economics and journalism

8/6/2019 Economics and Journalism

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Richard Parker 1

The relationship between economists andeconomic journalists should be symbiotic. Theyhave much to learn from each other. The media

are obviously an important source of economicinformation, and economists have a considerableamount of information about how the economyworks that should be useful to journalists. Inaddition, it is particularly important for econo-mists who are interested in influencing policy tohave their findings effectively presented both tothe public at large and to policy makers in par-ticular. In principle, therefore, these professionsare allies. Yet as Richard Parker convincinglydemonstrates in this paper, their interactionworks poorly.

Economists often find fault with the way in

which economic information is reported.Sometimes they accuse the press of ignorance,distortion and a misplaced emphasis on recentnumbers rather than trends. At other times,however, journalists are faulted for claimingtrends without sufficient evidence. Journalists,for their part, find much of what economists doboth incomprehensible and irrelevant. Many ofthe issues with which academic economists arepreoccupied, appear remote from the concerns ofaverage citizens.

Economists are, in fact, deeply concernedabout policy. It is common, even in the mostesoteric papers in professional journals, to findstatements which draw implications for policy.Yet one can be sure that the likelihood that actu-al policy makers will be aware of these insightsis extremely low. One reason is that the lan-guage of economists is utterly unintelligible tothe layman and both the economists themselvesand journalists are poorly equipped to undertakethe necessary translation. As an economist I res-onated particularly strongly with the papersemphasis on the inherent difficulties of commu-nicating information that is technically complex

to an untrained public. I would add that theincentive systems which are set up to rewardeconomists and journalists inhibit effective com-munication. In particular, in academe, a highvalue is often placed on rigor rather than rele-vance. Moreover, economists reputationsdepend not on the public but their peers. Theyoften feel uncomfortable providing answerswithout footnotes, and compelled to hedge whenthe discipline itself has not resolved an issue or

where the answers that it does have are highlydependent on a particular set of assumptionsthat might not hold true in reality. On the other

hand, journalists quite naturally prize soundbites, answers which are definitive and provoca-tive, that are clear and easily conveyed. In addi-tion, the search for what is newsworthy oftenleads to stories which emphasize the novel orthe unconventional, which accentuates differ-ences of opinion rather than areas of agreement.On many issues important for the news, such asbusiness developments and market movements,economists have little to say. On other issues,where economists do have views, the professionis often presented as divided, even when differ-ences are relatively small, thereby conveying an

impression of chaos.For whatever reason, economists from acad-

eme are rarely quoted. The press prefers the pun-dits from Wall Street or Washington. In the rareinstances when they are quoted, the quotesoften fail to capture fully the subtleties of whatthe economists have to say. The result is thatthe public in general and policy makers in partic-ular, for the most part, carry on without the ben-efit of the insights which economists have tooffer.

What can be done to improve this situa-tion? The answer is clearly important if econom-ics is to contribute to better public policy. It issurely a necessary condition for effective report-ing that journalists become more economicallyliterate and better rewarded for doing so. It isalso surely necessary that economists undertakeresearch that is relevant. However, what is inter-esting and most provocative in this paper, is thesuggestion that this might not be sufficient.Parker correctly points to the key actor oftenmissing in this discussion the public.

He suggests that even the clearest state-ment of what economists know about policy,

written by journalists who are as well trainedin economics as the economists themselves,might still not penetrate the publics conscious-ness unless the reporting can be captured bythe filters by which the public organizes andprocesses information. In particular, the publicimposes a moral and human interest frame onnews which economics, as a discipline, severelyunderplays. The public, according to Parker, hasdeeply rooted views which are at odds with the

INTRODUCTION


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2 Journalism and Economics

individualistic, rational- decision maker para-digm which underemphasizes the role of institu-tions and collective action.

If Parker is correct, the implications are atonce important and somewhat depressing.Unless the discipline changes in a most funda-mental and not very likely way, no matter howbrightly the light is shined by journalists, econo-

mists and the public may be doomed, likestrangers passing in the night, never quite tomeet. Nonetheless, Richard Parker is surely rightthat we are far better off understanding the rea-sons for these difficulties in communication,than in trying to ignore them. He is also right inpointing to the need for improved understandingof how the public learns from journalism and inparticular how it interprets and evaluates eco-nomic news. All in all, this is a most stimulatingpaper. It is well worth reading, both for the cen-tral argument it makes and for the many percep-tive observations it contains.

Robert Z. LawrenceAlbert L. Williams Professor of International

Trade and InvestmentJohn F. Kennedy School of GovernmentHarvard University


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Richard Parker 3

Cecily, you will read your PoliticalEconomy in my absence. The chapter on theFall of the Rupee you may omit. It is some-

what sensational.Miss Prism, in Oscar Wildes

The Importance of Being Earnest

Financial stories really bore me. Its afunction of my own ignorance.

Ted Koppel, ABC News

For most Americans, the press is the singlemost important source they have for informa-tion about the economyand explanations forits performance. Were all embedded in econom-ic relations, but our personal experience is only

an uncertain drop in the sea of economic actionsand assumptions around us.

But what does the press teach us? Or putperhaps more importantly, what do we learnfrom the press about the economy and econom-ics? Its a question without easy answersinpart because journalisms relationship to mod-ern economics has served as an endless sourceof frustration, criticism, and calls for reform.One recent academic study put the matterorat least the accusationbluntly: Economicsjournalism is charged with being factually slop-py; oversimplifying, sensationalizing; focusingon personalities over issues, discrete events overtrends, the short-run over the long-run, and badnews over the good.1

That would seem to bode ill. After all, ifwe cant rely on press reports about economicinformation, actors, and concepts, if variousgroups and individuals are right to find suchreporting confusing, errant, or at times mali-ciously misleading, how are we to act rationallyin pursuing our private or collective interests?But, as many of us know, these complaints havetheir own problems. In a world of competing

interests, groups, and beliefs, your bias is mytruth. Your efficient market is my union-busting; his clean air is her excessive regu-lation. Charges of press failure, because theycome from diverse sources and have such differ-

ent ideas of what better economic coverageshould be, dont themselves proffer clear-cutpolicy solutions.

Quite frequently, as we all recognize, themost vocal critics of economics journalism aregroups with stoutly defined economic inter-estsbusinesses (or specific industries or com-panies), labor unions, farm organizations, con-sumer or community groups, etc. or politicians,parties, or ideological factions associated withthem.2 Their complaints about how particularstories interpret facts or intentions, or whatthey see as systemic press bias, reflect their owndefinition of public interests. Quite often, thepublic realizes such charges are themselves opento debateor at the very least can be viewed as

part of the pull-and-haul of democratic competi-tion in the marketplace of ideas.

Since World War II, however, these groupshave been joined by an increasing number ofacademic economists who charge journalismwith being insensitive to, or simply ignorant of,broad fundamental agreements that economiststhemselves consider decided professionally, butill-understood by journalists and the public.3

Because of economists expertise and ostensiblyscientific neutrality (compared to interestgroups), their critique carries a different weight.But is there in fact economic knowledge, widely

shared professionally, which through misreport-ing (more important than annoying economists)causes public harm? Economist Roger Brinner,head of the forecasting firm DRI/McGraw-Hill,for example, believes there is. For one, inoveremphasizing bad news, he charges thatthe press was singularly responsible for slowingrecovery from the 1991 recession.4

Yet how the public views all this isntnearly as clear as one might hope, since system-atic research is either lacking or open to inter-pretation. Beginning in the late Sixties, largesegments of the publicto judge by opinionpollingconcluded that something was deeplywrong in the play between economics and jour-nalism, though what it is, and where preciselythey place blame is less apparent. Yet there is nodoubt that much of the public is deeply attunedto economic performance: polls have listed theeconomy as the publics number one concernin virtually every year since 1972, when it dis-placed Vietnam.5

JOURNALISM AND ECONOMICS: THE TANGLED WEBS OF PROFESSION,

NARRATIVE, AND RESPONSIBILITY IN A MODERN DEMOCRACY

by Richard Parker

Richard Parkeris a Senior Fellow at the Shorenstein Center,

and heads its Project on Journalism and Economics. An

economist by training, he has extensive experience in jour-

nalism as well.


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Richard Parker 5

public. Yet in the past fifteen years or so, morethan a passing understanding of professionaleconomics has grown ever-more important: asone study puts it,

A course in macroeconomics has been the pre-

requisite for engaging in the politics of the 1980s.

But it is clear that members of Congress, the

administration, and anyone who has wanted toenter into the national political debate is talking

about subjects which assume knowledge of rela-

tionships that have not been common parlance in

the recent past.9

Yet even when the publiclargely throughjournalismhas been taught to focus attentionon concepts such as productivity, GNP growth,savings and investment rates, the size ofdeficits, and global competition, for exampleaudience uncertainty about what to believe hasbeen as much a characteristic as acquiescence.

