Biz media creates skewed view of the economy

Brian Westbury, the chief economist of First Trust Partners, writes on the Wall Street Journal that the business media often creates an unbalanced view of what’s going on in the economy.

Westbury wrote, “I talk frequently with members of the print media and I am a regular guest on business TV shows. Both venues stress debate and journalistic skepticism. In my view this tendency causes a great deal of confusion.

“If one guest or expert is a ‘bull,’ then the other must be a ‘bear,’ to keep things fair. Or, if there is a single guest on air, the host often takes the other side of the issue in order to keep things balanced. Get some sparks between guests, a little argument here or there, and it’s even better for the ratings. The bigger the audience, the better the show, that’s the way the advertisers see it. It’s basic supply and demand.

“But this idea of presenting both sides of an issue, while entertaining, informative and seemingly balanced, may paradoxically create a warped perspective of the economy.

“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.”

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