A September 7 Washington Post report on Japanese healthcare claims that "more than one-third of the workers' premiums are used to transfer wealth from the young, healthy and rich to the old, unhealthy and poor." Which Dean Baker (Beat the Press, 9/7/09) understatedly calls "a striking statement":

Fire insurance transfers wealth from people who don't have house fires to people who do. Car insurance transfers money from people who don't have car accidents to people who do. This is the basic concept of insurance. It protects people from bad events, transferring money from people who don't have bad events to those who do. In other words, this quote is telling us that Japan's health insurance system is operating like a health insurance system.

The article is also quick to tell readers that Japan's system may be unsustainable. Its subhead is: "Aging population could strain system." It is worth noting that Japan's population is already far older than the U.S. population.

"If the United States had the same age distribution as Japan," writes Baker, "its healthcare costs would almost certainly already be above 20 percent of GDP, compared to the current 17 percent." Listen to the FAIR radio program CounterSpin: "Trudy Lieberman on Healthcare Reform" (8/14/09).

"Robert Samuelson Doesn't Like Trains" is what Dean Baker (Beat the Press, 8/24/09) takes to be "the unifying theme from his column today, since his arguments against high-speed rail do not make a lot of sense."

In his August 24 broadside against what he dubs Barack Obama's "Rail Boondoggle," Samuelson trots out the tired argument against "almost $35 billion in subsidies into Amtrak" that "the federal government has poured" in the last four decades--with the usual corporate pundit omissions, like the fact that, as long ago as 1994 it was determined that "hidden subsidies for drivers amount to well over $2 for every gallon of gasoline sold."

Beyond that, "Samuelson tries to tell us that trains might be useful in Japan and Europe, but they won't work in the United States":

He tells readers that:

Densities are much higher, and high densities favor rail with direct connections between heavily populated city centers and business districts. In Japan, density is 880 people per square mile; it's 653 in Britain, 611 in Germany and 259 in France. By contrast, plentiful land in the United States has led to suburbanized homes, offices and factories. Density is 86 people per square mile.

The density for the United States as a whole would be relevant if the plans were to build a train network going from Florida to Alaska, but that is not what is on the agenda. Instead, the issue is about deepening and improving the network in relatively densely populated parts of the country, like Ohio (277 people per square mile), New York (402) and New Jersey (1,134). The population densities of much of the United States are very comparable to the regions in Europe through which high-speed rails travel.

Baker then tells how "Samuelson also bizarrely compares long-distance train with the 140 million daily trips to work each day," even though "most people do not travel between cities every day, so it's not clear what the point of the comparison is."

Recapping, Baker writes that "Robert Samuelson doesn't like trains. He told us that this morning in his column." However, "he didn't tell us anything else."

See the FAIR magazine Extra!: "The Railroading of Amtrak: Trains, Planes and Automobiles Held to Different Standards" (7–8/02) by Christopher Ott.

Economist Dean Baker (Beat the Press, 8/9/09) sees the Washington Post as simply "keeping with its strict editorial policy of only letting others tell readers what 'populists' think," when publishing its August 9 "front-page article on setting executive compensation at banks receiving bailout money"--one which "never presented the views of an actual populist."

Instead, Baker writes "readers got to see the comment of Robert Profusek, a lawyer at Jones Day who is identified as having advised major banks on compensation matters," and Linda Rappaport, "head of the executive compensation practice at the firm Shearman & Sterling"--both of whom unsurprisingly argue for maintaining high executive pay in order to attract "talent" that will "make the money for the shareholders."

Baker voices the unspoken aspects of this assertion:

If the Post had solicited the views of a populist, or an economist, they might have told readers that much of what the banks earn comes directly at the expense of consumers and businesses....
The public has no obvious interest in subsidizing traders to speculate in financial markets. If the speculators win, then the loans that Goldman and the others receive will be repaid, but this repayment will only be a portion of the higher prices paid by consumers and lower profits earned by producers as a result of Goldman's speculation.

