Winner of the New Statesman SPERI Prize in Political Economy 2016

Saturday, 17 October 2015

How television fails in its duty to inform

When a Tory voter emotionally complained about how she had been deceived about cuts to her tax credits, it caught the media’s attention. I don’t want to get into the debate that followed about whether she deserved sympathy or not, except to say this just shows up some elements of the left at their sanctimonious worst. What struck me was the juxtaposition of this with another remark I saw elsewhere, which is that everyone who had looked at the numbers knew Osborne would cut tax credits after the election. This remark is correct, if be ‘knew’ we mean highly likely.

That information had clearly not got through to this Tory voter. Conservative MPs know she is not alone, which is of course why the Prime Minister lied about it before the general election, and why he and Osborne continue to try and cover up the facts. It is the media’s job to get information across, and on this it clearly failed. Most in the parts of the print media that see that as part of their job did their best: those in the part who are paid to deceive also did their job well. Whether we should let those who produce news like celebrity gossip and sports reporting use that platform to peddle political propaganda is an interesting issue. But these do not arise in the UK with the television media, which has a duty to inform in an impartial way which it is clearly failing to fulfill.

This is not about the television media’s coverage as a whole, but how information is presented in the kinds of programmes that this Tory voter is likely to watch: the major news programmes, interviews with the Prime Minister or Chancellor etc. Take for example the clip where the Prime Minister lied about cuts to tax credits. There David Dimbleby asks him by saying “some people” have suggested tax credits would be cut, rather than “every non-partisan expert”. This may seem small, but this kind of detailed textual analysis is critical (and it is what many journalists have been trained to do).

Of course this is not an isolated incident. The idea that the deficit was a consequence of Labour profligacy rather than the recession is widely believed (as another pre-election debate illustrated), which means the television media again failed. In other areas where the partisan right wing press do their best to mislead, like welfare and immigration, the average person’s perception of key facts is wildly wrong (in the direction they are misled), which means the television media has also failed. Journalists seem happy to quote large sums of money on magnitudes like government debt in a way designed to make them sound scary, but fail to put them into historical context (it needs just one chart), which would mean focusing on the debt to GDP ratio and pointing out that this will fall even if we run modest deficits. The politically loaded and inaccurate term taxpayers money is freely used, and the term welfare benefits misused. I could go on and on, and have.

Political journalists working in television try hard to be unbiased in a party political sense. They do this partly because there are political machines that try and hold them to that. I would suggest being unbiased towards the facts, and more positively their duty to inform, are at least as important. Unfortunately there are no equivalent mechanisms to ensure this happens.

30 comments:

  1. It would indeed be refreshing for the BBC and other broadcasters to call a spade a spade, and report that Cameron is a LIAR..

    And while we they are at it, they could also say that the fiscal charter is nothing but a political stunt. And say that not ONE economist can be found to support this policy, This is absolutely staggering. The BBC cannot do it themselves, to admit that the idea is RUBBISH, and had to wheel in ex-employee (ex economics editor Stephanie Flanders) to say so.

    Most worryingly , though is that when they have a chance to inform and add value to the debate, they completely miss an open goal. For example the MORONIC IDEA that public sector pension funds could invest in public infrastructure, and thereby create a wealth fund. as proposed by the Chancellor and the Mayor of London. I have never read that this idea is completely STUPID. Why you can read here, if you are interested (the BBC should of course have said the same):

    https://radicaleconomicthought.wordpress.com/2015/10/07/economics-of-the-bullingdon-boys-wealth-funds/


    Rather than provide news, the BBC especially specialises in gossiping and rumour-mongering (which seems from Peston to Robinson to Kuensberg - the call it analysis, of course, their snide remarks which do not add anything new to the debate, other than unattributed gossip).

    But if you want some economic reporting from the BBC, forget it. Their economics editor Peston is to leave. How he could become economics editor beats me, but presumably also himself. He is "economics editor allegedly" according his twitter tag.


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  2. The big failure is with students. You are literally lied to and taught BS e.g. the money multiplier.
    A rudimentary google search and you can see the UK along with Canada etc has *no* reserve requirements and it seems fishy.
    But most students just suck up the BS like a sponge.
    Pure Maths > Econ anyway.
    As Steve Keen says, we have to change the teaching.

