The economy is not a soap opera.
Economics and politics are inseparable, but you wouldn't know it from mass media news coverage.
As the election year starts, we can expect more and more emphasis on what the candidates say about themselves and about each other, with the poisonality of venom increasing as the weeks go by.
The more they rant about their own strengths and their opponents' weaknesses, the less we hear about plans for governance, and much less than that about economics. The reality, however, is that politics has always been intertwined with economics, ever since the ancient Greeks coined the words.
Initially, the term economics referred to how a household managed and used what was available. The term was then expanded to embrace the Greek "polis," which referred to a city-state. By the 19th Century, when the modern study of economics came into its own, the term used was "political economics." And in the mid-20th Century, high schools were teaching "home economics" to girls, while boys went to college to study "political economics." Fairness didn't enter into it. Fortunately, things have changed.
However, academics and journalists soon split the latter term and began to treat politics and economics as separate and distinct fields.
'T'ain't so, McGee.
Unfortunately, far too many news reporters avoid writing about economics because they feel the topic is "too hard." Corruption and fraud in business is easy to cover, of course, since the investigations are often done by prosecutors, who then feed the information to reporters. There are, of course, investigative journalists who do dig out corruption and fraud, and after the stories appear in print the legal beagles sniff out stuff to enhance their own reputations and record of convictions.
These stories, however, are less about economics than they are about criminality. Writing about economics is no more difficult than writing about any other topic. Granted, the stories may not be as flashy or juicy as the entertainment and gossip quality of catching a prominent figure with his metaphorical pants down, but economics is no less important. In fact, it's more important, because the health of an economy in a metropolis, state or nation affects all citizens.
Many reporters, moreover, mistake entertainment and gossip for importance, and take the easy road to covering a story. It's not that economics is more difficult, although it tends to be quieter. And part of the problem may be that classes in Economics 101 were, for many students, boring. The fault, therefore, lies with the academics, not with the students.
In addition, the problem was perpetuated in newsrooms, where senior editors treated the business page as mostly a nuisance, whose main purpose was to mollify executives and retailers who wanted to see their names in print as they promoted other executives and announced their profitable sales figures. Moreover, too many publishers caved in to threats from major advertisers to pull their ads unless they got favorable coverage.
In response, publishers instructed their senior editors not to cover certain industries or business fields, lest the newspaper lose revenue.
It takes a strong-willed, successful publisher and editor to resist such pressure. Unfortunately, only major metro dailies are financially strong enough to do that, and even they sometimes yield to advertiser pressure.
So that makes the business section, if there is one, an unwanted stepchild in the newsroom. Far too often, there is only one page devoted to local business, and that is usually slapped together by a general news editor who takes a few minutes to gather a stock market report and a couple of national stories from the newswire, and perhaps include a feature about a local business written by a general news reporter, send the layout to the general news copy desk where overworked copy editors zip headlines on the stories, and off goes the page to the press room while the reporters and editors return to the "real news" of crime, corruption and politics.
The reality, however, is that all three of those categories are at root economic issues.
Citizens turn to crime because they have no jobs, or are boxed out of "legitimate" opportunities by corrupt politicians or adverse social pressures.
Economics is the study of how a home, business, city or nation uses whatever resources are available. Economics 101 teaches that these resources are Land, Labor, Capital and Entrepreneurial Skill. By definition, Land includes not only the terrain, but also minerals, water and forestry. Labor deals with people and how they work the Land resources. Capital means the machinery and tools invested in for Labor to work the Land. And Entrepreneurs are those who organize and supervise the other three.
It ain't that hard, folks. All it takes is a little time and effort, and to realize that the national economy is not a soap opera.
Friday, January 1, 2016
Wednesday, December 30, 2015
Show Biz Politics
"Who's that? Must be a king."
"King, eh? I didn't vote for him." -- Monty Python
The presidential campaign hasn't even entered the designated election year, and already it has taken on elements of a Shakespearean tragedy, reducing the competition to a level of personal attack unworthy of mature candidates.
Assuming, of course, that the candidates are mature individuals.
Rarely are policy plans and positions mentioned, if in fact there are any. Instead, the talk has been just that -- talk, coupled with warnings that any criticism, disagreement or attack will bring on severe counterattack, coupled with complaints about "unfair" treatment.
It's schoolyard behavior.
"Boo-hoo, that's not fair, you're not being nice to me."
