Why I am mad at the media

Reason #1: The Bush and Chaney SEC investigaions


On this morning's news they had a survey where 23% of people said Bush did nothing wrong, 41% said Bush probably did something unethical/ boarderline but not illegal, and 23% said he probably did something illegal. This is the most worthless survey I have ever seen. A generous estimate of what % of American know what the SEC does is 15%. I would say that maybe 1 in 1000 people (again very generous), mostly lawyers and accoutants (not me), actually know enough to make an educated judgement in the matter. I will also venture to say that there are no major news anchors in this group.


Reason #2: The budget deficit


This is a good thing. According to ECON 103: INTRODUCTION TO MACROECONOMICS it is correct for the government to borrow and spend money it doesn't have at times. I am sick of listening to reporters who didn't pay attention in college say "well everyone has to balance their checkbooks so the government should too". The more I learn about economics the more the news sickens me because most people (including congress) have no concept of how money works. It is a real hole in our educational system. I do not proport to know everything, I am just learning (I got kind of a late start). However, I feel it is irresponsible for reporters who know nothing about the subject to comment and criticize, using irreleveant common sense refrences to simplify things which are not simple.


comments?


PS - I don't agree with all of Bush's policies, etc... I have no problem with challeging authority or criticizing our leaders, I just feel it is irresponsible for the media to act as an authority on every matter, because most people won't ever know better.

Glenn,


I'll second that motion. A week doesn't go by in which I don't read some blooper in Fortune, Business Week, Forbes (less often) or other representatives of the "business" press.


Then I realize that these guys and gals were journalism majors - not business majors - and that explains everything. /images/smile.gif


Ron

I only took econ 100 years and years ago, but that deficit reporting stuff has been bothering me for a long time too.


Here is another one:


Oreily factor Oreily arguing against the "under God" ruling took the phrase out of the constitution with the word "creator" and argued that this means the US is a theist state afterall.


What is particularly annoying about this, is that that "creator" ref. was the only thing remotely religious in a document written over 200 years ago in a severely religious climate, and really shows just how serious they were about separating church and state.


This segment was also introduced with a mislead "For 50 years "under god" was ok in the pledge .... when the complete history goes back years before it was added during the Red scare.


d.

on #1 i think you underestimate usa citizens.


on #2 i watched a show last night on cnbc interviewing robert rubin. he was decrying the budget deficit and the bush tax cuts saying they destroyed fiscal responsibility. rubin stated that running a deficit now isnt terrible but running a deficit over a long period of time is. when doing deficit spending what is being financed is key question. i suppose its the war on terrorism now but if this is an ongoing effort wouldnt it be accomplished more prudently through tax increases and or cutting back in other aspects of govt spending?

greenspan when asked today in senate testimony about declining us dollar made brief terse statement and said he would answer no more questions about it. he directed all questions about the dollar to secretary of treasury. meaning that he greenspan blames us dollar decline squarly on federal budget deficit spending that has resumed.

Please how you get that conclusion from that information.

For #1, US citizens may be more courageous than people assume, and most people have a unique skill, but as far as book smarts go, I was generous. Take a look at one of those studies that has people label a blank map of the US, then tell me that the average American who gets 5 states or something has a deep understanding of insider trading regulations with regard to the accounting practices of large coorperations.


For #2 you replied:


"rubin stated that running a deficit now isnt terrible but running a deficit over a long period of time is"


This is obvious, you can't run at a deficit forever. All I said is that, at times, deficit spending is correct. The checkbook analogy is wrong.


"when doing deficit spending what is being financed is key question. i suppose its the war on terrorism now but if this is an ongoing effort wouldnt it be accomplished more prudently through tax increases and or cutting back in other aspects of govt spending?"