There is a host of obvious reasons for this.Very few Americans are trained as economiststhere are only about 20,000 economics PhDs(and several hundred thousand economics BAs)in a country of 250 million. Even for economists,the disciplines steadily-advancing mathematicalrequirements constantly raise the threshold forunderstanding the latest theoriesas do increas-ing professional questions about its relevance.10

Subspecialization adds an additional complicat-ing factor, as it has in many professions.

Since the 1970s, moreover, economists

have been divided about what tenets of macro-economicsthe Keynesian paradigm since the1930sto embrace, and how they relate tomicroeconomic theory, the substratum thatdates back at least to Marshall in modernform. Because macroeconomics has served sincethe New Deal as the principal construct overar-ching public policy, this has fed deep dividesabout the area of most obvious importance tothe public.11

Journalism, as a result of both this academ-ic isolation and complexity, and its own narra-tive focus on politics as the prime arena for

interpreting conflict in complex societies, hasconsequently continued to rely heavily on apolitical dimension in its reporting of eco-nomic information. By itself, this is hardly sur-prising. As a modern profession, journalism is achild of the turn-of-the-century Progressive Era,when the highly partisan and advocacy-orientedjournalism of the 19th century gave way to anew model that sought to combine a scientifi-cally-inspired drive for objectivity in reporting

with the middle-class impulse for evolutionarycivic improvement, the superiority of rationalmanagement, and democratic limits on bothpublic and private power.

The New Deal added a second, enduringreason for journalisms focus on the politicalcharacter of its economics reporting. In 1900,government amounted to barely 45% of GNP;

today it encompasses over 35%. Size isnt theonly change; governments today are purposive(if not always rational) spenders, collectors,employers, regulators, subsidizers, and price-makers. Trillion-dollar budgets make real differ-ences in economic performanceand by virtueof Keynesian beliefs, are meant to. And as pub-lic activity, subject to democratic oversight andchoices, these government actions also differfrom the ordinary activities of private business-es, even though collectively dwarfed in size bythe latter.12

As a result, virtually all studies of econom-ic journalism note the high volume of coveragedevoted to governmentin particular, toWashington. Of course, this coverage takes awide variety of forms. First, journalists turn togovernment as a source for seemingly straight-forward economic information. Governmentstatistics on inflation, unemployment, housing,and the money supply are a staple of economicreportingquite frequently unadorned by jour-nalistic interpretation. Second, governmentactionsits spending, regulation, tax, and tradepoliciesare prominent features as well. Not

just budget debates, but the various program-matic debates which are a staple of governanceare central to reporting as well. Third, govern-ment sources form a critical part of reportingon business, labor and consumer news that maynot by itself have a government origin.

This use of governmentits data, opera-tions, policies, and legislationas narrative sub-ject is in turn wrapped in a much more complexnarrative form. Journalism routinely interpretseconomic information in light of its impact onpolitical actors and trends. The most obviousand ostensibly potentform lies in assessing

Presidential performance and popularity as inter-twined with aggregate economic performance.The journalistic belief that, in the modern era,Presidents are deeply responsible for U.S. eco-nomic performance has in turn led more thanone President to seek in various ways to influ-ence the electoral growth cycle as part of theeconomys business cycles in a myriad of ways.13

As a consequence, readers and viewers findthe frames through which economic news


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is presented almost ineluctably bound to poli-tics and government. On one level, of course,none of this is either surprising (or terribly dis-turbing) to professional economists.Government data are a principal source ofinformation for academic research as well asreporting; economists acknowledge andattempt to assess the impact of government

spending, taxation, and regulation on economicperformance; the government sources usedin reporting frequently are themselves profes-sionally-trained economists, etc. Even thepresss emphasis on the political dimensions ofeconomic news is recognized as important tothe polity, even if not the principal locus ofacademic interest or understanding.

Described thus, however, economistsresidual concerns about economic reporting arein fact overly minimized.14 One must be hesi-tant to talk too easily, of course, about econo-mists as a unitary groupthe simultaneousexistence of the Chicago and Harvard economicsdepartments gives the lie to that. Generallythough, what follows represents concerns com-monly held by a broad swath of the profession.(The issue of complaints from economic inter-est groups will be taken up later.)

1) Botched Concepts 101: The perhapsstereotypical worries heard casually when econo-mists gather turn around what might be calledbotched concepts 101journalists explana-tion of economic rules and processes throughstatements that economists feel misrepresents

basic microeconomic propositions. Any econo-mist can easily recall his or her favorite howler,and in fact a small academic literature has devel-oped documenting such mistakes.15

One typical study offers examples drawnfrom articles in the Wall Street Journal, Los

Angeles Times, and Milwaukee Journal in whichthe reporter a) misconstrues the effect of a com-moditys price decline on demand, and its result-ing role in a subsequent price rise; b) describes ahousing markets price rise as affected by sup-ply-and-demand, as well as by interest rates, astrong economy, and foreign investors, implying

their separateness from supply/demand; c)speaks of oversupply in the market for doc-tors, without reference to the ways in whichwage/price systems bid away such surpluses. Asthe study makes clear, in each instance, thereporter violates elemental principles taught inany introductory economics course.16

While illustrative of what seems to be jour-nalistic ignorance, the inherent difficulty withsuch anecdotal reports is that they dont gauge

the frequency of the errors occurrence. Moreimportantly, in some instances, while thereporter may be violating elementary economicprinciples in a story, the story may in fact betelling the reader something real and importantabout actualnot textbookmarkets. An Econ101 instructor may think the notion of over-supply of doctors violates fundamentals in

market-clearing, but good health economistsaware that the medical labor market contains ahost of real-world rigiditiesmay find thenotion realistic, if insufficiently explanatory.

2) Numbers Reporting: A second cause ofconsternation for economists lies in presenta-tion of standardized economic data with eitherno explanationor (worse in some cases) brief,overgeneralized explanation. Television appearsparticularly guilty of this; as one study of net-work TVs economics reporting concludes:

Only about half of all economic stories contain sta-

tistical information, and...only a handful of statis-

tics are reported on a regular basis. These are the

rates of unemployment, growth and inflation, the

index of leading economic indicators, and a few

other simple indicators such as housing starts, retail

sales, factory orders and consumer confidence...

Though they underreport the numbers, news

shows do not shy away from interpreting what

they mean. Analysis is part of journalism, but tele-

visions interpretations of economic developments

tends to be episodic, shallow and formulaic, focus-

ing on the most short-term effects....Linkagesrarely go beyond the simplistic level of Dan

Rathers explanation that the dropping dollar got

a lift today, and that pushed stock prices up on

Wall Street. Seldom are statistics or trends placed

in long term historical context, and there is little

discussion of the complex interdependencies

among economic factors.17

Here, the literature is more advanced quan-titatively than the botched concepts litera-ture, with a great deal of counting and classify-ing over a relatively lengthy period. The authors

of the study just cited, for example, said theirreport relied on review of more than 17,000 net-work economic stories broadcast between 1982and 1993.

This seeming advance in quantitative mea-surement, however, frequently belies other prob-lems. One is the methodology used byresearchers: data coding is subject to subtle inter-pretation, and none of the major studies of eco-nomic reporting have actually sought to assess


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Richard Parker 7

viewers or readers to judge what audiences takeaway, versus what a trained coder sees.

A second is the significance of the govern-ments data itself, a subject of intense debatethese days. One issue has to do with the fre-quency of reporting: until the late 1960s, muchof the government economic data reported todayon a quarterly, monthly, or even weekly basis

was reported on an annual or semi-annual basis.Many economistsespecially given the govern-ments habit of releasing lagged revised esti-matesquestion the value of frequency, espe-cially in light of journalisms (and politicians)perceived misuse of the numbers.

Yet a third dimension to the numberreporting problem has to do with the datasintrinsic accuracy in two different senses. TheConsumer Price Index, for example, appears onthe verge of being revised downward because ofdoubts about how it measures what it claims tomeasure. Another, longer-running, argumentover the Gross National Product asks a deeperquestion: does it measure what we want or needto know about national economic performance?

A final aspect to the analysis of the num-bers reporting problem is more frankly ideolog-ical: since the late 70s, when such research grewpopular, partisanparticularly conservativenon-profit groups have often done the studies toprove liberal media bias, an interpretationless-passionate academic studies believeobscures more complex findings.18 (We shallreturn to this issue.)

