Fox News has downright ignored the billions lost in productivity as a result of the government shutdown, which stands in stark contrast to the network's years-long attack on minimal waste and abuse in food assistance programs.
On October 16, the financial ratings agency Standard & Poor's released its estimate of the economic cost of the 16-day long shutdown of the federal government, concluding that it cost the American economy $24 billion in lost productivity. The agency also cut its forecast for economic growth in the upcoming fiscal quarter by at least 0.6 percentage points.
Since the shutdown was lifted on October 16, Fox News personalities have expended considerable effort downplaying the effect the shutdown had on the economy.
On October 16, Fox Business host Lou Dobbs cited a slight uptick on the Dow Jones industrial average throughout the shutdown as evidence that the nationwide closure of federal lands and agencies had a negligible economic effect. Fox Business' Melissa Francis made a similar argument, claiming that the shutdown had shown Americans they could live with "a lot smaller government." On the October 17 edition of The Five, Fox News host Eric Bolling questioned the validity of S&P, and other agencies, that report economic losses from the shutdown, baselessly suggesting that their reports are influenced by political factors.
Fox's continued denial of the ruinous economic effect of the government shutdown reveals the network's hypocritical and overzealous reporting on waste and abuse in federal anti-poverty programs.
In August, the United States Department of Agriculture (USDA), which administers the Supplemental Nutrition Assistance Program (SNAP), updated its figures for "trafficking," or when SNAP recipients sell their benefits for cash, in the program. Its data reveal a slight increase in trafficking rates from 1.0 percent in 2006-2008 to 1.3 percent in 2009-2011. The total value of trafficked benefits during the last three year period is estimated to be $858 million annually.
Rather than acknowledging that SNAP trafficking rates were still near historic lows, Fox misleadingly highlighted what it called a "30 percent" increase in abuse. Days previously, Fox dedicated another segment to attacking food assistance that included host Eric Bolling overestimating SNAP fraud and abuse rates by 5,000 percent.
The amount of yearly trafficking abuse in SNAP amounts to less than four percent of the wasted economic output caused by the government shutdown. In other words, the cost of the 16-day shutdown is nearly 28 times larger than a full year of food assistance abuse. While Fox has repeatedly claimed that waste in SNAP cannot be tolerated, the network has yet to acknowledge that waste from the shutdown even exists.
Of course, this should come as no surprise given the network's efforts to encourage the shutdown and resulting economic fallout. Fox News played a prominent role in encouraging and facilitating a partial government shutdown that cost the economy billions of dollars in lost productivity while producing zero policy gains for the Republican Party or its right-wing media champions. Fox has tried repeatedly to find scapegoats in the administration to shift blame away from allies in the House GOP caucus.
According to the USDA, "fluctuations in the number of SNAP participants in the last 16 years have broadly tracked major economic indicators." With the Republican-led shutdown effectively draining tens of billions of dollars out of the economy, SNAP registries are likely to increase in the near-term as the shutdown and lingering fiscal austerity drag down recovery.
If that happens, recipients of federal anti-poverty assistance can expect a resurgence of Fox attacks.
Wall Street Journal editorial board member Mary Kissel falsely claimed that no American homeowners have been wrongfully foreclosed on since the financial crisis of 2008 and 2009. In fact, federal investigations found more than a million homeowners have faced potentially wrongful foreclosures.
On the October 11 edition of Fox Business' Varney & Co., guest host Charles Payne was joined by Fox contributor Monica Crowley and Kissel to discuss the latest quarterly earnings report from JPMorgan Chase. The firm, which has been beset by legal battles, reported robust profits despite extensive legal expenses in the last fiscal quarter.
The discussion turned to an alleged government "shake down" of the bank and demonization of Wall Street when Kissel interjected that, in fact, the financial industry had done nothing whatsoever to deserve extra scrutiny:
KISSEL: There hasn't been a single homeowner who has been identified who was foreclosed on that shouldn't have been foreclosed on. Somebody who was paying his bills.
In fact, more than a million American homeowners were potentially wrongfully foreclosed on during the housing crisis.
An independent review of foreclosures, conducted by the Federal Reserve and the Office of the Comptroller of the Currency (OCC), found that up to 30 percent of the 3.9 million households foreclosed on by 11 leading financial institutions faced wrongful challenges or should have been subject to certain legal protections. From the Huffington Post:
Close to 1.2 million borrowers, or about 30 percent of the more than 3.9 million households whose properties were foreclosed on by 11 leading financial institutions in 2009 and 2010, had to battle potentially wrongful efforts to seize their homes despite not having defaulted on their loans, being protected under a host of federal laws, or having been in good standing under bank-approved plans to either restructure their mortgages or temporarily delay required payments.
They reveal that nearly 700 borrowers who faced foreclosure proceedings had actually never defaulted on their loans.
