Actual Washington Post headline today (3/11/10):

Rise in Washington Area Unemployment Seen as Good Sign for Economy's Recovery

Reporter V. Dion Hayes tries to explain:

Rising unemployment as a positive sign may sound counterintuitive, but economists explain it this way: The increase suggests that long-term unemployed people in the D.C. area who had given up looking for work have restarted their job hunt, perhaps because they see evidence that the region's economy is improving and that employers are beginning to hire again. On the other hand, the declining national rate indicates that discouraged workers elsewhere have remained out of the labor force because they do not see any reason to look for work.

There are actually other measurements of unemployment put out by the federal government that don't force editors to come up with such ridiculous headlines--and might help readers understand what's going on better. The Bureau of Labor Statistics tracks the number of people who have given up looking for work but want a job ("marginally attached" people), as well as those who are working part time but want to be working full time; those numbers are publicly available, yet journalists rarely use them. (For more on such media malpractices, see Veronica Cassidy's article, "Misleading Indicators," in the January 2009 issue of Extra!.)

In a column headlined "A Word From the Wise" (3/3/10), New York Times columnist Thomas Friedman lets us know what Intel CEO Paul Otellini thinks is wrong with the U.S. economy. And there's a certain theme that runs through his critique:

"The things that are not conducive to investments here are [corporate] taxes and capital equipment credits."...  "If I build that factory in almost any other country in the world, where they have significant incentive programs, I could save $1 billion," because of all the tax breaks these governments throw in.... "The cost of operating when you look at it after tax was substantially lower."... If the government just boosted the research and development tax credit by 5 percent and lowered corporate taxes.... With the generous research and development tax credits and lower corporate taxes they receive, Intel's chief competitors in South Korea basically have "zero cost of money."...

You think maybe the CEO of Intel would like to not pay so much in taxes?

One thing is strikingly missing from Friedman's column: any discussion of how high U.S. corporate taxes actually are. On paper, the country has some of the highest corporate tax rates in the world--but as Otellini's reference to "tax breaks" suggests, what matters to business executives is how much they actually pay.  And as a share of the total economy, U.S. corporate taxes are some of the lowest in the world: According to a Congressional Budget Office report (11/05), out of 31 industrialized countries, 28 have corporate taxes as a bigger share of the economy and only two have less.*

"'Something has to pay for' everything government is doing today," Otellini lectures the United States via Tom Friedman. But it shouldn't be corporate America, apparently.

*In the U.S., corporate taxes are 1.8 percent of GDP, vs. 2.9 percent in Britain and France, 3.1 percent in Japan, 3.4 percent in Canada, 5.3 percent in Australia and 8.2 percent in Norway. Germany is the one major country where corporate taxes are a smaller share of the economy, at 1.0 percent of GDP.

Yesterday Sheryl Gay Stolberg of the New York Times (2/18/10) turned in a piece on the one-year anniversary of the stimulus plan--a favorite target of Republican lawmakers (when they're not happily enjoying the federal funds in their states and/or districts, that is).

The piece tells us that there's a rather bitter partisan dispute over the stimulus: Democrats say that it worked to create jobs, Republicans say it was a failure.

The third paragraph of the story would seem to render a verdict on the question: "There is little dispute among economists that the measure has kept the jobless rate from being even higher than it is."

That's clear enough. But then the piece--adhering to the notion of "balance" in which true and false claims must be given equal weight--manages to muddy it up:

At a time when both parties are talking about the virtues of working together, the anniversary touched off a bitter dispute between them, with each using the day to write its own political narrative around the bill. Democrats sought to portray Republicans as hypocrites for voting against the bill and then rushing to claim their share of stimulus money for projects in their home districts, while Republicans painted the measure as a failure.

The Republican National Committee posted a Web video aimed at Mr. Obama titled "Broken Promises," and the House Republican leader, Rep. John A. Boehner of Ohio, issued a report titled "Where are the Jobs? A Look Back at One Year of So-called 'Stimulus.'"

If the major parties are each writing their "own political narrative around the bill," a reporter should try to examine the claims.  But Stolberg's piece merely lists them:

In interviews and e-mail messages, Mr. Boehner and other leading Republicans, including Rep. Eric Cantor of Virginia, Rep. Mike Pence of Indiana and the Republican National Committee chairman, Michael Steele, argued that Mr. Obama could hardly claim credit for improvements in the economy with 3 million jobs lost over the past year, unemployment at nearly 10 percent and a deficit at $1.6 trillion.

