another study that Kevin Hassett.. tells the story
more clearly of why this economy is not getting the
respect it deserves. In that study, Hassett and John Lott
documented media bias in covering economic news depending
on whether there was a Republican or a Democratic
president in the White House. The results are quite
striking.
Economic Doom and Gloom
Betsy's Page
George Will traces the disconnect between what is actually going on in today's economy and how the media and the Democrats seek to portray it. It really is remarkable that such a booming economy constantly gets so badmouthed.
<<< Never a connoisseur of understatement, Clinton said America is "now outsourcing college-education jobs to India."
But Clinton-as-Cassandra should not persuade college students to abandon their quest for diplomas: The unemployment rate among college graduates is 2 percent.
Clinton is always a leading indicator of "progressive" fashions in rhetoric. And every election year -- meaning every other year -- brings an epidemic of dubious economic analysis, as members of the party out of power discern lead linings on silver clouds.
"Worst economy since Herbert Hoover," John Kerry said in 2004, while that year's growth (3.9 percent) was adding to America's gross domestic product the equivalent of the GDP of Taiwan (the 19th-largest economy). Nancy Pelosi vows that if Democrats capture Congress they will "jump-start our economy." A "jump-start " is administered to a stalled vehicle. But since the Bush tax cuts went into effect in 2003, the economy's growth rate (3.5 percent) has been better than the average for the 1980s (3.1) and 1990s (3.3). Today's unemployment rate (4.6 percent) is lower than the average for the 1990s (5.8) -- lower, in fact, than the average for the past 40 years (6.0). Some stall. >>>
Will calls this mood "economic hypochondria" and blames it on spoiled boomers who can't take any bad news in the economy without thinking that the sky is falling.
<<< Economic hypochondria, a derangement associated with affluence, is a byproduct of the welfare state: An entitlement mentality gives Americans a low pain threshold -- witness their recurring hysteria about nominal rather than real gasoline prices -- and a sense of being entitled to economic dynamism without the frictions and "creative destruction" that must accompany dynamism. Economic hypochondria is also bred by news media that consider the phrase "good news" an oxymoron, even as the U.S. economy, which has performed better than any other major industrial economy since 2001, drives the Dow to record highs.
The Jack No. 2 well, in deep water 170 miles southwest of New Orleans, recently discovered a field with perhaps 15 billion barrels of oil -- a 50 percent increase in proven U.S. reserves. This news triggered a gusher of journalistic gloom: More oil means more woe -- a reprieve for that enemy of humanity, the internal combustion engine, and more global warming, more air pollution, more highway fatalities, more suburban sprawl.
....
President Bush's tax cuts were supposed to cause a cataract of red ink. In fiscal 2006, however, federal revenue as a share of GDP was 18.4 percent, slightly above the post-1962 average of 18.2. And the federal budget deficit was $247.7 billion, just 1.9 percent of the $13.1 trillion GDP. That is below the average for the 1970s (2.1), 1980s (3.0) and 1990s (2.2).
....
Finally, today's widening income disparities will be partly self-correcting. Granted, income statistics show the increasing disadvantages of persons with education deficits. But that is the market saying -- shouting, really -- "Stay in school!" Over time the voice of the market is rational, credible and therefore a potent instrument for changing behavior. >>>
Will quotes a column by Kevin Hassett and Aparna Mathur of the American Enterprise Institute showing how benefits, lower taxes, and consumer behavior should be considered when talking about compensation.
I think another study that Kevin Hassett (my daughter's former boss at AEI) tells the story more clearly of why this economy is not getting the respect it deserves. In that study, Hassett and John Lott documented media bias in covering economic news depending on whether there was a Republican or a Democratic president in the White House. The results are quite striking.
<<< When GDP growth is reported, Republicans received between 16 and 24 percentage point fewer positive stories for the same economic numbers than Democrats. For durable goods for all newspapers, Republicans received between 15 and 25 percentage points fewer positive news stories than Democrats.
For unemployment, the difference was between zero and 21 percentage points. Retail sales showed no difference.
Among the Associated Press and the top 10 papers, the Washington Post, Chicago Tribune, Associated Press, and New York Times tend to be the least likely to report positive news during Republican administrations, while the Houston Chronicle slightly favors Republicans.
Only one newspaper treated one Republican administration significantly more positively than the Clinton administration: the Los Angeles Times' headlines were most favorable to the Reagan administration, but it still favored Clinton over either Bush administration.
We also find that the media coverage affects people's perceptions of the economy. Contrary to the typical impression that bad news sells, we find that good economic news generates more news coverage and that it is usually covered more prominently. >>>
That was for results of a study in 2004. I would bet that the disparity would be larger if you looked at the coverage since 2004. And this is during a period while we've been conducting two military engagements and had a catastrophic hurricane plus a huge spike in oil prices. And still the economy is doing so well. Just imagine what the mood in the country would be if the media had covered the past years of economic good times in the same celebratory fashion as they covered the economy during Clinton's presidency.
betsyspage.blogspot.com
washingtonpost.com
aei.org
papers.ssrn.com |
