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Home Publications Blogs Beat the Press Deficit Dogma Runs Deep Even at the New York Times

Deficit Dogma Runs Deep Even at the New York Times

Friday, 02 May 2014 16:45

This is one of those strange but true stories. Here's the description of Paul Krugrman's column from NYT opinion page for Friday:


Why Economics Failed

Though it’s true that few economists saw the fiscal crisis coming, policy makers and politicians ignored both the textbooks and lessons of history. comment icon Comment


You have 30 seconds to see the problem in this story.

That's right, Krugman doesn't believe there was a fiscal crisis, in fact he has vigorously argued the opposite. We clearly had a financial crisis, but as Krugman argues, it had nothing to do with excessive budget deficits.

So how does this find its way into the NYT? Clearly some folks were asleep at the wheel, but this is pretty incredible. It attributes a view that is at 180 degrees at odds with the frequently and strongly expressed view of the paper's most prominent columnist.

Comments (20)Add Comment
Propaganda confuses the best of us
written by Dave, May 02, 2014 5:25
Propaganda is powerful. This idea of a fiscal crisis is all over the place. I'm sure this was an honest mistake, but it shows that most people, unless they are really paying attention, can be fooled into basic errors.
Feature, not a bug
written by ifthethunderdontgetya™³²®©, May 02, 2014 5:33
It attributes a view that is at 180 degrees at odds with the frequently and strongly expressed view of the paper's most prominent columnist.
written by Dave, May 02, 2014 5:38
Which elements?
Don't Assume
written by Andrew Solarski, May 02, 2014 5:45
Maybe I am too cynical, but what are the odds that whoever wrote that doesn't know the difference between fiscal and financial?
@Don't Assume
written by Dave, May 02, 2014 5:54
Pretty good, I think.

That is why propaganda is so powerful. Most people don't know the difference, but this kind of mistake propagates. The confusion goes beyond the mistaken words. Ask any linguist, that if you can confuse the words you can confuse the meaning.
written by Tom, May 02, 2014 5:55
I see fiscal has ben removed and replaced by financial.
written by Fred Brack, May 02, 2014 6:02
As a retired newspaperman, Dean, permit me to suggest the following:

* Given the media's widespread economic illiteracy (not to mention simple innumeracy) that Great Recession coverage exposed, the person writing the item at issue likely had no idea what "fiscal crisis" meant, only that "fiscal crisis" has been a widely used term since 2008 in the context of the Great Recession.

* Because the item was online, it likely was not subjected to copyediting, or at least to the rigorous copyediting during the time of Ted Bernstein and his famed Winners & Sinners newsletter. And even copy editors -- wordsmiths by genetic inclination and trade -- suffer from economic illiteracy.

As as boy managing editor at a 50,000-circulation Upstate New York daily in the mid-60s, I became aware of my profession's -- and my! -- ignorance of basic economics and inability to do simple arithmetic. That awareness became especially acute when the economy crashed and the media --especially cable news -- found itself helpless to understand the crisis and thus fell back on the she said/he said framework, without the capacity to call BS when he or she was wrong or self-serving.

Media ignorance provides you a column every day, and you only have time to touch the surface. Sen. Elizabeth Warren (bless her!) flogging her new book on TV invariably mentions that tuition at her first college was only $50 a semester. $50! Now obviously that's a nominal figure. But I have yet to hear a TV host call her out on this by noting that figure hasn't been adjusted for inflation so that its meaningful today. Either those hosts (a) don't understand the need to adjust for inflation or (b) don't want to step on a "good" story -- or both (a) and (b).

What The NYTimes needs is an economist on staff with the authority to edit any story (or kill it) dealing with economics or finance, and to produce a monthly Winners & Sinners -- or Beat the Press.

written by JDM, May 02, 2014 6:27
Up until I started reading blogs like this one, Krugman's, Angry Bear, and others, I had pretty much the same understanding -- that is, non-understanding -- of the term fiscal. So if I saw the crisis we've had, I'd have thought, okay, it's a crisis; involves money somewhere; therefore fiscal crisis.