And, "moving beyond the world of speculation," Baker doubts that "if most of these individuals were replaced by the person next in line...the bank's profits would suffer in any big way." Which means that "these high salaries are just a drain on the bank, its shareholders and the taxpayers. But you won't see this argument presented in the Post."

Listen to the FAIR radio show CounterSpin: "Robert Johnson on AIG Bonuses" (3/20/09).

Quipping that "usually newspapers are big defenders of free speech, but not the Washington Post," economic reporting critic Dean Baker (Beat the Press, 8/2/09) takes down the paper's recent piece giving over "nearly 2,000 words to complain that a website had ripped off" one reporter's story.

Careful to say that "the problem was not that the website had plagiarized the piece"--indeed, the "story was credited and even linked to by the website, which was a major source of readers for the original article"--Baker tells us that the Post "is upset that the website may have made money off his work, because it sells ads based on viewership."

The Post "wants 'news organizations' to have the right to sue others that use their work without permission and profit from it"--even though, as Baker writes, "if people opt to read the piece on another website rather than the Post, then there must be some reason. Obviously they prefer something about this alternative venue":

If the protectionist measure advocated in this piece succeeded in shutting down the competition, then there would be a clear loss to readers. This loss would likely dwarf the loss to consumers that the Post routinely whines about so loudly when anyone suggests a tariff on imports or any other barrier to trade. After all, those forms of protection rarely add more than 10–15 percent to the price of a product. In this case, the Post's proposal may make the product unavailable altogether. Yet again, we see that protectionism is just fine with "free traders." The only issue is who is being protected.

Finally, let's consider what the enforcement of the Post's measure looks like. First, who is a "news organization?" Is this a title that one registers for with the government? Does the Post get the title but not its website competitors? I suppose those big bucks dinners with lobbyists and policymakers really are worth something.

As a practical matter, it would be an incredible affront to the First Amendment if the Post and other major newspapers and established news outlets were given any special ability to sue under such an act, compared to websites, or for that matter think tanks.

Going with his usual inclination to "think this one through for a moment," Baker finds the whole argument somewhat moot, considering how the paper's reporter "does not even know that he was harmed by the website piece." In fact, "it is entirely possible that more people viewed his piece on the Post's site as a result of the version appearing on the website."

Read lots of related content in the special Future of Journalism issue of FAIR's magazine Extra!: "Did Google Kill the Newspaper Star?" (7/09) by Peter Hart.

Dean Baker (Beat the Press, 7/21/09) has synopsized the latest fiasco of a David Brooks column under the headline "David Brooks Wanted Tax Increases to Pay for Stimulus"--since, Baker writes, "that is presumably the implication of his complaint that the Democrats paid for the stimulus package 'with borrowed money.'"

Predictably, "this is not the only peculiar item in his column. He also claims that only 11 percent of the stimulus will be spent in the first seven months of the program." Even though, as economist Baker explains, the "Congressional Budget Office puts the figure at 20 percent, which doesn't seem bad for a program that is just getting started and should be spent out over time in any case." And

then, in full Republican talking point mode, Brooks tells us:

The House [health care] bill adds $239 billion to the federal deficit during the first 10 years, according to the Congressional Budget Office. It would pummel small businesses with an 8 percent payroll penalty. It would jack America's top tax rate above those in Italy and France. Top earners in New York and California would be giving more than 55 percent of earnings to one government entity or another.

Let's see if we can rewrite this slightly:

The House bill adds an amount equivalent to 10 percent of the spending on the Iraq and Afghan wars to the federal deficit during the first 10 years, according to the Congressional Budget Office. Some small businesses will end up converting as much as 8 percent of their wage bill into healthcare insurance for their workers. The richest 1 percent will see an increase in their marginal tax rate, but it will still be lower than in most European countries. And the effective marginal tax rate for the wealthy will still be far lower than the marginal tax rate and reduction in benefits that most moderate income families face.

Baker's version of the same points renders somewhat silly the sentiment he attributes to Brooks' screed: "Are you scared?"

