The BBC intends to commission reviews on impartiality in various subject areas, and last week it published its first on fiscal policy (taxes, spending, government debt and all that) written by Michael Blastland and Andrew Dilnot. I think it’s a good report, and the BBC’s coverage in this area would be a lot better if its suggestions were widely followed. As I coined the term mediamacro to signify the disconnect between macroeconomic knowledge and what was said in the media, I very much welcome this attempt to bridge that gap. However at the end I want to note two fundamental problems, one of which at least the authors could not avoid.
The report starts brilliantly with a chart published by the BBC. Although this just plots ONS data, it is biased. Why?
For most people this chart looks scary, and there is a danger that this is why it was presented this way. (Laziness may be another reason.) I and most other economists would say it is highly misleading because debt is not normalised (divided by some other economic variable, like GDP). The way the report describes this is that “it brings a high risk to impartiality and can lead to the appearance of bias”.
Both economists and the report are right. If you look at the path over time of debt divided by GDP (as you should) the picture looks a lot less scary, especially if you take the series back to just after WWII. By presenting this chart, the BBC was both misleading and biased, even though it was just presenting data. The report then goes on to criticise more general alarmism in reporting about government debt. In reporting there is too often a presumption that debt is bad, and more debt is always worse. I would just say that presumption is wrong, while the report would say that views differ, and that to assume its bad is therefore biased. 
To say that the government is not like a household and therefore household analogies should never be used is too strong. Sometimes these analogies can be useful and helpful for audiences. However at other times they can be terribly misleading, as my blog pointed out many times during the austerity period. The report rightly says that “it helps to know that household analogies are dangerous territory, intensely contested, and can easily mislead.”
Some may say that using household analogies represents deliberate political bias by journalists. The report suggests, and I think this is correct, that it normally represents ignorance. Most political reporters are not economists, and the breadth of what they cover means that they end up being experts in little except who is up and who is down in a political pecking order. It is worth quoting the report on this:
“It’s clear to us that political perspectives can be partial, neglecting others. Political journalists can likewise miss or misunderstand or underweight economic perspectives. We could simply say that’s why the BBC has other specialists. But if they’re all bound from the outset to work within a political frame that shapes the choice of subjects, interviewees, the running order, the line of questioning and the shape of the story – perhaps squeezing it into binary politics - how much can other specialists really exercise influential judgement? A risk is the BBC overlooks interests that lack current political salience.”
I think the report isolates a key problem here, and one whose scope goes well beyond fiscal issues, but it ducks exploring the fundamental reasons for it. Its recommendation here is really little more than ‘must try harder’. As I have suggested elsewhere, the problem lies in an explicit hierarchy which puts Westminster politics in the most narrow sense (who is up, who is down) above all else. To take a very recent example, the government can only get away with claiming that higher public sector pay will increase inflation because it knows that political journalists won’t subject the claim to the ridicule it deserves because these journalists don’t know it’s ridiculous (HT Tim Bale).
This may seem like bias. Journalists will too often adopt a political frame provided by the government because they are ignorant that other frames are possible. The report is rightly critical of reporting that says, for example, that a rising deficit means the government will have to cut spending. What it should do is report that a rising deficit will mean the government will say it has to cut spending, but other choices like higher taxes or accepting higher borrowing are possible.
As the reports says: “Governments often claim their choices are acts of necessity; this does not make them so.” It also points out that reference to the government’s fiscal rules can invoke similar dangers, because the rules are themselves contestable and contested. They may be rules for the government (although for this government frequently broken and revised), but not rules for society.
More generally the report talks about the dangers of journalists projecting a consensus where none exists except perhaps between the two main parties. It suggests that
“in economics we think there’s a case for a small shift in the balance of perceived risks towards more breadth of expert view. We mentioned a well-known academic who felt his views on debt were largely ignored during austerity, and who many might now say had a reasonable argument.”
That could be me, as I did give evidence to the report, but of course it could have been countless other economists. I personally would say we need much more than a small shift towards more expert views.
Now to the two elephants. The report doesn’t say that over the 2009-16 period the BBC, along with the rest of the broadcast media, made a colossal mistake in adopting the line that reducing the deficit was the most important priority for fiscal policy. This was not at first a failure of treating a political consensus as an economic one: initially Labour opposed the extent of austerity. It is possible to argue that this mistake had profound consequences, not only in pushing Labour towards the government’s position, but also in influencing the 2015 election, and after 2015 in creating the space for Corbyn to become Labour leader. Whatever you think of those consequences, it all stemmed from the broadcast media getting the economics completely wrong.
That is the first elephant in the room that the report fails to confront head on. It is important because the media’s near consensus that austerity was necessary was not just the result of ignorance on the part of political journalists. If you read Mike Berry’s book, for example, it is clear that the austerity consensus included the economic journalists at the time. As I have pointed out in my own book, the evidence suggests the majority of academic economists always disagreed with austerity, and by 2015 that majority was a consensus. The reason for this disconnect between economic journalists and state of the art knowledge over the austerity period is not addressed in the report.
Why did most economic journalists adopt the media consensus that reducing the deficit was more important than ensuring a swift recovery from the deepest recession since WWII? I have written about the influence of economists employed by City firms in my book, and I have also written more recently (at the time I talked to the authors of this report) about the origins of mediamacro. But the fact remains that, even after publishing my blog, none of the economic journalists working for the broadcast media ever contacted me about austerity.  That either suggests huge arrogance by journalists about their own intellectual abilities, or more probably it reflects that getting the economics right was both not important and also possibly dangerous for the journalists concerned. 
The second elephant is one which the report could not avoid, and that is in adopting impartiality as the overriding frame of reference. I have written about this in detail here, but its biggest problem is that the truth becomes of secondary importance. Impartiality seems to be defined in terms of what people think, even if what they think is just wrong. So under impartiality, anti-vaxxers should get some air-time, as should climate change deniers.
To see how disastrous this impartiality framework is, you only need to look at the Brexit referendum. The BBC, following impartiality, gave equal airtime to both sides whenever the economic consequences were discussed, and drew back from calling out obvious lies that largely came from the Leave side. On the economics of Brexit there was as close to a consensus among academic economists as you will ever get, and the BBC mostly ignored it. Arguably the consequences of that failure have been with us ever since, because the academic consensus was right. 
So it is quite plausible that two major errors in the way the BBC has treated economic issues have had a crucial role in political developments since 2010, with the terrible consequences we see today. If the BBC follows the report’s recommendations its reporting will certainly improve, but it remains only a first step to correcting the disastrous errors that the BBC and others made over the last fourteen years.
 There is a way of making this point, popular among some, which carries risk. The argument is that government debt represents someone else’s wealth, and we normally think wealth going up is a good thing, not a bad thing. All true, but most people do not own government debt directly, and even those who own it indirectly may be unaware of that, so it remains the case for these people that government debt is a potential liability and not an asset.
 Why should they have contacted me? Because at the time I was one of a small number of senior UK academics working on monetary/fiscal interaction, and austerity was all about monetary/fiscal interaction. I had a track record of advising the Bank of England and the Treasury, and on major policy issues my advice had been right.
 If you think dangerous is too strong a word, can I remind you what happened to Stephanie Flanders when she made the obvious point that strong employment growth coupled with weak output growth was problematic because it implied weak productivity growth. I'm also fond of this post I wrote on that.
 I used to think the media making political impartiality more important than knowledge was peculiar to economics, but the pandemic showed it was not.