Friday, June 24, 2011
With this week's announcement of "worse than expected" unemployment numbers, it is worth investigating how often the experts have gotten their predictions wrong. While admittedly an unscientific approach, a comparison of Google search results is a quick and easy way to compare news coverage of the economy. Below are screen captures of the Google results for the phrases "better than expected" and "worse than expected" plus unemployment.
While both searches show an increasing trend over time, this is probably attributable to better access to recent data with the growth of the Internet. On the other hand, there is a clear bias in favor of "worse than expected" economic reports by a margin of about 28,300 to 18,100, or roughly three "bad" stories for every two "good" ones.
In is impossible to predict the future with any certainty, so it's hardly newsworthy when reality fails to meet projected targets. However, we should be concerned when journalists distort uncertain economic predictions in order to manipulate public opinion. If journalists were honest in their reporting, we would expect an even number of articles for better than expected and worse than expected economic performance.
By consistently favoring bad news which undermines consumer confidence, journalists create a self-fulfilling prophecy of negative feedback that makes it all the more difficult for the economy to recover. Worse still, this unsophisticated approach to economics also undermines the vital role of the press in maintaining the educated public which is at the core of republican self-government.