Behaving like Luddites

The Luddites were 19th-century English textile artisans who protested against newly developed labour-saving machinery from 1811 to 1817. Activists smashed Heathcote's lacemaking machine in Loughborough in 1816. At the time, the BBC said that the increase in employment that would result from destroying the machinery “was of course good news”, but there was a concern that output might fall as a result. But some experts proclaimed that, thanks to the Luddites, we should celebrate that Britain was now leading the way in employment creation. A prominent politician that supported the Luddites accused the BBC of being hopelessly biased, and “peeing all over British workers”. The BBC Trust subsequently held a seminar on impartiality and economics reporting.

OK, the first two sentences come from Wikipedia, and the rest is nonsense. The idea that the BBC might describe additional employment that resulted from not using labour saving machinery as good news is surely unthinkable. If a journalist pointed out that these actions were problematic because productivity would fall, it must be inconceivable that any serious politician would accuse that journalist of bias. Unfortunately, if you follow the links, you will see that I made very little of that paragraph up, but just transposed things that happened a year ago back another 200 years.

There is one sense in which my transposition may be slightly unfair. In a recession, low productivity growth means that unemployment is lower. So I would have no problem with a line that went: “Of course the growth in UK employment, given flat output, is bad news. However, if this slowdown in productivity growth is temporary, and we catch up in terms of productivity levels later on, it may have a silver lining. Low productivity growth means that unemployment is lower, so that the pain of the recession is being more evenly spread by (nearly) everyone receiving lower real wages.” In a car crash, it is good when things like seat belts mean that people escape with minor injuries. But no one should describe the car crash itself as good news. [1]

At the seminar that the BBC Trust did hold in November 2012, there was disagreement over “whether BBC coverage should reflect a consensus view, in areas where there is one, or whether instead it must reflect the range of opinions even if parts of that range are minority views.” I would suggest that the overwhelming view today is that high productivity growth is beneficial, and that low productivity growth is a serious cause for concern, even if it might in the short term keep unemployment low. Do we really want the media to portray this as just ‘one perspective’, and then give equal time to the ‘opposing view’ that strong employment growth and low productivity growth is simply good news. In the case of the BBC and UK productivity, the BBC currently follows the 'opinions on shape of the earth differ' approach, and is then accused of bias for even mentioning that low productivity growth might be a concern.

It is vital that the media does not let politicians dictate how facts are interpreted. In George Osborne’s Orwellian nightmare, support for his handling of the economy is growing, and opposition to austerity is crumbling, whereas in the real world the case for austerity has never been weaker. It was always obvious that when the economy started recovering, this would be proclaimed as proof that the government’s policies are working, whereas what it really tells us is how used we have become to a no-growth economy.

Now if politicians want to be Luddites that is of course their choice. We trust in the system to quickly find them out, so that they do not get to hold positions of responsibility. Yet how is that supposed to happen, when the media insists on giving the Luddites equal space. As the opinion poll results presented by Professor Schifferes to the Trust showed, many people follow economics news closely, but remain confused by it. They rely on the media not just to present the news, but to put that news into context. Reporting that says one day ‘output growth low: bad’ and the next ‘employment growth high: good’, without putting the two together, is bad reporting.

Tim Harford has a recent post that pokes fun at some of the common misperceptions that the UK public has, such as crime is rising, a third of the population was born overseas, or that teenage pregnancy is widespread. What Tim does not ask is where these incorrect perceptions come from. He does note that they often do not come from direct experience: “people generally believe that their own area is closer to the way they like it with lower crime, lower unemployment, better policing, fewer immigrants. It’s the rest of the country they worry about.” So where do these perceptions about the rest of the country come from, if they do not come from the official statistics? The answer is pretty obvious - they come from the media.

There is a large part of the media, in the UK and elsewhere, that would regard the perceptions Tim quotes as indications of success rather than failure. It is not a coincidence that these misperceptions all tend to encourage a rather illiberal political agenda. However these perceptions should be a source of deep concern for organisations like the BBC, whose mission is “To enrich people's lives with programmes and services that inform, educate and entertain.”

Of course the ‘two sides’ approach has its place. It is not clear, for example, how much of the productivity slowdown in the UK is the government’s fault. However given what we know about output, the strong growth in UK employment is self-evidently bad news. As the coincident slow growth in UK wages shows, we are (nearly) all significantly worse off as a result. It is time the UK media recognised that the Luddites were wrong, and update its reporting accordingly.

[1] In the US in particular, monthly employment numbers are used as an indicator of what is happening to output, which is something completely different. Here I am talking about commentary that at least has the potential to compare what is happening to employment and output.