Bob CollinsWeeks after the massive — and so far unsuccessful — bailout of some financial institutions and days after Congress took another whack at the auto industry, New York Times columnist David Carr today identified the boogieman behind the country’s economic woes — the media.
Every modern recession includes a media séance about how horrible things are and how much worse they will be, but there have never been so many ways for the fear to leak in. The same digital dynamics that drove the irrational exuberance — and marketed the loans to help it happen — are now driving the downside in unprecedented ways.
The recession was actually not officially declared until last week, but the psychology that drives it had already been e-mailed, blogged and broadcast for months. I used to worry that my TiVo thought I was gay — doesn’t everyone enjoy a little “Project Runway” at the end of a long, hard week? Now I worry that my browser knows I am about to lose my job.
“When everyone is talking about recession, we all feel like something has to change, even if nothing has changed for us,” said Dan Ariely, author of “Predictably Irrational,” a book that explains why people do things that defy explanation. “The media messages that are repeating doom and gloom affect every one, not just people who really have trouble and should make changes, but people who are fine. That has a devastating effect on the economy.”
Carr’s riff isn’t all that different from a similar one in the ’70s. Only then, the subject was the Vietnam War. We really weren’t losing it, the media was just focusing on the bad news.
But increasingly, the message behind Carr’s prose is being amplified. A Business and Media Institute writer said today:
The barrage of constant bad news can affect people who don’t find themselves in financial trouble, Carr noted, citing Dan Ariely, the author of “Predictably Irrational.”
“When everyone is talking about recession, we all feel like something has to change, even if nothing has changed for us,” Ariely said. “The media messages that are repeating doom and gloom affect every one, not just people who really have trouble and should make changes, but people who are fine. That has a devastating effect on the economy.”
It sounds plausible, but who are these people for whom “nothing has changed?” People still may have jobs, but their plans for retirement are in ruins. Not everyone is 30 with a lifetime to get back what’s been lost.
And Carr doesn’t say the media is making it up; only that the bad news these days can be collected and disseminated far more quickly than ever before. But what are we supposed to do about that? In fact, that’s a question that media critics have specifically not answered.
Here’s today’s economic news: The Tribune company filed for bankruptcy, 3M cut its earnings outlook and announced more job cuts, many borrowers who have their mortgages restructured are defaulting a second time, and auto magnate Denny Hecker closed some more businesses.
In non-economic news, the Timberwolves fired a coach, the Fergus Falls band is going to march at an inauguration, and a truckload of reindeer slid off an icy road in Freeport. So it’s not as if other stories aren’t being reported.
“The media are only doing what they always do eventually: They get it right, way too late to make a difference,” said the Center for Citizen Media’s Dan Gillmor, who hasn’t had a nice thing to say about mainstream media, it seems, since savings accounts paid 5 percent.
Gillmor said, however that “people who save their money today are not being irrational, even though this is exactly the time you hope that enough people will spend to keep the economy from an absolute crater.”
So there we are. A gloomy economy, a gloomy media, and a handful of critics who don’t know the solution to either problem.