Stating quite succinctly how "there is an ongoing issue about whether global warming deniers should be treated seriously by the media, given that they have about as much scientific support for their position as the flat-Earth crew," economist Dean Baker (Beat the Press, 7/11/09) notes how the July 11 "New York Times goes them one better in finding a global warming ignorer":

Apparently, Ben Stein has never heard about global warming. How else can someone interpret this paragraph:

I don't believe we need to do something radical about energy, but even assuming that we do, why do it right now? Do we need to take one of the few sectors that is working like clockwork through the recession--oil refining--and wring its neck by making it pay for pollution "cap and trade" credits? Why attack a healthy industry when so many other sectors are ill? What is all of this anger at Big Oil, which has not done anything blameworthy, all about? Why endlessly beat up the companies that keep the country going?

He then goes on to complain about the Obama administration's efforts to change the laws on foreclosures. This would be a good idea, except the Obama administration is not working to change the laws on foreclosure.

Baker explains that "Stein is opposed to this plan because he is worried that it will further discourage mortgage lending," even though "there is no problem of mortgage lending at present. Mortgage rates are near historic lows and the Mortgage Bankers Association applications index indicates that few people are having trouble getting mortgages." Baker is impressed with how, "once again, Ben Stein distinguishes himself by how many things he can get really seriously wrong in a relatively short column."

Writing at his regular Beat the Press blog (7/8/09), economist Dean Baker says that the New York Times' David Leonhardt "rightly complains that President Obama's health care plan does nothing to change the incentives for doctors to prescribe expensive forms of care, even when there is no evidence that this care will lead to better outcomes." But "Leonhardt fails to take the extra step and ask why this care is expensive":

In most cases, the care is more expensive because it involves expensive medical equipment and drugs, with a healthy dash of high doctors' fees as well. The reason that medical equipment and drugs are expensive is that they have government-granted patent monopolies. In the absence of such monopolies, medical equipment and drugs would be cheap in nearly all cases. The huge patent rents that these monopolies allow medical supply companies and drug companies to earn also give them incentive to mislead doctors and the public about the benefits of their products.

The patent monopolies are justified as being necessary to support the development of new equipment and drugs; however, there are more efficient alternatives. However, that would require bigger thinking than NYT columnists are yet prepared to undertake.

This being far from a new story, the Times really has no excuse for ignoring the factors described by Baker, except maybe that they're corporate media reporting on corporate medicine--and don't worry, Baker tells us that "the WaPo has the same problem." See FAIR"s magazine Extra!: "Media on Medicare: Don’t Mess With Success—or Corporate Profits" (1–2/07) by Julie Hollar and Jim Naureckas.

Tying the urgent present-day topic of economic reporting in with the most pressing global emergency of climate change, Dean Baker has posted at his Beat the Press blog (6/29/09) on "What Does 'Free Trade' Have to Do With Taxing Greenhouse Gas Emissions?":

That is the question that the New York Times should have been asking in an article that reported President Obama's opposition to taxing imported items from countries that have not taken steps to curb greenhouse gas emissions. The point of his cap-and-trade program is to make items that require large amounts of greenhouse gas (GHG) emissions more expensive, thereby discouraging their consumption.

If goods can just be imported from countries that have no tax on GHG, then the point of cap-and-trade is undermined, as goods that require large amounts of fossil fuels will just be produced abroad. It is understandable that importers and other special interest would be opposed to measures that prohibit this sort of evasion, but that has absolutely nothing to do with "free trade."

Baker notes that "the NYT completely misrepresents the issue by implying that this is somehow a debate over principles of free trade," when really "it is a debate of whether special interests will be allowed to import goods to undermine the limits set by a cap-and-trade bill for GHG emissions." For more on press distortions of Obama's cap-and-trade policies, listen to the FAIR radio show CounterSpin: "Mike Lillis on Climate Bill" (5/22/09).