Since we were already told that most economists agree that unemployment would be worse without the stimulus, these GOP talking  points are misleading, right? Apparently not:

Economists say that Mr. Obama and the Republicans are both, in a sense, correct. The economy has indeed lost jobs on Mr. Obama’s watch, but the nonpartisan Congressional Budget Office recently calculated that the recovery package, formally called the American Recovery and Reinvestment Act, had saved or created between 900,000 and 2.3 million jobs.

"The economy has shed some 3 million jobs over the past year, but it would have lost closer to 5 million without stimulus," said Mark Zandi, who is currently advising congressional Democrats but also advised Sen. John McCain, the 2008 Republican presidential nominee. "The economy is still struggling, but it would have been much worse without stimulus."

Mr. Zandi said: "It's legitimate to debate the efficiency of the stimulus; one could say, 'You're spending $800 billion plus and look at what we're getting for it.' But to say that this has not helped the job market is not correct."

So while the Times tells us that "economists" say both sides are "in a sense, correct," the actual economist they quoted to illustrate that fact says that in another, more accurate sense, the Republicans are wrong.

The fact that Paul Krugman writes columns for the New York Times means that the paper's readers are occasionally treated to a good media criticism--like today (2/5/10). He writes:

These days it's hard to pick up a newspaper or turn on a news program without encountering stern warnings about the federal budget deficit. The deficit threatens economic recovery, we’re told; it puts American economic stability at risk; it will undermine our influence in the world. These claims generally aren’t stated as opinions, as views held by some analysts but disputed by others. Instead, they’re reported as if they were facts, plain and simple.

And the reality:

Let's talk for a moment about budget reality. Contrary to what you often hear, the large deficit the federal government is running right now isn’t the result of runaway spending growth. Instead, well more than half of the deficit was caused by the ongoing economic crisis, which has led to a plunge in tax receipts, required federal bailouts of financial institutions, and been met--appropriately--with temporary measures to stimulate growth and support employment.

This is important--especially when compared to news stories that tell you things like this:

--"Independent voters in particular are uneasy about a tide of red ink in the wake of the billion-dollar packages for Wall Street, automakers and stimulus spending." (USA Today, 2/3/10)

--"Deficit spending, in turn, has caused the nation's accumulated debt to swell to dangerous levels." (Washington Post, 1/20/10)

Or the ABC World News report (2/1/10) that attempted to explain the deficit by focusing on the meaning of a billion: "And when we start tossing around a billion, it's a huge number. Just think, a billion hours ago, we were in the Stone Age." Well, that clarifies things.

For more media criticism on the deficit, see Extra!: "The Deficit Distraction: Media Push Spending Cuts Over Stimulus" (9/09) by Veronica Cassidy.

From CNN's American Morning (2/1/10), an interview by anchor Kiran Chetry with White House OMB director Peter Orszag:

CHETRY: You also talk about letting taxes expire for families that make over $250,000. Some would argue that in some parts of the country that is middle class.

ORSZAG: Well, I guess it's not the parts of the country where I've been.

Households that make $250,000 or more a year make up 1.5 percent of the U.S. public.

David Brooks, the conservative New York Times columnist who speaks for the little guy who eats at the Applebee's salad bar, has figured out (1/29/10) what Barack Obama ought to do:

Force the country to accept common sacrifice.  This is the issue that unlocks everything else.... Establish your credibility and offer to raise taxes on the lower 98 percent.

At a time of 10 percent unemployment,  when the median wage for male workers is lower than it was in 1974, Brooks has a solution: Let them not eat so much cake.

AP's story (1/28/10) on Ben Bernanke's reconfirmation as chair of the Federal Reserve states plainly what is more usually the unstated assumption in corporate media coverage of the Fed:

The battle over Bernanke's confirmation has been a test of central bank independence, a crucial element if the Fed is to carry out unpopular but economically essential policies.

From this perspective, the Federal Reserve is an organization of financial philosopher kings who must be insulated from democracy in order to do what is best for us. There is another way to look at it, of course: that the Fed essentially represents the interests of the financial industry, and that its independence is crucial if it is to carry out unpopular but economically very profitable policies--such as maintaining the value of money, otherwise known as fighting inflation, by keeping people out of work who would otherwise be employed. You will not often find this alternative perspective discussed in corporate media.