3) The Implicit Macro-model: A third con-cern for economists treats a rather more compli-cated subject: whether or not there is an implic-it macroeconomic model of the economy usedin reporting, and whether its accurate and/oruseful. That is, some researchers have asked anintriguing question, particularly for those econo-mists concerned about journalists understand-ing of concepts underpinning much of publicpolicy: can one discern a coherent pattern toreporting (versus individual statement errors,noted above) that might provide readers/viewerswith a recognizable structure that also meets

minimal acceptance by economists?Surprisingly little work has been done in

this field (given its rich potential), but one studyproduced interesting results. By analyzing eco-nomic coverage from The Washington Post overa ten-month period, two researchers were ableto produce a macro-model of the U.S. economywhich they judged not only internally coherent,but quite acceptably recognizable toeconomists.19

This tells us little about the other 1,700dailies, or electronic news, but serves as smallencouragement that all is not wrong with eco-nomics journalism. But here again, though,there is a peculiar epistemological assumptionthat runs throughout existing research on eco-nomics journalism: the valid macromodel is dis-covered by trained economists doing textual

analysis, without reference to what the papersreaders take away. Audiencepresumably thetouchstone measure of journalisms transmis-sion roleis absent. (This issue will beaddressed again later.)

4) News Effects on Financial andCommodity Markets: A fourth concern liesspecifically in the impact of reporting on marketbehaviorparticularly financial and commoditymarkets, with their special (and seemingly mea-surable) sensitivity to news. Here the workhas been rather specialized among financialeconomists (or, to a lesser degree, microecono-mistss work in information theory). As a result,its implications touch less on what were hereconcerned witha broadly-defined publicsunderstanding of economics, and more with theform and timing of informations impact (deliv-ered through journalism) on these specializedmarkets.20

One must quickly note that the behaviorof such markets is far from irrelevant. In thepast two decades, financial and commodity mar-kets have been characterized by three features:globalization, integration, and explosive growth

in velocity and volumes, all of which exerciseobviousand powerfulimpact on nationaleconomies and policy sovereignty. With theappearance of non-fixed exchange rates,petrodollar recycling, emerging markets, andunprecedented trading activity based on innova-tions in computers and telecommunications,these markets have taken on complicated pow-ers vis-a-vis traditional notions of the realeconomy. These issues, though, are broadly aseparate issue from the vantage point of the lit-erature discussed here, and better taken upunder the rubric of news and economic policy.

5) News and Economic Policy: Here,arguably, lies the core of economists concernabout reporting, because it is here simultaneous-ly that markets meet law and regulation, andeconomic theory meets both politics and publicbeliefand the point at which we need to dwellfor a moment. Few academic economists lack forevidence of seeming irrationality in policy choic-es, and many are all too prone to see public poli-cy as the arena in which sound economic theory


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is turned into hash (or sausage, for those with aBismarckian cast), a consequence in which theybelieve journalism is deeply implicated.

Vivid debate over economics and publicpolicy, of course, is far from newone need onlyturn to controversy over the 18th-century PoorLaws or the 19th-century Corn Laws in England,or over the National Road system, or National

Bank, or tariffs-versus-free trade before theAmerican Civil War to see how well establishedthe subject matter (if not the modern forms) ofpublic policy was long ago. But up until CalvinCoolidge, American leaders lacked formal eco-nomic advisers; after Franklin Roosevelt, nonehas. Creation of the Council of EconomicAdvisers shortly after World War II sanctified theunique place of this branch of social science overthe others in policy judgements.21

Robert Nelson, in a landmark article, hastraced out this developmentand argued thateconomists have, since the 1970s, been caught inthe midst of an ideological era unlike both theProgressive Era, which marked economists firstsystematic involvement in public policy, and theperiod from World War II to the Seventies, whenthey played a role in a muddling-through eraof policy meant to address the perceived interest-group pluralism of the times.22

The trickiness of labeling the post-Sixtiesperiod ideological (versus, sayamong manyother easy choicesthe era of Keynesian ascen-dence beforehand) is obvious. But it speaks to acore peculiarity of the ways in which public pol-

icy, and supporting public opinion, are formulat-ed that touches at the core of economists dis-quiet, the question of alternatives, and journal-isms role therein.

Journalism since the late 18th century,when it began disseminating the ideas ofSmiths Wealth of Nations to readers whowould never read the text, has been (apart frompolitics itself) the primary social arena inwhich knowledgeable publics have confrontedone another over the organization of societyand its rewards.23 In recent years, apart fromissues of distinctly macro-managerial concern

such as measurement (and remedy) of the gapbetween actual- and full-employment budgetpolicies, or division over fully-fixed versussnake-like exchange rates, the public has beenasked to understand and affirm such funda-mentals as insufficient savings or productivi-ty rates, the merits of financial, transportation,and telecommunications deregulation, the ben-efits of GATT and NAFTA, and whether theFed ought to follow interest rate or monetary

aggregate goalsnot to mention the issue ofsupply side nostrums as a meaningful alter-native to Keynesianism.

This not unsurprisingly has bred uncertain-ty, and uncertainty has done no little harm tothe prestige and influence of economists,because if there is a Progressive Era value whichstill obtains in journalism and the publics mind,

it is the authority of the expert. Uncertainexpertsor visible disagreements amongexpertsundermine the very confidence of the20th century in the idea of public rationality.

That lack of confidence conjoins with theways in which publics reach public judgmentthat is affirmed in policies. The direct experi-ence of participants in an economy or society isindividualand overlain by individual frames ofreferencethat become collective in complex(and always problematic) ways. When a majorityof young Americans tell pollsters they doubtwhether Social Security will meet their needsdecades hence, they express individual fearsabout whether collective obligations will meetother collective obligations such as budgetdeficits. Absent journalismand the politicaland economic debates reported thereintheyhave no frame of reference for judgement.

This nervous relationshipbetween whatan aggregation of individuals thinks it knows,and the outcome of collective choice andactionis where economists seek relevance, butmust face the constraints which late-20th cen-tury life places upon them. Public policy in the

current moment exhibits all the problems ofcollective irrationality, by economists stan-dards. Reforming welfare, downsizing govern-ment, an insistence on balanced budgets, healthcare reformall are policy issues with deep,indeed primitive, foundations that touch poli-tics, morality, idealized notions of the self andof the correct public domain. In all these issues,economics exercises a certain parametric, but byno means central or decisive, role.

Economists may be concerned about ongo-ing large budget deficits, but as a policy matter,are divided about whether the current trend line

is positive in detail, or whether even balance perseas it is conceived by many political figuresand large parts of the publicis the relevantmeasure. Health care policy is even more intri-cately complicated because the valuation ofones health is by no means susceptible to sosimple an expression as price, or even a range ofprices, especially when trade-offs are far fromapparent, and consumers are also voters.


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Richard Parker 9

Journalists consequently face a narrativecrisis of their own, because theyand elite com-munitiesdont feel economists can providedeterminative answers to any of these questions.This encourages journalistic citation of compet-ing economic views (economists disagreedtoday about the policys effect, following itsannouncement...), oftentimes mixing judgments

of supremely different qualities, as it turns out.Also, because the political conflict narrativealmost always trumps the economic, journal-ism is captured by the range of politicians andpartisan analysts views (In reply toReischauers comments, policy analyst JudeWanniski insisted...), again without clear pre-sentation of professional ability or partisan bias.

Solving this particularly thorny connec-tion between economists and journalistsandtheir competing narrative demandsis by farthe most complicated, and most important ofthe issues in the field. Yet it is perhaps the leastsusceptible to easy recommendations.

6) News and General EconomicPerformance: A sixth concern, similar to thefourth, but much broader for policy, treats newseffects on economic performance generallyinparticular on consumer behavior. Cited earlier,economic forecasters such as DRIs RogerBrinner have complained that journalisms pref-erence for bad news has prolonged recessionsor slowed recoveries. It is a charge businessleaders, business publications, and recently-defeated politicians have made a staple criti-

cism, although academically-satisfying evidenceis thin.The critical missing link to the argument

is proof that the public, after years of exposure,has somehow failed to notice the presss prefer-ence for news of the bank that was robbed overthe bank that wasnt. After all, theres wide-spread polling evidence that the public recog-nizes and deplores press negativism generally;whyeven if one grants the bad news thesis,critics argue, arent Brinner and others guilty of

post hoc, ergo propter hoc without more com-pelling, and closely-reasoned evidence? If dis-

counting is a feature of rational economic exis-tence24, why isnt it at play in the publics han-dling of news?

7) Which Economist Shall We Listen To?:Finally, there is the issue of which economiststhe press talks to, a matter some economistsconsider more than an issue of amour-propre.Beginning in the 1960s (now wistfully called theGolden Ageby Keynesians), Time put JohnMaynard Keynes on its cover, and Newsweek

made Paul Samuelson and Milton Friedman reg-ular columnists; claims for fine-tuningabounded, and economists were hailed for hold-ing the keys to eternal prosperity.25 Nowadays,magazines prefer personal finance columns,and reporters call the denizens of Wall Streetbrokerage firms or Washington think-tanks forcomment on the latest policy or stock market

twist. Several recent studies of economics cover-age generally shows markedly little use of uni-versity-based economists, despite a boom in thevolume of such coverage.

