Fox News host Jon Scott identified all retirees as those "who could be working" in order to disparage the labor force participation rate from April's positive jobs report.
The Bureau of Labor Statistics' (BLS) May 3 jobs report determined that the economy added 165,000 jobs in April, while the unemployment rate fell from 7.6 to 7.5 percent. BLS also reported that the labor force participation rate remained unchanged at 63.3 percent.
On Happening Now, Scott wondered of the labor force participation: "So, if this participation rate is at 63 percent, that leaves, what? Thirty-seven percent of the country who could be working, not working?" Doug Holtz-Eakin, former director of the Congressional Budget Office under President George W. Bush, responded, "Yeah. If you look at the ratio of the number of people in the United States who are working, to the number in the United States, that's a low number. We're not taking advantage of the skills of our population."
BLS determines the unemployment rate after conducting the Current Population Survey, a monthly sample of approximately 60,000 households where people are asked about the labor force status of household members.
The labor force participation rate that Scott referenced is the percentage of the civilian noninstitutional population who identified as either employed or actively looking for work. But here's where he dropped the ball -- the civilian noninstitutional population, as BLS defines it, includes all people 16 years of age and older, who are neither institutionalized (in a penal or mental institution) nor active duty military. So the 37 percent of people who self-identified as "not in the labor force" includes retirees and stay-at-home spouses, not generally groups "who could be working" or want to work.
Holtz-Eakin's claim was even more extreme, comparing the civilian labor force to the total population of the nation, which of course includes children.
According to Fox News Sunday's Chris Wallace, the conservative Heritage Foundation is set to release a report that claims immigration reform will cost taxpayers billions of dollars. But Heritage's analysis is reportedly based on a 2007 study that was widely discredited by experts for its faulty methodology and dubious conclusions.
On KFTK's Allman in the Morning, Wallace stated that he plans to host Heritage Foundation president and former Republican Sen. Jim DeMint to introduce the report this weekend. Wallace said that the report will show that the proposed Senate immigration reform bill will "cost the Treasury billions of dollars" because "people would be eligible for Obamacare and various welfare programs."
In fact, as Wallace himself noted, undocumented immigrants who are granted legal status under the Senate bill will not be eligible for federal public benefits or subsidized health care for at least a decade. Moreover, immigrants are less likely than native-born Americans to rely on such programs.
Wallace went on to criticize the conservative myth that immigrants come to the United States to gain access to government benefits.
Here are five facts media should know about the Heritage Foundation's previous problematic immigration report:
Fox News claimed that federal government policy was failing to lower unemployment by citing recent decisions made by the Federal Reserve. However, economists note that Federal Reserve action alone cannot increase employment, and federal spending must be increased to improve the economy.
Reacting to the May 2 weekly jobless claims report, Fox Business anchor Stuart Varney dismissed the 18,000 drop in initial claims to the lowest level in five years, stating that "it's a better number, but it's still not a good number." Varney went on to claim that the Federal Reserve's recent decision to continue its bond buying program was not producing expected drops in unemployment, claiming "unemployment rates are not falling the way they should when you're printing all this money." From America's Newsroom:
While Varney was quick to dismiss the government's role in strengthening the labor market by citing the Federal Reserve and the effect of current monetary policy on job creation, he completely ignored the fact that decreases in government spending have negatively impacted the economy, overlooking statements made by the Federal Reserve and the warnings of experts.
In the statement released by the Federal Reserve on May 1 outlining its future decisions regarding monetary policy, the board specifically cited that "fiscal policy is restraining economic growth."
Indeed, many analysts have been claiming that actions by the Fed are not enough to bolster economic growth, and that increased government spending -- that is, expansionary fiscal policy -- is necessary to improve current conditions.
In The Washington Post's Wonkblog, Roosevelt Institute fellow Mike Konczal explained how actions taken by the Federal Reserve have failed to counteract the negative effects of decreased government spending:
But the most important lesson to draw is that fiscal policy is incredibly important at this moment. In normal times, the broader effect of government spending, or the fiscal multiplier, is low because the central bank can offset it. But these are not normal times. It's not clear why the Federal Reserve's actions haven't balanced out fiscal austerity. But since they haven't, we should be even more confident that, as the IMF put it, "fiscal multipliers are currently high in many advanced economies."
The main point here is that while the Federal Reserve is attempting to spur economic gains through monetary policy, it simply can't do enough to counteract recent contractions in government spending. Former Labor Secretary Robert Reich echoed Konczal, stating "easy money from the Fed can't get the economy out of first gear when the rest of government is in reverse."
