The Good, the Bad & the Ugly
CNBC’s Burnett Finds ‘Silver Lining’ in High Energy Prices; ABC Eager to Sound Stagflation Siren; Climate Change Conference Mocked by The New York Times

March 5, 2008

The Good

      CNBC’s Erin Burnett found an economic “silver lining” on NBC’s February 29 “Today.” Higher energy prices are hitting some in the pocket, but that’s also causing some companies to hire.

     “Keep in mind that we did look around for a silver lining, if there was one, to the surge that we’re seeing in prices for oil that will cause record prices at the pump,” Burnett said following a report on a “surge” in oil and other commodity prices. “And that is: some companies are hiring.”

     “Companies that do anything related to oil, Natalie, they’re hiring,” Burnett said, addressing anchor Natalie Morales. “[I] talked to the CEO of Fluor yesterday. He said he’s hiring more than 3,000 people in the United States this year. Job creation is what we need right now so we’ll take that if we can get it.”

     Burnett’s attempt to balance her reporting by including a little bit of good news was certainly a step in a balanced direction. 

The Bad

     Nothing like the cheery decade of the 1970s - disco dancing, "Animal House," Farrah Fawcett and a buzz word to describe the economy - stagflation. While the '70s may be over, the media have reincarnated the term.

     After a disappointing spike in inflation, the producer price index (PPI), by 1.0 percent in January, and a rise in core inflation (with food and energy costs excluded), rising 0.4 percent on Tuesday, the media have deemed it necessary to sound the stagflation siren.

     "Now, to the economy," ABC "World News" anchor Charles Gibson said on February 26. "And a word not heard since the 1970s - stagflation. That occurs when prices go up just as the economy slows down - stagnation plus inflation. And the government REPORTED TODAY that wholesale prices shot up 1 percent in January and are now up almost 7.5 percent in the past 12 months."

     "Just today, oil set a record high - a barrel of crude at just over $100," continued ABC correspondent David Muir. "And what so worries economists, is that potential dynamic - stagflation."

     Although economic growth has tapered off, from 3.9 percent in the third quarter of 2007 to estimates of 0.6 percent in the fourth quarter of 2007 - stagflation takes time to develop according to Brian Wesbury, an economist for First Trust Advisors, L.P.

     "Let me just put it this way, stagflation comes from the 1970s," Wesbury said on CNBC's February 21 "Power Lunch." "A lot of people throw this word around. They don't know what they're talking about. It takes a long time for stagflation to develop. It was because every time the economy kind of faltered in the '70s, we cut interest rates, like we just did, and that drove inflation higher. And then, when we raised interest rates to kind of fight inflation, that hurt the economy - then we cut interest rate really fast again."

The Ugly

     It’s not much of a surprise to see The New York Times rip on anything critical of manmade global warming theories. Times’ reporter Andrew Revkin did just that on March 4.

     Revkin, whose “Reporter’s Notebook” (read: opinion column) piece on the conference appeared on A20 in his paper. He wrote that conference speakers were “trying hard to prove that they had unraveled the established science showing that humans are warming the world in potentially disruptive ways.” 

     He said a diversity of views among scientists – the conference features voices from across the global warming spectrum, especially on the causes of climate change – was a “challenge” for the conference’s mission. Maybe that explains why the media include so little diversity in their reports: it poses a “challenge”?

     But, Revkin included a note about conference sponsor Heartland Institute’s funding and said the group’s “antiregulatory philosophy has long been embraced by, and financially supported by, various industries and conservative donors.”

The Good, the Bad & the Ugly tracks the best and worst media coverage of business and economics. Readers are invited to submit suggestions or news tips to Staff Writer Jeff Poor at jpoor@mediaresearch.org.