If taxes were raised, it would put more stress on an already stressed economy. The interjection of borrowed money allows for growth. Since interest rates are so low, there is little downside to this right now. When the economy needs to be slowed, then taxes are raised to pay the debt back. Cutting government spending is a more complex issue. I belive that the government is way too big, so obviously, I like the idea. For the sake of proving the press's mistake, however, I am using the common axioms for the role of the government, not mine. The problem with cutting spending at this time is the same. Less money will be put into the economy at a time when stimulus is important. I understand that this can be partially refuted and I am not going to get into the counter-counter arguement for time's sake.


As I stated in my original post, I am not exactly a fan of the current budget. My point was that the omnipresent idea that deficit spending = bad that is propogated by the press and sound-byte politicians, is misleading to the public. The issue is much more complex. Again, I don't not necessarily agree with the budget, I just think many the media's criticisms are generally garbage, and I find this irresponible.

Please excuse the lack of correct use of English in my previous post. I think I accidently deleted the "tell me" after "please" or something.


Anyhow, couldn't the drop in the exchange rate of the dollar be due to the capital outflow from low interest rates?

my take on watching him testify based on reaction to the question and who he referred it too. then going on later about fiscal responsibility. again just my take.


"Anyhow, couldn't the drop in the exchange rate of the dollar be due to the capital outflow from low interest rates?"


sure and i think thats where the senator (sarbanes) was going with it but greenspan cut him off immediately indicating that greenspan didnt want to entertain the question.

about question 1 i know i dont understand all the intracasies of accounting and i think its a complicated subject so i have to answer such questions out of ignorance myself. if someone asked me the question id concur with the 41% because i would doubt someone is totally corrupt and i would doubt that someone is totally honest. as far as the sec is concerned i would say that they are at least somewhat influenced by political events so i wouldnt trust them completely even if i didnt have an idea as to what they did. to me the survey seems rather ridiculous. the surveys you mention regarding geographical knowledge im not aware of but i dont doubt that its true.


on question 2 your point about running a deficet is well taken and i believe the media does tend to sensationalize things. i should say at least some in the media. i would counter that we have had 6.5% gdp growth in the first quarter and estimates range from 2%-4% gdp growth in the second quarter. in theory tax cuts are stimulative but the economy was very robust pre fed tightening when taxes where at a higher level. whats interesting to me is that the fiscal stimulous package that the prez and congress talked about after sept 11 (more govt spending) has been shelved. if you trust what greenspan (and I might add rubin) youd say that the economic recovery is well underway from a level of business decline that was very slight. id debate whether or not we really had a recession but ill concede we had one. the problem that i find with govt spending is that it is often very wasteful and tends to create bigger unecessary beauracracy. giving the defense department carte blanche to fund weapons programs is a bad idea although things there are better than they used to be. what the economy needs is job creation which means investment spending. greenspan testified today that he is seeing improvment in that area.

and you'd still be frustrated if they were business majors. the only way to get non-idiot reporters in the financial press is to hire Economics majors. They know everything. /images/smile.gif

well, the underlying theory is that government can 'even out' the business cycle by fiscal deficit spending. note that this has nothing to do with what the government actually needs. spending money is an end in itself. taxes are included here.


on the other hand is monetary policy. the people's representatives in congress have dedcided to hand over their legitimate authority to private bankers.


is it any wonder that there is no clear message to the common people of whats going on?


brad

A business owner, a CPA and an economist are sitting around discussing the idea of how to achieve full employment.


The business owner goes into a long explanation involving lower interest rates, easier credit from banks, less government regulation, etc. and ends by saying, "That's how you achieve full employment."


The CPA offers one point - lower taxes. "And that's how you achieve full employment."


The economist pauses for just a second, takes a deep breath as if preparing for immense profundity, and says..."The first thing we do is assume full employment."


And if I have to explain the punchline, you wouldn't understand. /images/smile.gif


BR

nm

The best economists are ones with only one arm.


That's because you'll never hear them say "on the other hand..."

from slapping it so hard. /images/smile.gif


Is eek-O-nom-ix your chosen profession, Boris?


BR