Second quarter Gross Domestic Product (GDP) doubled to 1.9 percent, up from 0.9 percent in the first quarter, the Commerce Department announced Thursday morning as consumer spending rose 1.5 percent in the quarter ending June 30, up from 0.9 percent in the first quarter, and U.S. exports soared 9.2 percent, way up from 5.1 percent in the first three months of 2008.
Yet the CBS Evening News centered a story around “disappointing” news about the supposedly “struggling economy” (with that on screen) -- while ABC and NBC, which on April 30 led with full stories on the news of a 0.6 percent (since revised to 0.9) first quarter GDP, didn't utter a syllable Thursday night about the big GDP jump. On the last day of April, ABC's Betsy Stark declared the economy had “flat lined” and NBC anchor Brian Williams warned “it's getting rough out there” as the new GDP number “stops just short of the official declaration of a recession.” Thursday night, however, ABC's World News and NBC Nightly News made time for full stories on outrage over ExxonMobil earning “the largest profit ever made by a U.S. company.” The “oil industry says it is not out of line, but some motorists feel otherwise.”
CBS anchor Katie Couric, picking up on the 4th quarter 2007 GDP revision from 0.6 percent to a minus 0.2, stressed how “the government now says the economy was receding, not growing, in the final quarter of last year” though “it picked up a bit in the first quarter of this year.” She then twisted the fresh news of a 1.9 percent jump into a negative:
But look at this: In the second quarter, when all those rebate checks were supposed to stimulate the economy, it grew less than two percent. Jeff Glor has more about the disappointing numbers.
Preferring an anecdote to factual data analysis, Glor started his story with how “you'll have a hard time convincing Paula Corletto the economy is growing” since “she and her eight-year-old daughter Leandra,” both of whom CBS showed shopping for clothes, “now limit their shopping to only one day a week.” (I haven't shopped in a store for clothes yet this year!)
A full screen CBS News chart incorrectly listed first quarter GDP growth at 0.6 percent. In fact, the July 31 press release from the Commerce Department's Bureau of Economic Analysis announcing the second quarter number, stated: “In the first quarter, real GDP increased 0.9 percent.” The initial report on April 30 put first quarter GDP at 0.6 percent, but last month it was revised upward to 0.9 percent.
So, Couric and CBS News producers/writers highlighted a downward revision for the fourth quarter of 2007, but somehow missed an upward revision.
The consumer spending and export numbers above came from a Thursday AP dispatch by Jeannine Aversa, which itself spun the improving economic indicators into bad news. Under the headline of (as posted by Yahoo) “Growth weaker than hoped; economy shrinks in Q4,” the Washington, DC-based Aversa began:
The country didn't get the energetic rebound in economic growth hoped for from the government's tax rebates in the second quarter, and the economy jolted into reverse at the end of 2007, raising new recession fears...
Back on Thursday, April 30, when Commerce's Bureau of Economic Analysis pegged second quarter GDP at 0.6 percent (a number, as already noted, since revised to 0.9), ABC and NBC led with the “meager” growth rate:
ABC's World News:
CHARLES GIBSON: Good evening. Seven months, seven-straight interest rate cuts made by the Federal Reserve, trying to head off a recession. And yet, for the seven months, the economy has continued to go from bad to worse. Today was cut number seven, a key interest rate was cut another quarter percent. And today, new number show the economy is limping along, with meager growth, six tenths of a percent for the first three months of the year...
BETSY STARK: Seven rate cuts in seven months. And as that GDP report makes clear, the U.S. economy has essentially flat lined....
NBC Nightly News:
BRIAN WILLIAMS: Is the United States right now really, officially, in a recession? Well, that depends largely on who you ask. A whole lot of American families are hurting financially right now in ways they haven't in decades. If you go by government numbers, the figure that came out today stops just short of the official declaration of a recession. But the Fed acted again today, bringing interest rates down even further. And there are strong indications tonight this economy has further to go. We begin tonight with Erin Burnett from CNBC. It's getting rough out there.
ERIN BURNETT: It certainly is, Brian. And when you look at the numbers today, yes, they were weak. In fact, the last time it was worse for this, than this for the US economy was six years ago. It's been years since the Gross Domestic Product, which measures economic growth, has been watched this closely, and even though it grew slightly in the first three months of the year, up .6 percent, many are still very cautious....
Fast forward three months and on Thursday night ABC and NBC featured full stories on ExxonMobil's profit level:
ABC's World News, July 31:
CHARLES GIBSON: Well, we turn next to big oil and big profits. The ExxonMobil corporation made a profit of almost $12 billion in April, May and June. That is the largest profit ever made by a U.S. company in any three-month period. It equates to $1,500 in profit every second of every day. David Muir tonight on where that money comes from.
NBC Nightly News:
BRIAN WILLIAMS: And perhaps you heard this story this morning, and perhaps it made you think of what you last paid for a tank of gas. ExxonMobil broke its own record for the most profitable quarter by any American company ever, taking in just under $11.7 billion in the second quarter of this year. Bears repeating. That's almost $12 billion in pure profit for just one quarter of the business year. The oil industry says it is not out of line, but some motorists feel otherwise. The story from CNBC's Trish Regan.
The MRC's Brad Wilmouth corrected the closed-captioning against the video to provide this transcript of the incredible story on the Thursday, July 31 CBS Evening News:
KATIE COURIC: The biggest issue for voters this year is the economy, of course, and there's news about that tonight. The government now says the economy was receding, not growing, in the final quarter of last year. It picked up a bit in the first quarter of this year, but look at this: In the second quarter, when all those rebate checks were supposed to stimulate the economy, it grew less than two percent. Jeff Glor has more about the disappointing numbers.
JEFF GLOR: You'll have a hard time convincing Paula Corletto the economy is growing.
PAULA CORLETTO: I just have to watch my spending.
GLOR: She and her eight-year-old daughter Leandra now limit their shopping to only one day a week.
CORLETTO: I chose Wednesdays because there's always a sale on Wednesdays.
GLOR: Consumer anxiety has a lot to do with the job market. Numbers out today show that new unemployment claims are at a five-year high, with nearly 450,000 filing last week.
DAVID WYSS, STANDARD AND POOR’S: Normally, anything over 400,000 gets you into a recession range.
GLOR: The slight rise in growth in the U.S. economy in the spring was due mostly to the $100 billion life jacket thrown out by the federal government.
HENRY PAULSON, TREASURY SECRETARY: The stimulus plan has supported the U.S. economy during this difficult period.
GLOR: But those stimulus checks are one-time only.
WYSS: The problem is, I think, once people have spent those rebate checks, we're going to have a problem again.
GLOR: That's bad news for retailers, hoping to cash in on the upcoming back-to-school season.
RICHARD GERSTEIN, SEARS: Back-to-school is an important period for us, particularly this year.
GLOR: A survey finds 71 percent of households will spend less on back-to-school shopping this year, with 48 percent saying they'd spend less than $100. Hoping to generate store traffic, retailers are turning to catchy Internet campaigns, with Sears featuring Vanessa Hudgens, and a J.C. Penney ad aimed at parents nostalgic for the 80s.
MIKE BOYLSON, J.C. PENNEY: If all you try to compete on is price, it’s going to be a very tough game to win for anybody.
GLOR: But it might take more than music to make Paula Corletto feel good about the future.
CORLETTO: I'm just saving my money right now.
GLOR: Tomorrow's July jobs report is expected to show the economy lost even more jobs last month. And it's pretty simple -- when people don't have jobs or feel good about the ones they do have, they don't spend money. Jeff Glor, CBS News, New York.