CEPR - Center for Economic and Policy Research


En Español

Em Português

Other Languages

Home Publications Blogs Beat the Press How Can an Election Result be "Shrill?"

How Can an Election Result be "Shrill?"

Tuesday, 08 May 2012 09:22

If the Washington Post doesn't like it. That would explain the lead sentence of its lead front page story on the elections in France and Greece on Sunday:

"The shrill anti-incumbent message that has emerged from a pair of European elections carries a threat to the U.S. economic recovery and a political warning for President Obama, whose reelection prospects could hinge on whether the economy can improve."

Other newspapers might leave such editorializing for the opinion pages, but not Fox on 15th Street.

The substance in this statement is also not especially accurate. U.S. exports to Europe are only about 2 percent of U.S. GDP. This means that even a sharp drop in exports (e.g. 10 percent) would only imply a reduction in growth of around 0.2 percentage points. That is unlikely to make much of a difference in U.S. growth.

If Europe's turmoil leads to more uncertainty in financial markets (short of a full-fledged meltdown), it could actually benefit the United States. Interest rates in the United States plummeted following the spike in interest rates on Spanish and Italian debt last summer. The same would likely happen again. This would make it cheaper for people to refinance mortgages and engage in other types of borrowing.

The piece also includes the bizarre assertion:

"A new round of political paralysis that delays Europe’s recovery or calls into question the austerity agreement reached this year to help bail out Greece would probably lead to an immediate slowdown of U.S. economic growth and job creation while confusing bond and equity markets."

Actually, Europe is not on a path to recovery. It is on a path to recession because of the austerity being imposed by the European Central Bank and the IMF. If this austerity is reversed and Europe starts growing again that would help the U.S. economy.

Comments (3)Add Comment
you think thats odd
written by ezra abrams, May 08, 2012 3:23
On Monday 7may, I heard Jeff Katz, AM1200 Boston, say that the election results threatened the *ongoing* recovery in Europe..
Well, I'm sure they also said
written by Rick Massimo, May 09, 2012 8:12
the 2010 U.S. midterms carried a shrill anti-incumbent message.

Oh, wait - no they didn't.
written by Calgacus, May 14, 2012 3:51
How Can an Election Result be "Shrill?"

Dontcha know? The sole function of an economy, a polity is to be a giant organ making soothing music for its bankster masters, music made out of cries and moans of the lesser people the all-wise banksters fit into their instruments of torture. Too many high pitched shrieks? Well, torture them some more, they will become pleasing, low, dulcet, despairing sighs and moans soon enough. (H/t Jack Vance)

Write comment

(Only one link allowed per comment)

This content has been locked. You can no longer post any comments.


Support this blog, donate
Combined Federal Campaign #79613

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.