Some university economists take a balefulview of all this. Paul Krugman, a rising young aca-demic star, has particularly taken to task thosehe calls policy entrepreneurspseudo-econo-mists in his eyes whove hoodwinked the publicand political elites into a host of misguidednotions, from industrial policy to managed trade.

Krugmans critiqueoften smart, but fullof blistering ad hominem assaultsfails howev-er to fully credit several other reasons why acad-emic economists stock as news sources has fall-en, having little to do with perfidious policyhustlers. One factor is the sheer number ofpeople now working in public policy, and thespecialization that has come with that growth.Washington, for example, is full of current andformer government economists and policy ana-lysts whose familiarity with specific programsor legislation equals or exceeds all but a handfulof university-based economists. Reporters ondeadline find these specialists easy to locate,

highly current on the latest turn in policy, andalso often deeply insightful into the politics sur-rounding the policy.

There is a second reason, which Krugmannotes, but nowhere solves in terms useful tojournalists or the public. Since the 1970s, thehegemony of Keynesian macro-beliefs has beeneroded by what appears to journalists and thepublic as a cacophony of voicesNew Classical,Post-Keynesian, Monetarist, Neo-Keynesian, andSupply Sidethat fail the role of confidentauthority that journalists use as a narrativeconvention when they query specialists for

interpretive comments on programs or issues.This cacophonywhat one economist

friend wryly calls the shift from the one trueCatholic faith to a thousand Protestant oneshas its costs. As Albert Rees, president of theSloan Foundation (and a leading funder of eco-nomic research) has warned economists,

Serious newspapers carry long accounts of the dis-

putes among economists of these various views,


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and rival economists berate one another in the let-

ters to the editor. The newspaper reader no more

understands the difference between these schools

than he understands those between the rival fac-

tions of the Palestine Liberation Organization. His

impression is that economists are divided on all

issues into irreconcilable warring sects. Since

economists themselves cannot agree on anything,

he reasons, no attention should be paid to them.26

Note here that Reese is addressing the splitamong full-fledged academicsnot Krugmansdivide between the academics and policyhustlers.

Robert Solow somewhat more dispassion-ately than Krugman offers yet a third reason whyacademic economists play less than the role theymight hope for in public debates over policy, andreceive thereby less journalistic attention:

. . . . good economics is bound to be complicated.

Good economics is also bound to be uncertain.

Even where the underlying principle is clear its

application to particular circumstances is never

direct. Too many other things are always happen-

ing at once. If there is anything that the politician

[or journalist, for narrative reasonsed.] does not

need it is complexity and uncertainty. Just the

opposite is called for. This demand for simplicity

and confidence is strengthened by the fact that the

political process is rarely interested in narrow eco-

nomic policy for its own sake. What we think of as

the heart of the matter is often seen by the players

themselves as subsidiary to issues of distribution,

party-politics, and image. You can hardly expect

the President, the Senator, or the House

Committee Chairman to tolerate distraction from

the frying of his own fish by the complexities and

uncertainties of economic analysis . . .27

Solow goes on to observe, Probably thereis nothing to be done about this. It goes withthe territory of democratic politics.Nevertheless there may be occasions for themarginal improvements and they should be wel-comed and followed up whenever they arise.

The Journalistic Complaints of Non-Economists

Economists arent the only ones with com-plaints about economics journalism. Here theissues, however, are both richer in their com-plexity and less susceptible to classification assimply economic in the sense that profession-al economists often use the term.

Economics, in this broader meaning,encompasses economic activityby individuals,

groups, corporations, and the state. Or it mayrefer to economic dimensions of issues that wetend to speak of otherwise as social policy, aslegal disputes, as class conflict, or politicalcompetition. The term economic in theseinstances tends frequently to the voluminouslyinclusive, and hence awkwardlyand controver-siallyambiguous. When is environmental

policy an economic matter? What are the eco-nomic components of defense spending? Howis racial or gender inequality, or reverse discrim-ination, an economic issue? To what degreeshould legal decisions rest on economic princi-ples? Is the single-parent family a social, moral,or economic issue?

These arent just matters for social scien-tists or policy makers to sort out, but cut to theheart of democratic speech and reasoning, indeedlie at the core of the democratic polity. Decisionstaken for all sorts of reasons other than econom-ic have economic consequences, but are they tobe judgedor even describedas economic?

For journalists, this is no small matter. Asnoted, the journalist seldom uses academiceconomics to tell stories to an audiencebutto what degree does understanding economicshelp better tell the story?

To judge by the volume and durability oftheir complaints, business is the most vocalgroup believing that economic ignorance injournalists causes specific, measurable harm. Atone foundation-sponsored convocation wherecorporate executives talked directly with jour-

nalists, the reports summary (befitting the orga-nizers purposes) was quite frank about thisantagonism:

. . . the business community is becoming more

vocal in its attacks on the press. Of late it feels

particularly embattled and embittered. What

was once a relatively quiet adversary relationship

is fast becoming an openly antagonistic relation-

ship between two powerful and self-righteous

institutions.

To the businessman, too often the antagonism boils

down to thisbusiness builds up; the media teardown. To the media, too often the antagonism boils

down to thisbusiness always hides its wrongdo-

ing; only the media penetrates this stone wall . . .

The businessmens complaints are not unlike those

of government officials and politicians: the media

is too powerful; they always get it wrong; you can-

not get a fair shake; they dont write about all the

good things we do but only the bad; sensationalism


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Richard Parker 11

sells newspapers; they dont understand what they

are reporting; they oversimplify.28

At the most elemental level, the issue is ofaccuracy about specifics involving individualstorieshardly an exclusive province requiringeconomists judgment. A quotation isnt correct,a longer explanation is wrongly condensed, the

juxtaposition of statements or examples places abusinessman or company in an unfairly criticallight. Here the economist can add little, becausethe issues go directly to core journalistic canonsabout objectivity, balance, and fairness.

But behind these complaints lies a deepersuspicion, that points toward what manybelieve is a systemic bias among reporters andeditors against business. Here a good deal ofresearch has confirmed that, in terms of self-description, the press sees itself as liberal, anddoes in fact harbor suspicion about the trans-parency of motives, and self-interestedness, of

the business community.But some of the research goes further to

argue that such personal views inherently doesbias coverage of business. Burton Pines, in Outof Focusa detailed study of network TVs por-trayal of economics and business in 1992bit-terly concluded that

. . . a random tuning-in of TV was more likely to

give a viewer information that distorted or under-

mined free enterprise than supported it...In [1992],

network newscasts aired 68 hours, 34 minutes on

economic policy and business matters. Most of

this, some 56 hours, 32 minutes, was background

material, often factoids of little importance. But

much of the reporting was explicitly or implicitly

didactic. Of this, 6 hours, 59 minutes misinformed

viewers about the facts or principles of the

American economy and business compared to 5

hours, 3 minutes which portrayed the free enter-

prise economy accurately and fairly.29

The precision here, suggesting a carefulanalysis quantitatively of news bias, initiallyoffers a strong case for bias; however, it loses

some of its persuasiveness as one follows Pinesargument. By the end of his book, he offers anappendix of what to read for journalists wish-ing to improve their understanding of freeenterprise. The list consists of just sixauthorsMilton Friedman, Henry Hazlitt,Charles Murray, Martin Anderson, RobertBartley, and George Gilder. It is not a diversityof views meant to inspire confidence in Pinesoverall judgment.

What Journalists Think, and Do, Aboutthe Problem

None of these complaintswhether fromeconomists or non-economistsis unfamiliar tojournalists; indeed many journalists seem attimes no less bothered by their professions cov-erage of economic issues. Elie Abel, formerdean of Columbias Journalism School, hascalled business and economics reporting themost disgracefully neglected sector of Americanjournalism. Writer Dom Bonafede, slightlymore literary in his imagery, is no less harsh.Business reporters historically, he writes, haveall too often rightly been considered by peers ascity room castoffs and journalistic drifters, bitplayers in a raw profession, fulfilling a melan-choly task requiring little talent and less imagi-nation in a cramped corner of the newsroom.30

ABC News reporter Jeff Greenfield prefers aslightly more ingenuous metaphor.

Economics, he avers, was once the blinddate of journalism. It was better than stayinghome, but not by much.31

Journalists, however, are thinking of agreat deal more when they talk about econom-ics coverage than what economists usuallymean. A quick look at either a newspapersbusiness section or its front pages tells why.Topically, and in terms of interpretive frames,economics to journalists is heavily shaped (asdiscussed earlier) by a deep-rooted sense ofpolitics; but it is also shaped by journalismsuse of business as its other important narra-

tive frame.Business pagesor increasingly, business

sectionsare the routine repository for thesestories. These sections have surprisingly stan-dard organizational form, despite ever-changingstories. They typically consume a third to halftheir space (or more) simply publishing financialtablesreporting the activity of stock exchanges,mutual funds, and bond, currency and commodi-ty markets for the previous day. Descriptivereporting concentrates on large publicly-tradedcorporations, both local and nationaltheirmergers and acquisitions, quarterly sales data,

personnel changes, new product announcements(and occasionally, legal troubles). Added to thatare government reportsroutine announcementsof economic data series (unemployment, housingstarts, inflation, trade, etc.), Fed activities, andthe like. And then, usually depending on activitylevels, shorter or longer stories on the financialmarket movements and their meanings.