By only focusing monetary policy as the government's way to bolster employment and economic growth, Fox is only telling half the story -- the negative effects of decreased government spending are far too damaging to be mitigated elsewhere -- and continuing its trend of downplaying positive economic news.
Fox Business anchor Lou Dobbs dismissed the discovery of errant data points in a recently dismantled Harvard economics study that had formed the cornerstone for arguments supporting U.S. and European austerity as merely "a small mistake."
On the April 30 edition of Fox Business' Lou Dobbs Tonight, Dobbs discussed with former Reagan administration economic adviser Arthur Laffer a "contretemps" between New York Times columnist and Nobel Prize-winning economist Paul Krugman and historian Niall Ferguson over national debt and the economy. Dobbs stated that Krugman and Ferguson were referring to a recent Harvard study that contained "a small mistake," then asserting that the study's errors "doesn't change the fact," as advocated by Ferguson, that "high debt constrains opportunity for growth."
Laffer responded by saying he'd rather talk about taxes and spending. Dobbs added: "I'd rather they all start talking about both the creation of jobs and how to spur economic growth and be done with the bunch of nonsense and the debt. It's so dreary."
In fact, the Reinhart-Rogoff study -- which asserted that nations with public debt of more than 90 percent of GDP faced a tipping point of economic decline, an idea embraced by right-wing politicians and media alike, including Fox News -- suffered from much more than "a small mistake." The study was dismantled by Thomas Herndon, Michael Ash, and Robert Pollin of the University of Massachusetts, Amherst, who found that Reinhart and Rogoff's data includes calculation errors and selective exclusions that biased the results and invalidates the 90 percent tipping point finding. Rogoff and Reinhart conceded the calculation error but "adamantly deny the other accusations," which has been criticized as a weak rebuttal.
Dobbs' stance of finding discussions of debt to be "dreary" is a shift from how he led his program as recently as March 29, when he called for reduced government spending in response to President Obama's proposed improvements to infrastructure. "It shouldn't be a partisan issue because neither political party should be calling for higher spending when the federal government is running almost trillion-dollar deficits and the national debt amounts to almost $17 trillion," Dobbs said. "That doesn't seem to me to be a partisan issue at all, just one of common sense and good judgment and responsibility."
The Wall Street Journal reinforced its call for spending cuts, seemingly undeterred by recently discredited research and overwhelming evidence showing that fiscal tightening negatively impacts economic growth.
Reacting to recent research that has questioned austerity proponents' most cited figure -- the 90 percent debt-to-GDP threshold as identified by Camen Reinhart and Kenneth Rogoff -- an April 30 Wall Street Journal editorial claimed that the new revelations are being used to "revive the spending machine."
Instead of addressing the fact that the discrediting of Reinhart-Rogoff took, as The Washington Post's Neil Irwin puts it, a "great deal of wind out of the sails from those who argue that high government debt is, anywhere and everywhere, a bad thing," the WSJ instead used this event to attack government spending in all forms and reinforce calls for austerity. From the editorial:
The Keynesians are now using a false choice between "austerity" and growth to justify more of the government spending they think drives economic prosperity. The brawl over Reinhart-Rogoff is thus less a serious economic debate than it is a political exercise to turn more of the private economy over to government hands.
After five years of trying, we should know this doesn't work. The real way to promote a stronger economy is more austerity and reform in government, and fewer restraints on private investment and risk taking.
Arriving at such a conclusion requires not only obscuring the importance of the Reinhart-Rogoff debt threshold and its importance in pushing global austerity measures, but also ignoring a few key economic realities.
First, the editorial uncritically dismisses the impact of previous economic stimulus in order to bring into question any future government spending:
[Former White House economist Larry] Summers says governments should borrow more now at near-zero interest rates to invest in future growth. But this is what we were told in 2009-2010, when Mr. Summers was in the White House, and the $830 billion stimulus was used to finance not primarily roads or bridges but more unionized teachers, higher transfer payments, and green-energy projects that have since failed. Why will it be different this time?
The WSJ fails to note that the economic stimulus that was enacted in 2009 is widely regarded as a success. According to a WSJ forecasting survey conducted in 2010, 70 percent of economists agree that the stimulus helped the economy, and a May 2012 Congressional Budget Office report noted that it created between 900,000 and 4.7 million full-time-equivalent jobs in 2010 and between 600,000 and 3.6 million in 2011.