The Huffington Post further reported, according to OCC data, that nearly a quarter-million borrowers eventually lost their homes. JPMorgan Chase, the bank being discussed on Varney & Co., has paid out millions of dollars in settlements over wrongful foreclosures, "leading Jamie Dimon, JPMorgan's chief executive, to personally apologize for his bank's errors."
Kissel's argument that banks like JPMorgan Chase did nothing do deserve current legal investigation - and instead praising Dimon for not "blow[ing] up the bank" - denies the reality faced by millions of Americans over the past five years.
In the first week of cable and broadcast nightly news coverage of the ongoing government shutdown, networks largely failed to report the effects on low-income Americans, instead opting for discussions of political leverage and national park closures.
Major media outlets are pushing the narrative that the United States Department of the Treasury could prioritize payments to bond holders and select groups of recipients in lieu of an increase of the federal borrowing limit, also known as the debt ceiling, beyond October 17. This ignores Treasury Department officials and other experts who explain such prioritization is unworkable and legally dubious, and that default would still happen.
Fox Business host Stuart Varney believes that the ongoing government shutdown, while presenting no real threat to the economy, offers an opportunity to "punish" federal workers for "living on our backs."
On the October 2 edition of AM 560's The Big John & Amy Show, co-hosts John Howell and Amy Jacobson interviewed Fox Business' Stuart Varney and asked him about the government shutdown and its effect on workers and the economy. Varney stated, incorrectly, that the shutdown was not having an impact on financial markets or the greater economy before launching into a tirade against federal employees. When asked if federal employees deserved to be recompensed for lost wages during the shutdown, Varney had this to say:
HOWELL: Do you think that federal workers, when this ends, are deserving of their back pay or not?
VARNEY: That is a loaded question isn't it? You want my opinion? This is President Obama's shutdown. He is responsible for shutting this thing down; he's taken an entirely political decision here. No, I don't think they should get their back pay, frankly, I really don't. I'm sick and tired of a massive, bloated federal bureaucracy living on our backs, and taking money out of us, a lot more money than most of us earn in the private sector, then getting a furlough, and then getting their money back at the end of it. Sorry, I'm not for that. I want to punish these people. Sorry to say that, but that's what I want to do.
After co-host Amy Jacobson responded that "it's not the federal employees' fault" and that she hates to see them victimized by a political fight, Varney complained that in "the big picture" he is "getting screwed" by government workers who are "living large":
JACOBSON: But it's not their fault. It's not the federal employees' fault. I mean, that's what I'm sick of, I hate and it makes me anxious, to see people who are victimized because of a political fight.
VARNEY: I take your point Amy, it is not directly their fault, but I'm looking at the big picture here. I'm getting screwed. Here I am, a private citizen, paying an inordinate amount of money in tax. I've got a slow economy because it's all government, all the time. And these people are living on our backs, regulating us, telling us what to do, taxing us, taking our money, and living large. This is my chance to say "hey, I'm fed up with this and I don't miss you when you're on furlough." Sorry if that's a harsh tone, but that's the way I feel.
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Right-wing media are accusing President Obama of using "scare tactics" to score political points with the upcoming debt limit deadline, but professional economists agree that debt limit brinkmanship could end in disaster.
On October 2, President Obama sat down for an interview with CNBC correspondent John Harwood in which he said that Washington's political posturing was "different" this time, and that major financial institutions "should be concerned" by Republican threats to not raise the debt ceiling before October 17. But the right-wing media response to President Obama's caution has been to downplay the looming deadline while accusing the president of engaging in "scare tactics."
On the October 3 edition of Fox News' Fox & Friends, co-hosts Steve Doocy and Brian Kilmeade questioned if the president was hoping to "trigger a stock market sell-off":
In a later segment, the Fox & Friends crew was joined by Fox Business host Stuart Varney to discuss the effect the president's statements might have on financial markets. Varney and the hosts agreed that the president's rhetoric was designed to drive markets down and thus provide him with "extra leverage" in the debt ceiling fight:
Cable and broadcast television outlets, driven largely by Fox News, promoted the myth that the Affordable Care Act is forcing employees into part-time work and killing full-time jobs, while ignoring serious discussions of the labor market and the effect of policy proposals on job growth.
Media Matters research, which looked at economic news coverage over the past three months, revealed an overwhelming bias in news coverage of the effects of health care reform on the American job market. The Affordable Care Act (ACA) was identified as a primary driver of slow job growth and increased part-time employment in 90 recorded segments concerning the economy. More than three-quarters -- 69 -- of those segments came from Fox News, which has invested considerable time and attention to attacking President Obama's signature health care law.
The claim that ACA has a negative effect on the job market has been addressed and debunked by independent economists, but the myth persists as a talking point in the media. At Fox, the myth is a central theme of economic discussions.