Poor baby.
As if being nice was ever common in an American political campaign.
Disagreement over policy is routine in a mature society, where compromise is essential to progress. But an attitude of "my way or the highway" only leads to chaos, followed by dictatorship.
One candidate -- let's call him DeLear Tremens, since his behavior is like that of the Shakespearean king who went mad when those close to him disagreed with his demands -- began his campaign confident in all the glory that his previous success had provided. Anyway, DT's dreams of power, authority and his self-proclaimed ability to solve all problems if only everyone would do everything his way, dissipated in the swamp of competition, and King DT wound up a shadow of his former swaggering self.
It may be problematic to compare modern American presidential politics to royal retribution in medieval Scotland, and maybe it's just a coincidence that one of the candidates has a Scottish mother and owns several battlefields -- er, golf courses -- in Scotland.
In any case, overweening arrogance may be entertaining in a dramatic theatrical performance when it leads inevitably to the downfall of the arrogator, but when it happens in the real world, especially during a campaign for nomination to be President of the United States, the final act can only be tragic.
"King, eh? I didn't vote for him." -- Monty Python
The presidential campaign hasn't even entered the designated election year, and already it has taken on elements of a Shakespearean tragedy, reducing the competition to a level of personal attack unworthy of mature candidates.
Assuming, of course, that the candidates are mature individuals.
Rarely are policy plans and positions mentioned, if in fact there are any. Instead, the talk has been just that -- talk, coupled with warnings that any criticism, disagreement or attack will bring on severe counterattack, coupled with complaints about "unfair" treatment.
It's schoolyard behavior.
"Boo-hoo, that's not fair, you're not being nice to me."
Poor baby.
As if being nice was ever common in an American political campaign.
Disagreement over policy is routine in a mature society, where compromise is essential to progress. But an attitude of "my way or the highway" only leads to chaos, followed by dictatorship.
One candidate -- let's call him DeLear Tremens, since his behavior is like that of the Shakespearean king who went mad when those close to him disagreed with his demands -- began his campaign confident in all the glory that his previous success had provided. Anyway, DT's dreams of power, authority and his self-proclaimed ability to solve all problems if only everyone would do everything his way, dissipated in the swamp of competition, and King DT wound up a shadow of his former swaggering self.
It may be problematic to compare modern American presidential politics to royal retribution in medieval Scotland, and maybe it's just a coincidence that one of the candidates has a Scottish mother and owns several battlefields -- er, golf courses -- in Scotland.
In any case, overweening arrogance may be entertaining in a dramatic theatrical performance when it leads inevitably to the downfall of the arrogator, but when it happens in the real world, especially during a campaign for nomination to be President of the United States, the final act can only be tragic.
Sunday, December 27, 2015
Military Trust
The gun lobbyists argue that every individual needs a weapon -- whether single shot or rapid-fire assault weapon -- for self defense, up to and including the need to repel foreign invaders.
Apparently, they don't trust the Marine Corps, the 82d and the 101st Airborne Divisions of the Army, Special Forces troops, the regular army, or even the local and state police forces. Nor, for that matter, the ability of the U.S. Navy and Air Force to prevent a foreign invasion of, for example, Iowa, Kansas, or even Central Pennsylvania, much less coastal New Jersey, Manhattan, the Carolinas, the rest of the East Coast, or the entire West Coast. Not to mention intrusion from Canada, which has the world's longest undefended international border.
As if it would be an easy matter for an invader determined to occupy America to walk through Canada without opposition and march southward into the U.S., where, according to the gun lobby's playbook, a mob of armed individuals would suddenly transform into a "well-organized force" and defeat the invaders, while the Canadian military and Mounties could not, and the U.S. Marines and Army troops would also fail.
Therefore, the argument goes, every American must have a gun, as a patriotic duty.
Ignored in this scenario is the fact that throughout the United States, some 80 Americans die of gun-related violence every day. And the likelihood of a foreign invasion on the ground, either from Canada or Mexico, is somewhere between slim and none.
The defense of America is better left to the "well-organized militia" mentioned in the Constitution and organized by state and federal authorities. A foreign invasion attempted by any other country would have to be met first by Air Force and Navy personnel, and in the unlikely case of a landing, repelled by highly trained ground forces.
Armed individuals can't do it. Leave to the professional military.
Meanwhile, use your guns for the sport of target shooting or hunting. That's what they're designed for.