In recent years, as more talent andresources have flowed into such coverage, char-


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acteristics of these stories have changed. One istheir origin. Historically, business news reliedheavily on press releases and wire service copy,with only cursory independent reporting byjournalists; nowadays, while press release-basednews still dominates the total number of stories,turning up as shorter articles and news items,the section lead and longer articles tend to be

trend or impact stories, about internationalcompetition, industry or market profiles, andhigh-technology reviews. Smaller and newercompaniespart of the renewed national inter-est in entrepreneursget more coverage, par-ticularly if theyre in hot technology fields, as(in an age of affirmative action) do women andminorities working in corporations. Laborunions figure only marginallyusually when astrike occurs, while consumer-reform-orientedand public interest group-generated stories aredown markedly from the 1970s.32

This story environment seems to bepart of a larger trend, especially in print jour-nalism, that views interpretive reporting(compared to the old who, what, when, where,why style) as a premium print can offer incompetition to radio and TV news. Theprovince for years of magazineswhether thenewsweeklies, business magazines, or selectpublicationsthis style of reporting appearsnow much more regularly both on the frontpages and as section leads.

The front pages are reserved generally forfour types of stories. First are the aforementioned

trend stories, in which journalists seek toevaluate large economic/business themeswagestagnation, global competitiveness, savingsissues, growth rates, etcand which editors con-clude merit the wider exposure of the front page.

Secondand most obviously painful tomanagementare what we might call the cor-porate Three Cscrime, crisis, or conflict sto-ries. Boesky (or Milken, or . . .) Arrested,Government to Indict . . . , etc. represent thefirst; the Exxon/Valdez, Dow Corning, A.H.Robbins stories typify the second; Caterpillarenters second year of strike is a not unusual

third. It is, incidentally, these types of storiesthat almost inevitably produce the greatest hos-tility and anguish among executives over presscoverage, given especially the latitude for jour-nalistic interpretation of the crisis stories.

A third category is the corporate secularfortunes story: ATT to cut 50,000 jobs, LastUS TV Manufacturing Plant Closes, IBM totake losses on PC business. These portraychanges in individual corporations, usually large

ones, that because of their size are presumed tohave a significant impact (versus the constantswirl of changing fortunes exhibited by millionsof smaller, privately-held firms). Given the enor-mous restructuring of American industry inrecent years, these have been staple features onfront pages.

Afinal type is a political-corporate

hybrid, particularly relevant to industries suchas telecommunications, entertainment, finance,transportation, energy, and the like which havebeen the focus of deregulation in the past fewyears. These stories inevitably invoke fresh cor-porate activitysay, the acquisition of three TVnetworks this summerinto multi-story exami-nations of the significance of the move for theindustry, the economy, government policiessuch as antitrust, and the inevitable Americanconcern about corporate concentration. (As jour-nalistic forms, these are perhaps closest to abusiness magazine style pioneered by HenryLuce and Fortune in the 1930s, but seldom uti-lized in newspapers until the 1980s.)

Television, meanwhile, with the growth ofcable and independent channels, has done sever-al things: its main network evening newscastscarry more stories about the economy generally,as well as corporate and industry news. Cablechannels such as CNN and CNBC now offerbusiness news programs, as well as interviewand panel discussion programs about economicand business affairs. The explosion of news-magazine showsfollowing the 60 Minutes

modelhave also increased coverage of theThree Cs on television, though hardly a likenumber of serious trend stories.33

Since the 1970s, these changes have fed agrowing consensus among journalists at leastthat, taken together, things are improvingthequantity and quality of coverage, the trainingand specialized skills of reporters and editors,etc. Still, the question of how much remains.One study in the late 1980s conducted for theFord Foundation interviewed 4,552 workingreporters and editors, and concluded:

Journalists themselves are aware of the poorstate of public economic knowledge, and they

recognize the need to improve the quality and

coverage of business and economic news. Over

80% of the organizations surveyed had increased

such coverage in the last five years; 67% believed

that coverage of stories with economic content

should be increased even more. Reporters and

editors alike, however, are dissatisfied with the

quality of coverage. More than 50% feel their


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Richard Parker 13

firms do a fair or poorer job of business/eco-

nomics coverage, while 80% believe that general

reporters are not well equipped to handle busi-

ness/economics content. The poor quality of cov-

erage also affects the quantity of news provided,

for 62% of the editors surveyed said they would

increase coverage if the quality of business/eco-

nomic reporting improved.34

The report itself goes on to document whatit views as deeply problematic:

A) Formal economics training seems lack-ing: 55% of business/economics reporters arejournalism majors, vs. 4% who majored in eco-nomics and 6% in business. Only 23% havetaken more than three economics courses, while17% have had a similar number of businesscourses (96% say they wish they had takenmore such courses earlier in their careers).

B) Experience levels are lower:Business/economics reporters averaged 10.2years in journalism, vs. 15 for other reporters(They were twice as likely to be female aswell39%, vs. 18% on other beats).

C) Theyre likely to do less digging to getstories: Business/economics reporters are twiceas likely to rely on press releases, and spend lesstime (24%) than others (31%) doing research fortheir story. They also relied less on wire storiesand government hearings. They rely much moreon individuals in private companies for techni-cal questions, much less on academics or gov-ernment sources.

D) Theyre likely to feel undervalued:when controlled for education and experience,these reporters in fact make less than those onother beats. Perhaps related, 43% feelbusiness/economic reporting isnt well support-ed by management.35

All this suggests a major gap of sorts, but italso invites reflection. For example, by lumpingtogether several thousand journalists from wide-ly different-sized and kinds of papers, do thissurveys aggregation techniques obscure whetherrecent heavy hiring pulled down average experi-ence, whether lack of management support was

greater at smaller papers, whether less diggingreflected business section norms or those of thefront page? One can also wonder what sorts ofbusiness or economics courses reporters wishthey had taken, which in turn has invited reme-dy through improvement that takes severalrecognizable paths.

For the Ford Foundation, however, theresults were persuasiveand exemplary of anissue to which we next turn.

Curing What Ails Them: The Pedagogical Model

I formally reject the proposition that increasing

the economic understanding of the public is an

impossible task. I just wish I had stronger empiri-

cal evidence on which to base that rejection.

Nevertheless, I find the job of educating the public

on economic issues and controversies as important

and urgent as any the economist has, if we are tomake democracy work, or work better.

Discovering the economic truth comes first, but

truth is of scant value unless the public and the

government respect it and use it. And I believe

that economists can do much more to improve

economic understanding if they really give it the

energy, resources, and thought the job requires.

Leonard Silk, New York TimesEconomics Editor, to the

AEA annual convention, 1985

The model for almost all the remedies pro-

posed to date rests on increasing economicknowledge and communications skills for econo-mists and journalists, whichit is thoughtwillincrease the knowledge of the audience, andhence improve civic understanding (and there-by, the functioning of democracy). In this basi-cally classroom idea of learning transposed tothe press, the problem is viewed as a failure todevise appropriate means for transmitting under-standing between three economic ideal types(in the Weberian sense)the economists asknowledge producers, the reporter as distributor

(and translator), and the audience as consumer.This diagnosis, as far as it goes, sees alimited set of key problems. For the econo-mists, the failure is one of relevance, ofmaking issues or modes of thoughts whicheconomists value apparent and plausible to thejournalist, and hence to the general public.The late Leonard Silk, himself a PhD econo-mist and former economics columnist andbusiness editor at the New York Times, set outthe case in a speech before the AmericanEconomic Association.36

In it, he outlined what about economists

professionalism impedes their ability to com-municate through the general press. The first,he said, was hermeticsthe preference fortechnical jargon and talking too much withinthe caste. The second was ambivalencerefering to economists support for self-interestas a motive in the market, but alarm at its role(individual or collective) in politics. A third wasflawed scienceeconomics failure at predic-tion, basically, but also a certain inadequacy of


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explanation when simple models met complexeconomic realities, as well as a willingness tohide political bias or preference behind scien-tism. Combined with a public that was bothlazy and disillusioned by repeatedly unmetclaims by economists, he admitted to soundingdiscouraged.

He then attempted to overcome some of

that discouragement both by the perorationquoted above, and a series of recommendationsthat essentially counseled greater academicmodesty, commitment to public teaching, and arejection of the idea that a dispassionate andvalue-neutral science could solve the problem ofideology and interests.

