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Home Publications Blogs Beat the Press Neither the NYT nor Washington Post Has Heard About Unemployment

Neither the NYT nor Washington Post Has Heard About Unemployment

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Saturday, 23 March 2013 07:24

It's apparently hard to find out about the state of the U.S. economy in the nation's capital. That is the only way to explain the fact that in their articles on the budget passed by the Senate last night, neither the NYT or Washington Post said one word about how the budget would affect the economy over the next decade.

This one should have been pretty basic and simple. As tens of millions of graduates of intro economics classes know, GDP is equal to the sum of consumption, investment, government spending and net exports. Currently, annual GDP is close to $1 trillion below its potential according to the estimate from the Congressional Budget Office because private sector demand plunged following the collapse of the housing bubble.

While conservative politicians run around yelling mumbo jumbo about making the job creators happy, there is no plausible story that private sector demand will rise enough to fill this gap any time soon. That means that government has to fill the gap by running large deficits. Its failure to do so has meant that the economy is down almost 9 million jobs from its trend growth path and millions of people are needlessly suffering from unemployment.

However, neither the NYT or Post could be bothered mentioning the millions who are suffering unemployment as the direct result of government policy. Instead the NYT told us in the first sentence that the budget will:

"trim spending gingerly and leave the government still deeply in the debt a decade from now."

Yes, that is important for readers to know -- by the NYT's criteria the country will be "deeply in debt" a decade from now. What ever happened to the distinction between news and opinion pages?

Of course the Post was much worse. The Post was good enough to give a comparison with the budget put forward by House Budget Committee Chairman Paul Ryan and approved by the House last week. It told readers that in contrast to the $18 trillion debt from the Senate budget, the Ryan budget would have the debt top out at $14 trillion. It didn't bother to mention that the spending cuts in the Ryan budget will leave millions more unemployed. But hey, probably no one important would get the ax.

The Post also continued its crusade to gut Social Security and Medicare telling readers that:

"Obama has been busily courting Republicans, mostly in the Senate, with the promise that Democrats would back a more moderate path to deficit-reduction that pairs roughly $600 billion in new revenue with nearly $1 trillion in spending cuts, including structural changes to Medicare and Social Security, by far the most expensive federal programs."

Actually President Obama has not put forward any "structural changes" to Social Security. He has proposed cuts, as in reduced benefits, as in lower monthly checks, as in less money to high-living seniors. The Post knows that cuts to Social Security are incredibly unpopular with the public so it routinely uses euphemisms to help politicians who support such cuts try to conceal their agenda.

It is also worth noting that neither paper mentioned the Senate's approval by voice vote of the Sanders' Amendment. This amendment explicitly opposes the cut to Social Security that would result from shifting the basis for the annual cost of living adjustment to the chained CPI. This change would reduce the annual adjustment by 0.3 percentage points leaving benefits 3 percent lower after ten years, 6 percent lower after twenty years and 9 percent lower after thirty years. The average cut in benefits would be roughly 3 percent over a typical worker's retirement.

It might have been worth mentioning that not one member of the Senate, either Democrat or Republican, was prepared to stand up in support of this proposal that has been pushed both by President Obama and the Washington elites more generally. But, pointing out this fact might have undermined the agenda of the elites who support this cut.

 

Comments (12)Add Comment
Lori Montgomery - What Did You Expect?
written by Bart, March 23, 2013 10:33

She continues to position herself to join Maya Mac in a cushy think tank job doing Cat Food Commission work.
Any Economist Knows ... The Austerian Version of an Output Gap
written by Last Mover, March 23, 2013 10:42
Well yes, but with all due respect Dean Baker just doesn't seem to understand basic arithmetic.

Any economist knows in order to close the output gap, incentives must be allowed to work. The upper class must have more income and wealth to work harder and the lower class must have less entitlements to work harder.

This is just basic arithmetic. For example under Clinton the Bubba 11 million jobs were created despite a tax increase on the upper class while under Bush the Dim One, one million jobs were created from a tax decrease on the upper class.

In the end, two wars were put on a credit card to add to the debt from the tax cut, a stock bubble that bust was replaced by a housing bubble that bust and added even more debt from falling tax revenue within an output gap.