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    1. It's a matter of incentives. In order to pass a course you have to repeat back to the teacher what the teacher has said to you. If you say back something else you will lose grade points, perhaps fail the course, losing the considerable sum of money you were required to pay for it. After twenty-five or so years of doing this you begin to feel that working out the answer yourself is self-defeating at best, and it's tiring, too. On the other hand perhaps they just store up their resentment, and think, "You just wait, once I've got my credentials I'm going to publish the truth and blow you and your establishment out of the water." Of course nobody will publish their truth, so they just shut up about it.

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  3. Another aspect of the tax credit issue is effective marginal tax rates. TC is now withdrawn at 48%. Many people will also have basic rate tax and NI to pay, so a combined 79% marginal rate, and some will also lose other means tested benefits such as maintenance grants for children at university, which will push their marginal rate over 95%. Yet there has been little discussion in the media about this poverty trap and apparent acceptance of the idea that reducing TCs makes people work harder or longer. It may be true that some people will work longer to make up lost TCs but many won't have the opportunity and many might decide that it's uneconomic to work for very little money. I would expect there to be a lot of evidence from labour markets on the likely impact, and the media could discuss it in fairly simple terms. But it seems even this is too difficult a concept to get across.

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    1. Right, it reduces incentives to work. But the Tories say no it will lead to more work, as we will "be like the Chinese"??

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  4. Quis custodiet ipsos custodes?

    What about an Office for Media Responsibility?

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  5. I think it was Churchill who said that history is the least contested version of the events, which is what makes a lack of challenging media analysis so tragic.

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    1. Well he would know as he told a few porkies in his own biography!

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  6. I always think of the direction economic research has taken about the fiscal multiplier and how that has been presented on television.

    Here is Skidelsky in his Models Behaving Badly piece:

    "Forecasting organizations are finally admitting that they underestimated the fiscal multiplier. The OBR, reviewing its recent mistakes, accepted that “the average [fiscal] multiplier over the two years would have needed to be 1.3 – more than double our estimate – to fully explain the weak level of GDP in 2011-12.” The IMF has conceded that “multipliers have actually been in the 0.9 and 1.7 range since the Great Recession.” The effect of underestimating the fiscal multiplier has been systematic misjudgment of the damage that “fiscal consolidation” does to the economy."

    which led onto Skidelsky's MAY 28, 2015 'Niall Ferguson’s Wishful Thinking':

    "Simon Wren-Lewis of Oxford University has pointed out that UK austerity was at its 'most intense' in the first two years of Osborne’s chancellorship (2010-2011). The UK Office of Budget Responsibility, using conservative multipliers, calculated that austerity in this period reduced GDP growth by 1% in each year. That was the basis of Wren-Lewis’s calculation that austerity cost the average UK household the equivalent of at least £4,000. The economic recovery after 2012 coincided with the cessation of fiscal tightening."

    Krugman in APR 4 2015 'Osbornia Revisited' blog went with:

    "Has the growth been way out of line with what you might expect given the reality (as opposed to the rhetoric) of policy? Let me do a slightly different version of the austerity scatterplot I’ve used a lot. Here I look across advanced countries, and compare the annual rate of growth during the austerity era 2009-13 with the average rate of fiscal consolidation (as measured by the IMF). This scatterplot suggests a strong negative impact of austerity, with a multiplier of around 1.5. And I insert British performance in 2014 into that scatter...What do we learn from that experience...the real British story is one in which the government and the news media have misrepresented the actual history both of policy and of policy debates. Academic economists aren't fooled: they overwhelmingly disagree with the pro-austerity narrative. But the public may never hear about that."

    When I wrote to the BBC about their failure to report the change at the IMF (of all places) over the multiplier, they believed in 2012-15 it was not their problem. It looks like all the economic staff there in 2008 - Flanders, Pym, Peston - will be gone from economic reporting at the BBC. It is now, regrettably, about how much political pressure can come from the Labour Party for this information to come across as it should have some years ago, and whoever gets the new BBC economic reporter jobs will have a very difficult time going forward to explain away the mess they have inherited from the previous incumbents.





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  7. I have friends who really do believe that Muslims are "taking over", that the percentage of the population who are Muslims is over 50%, that people who cannot provide any evidence that they have any right to live in the UK get given JSA and ESA and at rates aboves what legal citizens get, that almost the entire welfare budget is spent on JSA and ESA, that most JSA and ESA claimants have multiple convictions for benefit fraud, that people who are on ESA are not asked to provide any evidence that they cannot work or where not until Cameron came along, that there are millions of jobs wherever you look but people on JSA are not asked to apply for them, that, internationally, almost all terrorists claim to be Muslim. that the crash happened because Labour massively overspent on welfare and the NHS, that spending under Labour was at an all-time high, that Labour presided over "uncontrolled" immigration, that most murderers and rapists are only in prison for a couple of years or less, that most economists agree with household economics, and the list just goes on and on and on.

