Economic Coverage: D as in Dismal

There have been periods recently when economic bulletins sounded like excerpts from an Ionesco notebook. Within a few days, the Wholesale Price Index drops a notch while consumer prices rise again. Unemployment hits a new high and the stock market rallies perversely. Assorted experts prescribe contradictory cures while Government officials shuffle a deck of options. How does a conscientious reporter or editor convey the meaning of it all? Not very well, in all too many cases.

Since events pushed inflation and recession to Page One and the top of TV news programs, it has become painfully apparent that American journalism, by and large, provides dismal coverage of the Dismal Science. Lyle Harris, director of the business-journalism program at the University of Missouri, sees business reporting as "a great wasteland. The public doesn't understand the stories, and the reporters don't either." To Louis Rukeyser, moderator of Public Broadcasting's excellent Wall Street Week, economics is the "No. 1 failing of journalism."

Most critics would exempt business magazines and other specialized publications from such censure. Their reportage is generally detailed and accurate, though not necessarily very prescient or original. And even the business press is generally reluctant to question the basic assumptions under which Government and private economists work. The problem is posed with distressing regularity as merely a choice between slowing down or speeding up the economy through conventional techniques.

Back to Basics. Television news audiences and the readers of most general publications get little serious economic analysis. There are exceptions. Leonard Silk of the New York Times is one of the few journalists whom academics respect as an intellectual in the field. The Times's Soma Golden and the Washington Post's Hobart Rowen have both done consistently fine work. Peter Milius of the Post recently explained with clarity the relationship between inflation, wage changes, productivity and unit labor costs--rather basic stuff, but necessary to educate a painfully ignorant public.

On the practical side, Syndicated Columnists Sylvia Porter and Jane Bryant Quinn skillfully translate economic trends into lucid prose helpful to consumers. Beyond these exceptions and a few others, the fall-off in quality is steep. Many local papers rely heavily on Associated Press and United Press International for national coverage. The A.P.'s Gregory Nokes and U.P.I.'s Gene Carlson dutifully summarize the zigzags of Washington policymaking and the fluctuations of various indicators, but neither wire service often attempts to dig below the surface.

Local coverage is worse. Stories tend to deal with economic distress largely in terms of symptoms, local color and superficial how-to guides. The Detroit Free Press, to its credit, recently supplemented coverage of auto industry layoffs with a useful story on how to navigate the maze of local bureaucracies disbursing unemployment benefits. But many papers flop even in such routine backyard reporting. During the fall, for example, the Atlanta Constitution did several stories on layoffs in auto plants elsewhere, but delayed in mentioning whether factories in its own circulation area would be hit (they soon were). Its sister paper, the Journal, ran a carelessly frightening headline--PRESIDENT WARNED OF IMPENDING BANK CRISIS--that caused a temporary run on a local savings and loan association. Coverage by the Constitution and the Journal has since improved. A professional economist has been hired to do a weekly column, and this month the two papers collaborated on a joint year-end review that was comprehensive and perceptive.

Other papers have also been trying to catch up. The Boston Globe last month organized a four-member economics team, but so far its efforts have been unspectacular. The Los Angeles Times this month is recalling Washington Bureau Chief John Lawrence to set up and run a new "economy desk," and just in time. One typical Page One example of Times enterprise: "A door-to-door Times survey of 457 Southern Californians indicates that inflation is regarded here as the nation's most serious economic problem by a sizable majority--but there is no widespread agreement on what to do about it."

Stock Scenes. Television is particularly ill equipped to cope with economic news. Until recently the commercial networks had virtually no economic specialists among their correspondents; as a medium, TV is handicapped when it covers any complex story that does not lend itself to exciting video. The standard half-hour evening news show allows time for little more than undigested statistics delivered machine-gun style and stock scenes of unemployment lines and supermarket aisles. Lately the networks have begun to do more specials on the recession. NBC broadcast an hour-long review on New Year's Day; to moderate a discussion between two economists, NBC borrowed Public Broadcasting's Rukeyser rather than relying on its own Irving R. Levine, a former foreign correspondent whose economic reporting has been drab and unperceptive. All three commercial networks have now begun to reorganize business coverage and recruit a few specialists.