Journalists, in turn, have been encouragedto strengthen their own knowledge of academiceconomics as a means for better reporting notonly views of economists, but better interpret-ing economic performance and issues in debateover public policy. Most of the recommenda-tions have followed four suggested lines ofimprovement: 1) hiring changesplace greateremphasis on hiring economics and/or businessmajors as reporters and editors; 2) pre-employ-ment trainingemphasize more skills prepara-tion in economics and business reporting atjournalism schools; 3) mid-career trainingprovide short-term programs designed toimprove formal understanding of economicsthrough intensive seminars, etc.; 4) status/rewardensure more recognition, pay, andprestige are given to reporting the

economics/business field.Over the past two decades, a number ofprogramsfrequently foundation-sponsoredhave emerged to fill in the perceived lacunae injournalists economic knowledge. With burgeon-ing demand for business and economicsreporters, there has been a pattern ofthoughperhaps not a systematic attempt atincreasinghires with at least BAs in both fields. At thegraduate level, surveys of journalism schoolsindicate both an increasing number offeringcourses in business and economic reporting, aswell as growing numbers of course cross-regis-

trations at business schools and economicsdepartments. Organizations such as theNational Association of Manufacturers or theKaiser Family Foundation have also offeredtraining programsmostly short seminarsorsometimes mid-career fellowships available tojournalists interested in specific fields such ashealth policy, trade, and the like.

But how accurately does this classroomlearning model address overcoming what both

economists and journalists take as the publicsignorance and/or disinterest in economicmatters?

For one, because journalism (like the pub-lic) gives the broadest possible meaning to theterm economics, incorporating business news,socio-economic trends and problems, and thesimple reporting of governmental and financial

market indices, it focuses on much more thanclassroom theories and theorists. The demandfor academic economists and their theories isovershadowed by the constant demand for newsand analysis of market changes, the latest gov-ernment policy debate, the newest legislativeturn and the likeissues at which others offersuperior information, or at least informationorganized in forms readily utilized by journalists.

When a group of Bagehot Fellows con-structed a textbook/reader for journalists onbusiness and economics in 1991, for example,economics took the decidedly back seat. Two-thirds of the text focused on reading balancesheets, using SEC documents, where to locateindustry information, and simple elements ofstory construction; the chapter on economicsdisplayed no knowledge of recent innovations(Samuelson and Friedman were the newest theo-rists mentioned), spent much of its timeexplaining simple economic indicators and Fedoperations, and even oddly insisted that JohnKenneth Galbraith virtually managed theFrench economy after World War II.37

For another, surprisingly little work has

been done to measure audience effects fromostensible changes in journalists knowledge offormal economics. Reporters interviewed afterboth short- and long-term training programsin economics journalism judge themselves bet-ter informed, but no one has actually analyzedcoverage quality, or audience learning, on a pre-and-post basis.

Economics: From a Peoples Science toProfessional Discipline

Reasonable men reach reasonable conclusions

in circumstances where they have no prospect ofapplying classical models of substantive rationali-

ty. We know only imperfectly how they do it. We

know even less whether the procedures they use in

place of the inapplicable models have any merit

although most of us would choose them in prefer-

ence to drawing lots. The study of procedural

rationality in circumstances where attention is

scarce, where problems are immensely complex,

and where crucial information is absent present a


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Richard Parker 15

host of challenging and fundamental research prob-

lems to anyone who is interested in the rational

allocation of scarce resources.

Economist Herbert Simon38

Simon, who won the Nobel Prize in partfor pioneering work on satisficing behavior as

an alternative to economics beloved notion ofrational maximizing, wasnt specificallyaddressing problems in economic journalismwhen he spoke; but he could have been. Hisremarks point to a singularly neglected aspect ofthe debate over the quality of economic report-ing: we have very little clear understanding ofhow and what the public learns from the news.

In the burgeoning academic field of com-munications theory, that lack of understandinghas not been for want of trying. The twentiethcenturys two great boom industries in commu-nication have been propaganda and advertising,

the former associated with coercive states, thelatter with manipulative marketsand for manyyears formed the central concern of communica-tion theorists. Starting in the 1960s, theoristsshifted their efforts to focus broadly on whatcame to be called journalisms agenda-settingfunction. It was widely argued that while jour-nalists cannot consciously dictate what wethink, by virtue of selecting the issues and actorswhich received prominent and recurrent atten-tion, they set the agenda of public debate.

More recently, there has been increasingrecognition that publics themselves approach

the news with their own agendas and organizingfilters, through which journalisms agendasmust pass. The emphasis has been on determin-ing what the frames of media presentationare, what frames audiences bring to theirabsorption of media messages, and the gaps andcontrasts between the two. Coupled with newattention to the factors involved in life-longlearning, framing analysis has in turn becomepart of what the discipline refers to as sociallearning or social cognition theory.39

There are several relevant lessons (or chal-

lenges) here for those concerned about economicsjournalism. The first is evidence that econom-ics (in the loose sense used by the public, notacademics) is in fact one of the primary filtersaudiences use to screen information. Politicalscientists Russell Neuman, Marion Just and AnnCrigler, for example, have identified five domi-nant filter categories in their empirical studies ofaudience learning through news, which theyidentify, along with economics, as conflict,

moral values, powerlessness, and humanimpact.40 Media, they argue, share these framesand use them to communicatebut to impor-tantly different degrees, and in importantly dif-ferent ways.

The media tend to employ technical language for

the economic frame, while people are far more

likely to overlay the frame with a moral or evalua-tive dimension . . . Approximately half of our inter-

viewees framed at least one issue in economic

terms but they tended to put a human face on it.

The medias numbers are reflected back as human

impact, values, or moral judgments . . . Greed was

seen as motivating various actions by governments

and individuals . . . Often, individuals saw the prof-

its going to powerful others who could not always

be trusted...our interviewees also included the

media among the powerful others motivated by

greed. Several of them employed an economic

frame to suggest that the medias main concern in

issue coverage was rating or profits.41

This constant conjunction of economicswith other frames, particularly the moral andhuman interest frames, suggests at least twokey insights into how audiences learn from jour-nalism. First, audiences carry with them fully-elaborated frames that run at odds in several keyways to the frames professional economistsuse to teach economicsand sometimes seemto want journalism to convey. Economists valuedispassion, observable rules, and the absence ofindividuals in their narratives; they avoid wher-ever possible telling stories that use words likegreed or power, and hardly ever mentionindividuals by name as key economic actors, sohighly do they prize their own narrative aboutabstract economic rules and forces.42 Whatframing analysis seems to suggest is that suchefforts run tangentially, and perhaps at odds, tothe modes through which people assimilate andretain information, thereby complicating thelearning process itself.

Second, it suggests why critics find journal-ismparticularly TV journalismweighted

toward coverage of what the critics define asbad news. Audiences tend to validate suchbad news because it meets their own doubts orskepticism about the world generally, but inparticular about their experience of and confi-dence in the economys performanceand thereliability of leaders and professionals (includingeconomists) when called upon to predict futureperformance of the economy or the benefits ofspecific economic policies.43


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Theres an intriguing additional dimensionto public skepticism over economic perfor-mance to be found in research on public percep-tions of risk. Repeated studies have found thatthe public routinely assigns a higher risk of dan-ger to man-made projects than to natural phe-nomena. Nuclear power plants, toxic spills, etc.are considered much more likely to occur and

cause harm than scientific evidence suggeststhey will; earthquakes, hurricanes, etc., by con-trast, are routinely given lower probability esti-mates for occurrence and harm than scientificdata say they hold. But why should this be so?Public policy analysts and statisticians, con-fronted with such evidence on a broad scale,have concluded that public trust of such man-made projects inherently contains deep doubts(or at the very least, skeptical uncertainty) aboutauthority and honesty, that directly relatesto confidence and relative powerlessness.

How Then Do We Learn?Theres a good deal of evidence today that

we do in fact learn from the pressbut in waysquite unlike the straightforward pedagogic mod-els that many who debate economics journalismunderstand. The mode is called unintended oraccidental learning, and its proponentsbelieve that we acquire bits of information andunderstanding from the press in haphazard, butnot unsystematic, ways. Those fragments arethen tentatively assimilated into what theresearchers call learning schemas, stored,retested against new information for consis-tency and usefulness, sometimes forgotten andthen relearnedand finally only graduallyretained as part of a larger cognitive architecturefor life-long learning.

As frame theorists now understand, thepress consequently is never simply providinginformation to audiences in a void, but pressingits reports through complex, interactive narra-tive structuresor framesthat serve as keyorganizing modules. Moreover, from the audi-ences vantage point, the usefulness of frames isin no small part to filter out the vast amount of

information for which the audience has nousein one researchers words, taming thetide of information constantly flowing over us.