Apparently, they don't trust the Marine Corps, the 82d and the 101st Airborne Divisions of the Army, Special Forces troops, the regular army, or even the local and state police forces. Nor, for that matter, the ability of the U.S. Navy and Air Force to prevent a foreign invasion of, for example, Iowa, Kansas, or even Central Pennsylvania, much less coastal New Jersey, Manhattan, the Carolinas, the rest of the East Coast, or the entire West Coast. Not to mention intrusion from Canada, which has the world's longest undefended international border.
As if it would be an easy matter for an invader determined to occupy America to walk through Canada without opposition and march southward into the U.S., where, according to the gun lobby's playbook, a mob of armed individuals would suddenly transform into a "well-organized force" and defeat the invaders, while the Canadian military and Mounties could not, and the U.S. Marines and Army troops would also fail.
Therefore, the argument goes, every American must have a gun, as a patriotic duty.
Ignored in this scenario is the fact that throughout the United States, some 80 Americans die of gun-related violence every day. And the likelihood of a foreign invasion on the ground, either from Canada or Mexico, is somewhere between slim and none.
The defense of America is better left to the "well-organized militia" mentioned in the Constitution and organized by state and federal authorities. A foreign invasion attempted by any other country would have to be met first by Air Force and Navy personnel, and in the unlikely case of a landing, repelled by highly trained ground forces.
Armed individuals can't do it. Leave to the professional military.
Meanwhile, use your guns for the sport of target shooting or hunting. That's what they're designed for.
Thursday, December 24, 2015
Journalistic Competence
The good stories write themselves.
Journalists have an obligation to follow the classic rule of the Five W's -- Who, What, Where, When and Why, plus How. There is also a temptation to track the juiciest stories and the most noisy characters, because they're easier to cover.
In that sense many reporters are lazy, and smart politicians and corporate executives, among others, manipulate the media to generate publicity for their cause or candidacy. It beats spending money on advertising.
The Constitution guarantees a free press. It does not guarantee a fair press, nor does it guarantee a competent press. There are no government-issued licenses for reporters and writers, nor should there be. When government authorizes a license for journalists, it can also take away that license. When government issues a license to operate a printing press, it can also cancel that license. And when that happens, the press is no longer free.
Moreover, this freedom applies not only to newspaper publishers, but also to book and magazine publishers, newsletter writers, and to any who vent their opinions and distribute them, whether via hard-copy printers or electronic means.
Certainly there is good reason to license and control many things, including broadcasting, to avoid competitors operating on the same frequency; or medical licenses, to ensure competency; or real estate sales licenses; or licenses for operating machinery of various kinds, including automobiles, trucks, trains, construction equipment, and airplanes. And when operators prove themselves incompetent, their licenses can and should be taken away.
Gathering and disseminating information by news media, however, is entirely different, because licensing those who do it means controlling them and censoring what they do.
At the same time, there is such a thing as false advertising, which is actionable.
Finally, media types have a moral obligation to be fair and accurate. And except for libel, there is no legal obligation to be either. Opinions and comments, especially about public figures, often cross into territory that would otherwise be libelous when printed about so-called ordinary citizens who are not in the public eye.
Political candidates, in the heat of a campaign, utter half-truths, falsehoods and flat-out lies almost every day, and the news media dutifully print their rantings, as well as responses from opponents and clarifications from fact-checkers.
All in all, it's a messy system, but it's better than government licensing and control of information.
"Congress shall make no law abridging freedom of the press." -- U.S. Constitution, First Amendment
Journalists have an obligation to follow the classic rule of the Five W's -- Who, What, Where, When and Why, plus How. There is also a temptation to track the juiciest stories and the most noisy characters, because they're easier to cover.
In that sense many reporters are lazy, and smart politicians and corporate executives, among others, manipulate the media to generate publicity for their cause or candidacy. It beats spending money on advertising.
The Constitution guarantees a free press. It does not guarantee a fair press, nor does it guarantee a competent press. There are no government-issued licenses for reporters and writers, nor should there be. When government authorizes a license for journalists, it can also take away that license. When government issues a license to operate a printing press, it can also cancel that license. And when that happens, the press is no longer free.
Moreover, this freedom applies not only to newspaper publishers, but also to book and magazine publishers, newsletter writers, and to any who vent their opinions and distribute them, whether via hard-copy printers or electronic means.
