The BBC is at it again. Cataclysmic economic disaster is just around the corner, the soup kitchens will be open this weekend and sales of Down and Out in London and Paris are set to skyrocket...
News broadcasters are insensitive - or, more worryingly, hypersensitive and very, very aware -to the power they exercise over the fate of the economy during recessionary episodes. Research seems to suggest that news plays an important effect in actually shaping our economic behaviour - and it is an effect more pronounced in periods of recession than in periods of prosperity or boom. Two studies worth reading are this one by Goidel and Langley from 1995 and this one by Wu et al. Both analyse the impact of news during the recessions of the 1990s. Both conclude that the reporting of 'bad' economic news has an effect, and that it can exacerbate behaviour, which must include 'dis-saving' (as Keynesians used to call it) and putting off purchases.
What does this mean for the BBC? Well, it must mean that this great public service institution is currently doing all of us a tremendous disservice. It is actually stoking the recession gleefully. Interviews during news bulletins today have included 'vox pops' insisting that a largely bemused public shares stories of 'how the downturn has affected them this lunchtime'. Not only is this editorially silly, it is potentially damaging.
Yes, the economy is faltering. Jobs will be lost. Businesses will go to the wall. But this is a cyclical phenomenon we have lived with for centuries. That, of course, is the BBC's argument - they proclaim that they are holding a mirror up to nature, not shaping it.
My point is that, with evidence showing so strongly the very real effect of news coverage in exacerbating the recession, should they take the risk?
Or are ratings worth that much to the BBC?
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2 comments:
But is it right for broadcasters to not give a reality check to a boom?
Whilst insightful BBC reports might have forestalled the credit crunch (although I have never seen any sign that the BBC understood the systemic nature of the problem until very late in the day) my complaint is that - whether in boom or bust - journalists are given to turning speculation into news. What the BBCs speculation about the 'cataclysm' of the recession is doing is dissuading people from spending, getting them to postpone capital purchases and sitting tight. They are, undoubtedly, having a significant and harmful effect and will make matters worse. This is irresponsible, in my view.
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