Over a lifetime we encounter endlessstreams of new information, that flow past uswithout disturbing much about those basicframes. Whats lacking for a theory of economiclearning through journalism is an understandingof how different groups in a society come tovalue key elements in a framehow for example,

some people come to favor widespread govern-ment involvement in the economy while othersoppose it, and how journalism affects commit-ment to those views.

Separately, different researchers have addedan additional, intriguing dimension to thislearning question. Without fully accounting forwhy, they have shown thatcontrary to earlier

researchers concernssuch beliefs display, inaggregate societal terms, remarkable stabilityover time. Individuals change their views, butwithin the society as a whole, the mean com-mitment to particular views changes only veryslowly when it changes at all.

This understanding of public opinionasan expression of public beliefs and framesused to interpret newsis relatively new tosocial science. For many years after World WarII, researchers focused on instability and short-term change in public opinion; only recentlyhave they gone back to look at patterns docu-mented over as much as half a century. Whenthey have, it is constancy, not change, whichhas stood out.

This has enormous implications for theeconomics journalism debate, particularly inpolicy reporting. Political scientists BenjaminPage and Robert Shapiro, in The RationalPublic, for example, argue that stable prefer-ences and beliefs are a characteristic of theentire post-World War II period:

Opinions about employment, inflation, taxes, and

energy, for example, reacted in systematic andconsistent ways to objective trends in prices and

unemployment rates. Because of the predomi-

nant stability of opinions, we concentrated a

good deal on patterns of preferences within and

across issues, showing that the American public

makes coherent distinctions among policies and

holds opinions that fit together into backing for

individualism and a limited, but substantial, wel-

fare state.

The high and generally stable public support for

government action on Social Security, education,

jobs, medical care, the cities, the environment,consumer safety, and the likeand willingess to

pay taxes for these purposesis especially striking.

We noted a number of dips during the late 1970s in

support for taxes, regulation, and social spending

(especially on welfare, redistribution, minorities,

and medical care), but in nearly every case this

right turn of opinion was small and temporary;

opinion never altered much and soon rebounded in

a liberal direction. In other cases (eg., spending on


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Richard Parker 17

Social Security and education), there was hardly

any change at all or even a continued movement

in a liberal direction . . . Throughout the Reagan

years and on into the Bush years, Americans

favored more, not less, spending and action on vir-

tually all these economic welfare programs.44

Presumably what we see in such researchare expressions of the frames used by the pub-lic to come to public judgment. Unlike the oftenviolent swings in leadership and elite arenas(including the press), as policies become com-plex instruments of competing group power,large segments of the public opt for a conserva-tive consistency that one might infer feelsdeeply wounded and offended by Washingtonshyper-partisanship of recent years. This viola-tion of a public desire for consistent, and demo-cratically-reflective, policiesas much as thespecific policies and politics themselvesmaybe playing no small part in public disillusion-

ment with politics and the press (as well aseconomists and other professionals).

What Then Ought to be Conveyed?

Even if we could fully understand howpeople learn about economics and the economyfrom the news, what should we conclude?What, in other words, ought we to desire as analternative, if we are discontent with the pre-sent state of affairs.

Economists arent a particularly goodsource of answersor at least we need to recog-nize that many of their answers collide with

deeply-rooted customs, values and beliefs thathave proved remarkably powerful in shaping ourcollective pictures of democracy, mutual obliga-tion, power, and institutions. The economicassumption of the individual as a rational, self-maximizing figure, the suspicion about motiva-tion for collective action, a complex and veryimperfect understanding about information feed-back, its costs and benefits, and a highly-styl-ized minimalist description of the impact ofinstitutions on decision-making issues all makefor a worldview appreciated by a far smalleraudience than otherwise might be the case.

To be sure, in recent years, with bothdebates over rational expectations theory, anda growing interest in the role information playsin economic decisionsas well as rationalchoice theorys invasion of political science,there have been advances. But for the timebeing, they remain largely at the abstract model-ing level, unavailable to policy-makers, or forthose interested in interpreting their appliedmeaning to the general public.

Set against (or alongside) this worldview, ofcourse, is the pageant of the journalist, and hisor her role in it. Fundamentally, it is a democra-tic worldview, composed of citizens who areonly secondarily economic agents. This citizen-ry participates in democratic activity as a meansof fulfilling deeply-held desires for freedom,equality, and opportunity. Bound up in and by

institutions ranging from family to custom tocivic obligation, the citizenry looks to journal-ists to play a crucial role as information-provider as a means to democratic action.

In a cynical age such as ours, one can dero-gate such modelsbut journalists, no mean cyn-ics themselves at times, find this picture ofcivic life aif not thecentral raison detre fortheir work. Born out of a Progressive Era under-standing that objectivity must blend with con-stant civic improvement and democratic renew-al, to surrender such beliefs is in some sense togive up on journalism as a profession.

But since neither journalists nor econo-mists plan to give up their professionsand thenarratives, logics, and audiences that go withthemthe issue remains of what then ought tobe conveyed. Both frame theory and researchin the stability of public opinion suggest that astarting point different from most thinking todate on economics journalismincluding theclassroom model of improvementwould betwo-fold.

One is an empirical effort to understandhow, and why, audiences learn from journalism.

Expansion of the frames analysis to carefullysubdivided social and economic groups andclasses would expand our understanding notonly of how citizens use information to formu-late judgments on economic issues, but also giveus greater insight into how the competingframes interact. The work already done in thisarea of news learning has, for the most part,been focused on politics, with little large-scalework conducted on economic learning.45

Alongside this, better research on how dif-ferent media affect learning would add to ourunderstanding. Neuman, Just, and Crigler have

found that, contrary to easy assumptions, TVenhances understanding and retention of certainlearning experiences, compared to print.Whether or not this applies to economic con-cepts, however, is less clearand needs investi-gation. Sahr has also found that TV learningabout inflation and unemployment also is relat-ed to income and occupation, but not to sex andlevel of educationwhich suggests patterns forresearch as well.


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There also needs to be an effort to betterunderstand how individual knowledge, groupaffinity, and the notion of delegated power worktogether. That is, a good deal of existing litera-ture on economic journalism presumes thesuperiority of better public information andunderstanding, but nowhere specifies what anideal distribution might look like. Assuming

that we neednt all acquire economics PhDs, arethere varying normative levels of understand-ingperhaps distributed by education levelsthat we can at least hypothesize as more coher-ent measures of improvement, compared to anunspecific notion of a unitary publics learning?

This in turn raises both empirical and the-oretical issues of what we expect from aninformed public. From the emotive effect ofRonald Reagans Are you better off now thanyou were four years ago? to political scientistEdward Tuftes When you think economics,think elections; when you think elections, thinkeconomics, observers of American political dis-course have long assumed the deep interactionbetween voters perceptions of economic perfor-mance and political outcomes and alignments.

But how do voters assess economic perfor-mance, and by what criteria? Are voters assess-ing past performanceie, voting retrospective-lyor looking forward, ie, voting prospective-ly? To what degree do voters vote on their per-sonal pocketbook, or on a judgement aboutnational performance? When evidence suggeststhe latter, are they engaged in irrational

behavior, or calculating long-term self interest?To what degree is economic voting assymetricpunishing bad results more than rewardinggood ones?

We also need to understand better not onlythe individual frames through which citizensprocess journalistic information, but the groupcues that help them interpret it. What are themodern equivalents of the barber shop orwater cooler discussionswhere we test notonly what we have read or seen in the media,but seek feedback and interpretive understand-ing of their meanings? In an age of allegedly

increasing isolation, are the declines not just inparty affilation, but in mediating civic institu-tionsdescribed in Robert Putnams BowlingAlone and elsewhereso fundamentally weak-ened as to be ephemeral to individual judgment?

Finally, are there shifts in the emphasis ofspecific frames, or selection of cueing termsor concepts, by journalists that would aid in anyof this? Neuman and Just argue that journalistsand the public share common sets of frames, but

differ emphatically in the frequency and empha-sis with which they use them. Conflict rateshigh with journalists; morality and humaneffects rate much higher with audiences. Isthere some way in which journalism can sustainits canonical commitment to objectivitywhile serving this public hunger for differently-organized forms of information?

Because the American economy seems tobe entering a new eraor at least leaving behindmany of the coordinates of an older onetheseissues are of lively and critical interest to all ofus, not just economists and journalists. Perhapsit is frustrating to end with more questions thananswers, but in part it may be a result of havingasked questions in the past which dont addressthe issues of greatest importance.

Economic journalism will increase in vol-ume, variety, and importance in the comingyears, as change in the economy imposes bothtrying challenges and painful dislocations on theeconomic lives of millions of Americans. Muchof the past complaints about it seem to haveborn little fruitin part, this paper has argued,because we perhaps havent framed our concernsin fruitful ways. Economists will continue to betempted to predict the future, and will oftenmispredict it; journalists will err through haste,simplification, and misunderstanding particularissues, data, and concepts. Economically impor-tant groups and actors will continue to feelaggrieved.

