Via a somewhat righty site, Betsy’s Page, two links to economic stories…
First, this at the Wall Street Journal:
For example, the most recent Wall Street Journal economic forecasting survey, from July, shows that 49 out of 60 forecasters expect real GDP to grow at an average annual rate of 2%, or faster, in 2007. Of the remaining 11 forecasters, only two expect growth of less than 1%, and only one expects a recession. For 2008, the forecasters are even more optimistic, with none expecting recession.
Despite this, an NBC News/Wall Street Journal poll taken in late July found that 68% of Americans thought that the economy either was in recession already, or would experience a recession sometime during the next 12 months. Interestingly, this is not much of a change from the past. This same survey question has been polled at least five times since September 2002. Each time a robust majority of between 65% and 85% of respondents thought a recession either was under way or would occur within the year. Americans have been bearish on the economy for quite some time.
In short, over the past five years, forecasting economists from academia, consulting shops, financial services and industry have a perfect 5-0 record against a random sample of American citizens. It’s important to understand that economists are not always right. Some even say that economists were put on earth to make weathermen look good.
In fact, some suggest that the experts don’t know what they are talking about. They say that economists make the mistake of looking at aggregate data, for GDP or overall income, which hides serious dislocations for the middle class and those with lower incomes. Those who argue this point believe that unfair foreign competition and unfair distribution of income are leaving many Americans behind.
But this is hard to believe. The economy moderated last year, but the unemployment rate is still just 4.6%, almost a full percentage point below its 20-year average of 5.5%. Since the jobless rate first fell below 5% in December 2005, average hourly earnings have expanded at a 4.1% annualized rate–as good as any year during the late 1990s. And recent research shows that incomes for the bottom fifth of wage earners have risen faster in the past few decades than incomes at the top, hard work is being rewarded more by performance pay, and income volatility is no worse today than it was in the 1980s and 1990s.
The telling line is this: incomes for the bottom fifth of wage earners have risen faster in the past few decades.
People feel good or bad about what’s going on right now. Sadly, the Census data on real median income only goes through 2005, but one glance tells youthe problem: no matter how much crowing this guy does about real growth (and we’ll get to that issue in a sec folks), real median income in 2005 was down from the year 2000. So for some reason, in this administration, economic growth has translated to less, not more income, for at least 50% of the population. (By contrast, it rose 7 out of 8 years from 1992 to 2000, and the annualized growth rate over that time was 2.3%.)
And then we get a link to an abstract of a paper by Kevin Hassett and John Lott of AEI:
Accusations of political bias in the media are often made by members of both political parties, yet there have been few systematic studies of such bias to date. This paper develops an econometric technique to test for political bias in news reports that controls for the underlying character of the news reported. Our results suggest that American newspapers tend to give more positive news coverage to the same economic news when Democrats are in the Presidency than for Republicans. When all types of news are pooled into a single analysis, our results are highly significant. However, the results vary greatly depending upon which economic numbers are being reported. When GDP growth is reported, Republicans received between 16 and 24 percentage point fewer positive stories for the same economic numbers than Democrats. For durable goods for all newspapers, Republicans received between 15 and 25 percentage points fewer positive news stories than Democrats. For unemployment, the difference was between zero and 21 percentage points. Retail sales showed no difference. Among the Associated Press and the top 10 papers, the Washington Post, Chicago Tribune, Associated Press, and New York Times tend to be the least likely to report positive news during Republican administrations, while the Houston Chronicle slightly favors Republicans. Only one newspaper treated one Republican administration significantly more positively than the Clinton administration: the Los Angeles Times’ headlines were most favorable to the Reagan administration, but it still favored Clinton over either Bush administration. We also find that the media coverage affects people’s perceptions of the economy. Contrary to the typical impression that bad news sells, we find that good economic news generates more news coverage and that it is usually covered more prominently. We also present some evidence that media treats parties differently when they control both the presidency and the congress.
When GDP growth is reported, Republicans received between 16 and 24 percentage point fewer positive stories for the same economic numbers than Democrats.
Ranking annualized real GDP per capita among Presidential administrations produces this:
1. JFK/LBJ (3.48% annualized)
2. Clinton (2.49%)
3. Reagan (2.45%)
4. Carter (2.14%)
5. Nixon/Ford (1.70%)
6. GW (1.37%)
7. Ike (1.11%)
8. GHW (0.93%)
Given that, under what circumstances would there be the same proportion of positive stories about the economy under Rep and under Dem administrations? (I note… the Lott & Hassett piece is from 2004… GW’s figures would look worse if I were to use only data available at the time they wrote the piece.)
Then there’s this:
Only one newspaper treated one Republican administration significantly more positively than the Clinton administration: the Los Angeles Times’ headlines were most favorable to the Reagan administration, but it still favored Clinton over either Bush administration.
Given that Clinton outperformed Reagan at real growth, as well as most other metrics we’ve been looking at here at Angry Bear over the past few months… isn’t giving Reagan more favorable headlines than Clinton a sign of bias? Seriously? As to comparing Clinton to the two Bush Presidents… the annualized real GDP per capita growth rate under Clinton was greater than GW’s added to GHW’s. Of course he got better press.
Its like Lott and Hassett watch a 100 meter race in which they’re rooting for losers who somehow or other find a way to get themselves lapped, and then complain their guys don’t get the same favorable press as the winners.