    A lot of them also think that the BBC and indeed most of the media is biased to the left. If it really were, then I am not sure where they would get these entirely wrong ideas from.

    I do try to convince them otherwise, without being "preachy" or "harping on", but it is a losing battle.

    Have recently discovered your blog and am already a big fan. I am only a Poli Sci MA, though :D

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    1. Sounds like a good summary of the conventional view. The question of "Where do they get these ideas?" is a good one, and one you could pursue for the Ph.D. in Poli Sci or Soc Psych. I would guess that the ideas, not in their specifics, but in their general tendency, predate the present era. "Mutatis mutandis", as they say, a similar summary could be given for the American context, throwing in a large dose of racial anxiety. Express these as general patterns that are differentiated according to context. If the media, under a more enlightened leadership, suddenly started trying to correct these views, they would immediately be distrusted, etc.

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  8. Coming out punching! I love it Simon!

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  9. "It is the media’s job to get information across, and on this it clearly failed." -S.W. Lewis

    Maybe this the capitalist, corporate media's job in the idealist fantasy land of neoclassical economics, . It's not that way in capitalist reality.. However, when one has a labor theory ot value based economic theory, it's logic leads to the conclusion that it's not the capitalist, corporate media's job to get information across. That is literally beside the point.

    Political economy teaches that a commodity is a use value (usefulness in satisfying needs and wants) and an exchange value, i.e., must be sold for money in the market. Since capitalist production is for exchange, for sale for money in the market, it follows that exchange value is the commodity's most important aspect for capitalist producers. Therefore, the use value, in this case providing the public information so that they may make important decisions about their lives is literally beside the point. Let me spell it out for Dr. Wren-Lewis, the capitalist, corporate media's job is to provide content that attracts the viewers, readers and clicks that their advertisers covet so that they may sell their "news' commodity for a profit.

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  10. Where's my comment?

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    1. Please read my note about moderation at end.

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  11. http://www.bondeconomics.com/2015/10/the-non-falsifiability-of-natural-rate.html?m=1
    May be of interest to Simon and others.

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  12. Didn't hippies have this conversation in the 1960s ?
    Didn't ADA have this conversatin in the 50s ?

    For its entire life, TV, with some very very rare exceptions, has been negative information: you know less after watching then before

    PS: you think I'm being harsh ? take a transcript of the flagship PBS newshour and compare the information in that transcript to any day of the N Y Times

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    1. I think the U and US are different here. Alas the UK seems to be heading in the US direction.

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  13. The media is doing its job. It is doing its part to render the people unfit to govern them selves, and thus providing the ruling elite justification for the de facto elimination of democracy. Of course, it is the ruling elite which is sponsoring the rendering. Just like here in the US.

    So the first question is: Is there any thing which can reverse the trend? And the second question is: Or has the process proceeded to the point where the consolidation of power cannot be stopped, and the hopes of the left to restore any balance of power empty, and their efforts futile?

    And the third question then is: And what then shall be the consequences, when the plutocrats triumph; when the wealthy few own everything?

    One problem I see, though. The elite don't actually seem to know what they are doing. They don't actually seem to know how to manage a modern economy. Certainly, what passes for academic macroeconomics seems very- lacking. Academia could be 'sandbagging' it, feigning ignorance and so be doing their part in service to our wealthy masters. Or, they could be sincere in their ignorance. Neither case is very flattering to them.

    I will say this though. For economists to allow the process, this experiment in human welfare, to proceed effectively unopposed is in fact an exercise in normative economics.
    It is a moral choice.

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  14. It's not only this stuff. I know a Sinologist who can't believe what journalists are saying about the Chinese economy (mind you some economists are not too familiar with what is really happening there either - but they still comment with a lot of nonsense and making ridiculously grand conclusions).

    As they say - don't believe what you read in newspapers.

    And the number of times I have heard experts complain about misrepresentations re Palestine, I would not be able to count. (Have a talk with your colleagues in International Relations sometimes!)

    Goes with the territory.

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  15. I have no opinion on "some elements of the left at their sanctimonious worst", but I would like to point out that some of us - sick and disabled people, job seekers, people in social housing - were being starved, made homeless and driven to suicide by the Tories before it was apparently cool. This woman voted intending more of the same for us, and chooses to speak up only because she is surprised to find herself among the victims. Yes, the Labour movement needs to welcome prodigal voters like this, but we have already eaten the fatted calf - if we had one - when we were sanctioned or in mandatory reconsideration. Please excuse a little bitterness.

