The Worst Economic Reporting in History: Has It Ever Been Thus?

-- Neil H. Buchanan

My new Verdict column, published yesterday, carries the somewhat ungainly title, "How to Succeed in Sounding Impressive When Talking about Budgets and Deficits Without Really Trying: Understanding the Degraded Media Environment When It Comes To Reporting and Discussing U.S. Budgetary Matters."

The ultimate purpose of the column is to summarize what we actually know today about federal spending, deficits, and so on.  The deficit has fallen dramatically in the past few years, and it will fall further, with projections showing that deficits will be completely sustainable for at least the next ten years.  The long-term forecasts have radically improved as well, with health care inflation having moderated significantly.

In short, even if one were a deficit worrier, the news lately has been nothing but good.  The only danger, and it is a very real possibility, is that the looming government shutdown and/or debt ceiling-related default will tank the economy, pushing down tax revenues and pushing up what remains of safety net spending, as people lose their jobs and homes.  The ballooning nominal deficit will be even worse as a percentage of a shrinking GDP.

As I noted above, my goal in writing the article was to summarize the current reality of our budgetary situation.  As the title of the piece suggests, however, I tried to reach that goal by setting up a rhetorical device, wherein I describe the facts about the budget situation, and then explain that a person who wants to write (either as a commentator, or even as a news reporter) about the budget does not need to understand any of those facts.  Such a person can have a successful career as a sage, worldly-wise bloviator about budgets without really trying to know anything about budgets.

In fact, the only thing that budding Beltway insiders need to do is to try to remain as ignorant as possible about reality.  Possessing knowledge will only complicate their jobs, which is to convince everyone that Social Security, Medicare, Medicaid, and domestic discretionary spending need to be cut -- not because the commentators will admit that they agree with Republicans, mind you, but because all serious people understand that the government can no longer afford to indulge its foolish notion that it can guarantee dignified retirements to people after a lifetime of work, or prevent people from dying of treatable diseases, or provide nutrition to children who will otherwise go hungry.  In pundit world, the story is that even liberals must admit that cuts need to be made, and the only thing to do is to decide how to add back a few dollars to the Republicans' demands.  Then, everyone can congratulate themselves on having backed "compromise," and we can call it a day.

I think a reader could fairly infer from the column, and from the paragraphs above, that I am saying that this state of affairs is uniquely bad.  If the media environment is "degraded," as I say in the subtitle of the column, that suggests that there is some higher level from which it has fallen.  That is not the only fair reading, of course.  It could be that the environment is degraded by comparison with an ideal, rather than a historical point of comparison.  But that is a less natural reading.  In any case, I certainly do mean to say that things are worse now than they used to be.

The obvious retort is that people always think that their era is the worst ever.  Kids are less well behaved than ever.  Music is less interesting than ever.  Politicians are more venal and stupid than ever.  And the media is less professional than ever.  In one of my college English classes, we were assigned to read Ovid's The Art of Love, and it was startling to read about people two thousand years ago complaining (and getting excited) about the same things that seemed ever-so-modern to an 18-year-old in the late Seventies.

One answer to this objection is that it really does not matter.  The point is not really whether things are worse, better, or the same as ever.  The point is that things are ridiculous now, and that has bad effects on policy.  Who cares if this is merely a different kind of ridiculousness, or that it is possibly meaningless to try to compare degrees of degradation?

As appealing as that argument is, I am willing to stick to the more difficult task of arguing that things really are worse now.  Maybe not the worst ever (after all, I really don't know what the media environment was like when Franklin Pierce was President), but the worst in at least a few generations.

This task is made more difficult, however, by the very language that I repeatedly use to describe the media's self-reinforcing echo chamber.  In decrying the "conventional wisdom," I am using a term coined in 1958 by the great economist John Kenneth Galbraith, who also meant to disparage the policy and media environment in the United States at the time.  It is not as if there was a time prior to, say, 2011 when media types and political hacks were free thinkers.  Galbraith saw the low level of independent thought of his era, and it was cause for alarm.

Moreover, the very embodiment of the conventional wisdom predates our current predicament.  David Broder, who died in 2011, held sway at The Washington Post for decades as the man who was always calling on serious people to agree that both parties were wrong, but somehow that the more conservative viewpoint was always really the right one.  Although he lived into the Tea Party era, his greatest influence was in the last half of the 20th century.  And his approach clearly infused the emergence of the political chatfests (McLaughlin and all those shows), which also date back a few decades.

How, then, is it worse today than it has been for decades, when at least the last half century has seen plenty of inanity passing as received wisdom?  For lack of a better way to describe it, the degree of inanity has simply gotten much worse.  For example, back in 2009, I was drafting an article that was not published until 2011 (as Good Deficits: Protecting the Public Interest from Deficit Hysteria, 31 Virginia Tax Review 75).  When I began drafting the article, I did not even plan to talk about the need for short-term stimulus, because it seemed obvious (in late 2008 and early 2009) that the conventional wisdom in Washington acknowledged the need for Keynesian stabilization, at least when the economy was extremely weak.

Within months, however, a Democratic President and his advisors were willingly going along with (and helping to reinforce) a newly metastasized consensus that the biggest problem facing the world at that moment was large fiscal deficits.  The insiders (politicians and the media) hardened their commitment to screwing up Social Security, even as the evidence piled up that that program was not part of any conceivable long-term problem.  And the rest is currently-unfolding history.

In short, there has surely always been a conventional wisdom.  And the conventional wisdom has almost surely always tilted toward comforting the comfortable and afflicting the afflicted.  Even so, the degree of disconnect between facts and reality, at least regarding budgets and fiscal policy, is greater now than I thought I would ever see.  Today, a person can pretend to say wise things about economic policy without even knowing the direction that the deficit is moving, much less when and why higher deficits are bad or good.  And virtually no one will call him on his willful ignorance.

It has surely ever been true that the political conversation is frustrating to those who actually know that they are talking about, but the current conventional wisdom has taken us to the point where the moderate position is to agree to policies that would obviously damage a weak economy.  Worst ... pundits ... ever.