links for 2009-10-11
journamalism and Technology...

Washington Post Crashed-and-Burned-and-Smoking Watch

Why oh why can't we have a better press corps?

James Fallows on why all the works of Fred Hiatt and his colleagues in Washington Post editorial are bad fishwrap:

Don't these people have The Google?: Would it have been so hard to mention the complicating fact that Nobel prizes are only for still-living people? And that this is a basic element of discussion when, for example, the literature prize rolls around each year?... The FAQ page at NobelPrize.org (yes! there is such a site) makes this clear... Maybe they should have exceptions for deaths within the calendar year. Etc. But these are the widely-understood rules. Who is on the copy desk these days? Or writing editorial like this?

As I have said, grave moral fault attaches to all who enable this by paying money to the Washington Post company for any purpose. And Princeton Review does a much better job of running test preparation courses than Stanley Kaplan does.

Even worse: Fred Hiatt this morning:

Re-Stimulating. Unemployment is bad. More fiscal debt might be worse: AT 9.8 PERCENT, the unemployment rate is higher than it has been since it hit 10.1 percent in June 1983. Since the recession began 21 months ago, the economy has shed nearly 7 million jobs. Whole industries -- cars, housing, finance -- have been devastated and may never recover fully. Nevertheless, White House economists reported in September that "employment is estimated to be between 600,000 and 1.1 million higher than it would otherwise have been" because of the Obama administration's stimulus plan and other government policies, especially the Fed's monetary expansion. While no one can prove or disprove that -- much less apportion credit between fiscal and monetary policy -- basic economics suggests that things might have been even worse if the government had done nothing...

It does not necessarily follow, however, that the economy needs more stimulus now. Government has managed to blunt the recession, but at a cost -- a higher national debt burden, which future Americans must pay off by working harder and saving more than they otherwise would have...

Ummm...

So far the stimulus spendout has been some $160 billion. The midpoint estimate by Christy Romer and company is that GDP is now 1% higher than it would have been otherwise. That higher level of production and employment than we would have seen otherwise is going to lead to the collection of an extra $80 billion in tax revenues. That means that the net effect of the $160 billion we have pushed out the door has been to raise the national debt by $80 billion. The Treasury can now borrow through its TIPS program for 20 years at an interest rate of 2% plus inflation. That means that taxes in the future have to be higher by $1.6 billion per year--by $5 per person per year.

Thus the stimulus package so far:

  • Incur an extra forward-looking tax burden per person of 1.3 cents per day...
  • Get an extra 800,000 people productively at work--and get all the stuff they make and do--this year...

That looks like a very good deal: buying an extra productive job for an American today at a cost of $2000 per year in higher taxes looking forward--particularly when you think that some of those extra jobs build up our productive capacity to make us richer in the future as well.

The stimulus arithmetic suggests we should be doing more of it. The benefit-cost ratio at current stimulus spending levels is very good, and there is no reason to think that Olympia Snowe was a proper judge last February of when the benefit-cost ratio turns down.

But nobody on Fred Hiatt's staff realized this. For nobody on Fred Hiatt's staff thinks that doing any arithmetic is part of their job description. Indeed, nobody on Fred Hiatt's staff is capable of doing any arithmetic at all.

They blather on:

The real question is whether the benefits of pumping even more government fuel into America's engine outweigh the risks. We see several reasons to doubt it. The first is the sheer immensity of stimulus policies already in place.... A second reason for skepticism is the intellectual poverty of some policy proposals.... [B]orrowing new money to move demand from the future to the present -- whether it's demand for houses, cars, or workers -- is a dubious proposition.

Let's set ourselves a national goal: close down the Washington Post down by July 2012.

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