Certainly there is good reason to license and control many things, including broadcasting, to avoid competitors operating on the same frequency; or medical licenses, to ensure competency; or real estate sales licenses; or licenses for operating machinery of various kinds, including automobiles, trucks, trains, construction equipment, and airplanes. And when operators prove themselves incompetent, their licenses can and should be taken away.
Gathering and disseminating information by news media, however, is entirely different, because licensing those who do it means controlling them and censoring what they do.
At the same time, there is such a thing as false advertising, which is actionable.
Finally, media types have a moral obligation to be fair and accurate. And except for libel, there is no legal obligation to be either. Opinions and comments, especially about public figures, often cross into territory that would otherwise be libelous when printed about so-called ordinary citizens who are not in the public eye.
Political candidates, in the heat of a campaign, utter half-truths, falsehoods and flat-out lies almost every day, and the news media dutifully print their rantings, as well as responses from opponents and clarifications from fact-checkers.
All in all, it's a messy system, but it's better than government licensing and control of information.
"Congress shall make no law abridging freedom of the press." -- U.S. Constitution, First Amendment
Tuesday, December 22, 2015
Economic Trumpedo
We're doing well.
That's what you say. Obviously, you haven't been in a grocery store recently.
The American economy continued a recovery of sorts in the third quarter, as output grew by 2 percent, according to the third estimate by the Commerce Department. Separately, an independent analysis of GOP candidate Donald Trump's tax plan would give the biggest benefits to the wealthiest Americans as it cut federal revenues by $9.5 trillion, offsetting perhaps all of the tax cut incentives and increasing the national debt by nearly 80 percent to as much as triple its ratio of debt to GDP.
Result: A likely crashing return to hard times.
Meanwhile, the economy seems healthy, if not robust. The third quarter growth rate was roughly the same as the second estimate of 2.1 percent. It was down, however, from the 3.9 percent growth rate in the second quarter. The increase largely reflected increased confidence throughout the country, as consumer spending, investment, and state and local spending rose.
Realistically, economic growth was about half the rate it was earlier in the year, but the growth seemed to support last week's attempt by the Federal Reserve Board to tap the brakes slightly by raising interest rates as a way to prevent overheating of the economy.
Whether the economy will withstand the Fed's brake-tapping, or will slip-side into a trench because of it remains an open question. Even the Fed itself put cautionary warnings into its announcement, noting that it would monitor domestic and especially international developments closely, and might even revert to its near-zero rates. However, lenders have already kicked up their charges, and whether they retract their hikes is also an open question.
Meanwhile, other government data point to stagnant wages, and grocery shoppers are already complaining about steadily rising prices. Add to that the trillions of dollars in new debt the government would incur from the tax code revisions proposed by Trump, and the nation faces a huge economic torpedo.
That's what you say. Obviously, you haven't been in a grocery store recently.
The American economy continued a recovery of sorts in the third quarter, as output grew by 2 percent, according to the third estimate by the Commerce Department. Separately, an independent analysis of GOP candidate Donald Trump's tax plan would give the biggest benefits to the wealthiest Americans as it cut federal revenues by $9.5 trillion, offsetting perhaps all of the tax cut incentives and increasing the national debt by nearly 80 percent to as much as triple its ratio of debt to GDP.
Result: A likely crashing return to hard times.
Meanwhile, the economy seems healthy, if not robust. The third quarter growth rate was roughly the same as the second estimate of 2.1 percent. It was down, however, from the 3.9 percent growth rate in the second quarter. The increase largely reflected increased confidence throughout the country, as consumer spending, investment, and state and local spending rose.
Realistically, economic growth was about half the rate it was earlier in the year, but the growth seemed to support last week's attempt by the Federal Reserve Board to tap the brakes slightly by raising interest rates as a way to prevent overheating of the economy.
Whether the economy will withstand the Fed's brake-tapping, or will slip-side into a trench because of it remains an open question. Even the Fed itself put cautionary warnings into its announcement, noting that it would monitor domestic and especially international developments closely, and might even revert to its near-zero rates. However, lenders have already kicked up their charges, and whether they retract their hikes is also an open question.
Meanwhile, other government data point to stagnant wages, and grocery shoppers are already complaining about steadily rising prices. Add to that the trillions of dollars in new debt the government would incur from the tax code revisions proposed by Trump, and the nation faces a huge economic torpedo.
Monday, December 21, 2015
Poll Positions
The only poll that really counts is the one on Election Day.