AP's Calvin Woodward, who has the standing assignment of  "factchecking" political speeches, continues to be an embarrassment to genuine factcheckers everywhere--substituting his own weird value judgments, semantic games and crystal-ball gazing for genuine examination of facts (FAIR Blog, 10/30/08, 2/25/09, 4/30/09).  In his post-State of the Union effort (1/27/10), he singles out Barack Obama's call for a non-military discretionary spending freeze, pointing out that during the 2008 campaign Obama had said that rival John McCain's proposal for a spending freeze was "using a hatchet where you need a scalpel." Saying that Obama's "proposal is similar to McCain's," Woodward complained that "he didn't explain what had changed."

Actually, regardless of what you think of the freeze proposal, the administration has explained quite specifically how the two proposals are supposed to differ: While McCain's "hatchet" would freeze funding for individual programs, Obama's "scalpel" would freeze overall domestic discretionary spending, allowing some programs to expand while others are cut (White House Blog, 1/26/10).  Again, you can question the wisdom of the policy, but you can't claim that the White House doesn't offer an explanation of how Obama's approach differs from McCain's. Or rather, if you work for AP, you not only can--you can make it the centerpiece of your "factchecking" article. (The article's headline is a pun about Obama's "Hatchet' Job.")

Woodward indulges in fortune-telling when he dismisses Obama's talk of creating a deficit-cutting commission as a "weak substitute" for a congressionally established panel: "Any commission set up by Obama alone would lack authority to force its recommendations before Congress, and would stand almost no chance of success."  Actually, Nostradamus, the Senate plan for a deficit commission would have required three-fifths majorities in both houses to enact the recommendations (McClatchy, 1/26/10),  proposals that came from a White House-created panel could pass by majority rule (since deficit-cutting measures fall under the Senate's reconciliation rules)--a far easier political hurdle.  (Once more, the question of whether such "success" is to be hoped for is another matter--see FAIR Action Alert, 1/6/10.)

Woodward follows Obama's "Our approach would preserve the right of Americans who have insurance to keep their doctor and their plan" with the retort, "But Obama can't guarantee people won't see higher rates or fewer benefits in their existing plans." Because an honest president would have pointed out, apparently, that his or her reform bill wouldn't permanently eliminate all medical inflation.

Time's Joe Klein wrote on his magazine's Swampland blog (1/25/10) that the American public doesn't understand that the economy benefited from the Obama administration's stimulus efforts. So far, so good--it's true that economists generally feel that the stimulus bill had some impact in curbing unemployment, saving about 1.2 million jobs, according to one survey of the profession (USA Today, 1/25/10). The CBO had a similar estimate of stimulus effects (Bloomberg, 12/1/09).

Where Klein goes wrong is blaming the public's lack of understanding of the impact of the stimulus on the public's stupidity. The post, headlined "Too Dumb to Thrive,"  notes that "it is impossible to be a citizen if you don't make an effort to understand the most basic activities of your government," and concludes by suggesting that the United States has become "a nation of dodos." Klein also blames the Obama administration, which "has done a terrible job explaining the stimulus package to the American people."

When media figures mock public ignorance, it always strikes me that we have an institution whose job it is to inform the public--and they work for it.  If the public doesn't know what it's supposed to, that tells us that our media system has serious problems.

Klein does note in an aside that Fox News has "misinformed" the public, but it's not just Fox--whose audience is tiny relative to the size of the population. And it's not really a problem of journalists messing up--the real problem is that they do their jobs the way corporate media expect them to.

Here's how you're supposed to report on the stimulus, if you work for a newspaper or daily TV news program:

Obama, GOP Spokesman Differ on Stimulus Results

That's from the Boston Globe (11/27/09), considered one of the most "liberal" corporate news outlets. The story that followed dutifully quoted the president claiming he had cut taxes and extended jobless benefits, followed by Rep. Mike Pence (R.-Ind)  saying that Democrats had taken the economy "from bad to worse with their failed economic agenda and big government plans." Who was right? The story gave readers not a clue, allowing the Globe to successfully avoid taking sides.

Or look at the piece from CNN (1/25/10) that set Klein off, reporting on a poll that found "3 of 4 Americans Say Much of Stimulus Money Wasted."  Is the public right to think that?  The CNN story doesn't say--it's just telling us what we think, not what the facts are.

Now, you do find the occasional report on a study that finds that, in fact, increased government spending does seem to result in lower unemployment. But such stories are  greatly outnumbered by the he-said, she-said of routine political coverage--few if any of which will refer back to the coverage that cited actual data about the stimulus program.  Expecting citizens to figure out on their own which side's line of the day is more credible is like randomly inserting passages from The Lord of the Rings into a history textbook and being surprised when students think Gandalf was a real person.