Why can't Dean Baker grasp such simple proof of how debt creators under Bush, acting as job creators, created jobs with more government spending and less tax revenue that actually reduces debt and avoids an output gap at the same time?
More absurdity
written by John Wright, March 23, 2013 12:05
I am still waiting for some supply-sider to surface and push for "Super Supply Side Economics" (SSSE).

SSSE would recognize the tremendous contribution of the USA highly paid job creators, not by taxing them, but instead by rewarding them with matching tax refunds.

Someone earning 1 Billion per year would not only pay no taxes and but also would receive a matching grant of 1 billion from the government in recognition of their status as "Super Job Creator".

For if lower tax rates are good, why not allow that we are not "zero bound" on tax rates and can go to negative rates on high income earners.

Super Supply Side Economics, arriving soon.

Unemployment
written by Jennifer, March 23, 2013 12:09
To be perfectly fair there was one mention of unemployment and how it should be a focus-by Senator Murray. It's pretty amazing how much more weight in the press the Ryan plan is given compared to the Democratic house plan or the Democratic Senate plan. Nobody could really disagree that the immediate effect of the Ryan plan would be to increase unemployment, but this is rarely articulated in press coverage-it's just "radical". It's the rare time the MSM embraces that term.
real unemployment..., Low-rated comment [Show]
Undocumenteds
written by David, March 23, 2013 1:50
... won't use County hospitals because they will be afraid of being deported. the use Santeria, don't you know that, Texan?
No coverage of the depression?!?!
written by geraldmcgrew, March 23, 2013 2:33
The lack of continuing coverage of the effects of this economic depression is the scandal of today's news media. Dean's doing great work exposing the incompetence/corruption of the mainstream.

But even the left media is coming up short. The 10th anniversery of the Iraq war is very important, as is gay marriage and gun control. But the story of this historical moment is economic depression.

Democracy Now! (as just one example) should run at least one story EVERY SINGLE DAY exposing the struggles of low income people to care for their families, pay their rent, hold on to their homes, find a job, maintain their health.

It's as if the fact that this depression is less severe than the depression of the 1930s means it's not worth covering as the major story of our time. It IS the major story of our time. The full spectrum of news coverage - left to right - is woefully inadequate.
Do (X) reporters not understand anything about (X)?
written by Rob Lewis, March 23, 2013 2:54
In a similar vein, science reporters should have at least a basic understanding of science. I can't count the number of times I've read that a new solar power plant will generate "1,000 megawatts per year", in spite of the fact that "megawatts per year" is an utterly nonsensical unit of measurement.

Oh, for a reporter who can do more than just copy down what they read in a press release (quite possibly also written by someone who doesn't understand the subject).
covering unemployment
written by Jennifer, March 23, 2013 8:39
@geraldmcgrew
You know who has covered actual unemployment, better then anybody else? Gawker has run 20+ "unemployment volumes" which, especially with the comments, have really illuminated how soul-sucking the experience it is for everybody, young old whatever. There's a lot of nonsense in Gawker but they really deserve attention for this work.
http://gawker.com/5973779/unem...escription
Is All Unemployment Voluntary?
written by Union Member, March 23, 2013 11:04


NPR's All Things Considered aired this Planet Money piece on Friday.

14 Million Americans Don't Work Due to Disability, and the Number is Growing.

http://pd.npr.org/anon.npr-mp3...5.mp3?dl=1

They say they'll air a segment everyday next week on these " 14 million Americans who don't have jobs, and don't show up in any of the unemployment measure we use. 14 million Americans who are invisible to the American economy, but central to understanding it."

Can't wait to hear what NPR has to say about the long-term unemployed and those who've given up looking for work.
observer
written by wil cummings, March 24, 2013 11:10
When will economist expand the definition of GDP to include what is really "gross" about what America produces - pollution of the air - export of discredited ideas, etc.

Those are the real elements of what we produce.
Ignorance
written by John Q, March 24, 2013 5:37
[ What ever happened to the distinction between news and opinion pages?]
Newspaper writers have no knowledge of basic macro-economics, so don't realize they are editorializing. To them, it's a "fact" that the deficit is too large, it's a "fact" that we have a spending problem, but it's not a "fact" that we have an unemployment problem when their friends and neighbors in NY and DC are doing quite nicely, thank you.

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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.

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