If the majority of newsmen were sluggish in grasping the importance of the economic story, a handful of publications got caught up early on in a rather irresponsible kind of Depression Chic. New Times magazine showed on its cover imaginary breadlines at McDonald's. Philadelphia magazine published a "Survival Guide to the Next Depression." U.S. News & World Report, which is hardly trendy or sensational, recently examined the likelihood of another 1929-style crash. The cover line, "What a Depression Is Really Like--Scenes from the 1930s," was a bit alarming for the sober story inside. In fact, economists generally agree that a return to the horrors of the '30s--when unemployment hit 25% as measured then (it is now 7.1%) and industrial production dropped by 53% (it is now down 4.3%)--is not remotely possible.

Such glib parallels have reinforced complaints by businessmen and public officials that the press is gratuitously contributing to bearishness. For the most part, however, the press has avoided wallowing in gloom. Nor have many publications been suffused with optimism--an attitude that most readers would reject anyway now that both Alan Greenspan, the President's chief economic adviser, and their own firsthand experience warn them that harder times are ahead.

Double Standard. Economic reporting is often found wanting in less visible ways. Reporters who would not hesitate to ferret out Watergate wrongdoing can be slow to investigate industry pricing policies, question whether suspiciously large price hikes are fully justified by rising costs or merely constitute price gouging, or examine the inflationary effects of monopolistic or Government regulatory policies. A recent Boston Herald-American story, for example, simplistically concluded that local retailers were raising their prices because "inflation is killing them."

Much of the reporting is flawed by errors of fact, interpretation and judgment that would embarrass even an undergraduate economics major. Few reporters note that current unemployment figures are not strictly comparable with those of earlier years because Government statisticians in the 1960s changed the way they define the work force. Similarly, many publications and broadcast outlets trot out the consumer price index monthly as if it accurately reflected everyone's inflation burden today. In fact, it reflects a market basket of goods and services required by less than 50% of all Americans. The base period for comparison purposes is now 14 years old, and the Bureau of Labor Statistics is working on a more precise and comprehensive index. Readers are rarely told of the lag of at least six months before Government fiscal or monetary measures begin to nudge the economy. Journalists who write of widespread demands for the President to take dramatic steps now to end the recession generally fail to mention that those steps could not bring any results before late 1975.

Why such fundamental shortcomings? The failure is not journalism's alone--U.S. general education is woefully inadequate in economics. Students in American high schools, and even in many colleges, learn more about medieval European wars than about modern economies. The U.S. press has traditionally not cultivated the subject as an important specialty. Business publications serve a relatively narrow audience (most notable exception: the Wall Street Journal, with its circulation of 1,430,000). The business pages of most newspapers are little more than repositories of wire-service roundups and rewritten press releases. The typical daily devotes at least twice as much space and staff to sports.

Until recently an economics degree has not been considered a good credential for newsroom recruits, and reporters have not been encouraged to specialize in the field. Says Ed Hart, financial editor of Los Angeles' radio station KNX, with perhaps some hyperbole: "Editors assign cubs to the business beat and say, 'Do a good job and we'll move you up to obituaries.' "

Only a handful of the nation's 213 graduate and undergraduate journalism schools offer programs in business or economic coverage. The one at the University of Missouri last year graduated just ten students, all of whom were snapped up by employers suddenly eager for such talent. To help increase the supply, the Columbia University Graduate School of Journalism next fall will offer the nation's first mid-career fellowship program in economics. Other universities are likely to begin moving in the same direction.

If the recession has posed a tough challenge to editors, better times will present another. Once the crisis recedes, journalists in the nation that considers itself the capital of capitalism will have to show whether their new concern for economics is permanent or, like Depression Chic, just a fashion.

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