Klein had a follow-up post (1/25/10) in which he said that Americans, i.e. Time's main customers, are not actually stupider than the next nationality,  but were instead the victims of public schools, the reform of which has been blocked by  "teachers' unions and other educational reactionaries." Nevertheless, he continued to blame "lazy" citizens who "don't pay any attention to the news" or who "get their information from sources that feed their prejudices." Ironically, the progressive blogs that he's presumably including in that category are much more likely to tell their readers what's actually going on with the stimulus--and include a link pointing to evidence--than the "objective" corporate media outlets that Klein wishes people paid more attention to.

The New York Times is one of the most effective tools for limiting discussion in the U.S. political system. Falsely perceived as a left-leaning outlet, it has the power to make the most reasonable proposals seem ultra-radical by placing them beyond the pale.

Take yesterday's review by Times book critic Michiko Kakutani (1/19/10) of progressive economist Joseph Stiglitz's Freefall: America, Free Markets and the Sinking of the World Economy. Kakutani says Stiglitz's accurate prediction of the financial crisis " lends credibility to his trenchant analysis of the causes of the fiscal meltdown," though at the same time she accuses him of "an I-told-you-so sanctimoniousness about both the recession and Washington’s response."

It's when it comes to policy proposals, however, that Kakutani really has problems with the book: "Some of the suggestions that Mr. Stiglitz makes in these pages for reconfiguring the American economy (and American society) stray far from the realm of practical policy recommendations that actually have a chance of winning broad public support or being enacted by Congress."  What are these way-out ideas?  Well, for one thing, he suggests that "a 'redistribution of income' and more progressive taxation might help stabilize the economy." He also calls for "a new global reserve system" and criticizes America's "unrelenting pursuit of profits." Concludes Kakutani:

Such remarks not only give ammunition to conservative critics who want to dismiss Mr. Stiglitz as a European-style liberal, but they also have the unfortunate effect of diverting the reader's attention from the many shrewd assessments that he makes in Freefall about the causes and consequences of the great financial meltdown of 2008.

In other words, proposals like progressive taxation should be avoided because people might call you a liberal.  This from the daily news outlet that was named by journalists most often when asked to name one that was "especially liberal."

For the record, taxing the rich is not an idea that has "a chance of winning broad public support"--it already has broad public support.

Claiming that "something needs to be done--and fast" to save Social Security, Parade magazine's Gary Weiss (11/22/09) suggests a downside to the idea of raising the ceiling on taxed income, so that income above the current $106,800 would be subject to the Social Security tax: "Raising the cap is popular among Social Security reformers but would increase the tax burden on the middle class, since more of their income would be subject to the tax. " (By contrast, "Raising the payroll tax rate would disproportionately affect lower-income workers.")

According to the Census Bureau, less than 5 percent of individuals over the age of 15 in the U.S. have incomes exceeding $100,000 a year.  That's a peculiar definition of "the middle class."

If Weiss truly believes that "experts agree that the longer we wait, the more difficult it will be to solve the system’s financial ills," he ought to read Dean Baker and Mark Weisbrot's Social Security: The Phony Crisis.

The New York Times (11/23/09) has an editorial on its front page today disguised as a news story.

Appearing under the headline "Federal Government Faces Balloon in Debt Payments," Times business reporter Edmund Andrews makes an impassioned plea for the neo-Hooverist economics popular in corporate media: Claiming that "the government faces a payment shock similar to those that sent legions of overstretched homeowners in default on their mortgages," Andrews maintains that "there is little doubt that the United States' long-term budget crisis is becoming too big to postpone."

There's not a lot of news in this ostensible news article; it appears to be largely based on the Office of Management and Budget's Mid-Session Review, which came out on August 25. And many of the facts derived therefrom are dubious or misleading; for example, the piece claims that "government debt has almost doubled in the last two years alone"; actually, gross federal debt is estimated at $12.9 trillion in 2009, and was $8.9 trillion in 2007; that's a far cry from almost doubling.

What's not in the piece or in the government forecast is anything to back up the idea that the federal debt situation is akin to an overstretched homeowner about to default on a mortgage; as economist Dean Baker (Beat the Press, 11/23/09) points out, "There is no evidence presented in this article that the rise in interest rates will place the U.S. government in a situation where it will be unable to pay its bills and no one cited in this article makes such a claim."

