CBS Talks Down the Economy with Biased Reporting

CBS Talks Down the Economy with Biased Reporting
Trish Regan ignores the numbers to criticize Greenspans rosy forecast.

by  Charles Simpson
July 21, 2005

     In the midst of a robust economy with steady job growth, strong gains in GDP, and little inflation, the CBS Evening News sees soup kitchens and long unemployment lines. Unsatisfied with Alan Greenspans sunny assessment of the economy, Trish Regan chose uninformed views over factual news to paint her own bleak picture. To spread pessimism, Regan took to the streets, where reality trumps forecasts.

     During the July 20, 2005, broadcast, news anchor John Roberts introduced Regans report by warning, What you think can depend a lot on who you are, what experts youre listening to, and especially whether you know someone who is out of work. He was right.

    Who you are: Trish Regan countered 3.7 million new jobs over 25 months, a 5.0% unemployment rate, 3.8% GDP growth in 1Q 2005, bolstering consumer confidence figures, and shrinking federal and trade deficits with negative opinion from people on the street. One of Regans subjects portrayed an economy on the brink, Its very tenuous. It could fall apart at any moment. One bad piece of news, one additional terrorist attack, one negative corporate earnings and it goes right down again. What experts youre listening to: Again, Regan ignored the overwhelming strength of the economy in favor of cynicism from John Challenger (a Chicago-based outplacement consultant). Challenger warned: Theres been a heavy spate of major layoffs. It suggests we may be hitting a tipping point in the economy.

Challenger should be surprised the economys even capable of tipping so soon. In an October 18, 2003 interview with the San Francisco Chronicle, Challenger predicted that the job market would start bouncing back late this year that the bounce will be relatively small and awfully slow. He doesnt expect a real boom until maybe 2008. Obviously, that prediction didnt pan out. So, theres little reason to believe his forecast should pass Regans reality test.

    Whether you know someone who is out of work: Regan obsessed over layoffs at Kodak and Hewlett-Packard: In June, nearly 111,000 jobs were lost, making it the worst stretch of job losses in nearly a year and a half. Meanwhile, the Labor Department reported that new claims for unemployment benefits spiraled down by the largest amount in two and a half years. Even though this reality trumped Regans dire forecast, she left that tidbit out of her report.

     After ignoring the abundance of good news about the economy, Regan added to her laundry list of economic pitfalls by warning of rising energy costs and a housing bubble that reporters have obsessed over for months. She didnt mention that, despite the high price of oil, inflation has held steady at 1.6% in May.

     Like some embellished weather forecast, Trish Regans prediction of gloomy skies and trouble ahead shouldnt be taken seriously.


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