What we need better to understand is how

the divergent and multifaceted lives of our fel-low citizensthat we compress at risk into anominal and homogeneous publicnot onlylearn from, but evaluate, and come to act upon,the information economics journalism provides.To date, weve not done an especially good jobof it. There is roomand reasonto do more.


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Richard Parker 19

1. Stephen Reese et al., Economic News onNetwork Television, Journalism Quarterly(Spring1987), p. 137.

2. Cf. Tom Goldstein, Killing the Messenger: 100Years of Media Criticism (New York, 1989) for a rep-resentative overview. Progressive Era writers especial-ly were vocal about capture of the press by busi-ness interests (Will Irwins eleven-part series forMcClures in 1912 is perhaps the most famous, andlater shaped the thinking of the HutchinsCommissions 1946 report). Conservative writers,though, were by no means less active, especiallywhen they concluded criticism of capitalism waslinked to Communist leanings. Cf. Percy Crosbysbitter Three Cheers for the Red, Red, and Red(McClean, Va., Freedom Press; 1936) for an especiallyrancorous example. Richard HofstadersAnti-

Intellectualism in America offers examples across alonger span of time.

3. Cf. David Colander and A.W. Coats, The Spreadof Economic Ideas (New York, 1993), Part II, esp.Robert Solows article, How economic ideas turn tomush.

4. Roger Brinner, in John Labate, Bad News HurtsToo, Fortune, March 23, 1992, p. 26. The motif ofthe press as economic Cassandra recurs throughoutthe business press. Cf., for representative examples,Kenneth Fisher, Misery in the Media, Forbes,

January 20, 1992, p. 127; John Lawrence, BusinessNews: The Terrible Truth, Fortune, April 25, 1998,pp. 145-149; and James Sites, The Press, theEconomy, and the Nations Future, Vital Speeches ofthe Day, March 1, 1978, pp. 290-294.

5. Reese et al.

6. For a view of foundations evolving role in eco-nomic policy and theory, see James Smith, The IdeaBrokers (New York, 1991). For a synopsis of major foun-dations current activity in the field, see Caren Grown,Federal and Foundation Support for Economics and

Policy, unpublished memorandum (Chicago:MacArthur Foundation, 1994). For a survey of conserva-tive foundations recent activity, though focused on thelaw and economics movement, see Alliance forJustice, Justice for Sale (Washington, DC, 1993).

7. Harold Lasswell, The structure and function ofcommunication in society, in Bryson, ed., TheCommunication of Ideas (New York, 1948), p.XX.

8. The positive-normative distinction, taught in vir-tually every introductory text, has been nonetheless acontentious one for years. Veblens attack on Marshallis one of the earliest statements, followed by Talcott

Parsons rejoinder to Lionel Robbins claims for it inthe Thirties. Friedmans famous restatement of thecase remains the post-war classic, but see Rosenberg,Machlup and McCloskey for dissent.

9. G.R. Boynton and Christophe Deissenberg,Models of the economy implicit in public dis-course, Policy Sciences,v. 20:1987, p. 129.

10. Cf. the AEAs officially-chartered Report on theCommission on Graduate Education, and its statisti-cal annex, The Education and Training of EconomicsDoctorates, Journal of Economic Literature, Fall,

1991, for a frank measure of the troubling intramuralproblems in the profession. According to it, 61% ofgraduate economics professors agree that economicstraining over-emphasizes mathematical and statisti-cal skills at the expense of economics. An evenhigher number think training needs major revision.The commission itself concluded that graduate pro-grams may be turning out a generation with toomany idiot savants skilled in technique but innocentof real economic issues.

11. Bell and Kristols The Crisis in Economic Theory(New York, 1980) offers a slightly dated, but still use-ful introduction to the non-specialist. For a more

recentand troublinglook at division and disarrayin economics, see the American EconomicAssociations detailed examination of graduate eco-nomic education, the Report of the Committee onGraduate Education in Economics, cited above.

12. Obviously, corporate activity isnt unexamined,whether by SEC oversight of public corporations, ormore generally by journalism. Still, individual enter-prises escape routine public surveillance in a wayunknown to government.

13. The classic arguments for the electoral eco-

nomic cycle are William Nordhaus, The PoliticalBusiness Cycle, Review of Economic Studies v. 42(1975), pp. 252-273, and Edward Tufte, PoliticalControl of the Economy(Princeton, 1978); for criti-cisms of the thesis, James Alt and Alec Chrystal,Political Economics (Berkeley, CA; 1982).

14. For a lively discussion, see Colander and Coats,eds., The Spread of Economic Ideas (New York, 1993).

ENDNOTES


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15. The Journal of Economic Education, primarilyconcerned with economics pedagogy at the collegeand high school level, also looks at journalistic cover-age, and offers a rich sample of such literature fromeconomists vantage point.

16. John Cochran and R. Michael Brown, WhatsWrong Here?, Economic Inquiry(July 1989), pp.

541-545.

17. Robert Lichter and Ted Smith, Bad NewsBears, Forbes Mediacritic (Fall, 1993), p. 82. Thearticle references two longitudinal studies, one by theMedia Institute covering three one-year periodsbetween 1982 and 1987, and a second by the Centerfor Media and Public Affairs that periodically ana-lyzed coverage in 1987-88 and continuously since1990.

18. Cf. David Harrington, Economic News onTelevision: The Determinants of Coverage, Public

Opinion Quarterlyv. 53 (1989), pp. 17-40. Harringtonreviews the literature, and in passing illustrates thecoding and bias problem of the conservativeresearchers. By coding, for example, movements inunemployment only by their direction, one study exco-riated network coverage as bad news, because itreported on unemployment when it was declining. Thiswas in 1983, however, when unemployment was 10%.

19. G.R. Boynton and Christophe Deissenberg,Models of the economy implicit in public dis-course, Policy Sciences v. 20 (1989), pp. 129-151.

20. For examples, cf. Jacob Frankel, FlexibleExchange Rates, Prices, and the Role of News,Journal of Political Economy, v. 89, no.4 (1981), pp.665-705; Craig Hakkia and Douglas Pearce, TheReaction of Exchange Rates to Economic News,Economic Inquiry, V. XXIII, October 1985, pp. 621-636; Torben Andersen, Credibility of PolicyAnnouncement, European Economic Reviewv. 33(1989), pp. 13-30.

21. Harvard economist Robert Barroa determinedcritic of the New Deal legacylikes to puckishlyremind fellow economists that U.S. economic per-formance fared best during those several (though rel-atively brief) periods when the CEA chairmanshipwas empty.

22. Robert Nelson, The Economics Profession andthe Making of Public Policy, Journal of EconomicLiterature, v. XXV (March, 1987), pp. 49-91.

23. Wayne Parsons, The Power of the Financial Press(Rutgers, NJ; 1989), esp. chs. 1 and 2, offers detailed

insight into the role of the press since the 18th centu-ry in disseminating economic theories.

24. Not to mention a tenet of faith among followersof this years Nobel Laureate, Robert Lucas and therational choice school.

25. James Tobins The New Economics One Decade

Older (Princeton, 1974) offers an excellent, briefrendition.

26. Albert Rees, The Marketplace of EconomicIdeas,AEA Papers and Proceedings (May 1986),p. 138.

27. Robert Solow, How Economic Ideas Turn toMush, in Colander and Coats, The Spread ofEconomic Ideas, p. 82.

28. Howard Simons and Joseph Califano, Jr., eds.,

The Media & Business (New York, 1979), pp. ix-x.

29. Burton Pines, Out of Focus: Network Televisionand the American Economy(Washington, DC; 1994),p. 6.

30. Abel and Bomafede, cited in Chris Welles,Economics and Business Reporting, in HollieKluge, Columbia Knight-Bagehot Guide to Businessand Economics Journalism (New York, 1991), p. xiii.

31. Greenfield, in Matthew Miller, The CaseAgainst Ted Koppel, The Washington Monthly(May,

1989), p. 35.

32. The great majority of small dailies, of course,lack the resources described here. One study foundthat a majority of business sections had fewer than 3staffers. Cf. Kent MacDougal, Ninety Seconds to TellIt All: Big Business and the News Media (Homewood,IL: 1981), p. 24.

33. The newsmagazine shows emphasis on ThreeCs has been painful to many in the corporate com-munity, it should be notedthough hardly withoutsome chagrin among journalists as well, after dust-

ups over Dateline and GM trucks, or 20/20sencounter with the tobacco industry.

34. James Hamilton and Joseph Kalt, A Summary ofthe Report to the Foundation for AmericanCommunications and the Ford Foundation,(Cambridge, MA; 1987), p. 5.

35. ibid, pp. 5-7.


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