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NPR Invents Republican Flexibility In the Absence of Evidence Print
Thursday, 07 July 2011 05:12

NPR decided to do a cutesy piece in which it implied that the debate over the debt ceiling amounted to the semantics of what constitutes a tax increase. It told listeners that there appears to be some movement by Republicans who are now willing to consider the elimination of some tax breaks, although these would have to be offset by reductions in tax rates. In other words, there would be no increase in revenue.

This is ZERO movement. Most Republicans have been on record as being willing to go along with the elimination of some tax breaks in exchange for a reduction in rates. In fact, this is the explicit goal of the Ryan plan which lowers tax rate but promises to offset with the elimination of trillions of dollars of unspecified tax breaks. This bill was approved by the Republicans in the House with just 4 Republicans voting no. It also garnered near unanimous support from Republicans in the Senate.

In short, the notion that there has been some change in the Republican position so that they are now willing to consider tax increases is a complete invention of NPR. It badly misled its listeners with this piece.

Do Obama's Advisors Really Not Know About the Housing Bubble? Print
Thursday, 07 July 2011 04:55

This is the point that the Post should have been highlighting in an article about President Obama's comments on the housing market in his twitter townhall yesterday. Nationwide house prices had just tracked the overall rate of inflation from 1896 to 1996. In the decade from 1996 to 2006, house prices outpaced the overall rate of inflation by more than 70 percent.

At the point where President Obama took office, house prices had fallen by about 20 percent from their bubble peaks. Since there is no identifiable change in the fundamentals of the housing market, it is reasonable to expect prices to fall back to their trend levels. However, the article quoted Obama as saying:

“The continuing decline in the housing market is something that hasn’t bottomed out as quickly as we expected.”

This statement reflects a frightening degree of ignorance about the housing market. It should have been the main focus of the article as the Post attempted to determine whether President Obama and his advisers could really not understand the housing bubble, the collapse of which has given the economy the worst downturn since the Great Depression.

Front Page at the Washington Post: Employment Rates Are Dropping Less Rapidly for Men Than Women Print
Thursday, 07 July 2011 04:31

There are a large number of organizations that produce interesting research on the labor market on a regular basis (including CEPR). Today the Post ran a front page piece on a study from the Pew Research Center that told readers: "Men Getting Jobs Faster than Women."

Those who read the article would discover that neither men nor women are getting jobs at a very rapid pace. In fact, the employment to population ratio (the percent of people over age 20 who are employed) has fallen for both men and women since the recession ended in June of 2009. It has just fallen more rapidly for women than men, a 1.1 percentage-point decline for women compared to a 0.5 percentage-point decline for men.

Given the slow rate of job growth to date, it is not clear that the pattern of employment growth at present tells us much about what the mix of jobs will look like when (and if) employment grows fast enough to raise the employment rate. This was a peculiar piece of labor market research to highlight, since the Post so rarely discusses the labor market. More obvious research to highlight would include the large and growing research showing that structural unemployment explains at most a small share of the increase in unemployment since the beginning of the recession. This means that the vast majority of unemployment is due to bad economic policy, not a mismatch of workers' skills/location and available jobs.

It would also be interesting to see a discussion of racial patterns in employment. While the employment rate for white men and women have edged up over the last year, employment rates for black men and women are at recession lows.

The Post could also do a piece that covers research the OECD and elsewhere that discusses the effectiveness of work sharing programs in reducing unemployment. Post readers would probably be interested in knowing that Germany's unemployment rate has actually fallen by 0.5 percentage points since the beginning of the recession even though its economy has grown no more than the U.S. economy.

This is due to the fact that it has given firms incentive to reduce work hours rather than lay people off. This policy costs no more than paying unemployment benefits and keeps workers at their job.

More He Said/She Said on Minnesota's Budget from NPR Print
Thursday, 07 July 2011 04:17
Morning Edition had another piece on the standoff over Minnesota's budget. Again it gave listeners no background that would allow them to determine the validity of Republican claims that state spending is soaring out of control. As noted before, the state is spending less relative to the size of the economy than it did in the early 90s. This means that the Republicans either are unfamiliar with the state budget or they are not being honest.
NPR Doesn't Know How They Balanced the Budget in the 1990s Print
Wednesday, 06 July 2011 15:14

That's the problem when you have young reporters. They can't remember back to the 1990s.