Meanwhile, the negative effect of spending cuts on reducing economic growth and labor market demand went relatively unmentioned in the media. Only 37 recorded segments concerning the economy mentioned the harmful impact of spending cuts, the majority of which -- 27 -- came from MSNBC.
Economists agree that the austerity measures enacted over the past several years have dragged down economic growth. Nobel Prize-winning economists Paul Krugman and Joseph Stiglitz have written and commented about the effect of depressed spending at length, as have many others. However, cable and broadcast news coverage of the economy consistently ignore the views of economists in favor of discussions centered around optics and political horse races. Only 3 percent of featured guests in these segments during the past three months have been professional economists.
The lack of serious discussions of economic policy, in favor of politically driven talking points, has had a tangible effect on the economy and government. The vitriol directed at health care reform from the right-wing reached its peak on October 1 when House Republicans, emboldened by supportive media, opted to shut down the government rather than concede their demand that Democrats dismantle the ACA in exchange for a temporary extension of current spending.
The ACA was signed into effect on March 23, 2010, and has been subject to constant media scrutiny for more than three years. Calls to have the law repealed, or to have significant portions delayed, have been pushed by right-wing outlets for the past several months in preparation for the start of enrollment for state-based exchanges on October 1.
Broadcast and cable evening news coverage touched upon a variety of economic topics, including deficit reduction, economic growth, and effects of the Affordable Care Act throughout the third quarter of 2013. While coverage of certain issues improved, a Media Matters analysis shows that many of these segments lacked proper context or input from economists, with Fox News advancing the erroneous notion that the Affordable Care Act is the purported cause behind poor job growth.
CNBC analyst Michelle Caruso-Cabrera incorrectly argued that there is "next to zero" threat of default at the debt ceiling deadline, accusing White House press secretary Jay Carney of "fear mongering" on the issue.
On the October 1 edition of MSNBC's Morning Joe, Caruso-Cabrera joined a panel discussion of the government shutdown to provide an outlook on its projected effects on financial markets and the greater economy. After downplaying the impact of the shutdown, Caruso-Cabrera addressed comments made by Carney concerning the October 17 debt ceiling deadline. Caruso-Cabrera disregarded the administration's concerns that failing to raise the debt ceiling presented a threat to the American and global financial system, stating:
CARUSO-CABRERA: There is a strong school of thought out there that says if we hit the debt ceiling, that it's not Armageddon, that we don't see skyrocketing interest rates. They keep saying "default on our debt," we just heard Jay Carney say that. The chances of that happening are next to zero because you can prioritize your payments. Defaulting on debt means the U.S. government would not make an interest payment [to] the U.S. Treasury. Highly unlikely, and the other thing is, if you pay that late, if it were even to happen, that is not default. And for investors to suddenly sell U.S. treasuries, because there's going to be a three-day payment late? Highly unlikely, because there aren't many other choices in the world.
Caruso-Cabrera closed the segment by accusing Carney of "fear mongering."
Fox Business host Stuart Varney argued that the potential nomination of Federal Reserve Vice Chairwoman Janet Yellen to succeed Chairman Ben Bernanke would be based in part on her gender, making no mention of her aptitude or qualifications for the position.
On the September 26 edition of Fox Business' Varney & Co., host Stuart Varney was joined by Fox Business host Melissa Francis and Fox News contributor Juan Williams to discuss the current and continuing role of the Federal Reserve. The panel largely focused on the recently politicized nature of the nomination process and who is expected to replace Ben Bernanke as chairman. Varney ended the segment by arguing that the potential nomination of Janet Yellen as the next Fed chair would in part be driven by her gender.
VARNEY: Would you agree with me that the lady in question here, Janet Yellen, is a shoo-in to be the next Fed chair because she's female, she's academic, and it is assumed that she would keep on printing money. That conforms with everything that President Obama wants in a Fed chair. She's a shoo-in, agreed?
Varney's contention that gender would play a role in the nomination process reveals a troubling development in right-wing media. Rather than discussing Yellen's qualifications as an economist, her history of accurate econometric predictions, or her broad base of support among economists, conservative media instead focus their attention on Yellen's gender.
On September 18, the Institute for Women's Policy Research sent a letter to President Obama supporting Janet Yellen, signed by more than 500 economists from across the country. The signatures included several former White House economic policy officials and Nobel Prize-winning economist Joseph Stiglitz. Nobel Prize-winning economist Paul Krugman also expressed his support for Yellen's candidacy in The New York Times. From Krugman's article:
Janet Yellen, the vice chairwoman of the Fed's Board of Governors, isn't just up to the job; by any objective standard, she's the best-qualified person in America to take over when Ben Bernanke steps down as chairman.