But Andrews' piece is not really about evidence so much as it about the personal intuition that just as individuals need to tighten their belts in hard times, so too should the federal government.  As Andrews writes:

Americans now have to climb out of two deep holes: as debt-loaded consumers, whose personal wealth sank along with housing and stock prices; and as taxpayers, whose government debt has almost doubled in the last two years alone, just as costs tied to benefits for retiring baby boomers are set to explode.

It's natural to conclude that frugality is the necessary penance to pay for profligacy--even more natural for Edmund Andrews, who wrote a whole book about his family's debt woes.  Applying that intuition to federal fiscal policy, however, is disastrous--that's why Herbert Hoover is supposed to be your model of how not to respond to a financial crisis.

And if you talk to economists, chances are that at least some of them will point out to you that deficit reduction is not what the United States needs right now.  For example, you could talk to economist and New York Times columnist Paul Krugman, who writes in the same edition of the paper (11/23/09), "Most economists I talk to believe that the big risk to recovery comes from the inadequacy of government efforts: The stimulus was too small, and it will fade out next year, while high unemployment is undermining both consumer and business confidence." (Give the Times credit for including some op-ed antidote to its front-page poison.)

But as Andrews' piece is an editorial only appearing by accident on the front page, he doesn't feel obligated to quote anyone who might question his instinct for austerity.  Instead he talks to the Concord Coalition, the vehicle billionaire Pete Peterson uses to express his opposition to government spending, and to a manager of the world's largest bond fund, who warns us against eating our nuts.

The piece closes by quoting the Treasury Borrowing Advisory Committee--IDed by Andrews as a group of "private-sector...market experts"--as saying that inflation ought to be our big worry and "fiscal prudence" our watchword.  Who is this committee, actually? It's chaired by someone from JP Morgan Chase, its vice chair is from Goldman Sachs, and its members include a representative of Peterson's Blackrock group--among other agents of the world's financial elite.

Maybe Andrews thinks these folks have nothing but the best interests of the nation on their mind.  But before he issued a front-page call for deficit-cutting in the midst of the deepest slump since the Great Depression, maybe he could've gotten a second opinion.

Washington Post columnist David Broder rounds up some "non-partisan" budget experts-- one of whom, oddly enough, was John McCain's Social Security adviser during his 2000 campaign -- to agree with him that the Democrats' healthcare bills are too expensive.  He closes with this:

The challenge to Congress -- and to Obama -- remains the same: Make the promised savings real, and don't pass along unfunded programs to our children and grandchildren.

This advice would be easier to take from someone who didn't just write that Obama should escalate the Afghanistan war because of the "urgent necessity is to make a decision -- whether or not it is right." Good thing that war doesn't cost anything-- or that if it does, our grandchildren won't mind paying for it.

In his New York Times column, David Brooks cheers the rise of suburban independent voters in this week's midterms elections, crediting them with Republican victories in New Jersey and Virginia. Brooks has made a career out of singing the praises of suburban Americans, all the while suggesting that they are somewhat ignored. While liberals and conservatives have their own media machines and think tanks, Brooks writes:

Independents, who are the largest group in the electorate, don't have any of this. They don't have institutional affiliations. They don't look to certain activist lobbies for guidance. There aren't many commentators who come from an independent perspective.

If he's talking about centrists, it doesn't make much sense; actually, middle-of-the-road think tanks tend to dominate the media discussion.  (Perhaps Brooks has heard of Brookings?) But he tries to explain their significance this way:

The first thing to say is that this recession has hit the new suburbs hardest, exactly where independents are likely to live. According to a survey by the National Center for Suburban Studies at Hofstra University, 76 percent of suburbanites say they or someone they know have lost a job in the past year.

While that does sound suspiciously like a think tank catering to, well, those think tank-less independents, are those numbers very alarming? An Ipsos/Reuters survey from June found that 80 percent of Americans knew someone who lost a job. A July Marist poll on New York state residents found that "82 percent of city voters and 79 percent of those in the suburbs" knew someone who'd lost a job in the past six months. Maybe Brooks' suburbs aren't so special after all.

Fox News host Bill O'Reilly, commenting on a tax increase in California:

That could happen on the federal level. Already Nancy Pelosi and her far-left crew want to raise the top federal tax rate to 45 percent. That's not capitalism. That's Fidel Castro stuff, confiscating wages that people honestly earn.

Setting aside the truth of the charge against Pelosi, Fidel Castro must have been the president of the United States in 1982-86, when the top rate was 50 percent. Or maybe all of the 1970s, when it was 70 percent. Or from 1950-63, when it was 91 percent.