Polls are useful things, and when conducted by responsible agencies using proven techniques, they can show trends. But it's important to remember that a poll is only a sample, a brief survey of a small portion of the entire population.
Moreover, the answers pollsters get can depend on how they phrase their questions, and the quality of an answer depends on who is being asked.
For example, if the pool of respondents comprises only Republicans, the poll leaves out independents, who also may be able to vote in a primary election. If the poll includes those who are not likely to vote at all, you will get a different set of answers. Moreover, some will respond with the first name that comes to mind, and that could be the candidate who has been getting the most news coverage.
Even the better pollsters, those unaffiliated with a political party or advocacy group, acknowledge a margin of error, which can mean any two leaders may be even, or trade places for the lead.
Meanwhile, candidates can tout the results of one poll's numbers that favor them, and ignore others.
Such a claim can be true, as far as it goes, except that it doesn't go very far, and this amounts to selective truth-telling. Moreover, if an opponent cites alternate polls, or an alternate reading of the same poll, or even mentions the margin of error in the touted poll, an aggrieved candidate will cry "foul!" and accuse the opponent of at least selective truth-telling, if not outright, under-handed manipulation.
Thus, both sides will be guilty of the same charges they sling at each other.
So what's a voter to do, hearing the poll cats snarl innuendo and duplicity, when it's clear that none of the candidates speak the full truth? That's when journalism steps in, reporting not only what each candidate claims, but also detailing facts that contradict the bluster. Last call comes on Election Day, when voters decide who speaks truth.
Polls are useful things, and when conducted by responsible agencies using proven techniques, they can show trends. But it's important to remember that a poll is only a sample, a brief survey of a small portion of the entire population.
Moreover, the answers pollsters get can depend on how they phrase their questions, and the quality of an answer depends on who is being asked.
For example, if the pool of respondents comprises only Republicans, the poll leaves out independents, who also may be able to vote in a primary election. If the poll includes those who are not likely to vote at all, you will get a different set of answers. Moreover, some will respond with the first name that comes to mind, and that could be the candidate who has been getting the most news coverage.
Even the better pollsters, those unaffiliated with a political party or advocacy group, acknowledge a margin of error, which can mean any two leaders may be even, or trade places for the lead.
Meanwhile, candidates can tout the results of one poll's numbers that favor them, and ignore others.
Such a claim can be true, as far as it goes, except that it doesn't go very far, and this amounts to selective truth-telling. Moreover, if an opponent cites alternate polls, or an alternate reading of the same poll, or even mentions the margin of error in the touted poll, an aggrieved candidate will cry "foul!" and accuse the opponent of at least selective truth-telling, if not outright, under-handed manipulation.
Thus, both sides will be guilty of the same charges they sling at each other.
So what's a voter to do, hearing the poll cats snarl innuendo and duplicity, when it's clear that none of the candidates speak the full truth? That's when journalism steps in, reporting not only what each candidate claims, but also detailing facts that contradict the bluster. Last call comes on Election Day, when voters decide who speaks truth.
Thursday, December 17, 2015
The Fed Decides
For the first time since 2007, the U.S. central bank acted to push interest rates up, raising its target rate for federal funds by just a quarter-point, to 0.5 percent. In a statement released today, the Fed said "there has been considerable improvement in labor market conditions this year, and it is reasonably confident that inflation will rise, over the medium term, to its 2 percent objective."
However, the Fed recognized that it takes time for policy action to affect the economy, and it used this to help justify the rate increase. It will continue to watch carefully future developments, expecting that the economy will continue to improve only gradually, with the federal funds target rate "likely to remain, for some time," below long-run levels.
Moreover, "financial and international developments," the Fed said, will play a major role in future interest rate decisions.
So a bit of inflation is OK, according to the Fed's current thinking, and for now, prices generally are rising by less than the 2 percent rate that the central bank deems acceptable.
However, the Fed recognized that it takes time for policy action to affect the economy, and it used this to help justify the rate increase. It will continue to watch carefully future developments, expecting that the economy will continue to improve only gradually, with the federal funds target rate "likely to remain, for some time," below long-run levels.
Moreover, "financial and international developments," the Fed said, will play a major role in future interest rate decisions.
So a bit of inflation is OK, according to the Fed's current thinking, and for now, prices generally are rising by less than the 2 percent rate that the central bank deems acceptable.
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