The establishment press often pays a price in lost credibility when it ignores important economic reports. The original omission is bad enough, of course. But when subsequent business coverage makes assertions which the ignored reports directly refute, it leaves you wondering why you should even try to believe anything they compose.
Such is the case with Martin Crutsinger's report today on the Institute for Supply Management's Non Manufacturing Index (NMI). Following on the heels of Monday's Manufacturing Index, which slipped into contraction (as perceived by surveyed purchasing managers) for the first time in three years, the NMI declined but at least remained in (perceived) expansion mode. In the course of describing current economic conditions, Crutsinger made the following erroneous statement:
Paychecks are barely keeping pace with inflation, making consumers less confident in the economy.
We should be so lucky.
The fact is that paychecks during calendar 2011 decreased even before considering inflation. Uncle Sam's Bureau of Labor Statistics reported this unsettling truth last week in its County Employment and Wages News Release. This report oddly combines detailed information about weekly earnings in the 922 largest counties with overall information about weekly earnings for the whole country. The latter data point came in at $955 during the fourth quarter of 2011, which was 1.7 percent lower than the fourth quarter of 2010. Again, this is without considering inflation, which from December 2010 through 2011 was 3.0 percent.
BLS noted that "This is one of only five declines in the history of the series which dates back to 1978." There is little if any reason to believe that weekly wages are keeping up with inflation now -- and even if they are, it's virtually impossible that they are on track to make up for the 4.7 percent decline in real terms (1.7% decline plus 3.0% inflation) experienced last year.
How did Crutsinger make such an obvious error? Well, it appears, as John Nolte noted at Breitbart.com on Tuesday, that no one in the press covered the BLS's data release:
NBC, CBS, ABC, The Washington Post, Politico, The New York Times, NPR, CNN... None of them want to talk about the beating the middle class and the unemployed and under-employed are taking in Obama's failed economy.
In days gone by, something which happened for only the fifth time in 33 years would automatically have been considered newsworthy. But not at today's Associated Press, aka the Administration's Press. Perhaps it's hiding somewhere in the bowels of the AP newsmaking machine, but I was unable to find any evidence that the AP covered the BLS report, which would mostly explain why the outlets Nolte listed above didn't either.
If you don't report something, a reporter's colleagues probably won't know about it either. If nobody knows about it, reporters will continue to report what they think they "know." When they erroneously relay falsehood as fact, they lose their credibility, making you wonder if anything they report is consistent with current reality, ultimately leading you to wonder if anything they report can be believed. It's that simple -- and sad.
Cross-posted at BizzyBlog.com.