Economist Dean Baker (Beat the Press, 6/20/09) has requested you try to "imagine a front-page Washington Post article that talked about how the United States had a shortage of small cars." He reasonable assumes such a piece would address "the limited capacity of the various small-car assembly plants" and "discuss the amount of lead time needed to build new plants. It would also talk about the need to raise small-car prices because it is so much more profitable to build big cars":

Imagine that the article never once mentioned the possibility of importing small cars. That's the front-page Washington Post (a.k.a. "Fox on 15th") editorial warning readers that "Primary-Care Doctor Shortage May Undermine Reform Efforts."

Yes, the United States already has a shortage of primary-care physicians. Any serious reform plan will make this shortage worse by cutting back our excessive reliance on specialists. However, primary-care physicians can be trained (to our standards) anywhere in the world. There are millions of very smart people in the developing world who would be delighted to train to U.S. standards and work for the $170,000 year (net of malpractice insurance) that our primary -care physicians. (Developing countries could train 2-3 physicians for everyone that came to the United States if we placed a modest tax [e.g., 10 percent] on the earnings of foreign-trained physicians and repatriated it to the home country.)

"Writing about the potential to increase the number of foreign-trained primary-care physicians in the United States by removing legal and professional barriers," Baker tells us, would only be possible "if the Post were not such an ardently protectionist newspaper.... However, trade never even enters the Post's discussion. It was only interested in telling readers about problems with President Obama's healthcare plan."

Dean Baker (Beat the Press, 6/14/09) has caught "Fox on 15th (a.k.a. 'The Washington Post')" once again "departing from normal news practice" with "another editorial complaining about President Obama's deficits on the front page." The piece's subhead--"Concern Mounts in White House as 2010 Elections Loom"--prompts some hard questions from Baker: "Who is concerned? The story doesn't tell us. Who says that they are concerned? The story doesn't tell us." His conclusion--"In short, it's not clear that there is any news here":

But the Washington Post wants to highlight the budget deficit, so it won't let such details stand in the way; after all, there were protesters in Wisconsin calling President Obama a socialist. That's enough for a front-page news story in the Washington Post.

Needless to say, the Washington Post has no problem ignoring completely far larger protests that don't agree with its editorial agenda, much less putting them on the front page. It is incredible that at a time when close to 15 million people are out of work that the Washington Post can continue to obsess about the deficit.

And, just so "there is no doubt which side the Washington Post is on," Baker reminds us that "of course this is also a paper that highlights on the front page that it is now easier to hire nannies."

Spotting a May 31 Washington Post column "that blamed the United Auto Workers for the bankruptcy of Chrysler and GM," Dean Baker declares (Beat the Press, 5/31/09) that the D.C. daily "showed yet again why it is known as "Fox on 15th Street":

So what if Toyota has managed to profitably run a plant in California represented by the UAW for more than two decades? So what if wages of unionized autoworkers in profitable car companies in Europe and Japan are the same or higher than in the United States? So what if the proximate cause of the bankruptcy was incompetent economic management in Washington and an explosion of incompetence and greed on Wall Street?

At the Washington Post, the line is blame the unionized auto workers--after all, they earn $57,000 a year. Except, of course, by the calculation in this column. Richard K. Bank, a man with no obvious qualification other than his dislike of unions, told Post readers that GM, Ford and Chrysler have labor costs of close to $110 an hour. The would come to $220,000 a year for a full-time worker.

"Of course," Baker notes, "this has no basis in reality, but it helps advance the anti-union case, so it's good enough to get in the Washington Post"--thus leading directly to the scathing headline of Baker's piece: "Do You Hate Unions and Working Class People? You Can Write for the Washington Post. No Knowledge Necessary!"

Read the FAIR Action Alert: "ABC's Overpaid Autoworkers" (12/5/08).

Blogging (Beat the Press, 5/26/09) about how the "New York Times Cooks the Books on Europe's Auto Industry," economist Dean Baker catches the paper "touting the layoffs in the U.S. auto industry as a virtue"--since "it notes that auto industry employment in Europe is remaining steady at around 2.3 million, while it is falling to close to 700,000 in the U.S.":

The article and accompanying chart imply that Europe is delaying an inevitable adjustment. The case is far from clear, in spite of the NYT's best effort to make the case. The chart shows that Europe produces about 18 million cars a year, while North America produces around 12 million. Those noting the asterisk will see that one-third of the cars in North America are produced in Canada or Mexico, meaning that only about 8 million cars are produced in the U.S. This adjustment makes the gap in employment look less extreme.