But I'm not writing news stories about finance, crises, and the like. I'd hope that if in my previous state of non-understanding I'd been assigned such a story, headline, or blurb, I'd have learned my subject a bit before writing it up. And if this had been a big story for several years, as it has been, I'd hope I'd have been intelligent enough to pick up on the accurate definitions and change my previous, mistaken, impressions of what these terms mean.

This assumes, of course, that the NYT mistake is an innocent but ignorant mistake and not part of an ongoing attempt to mislead the public. Given their other actions -- among them not providing the numbers context they promised many months ago -- I think we're justified in wondering if that assumption is valid.
Bless Dean Baker
written by Dave, May 02, 2014 7:48
Our press is horrendous.

Total honestly led me here. This is it. Honest economic analysis, this is the place.

Nobody else is honest. Dean is honest. The conclusions are real.
written by hello, May 02, 2014 8:05
So compared to typing, copy-paste rules!

The actual article simply says "... few economists saw the crisis coming...". It doesn't need an adjective, because a reader unable to connect the dots between this phrase and the title ("Why Economics Failed") probably wouldn't read it anyway.
written by djb, May 02, 2014 9:28
he meant that even if very economists saw the problem coming

present economist excepted

that even if the failed to recognize it was coming

that still they had the economic knowledge to fix it

I see no essential difference between Dean Baker and Paul Krugman
While you can never be too cynical...
written by Jimmy, May 03, 2014 8:41
...I doubt there are 5 people at the NYT who know the difference between "fiscal" and "financial."
written by Jim, May 03, 2014 8:56
I did not see the Krugman quote herein provided, when I read his op-ed. In fact, he mentioned what he mentioned a failure to see the financial disaster coming, and addressed failures of policy to remedy the problem of inadequate demand due to fixation over the debt--which is clearly a fiscal issue.

"For example, many seemingly knowledgeable people — bankers, business leaders, public officials — warned that budget deficits would lead to soaring interest rates and inflation. But economists knew that such warnings, which might have made sense under normal conditions, were way off base under the conditions we actually faced. Sure enough, interest and inflation rates stayed low."
It's About Money
written by Bart, May 03, 2014 12:23

Hey, both words begin with Fi and end in al; what's the problem?
Dumbing down
written by Jeff, May 03, 2014 2:10
I would argue that the NYT doesn't understand the meanings of "fiscal" and "financial"
It's an inside joke, people!
written by Leslie, May 03, 2014 4:43
Doesn't any here realize who wrote that?????
Not Just Journalists
written by Martin, May 03, 2014 6:04
The first definition of fiscal in whatever dictionary mac uses is:
of or relating to government revenues,esp taxes: monetary and fiscal policy
The second definition is:
of or relating to financial matters; the current fiscal crisis

I suspect the definition of fiscal is going in the same direction as unique.
James Meek on British health care
written by jerry glynn, May 03, 2014 7:08
You guys should read this and comment. Meek sounds very informed.

Housing bubble popped - didn't need to be an economist to know
written by Viewer II, May 03, 2014 9:30
Yes, there are a whole host of things that can and should have already been done regarding regulating our financial
banking tomfoolery. But Dean is about the only one I know who publicly stated several times what was going down.
After Bush took office and that recession that ensued, the only thing that brought jobs back was a housing bubble that many common people like myself knew couldn't last. Yes, we are stuck in the mud once again by our own inaction, and by that I mean the government must spend to foster demand. I look at Walmart and think of all the small to mid-size jobs it helped destroy. Yes, the big money invests in the safest bets only now, but not for too long I'm afraid, soon the taxpayers will be bailing them out once again. Shore up our trade deficits and fix healthcare. Restore the middle class seems like the message too many of us miss.
Thanks for this site Dean Baker! I'm learning a lot from it and I do appreciate most of the posts from all the good people as well.
honest mistakes
written by David Cay Johnston, May 04, 2014 5:24
Newspapers work on deadline and errors like this one get in now and then. Sometimes a D gets identified as as R, or million becomes a billion, the federal debt confused with the federal deficit.

That said, it should be fixed. Did anyone draw this to the attention of the Public Editor?

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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.