If NPR did have reporters who remembered back to the 1990s they would not be telling listeners that Ohio Governor John Kasich was "chairman of the House Budget Committee when he balanced the budget with President Clinton in the 1990s."

Actually, neither John Kasich nor President Clinton balanced the budget in the 1990s. The 1996 Congressional Budget Office (CBO) projections for the fiscal year 2000 budget showed a deficit in that year of $244 billion. Instead, the government ran a surplus of $232 billion. According to CBO the legislated changes put in place by Mr. Kasich and Mr. Clinton over this four year period added $10 billion to the deficit. 

This background information might have given listeners a somewhat different perspective on Mr. Kasich's quote:

"At the end of the day, you look yourself in the mirror, and you say to yourself, 'Did I do what was right for families and for children, and if I paid a political price, so what?"

Source: Congressional Budget Office and author's calculations.

Yet More Editorializing in the Post’s News Section Print
Wednesday, 06 July 2011 08:32

An article on the congressional debate over a new transportation bill began:

“The next flash point in the debate over the nation’s will to live within its means may emerge this week as House Republicans present a long-term transportation bill expected to cut funding for highways and mass transit by almost one third.”

Characterizing the battle over the transportation bill as a “flash point in the debate over the nation’s will to live within its means” is crude editorializing that would not appear in a news section of a serious newspaper. It’s because of articles like this that the Post is known as “Fox on 15th Street.”

When It Comes to Budget Deficits, the Post Again Makes It Up Print
Wednesday, 06 July 2011 08:31

The Post reported on President Obama’s assertion that it is necessary to make large cuts in projected deficits, telling readers:

“Obama weighed in Tuesday, noting that a remarkable bipartisan consensus has emerged about the scope and severity of the nation’s debt problem. ‘Most of us already agree that to truly solve our deficit problem, we need to find trillions in savings over the next decade, and significantly more in the decades that follow,’”

It would have been more appropriate to use the term “asserting” rather than “noting.”

Noting implies that the claim that President Obama is making about a consensus is true. It is not.

People familiar with economics know that the main reason that the country is facing large budget deficits is because of the economic crisis created by the collapse of the housing bubble. Contrary to President Obama’s assertion, the main way to solve the deficit problem is to get the economy back to full employment.

This is yet another case where the Post has ignored journalistic standards in a front page story to foist its editorial position on readers.

Mexico’s Secret Economic Boom Print
Wednesday, 06 July 2011 08:26

In an article on the decline in illegal immigration from Mexico, the NYT cited a “prominent economist” as saying that Mexico’s per capita GDP had increased by more than 45 percent since 2000. This view of Mexico experiencing an economic boom is radically at odds with the official data. The IMF data show that Mexico’s per capita GDP has increased by just 10 percent since 2000, including a 4 percent increase projected for 2011. This is considerable less than per capital GDP growth in the U.S. over this period.

When It Comes to Argentina's Economy, the NYT Redefines "Stagnant" Print
Tuesday, 05 July 2011 05:52

NYT readers must have been stunned to see the second paragraph of an article on the prospects for shale oil in Argentina refer to "the country’s long-stagnant economy."

According to data from the IMF, Argentina's economy grew at almost an 8 percent annual rate from 2003 to 2008, following a severe recession in 1998-2002. The world economic crisis brought its economy to a standstill in 2009, but it grew by 9.2 percent last year and is projected to grow 6.0 percent this year. This is stagnant?

NPR Does the He Said/She Said on Minnesota Shutdown Print
Tuesday, 05 July 2011 04:31

It is not balanced reporting to present a Republican legislator from Minnesota talking about spiraling state spending and then present someone else talking about state services. Most NPR listeners will not have the time to look up the data on state spending in Minnesota. NPR's reporter should.

If NPR had done its job, it would have pointed out that there has been no upward trend in state spending. Therefore when the Republicans complain about out of control or spiraling spending, they are not being honest.

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About Beat the Press

Dean Baker is co-director of the Center for Economic and Policy Research in Washington, D.C. He is the author of several books, his latest being The End of Loser Liberalism: Making Markets Progressive. Read more about Dean.