The U.S. economy is humming along pretty well.... or is it?

A short commentary on mainstream media coverage of the U.S. economy.

Photo by Hans Isaacson on Unsplash

I have written enough op-eds in my day to be conscious of the need for a “to be sure…” paragraph. This is the paragraph, usually buried deep into the column, that appropriately caveats the essay’s primary thesis. For example, if I was writing that “a second Donald Trump term would be catastrophic for the United States,” I’d include a paragraph that said something along the lines of, “to be sure, America survived Trump’s first term, and he might not win in 2024 anyway.” These kind of paragraphs are necessary in any commentary or reportage about current events because, well, life is complex and simple arguments do not always fit the data.

I bring this up because as the summer hums along, more data is coming in showing that the U.S. economy is performing pretty well. Inflation has come down dramatically without unemployment rising, leading to a serious drop in the misery index. As noted earlier this month, it remained an open question whether the American public would update its beliefs about the state of the U.S. economy. That is due, in part, to media coverage of the economy:

Even if the economy is doing well, voters fear a downturn because that it what experts in the media are telling them. Last December Mark Zandi noted: “Every person on TV says recession. Every economist says recession. I’ve never seen anything like it.” And it’s true — never forget, last fall Bloomberg’s economics model forecast a 100 percent chance of a recession this year. 100 percent! Other surveys at the start of the year forecast a 65 percent chance of a severe global recession….

Perhaps one explanation for the post-2019 divergence between consumer attitudes and real economic performance is that beginning with the pandemic, economic forecasters absorbed the same pessimism bias as geopolitical forecasters. Hence economics reporters are covering the Biden economy the same way Politico is covering the Biden foreign policy: stressing the dark clouds that are forever on the horizon.

For more evidence of this, consider two stories from earlier this week about the U.S. economy and how they were framed by mainstream media outlets in ways that vastly inflated the “to be sure” angle.