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    1. I understand your perspective, which is why I have been opposing government policy on these issues from the moment it began. But one point I would make is this. One of the mistakes that much of the press and media encourage people to make is to attribute agency where there is none. The unemployed have chosen not to work, for example. People who agree that the government should 'get tough on welfare' may just be making the mistake of believing what they are told.

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    2. That is all very well.. but everyone gets old if they live long enough, and anyone can become sick or disabled, some are born disabled, firms go bust causing unemployment for their workers etc It only requires a little thought to see Tory ideas are wrong or only one point of view. Why are so many people seemingly unable to use their brains? And end up supporting uncaring policies?

      " I'm all right jack" comes to mind. Not giving a fuck about your fellow citizens is a moral choice unlike being born blind or without arms which is not.

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  16. Ten years ago Thomas Frank asked 'What's the matter with Kansas?' It seems that Britons should be asking, 'What's the matter with Folkestone?' Why would anyone vote for Conservatives, in ANY country, if NOT for the implicit promise that they will cut benefits without any regard for the suffering it might impose? That is, as far as I can tell, the only policy suggestion any conservative in any country has ever seriously proposed.

    I feel sympathy for this woman but that is mixed with utter bewilderment at what she possibly could have expected when she pulled the lever for a Tory.

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  17. It seems that she got the wrong end of the stick (mis-informed?) and she won't be any worse off under the changes to tax credits.
    So she can now cheer up and be happy about voting Tory again.
    Huzzah!

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  18. I tend to see this a more a failure of the opposition than the media. TV pundits are obliged not to add too much commentary to what they report or risk being called out for bias. You are, of course, right that it would be better if they called out the obvious lies, but there are very strong pressures on them to appear (if not actually be) impartial.

    I do not recall the Labour party pointing out that tax credits would be cut under the Conservatives (in fact I remember being infuriated by their silence at the time). If they had then the media would have been equally obliged to report that accusation with only the conservatives denial as a counter narrative. It was just as much the Labour party that failed the poor woman on question time.

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    1. http://www.theguardian.com/politics/2015/apr/29/pm-does-not-rule-out-tax-credit-cuts-labour-claim-secret-plan

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    2. Honestly, if the media were doing their job, they would pull in someone who would point out that the lies were lies. Someone will point it out -- even if the Labour Party does not call out a particular lie, the SNP or the Greens will, and if the parties don't, you can pull in professors.

      Basically it is the media duty to call out lies. If they prefer to do this by getting third parties to do it, that's fine, but they have to do it.

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  19. A cynical view of the way the media cover most issues is that they deal with them in such a way that does not challenge the prejudices and assumptions of their readers and viewers too much. We seem to live in a world where the media are there to keep people quiet, rather than make them think - but if they actually thought about things it might shatter their culture of contentment.

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  20. Have you ever listened to that BBC Radio 5 programm at 05:15, "Wake-up to Money", it's a laugh a minute, utter economic nonsense from start to finish. It sums up the UK medias' total lack of understanding of how a sovereign fiat currency economy actually works.

    The programme is obsessed with "the markets" and think they drive the economy; which couldn't be further from the truth. The government bond market is a throw back from when we were on the Gold Standard. Gilts have nothing to do with raising revenue for government spending. They are welfare payments for rich people with pension funds.

    The financial sector has never been able to create its own "risk free" financial asset; it is totally dependant on the public sector to do that for it, hence, the Gilt. That is just how secondary and parasitic the Bond market are to the real economy.

    The Treasury could stop issuing Gilts tomorrow and leave its spending as "reserves" at the BoE. The BoE already pays interest on "reserves" because the natural rate of interest in a sovereign fiat currency economy is ZERO. Particularly one that has swapped £375 billion of Gilts back into the "reserves" that originally bought them (previous Treasury spending).

    BTW. When the BoE swaps Gilts back into "reserves" under QE, it is the same as if the Treasury Debt Management Office, had never issued those Gilts in the first instance; they cancel each other out. The same as taxes, eventually, cancel out the governments spending. What we mistakenly call the "national debt", is all the government spending it has not got back yet in taxes and charges, because the private sector is holding on to it; commonly called "savings". The government has to recognize when that is happening and keep up its spending. The exact opposite of Osborne austerity welfare cuts.

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