Furthermore, the U.S. imports a large portion of the parts for the cars that are produced here. Much of the employment in the auto sector is in parts production. Without knowing the balance of trade in car parts, there is no easy way to know how Europe's auto employment relative to its output compares to the U.S.

But such pesky realism has never gotten in the way of the neocon idealism U.S. media routinely try to push upon sometimes recalcitrant Europe; see FAIR's magazine Extra!: "Europe Says No--to Pundits’ Advice: 'Painful Reforms' Find Few Takers" by Seth Ackerman (9–10/05)

Asking "Can We Get Reporters to Stop Saying That EFCA Takes Away the Secret Ballot?" Dean Baker bluntly states (Beat the Press, 5/7/09) that "it's not true." Even though this is one of the "most often repeated lines of the opponents of the Employee Free Choice Act"--"that it will deny workers the right to vote decide on a union with a secret-ballot election"--Baker explains exactly how "that is wrong, wrong and wrong":

First of all, workers do not currently enjoy that right. Maybe that should be repeated a few times in case there are any very slow reporters reading: Workers do not currently have the right to a secret-ballot election to decide whether or not to be in a union.

Under current law, an employer has the option to recognize a union based on a majority of workers decision to sign cards requesting recognition. That's right, folks; under current law, employers can decide to recognize a union without a secret-ballot election.

In fact, with the EFCA, "the decision as to whether or not to have a secret-ballot election or to organize through majority sign-up would rest with workers, not employers." Which means that "anyone who claims that they oppose the Employee Free Choice Act because they support workers' right to a secret ballot, they are not telling the truth. The media should be pointing this out." See the recent issue of FAIR's magazine Extra!: "For Media, 'Card Check' Promise Is One to Break: Corporate Outlets Suddenly Discover 'Workers Rights'" (2/09) by Janine Jackson.

While asserting the extremely simple journalistic principle that "Past Records Should Matter In Assessing Views on the Economy," Dean Baker (Beat the Press, 5/2/09) is willing to admit that

everyone makes mistakes, but the odds are that anyone who couldn't see an $8 trillion housing bubble is not a really good person to rely upon for predictions on the economy. Joe Nocera gives a quick survey of some radically conflicting forecasts in his [New York Times] column today.

It's worth noting that all the optimists completely the missed the bubble and the impact that its collapse would have on the economy. At least some of the pessimists, most notably Nouriel Roubini, recognized that the conditions for a serious crisis were being created years ago.

See the FAIR magazine Extra!: "Busted Bubble: The Press Fell Down on the Job on Housing Prices" (11-12/08) by Veronica Cassidy

Asking a simple question about a large issue--"How Do Trillion Dollar Bank Bailouts Fit With 'Free-Market Fundamentalism?'"--Dean Baker (Beat the Press, 4/19/09) tells his readers that "the obvious answer is, they don't"--since, "if you are a free-market fundamentalist, then you are absolutely opposed to bank bailouts" that "involve taking taxpayer dollars and handing them to banks that would go belly up if left to the market":

However simple this distinction might seem, it somehow escaped the NYT, which discussed the policies promoted in recent decades as though they could be plausibly described as "free-market fundamentalism." It should be perfectly apparent to everyone at this point that the people designing economic policy in recent decades had no philosophical commitment to "free markets"; they were trying to design policies that had the effect of redistributing income upwards.

In the case of the banks, this meant giving them implicit government insurance, both through the FDIC and the "too big to fail" policy, without constraints on their behavior or making them pay for it. This approach has nothing to do with free markets; it is a story of wealthy people using their political power to get valuable benefits from the government.

The upshot, according to Baker, is that "the NYT is insulting its readers by implying that these policies had anything to do with free market philosophy."