Second, and perhaps more notably, the editorial completely ignores the mounting evidence that too little government spending is already hurting the U.S. economy. When individual contributors to GDP growth are isolated, it becomes clear that in the majority of recent quarters, cuts in government spending have pulled down overall economic growth. In fact, the negative contribution of too little government spending has compromised growth even in the face of strong private contributions.
And while editorial board member Stephen Moore may feel that recently enacted across-the-board spending cuts have helped economic growth, economists and even Fox News personalities recognize that they have and will continue to negatively impact GDP growth.
WSJ's call for ever elusive "pro-growth" spending cuts stands in stark contrast to observations made by former pro-austerity advocates. The International Monetary Fund, which previously called for austerity measures throughout Europe, recently noted that fiscal tightening has failed to deliver a reduction in debt due to declines in output. Even John Makin of the conservative American Enterprise Institute now claims that the U.S. has cut federal spending enough to substantially reduce the debt-to-GDP ratio.
Fox News covered Democratic criticism of harmful and unnecessary spending cuts as a purely political maneuver, without acknowledging that those criticisms are reflected in actual economic data, and echoed by economists and even by House GOP leadership.
On the April 29 edition of America's Newsroom, host Bill Hemmer set up an interview with Wall Street Journal editorial board member Stephen Moore by suggesting that only Democrats argue that America is not in a "debt crisis," and hinted that the raw total of U.S. debt belies that claim. Moore proceeded to divert the conversation far away from economic reality, first citing a Fox News poll on public concerns about the debt, then accusing anti-austerity Democrats of merely seeking to protect "the favored programs that they care about," before finally misleading viewers on the relationship between economic growth and spending cuts. From America's Newsroom:
There are a few layers of deception to unpack here:
These sorts of facts in the U.S., and related ones from other economies, are threatening to upend the entire austerity movement, as Irwin observes. But while that debate proceeds and evolves elsewhere, Fox News continues to offer conservatives a venue to avoid reconciling ideology and fact.
A Wall Street Journal article debunked the myth that federal disability benefits are to blame for the shrinking labor force, "exaggerated" claims that have previously been pushed by the paper itself.
An April 29 Journal article headlined "Real Culprit Behind Smaller Workforce: Age" explained that the recent decrease in the labor force -- the number of employed and unemployed Americans who are currently seeking work -- "has more to do with retiring baby boomers than frustrated job seekers abandoning their searches." The article noted that claims that Americans are voluntarily leaving the workforce to receive Disability Insurance instead of working, for example, "may be exaggerated," and explained that retirees and students made up a far more significant portion of those leaving the labor force. The article included the following graph, showing disability was the least common reason for individuals leaving the workforce in March 2013:
However, the Journal has previously pushed the myth that Disability Insurance accounted for much of the dropping labor force participation rate. An April 10 article headlined "Workers Stuck in Disability Stunt Economic Recovery" claimed that workers receiving disability benefits were costing the economy billions by not instead participating in the labor force, and quoted economist Michael Feroli's claim that "worker flight to the Social Security Disability Insurance program accounts for as much as a quarter of the puzzling drop in participation rates, a labor exodus with far-reaching economic consequences." These claims are in direct contradiction to the Journal's most recent reporting.
According to Center for Economic and Policy Research co-director Dean Baker, research shows if more individuals who receive disability benefits worked, it would have a relatively minor effect on employment figures. Harold Pollack, an expert on disability policy at the University of Chicago's School of Social Service Administration, dismissed the idea that disability benefits might be "luring away people who could work." Despite these facts, media continue to attack federal disability benefits by pushing the false claim that disability programs harm the economy.
From the April 29 edition of Fox News' Fox & Friends:
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Fox News glossed over an important aspect in its reporting on lower than expected GDP growth -- the government contribution to GDP has been negative in the majority of recent reports.
Following the April 26 release of first quarter GDP growth estimates, Fox Business anchor Stuart Varney dismissed the 2.5 percent increase as "not good numbers," claiming that the increase was not indicative of a robust recovery. From Fox News' America's Newsroom:
Varney provided a laundry list of reasons why GDP growth has failed to live up to expectations, including recent federal and state tax increases and, notably, cuts from sequestration - a reversal from previous right-wing assertions that sequestration was too small to harm the economy. Varney failed to explain, however, that too little government spending has been holding back economic growth, as indicated by many of quarterly reports from the past two years.
The Bureau of Economic Analysis provides data on individual contributions to GDP, including government spending's contribution. When the government's contribution to GDP growth is separated from total growth, it becomes apparent that it has been a drag on the economy for much of the past two years.
In the previous 13 quarters, government spending has only added to GDP growth twice - once in the second quarter of 2010, and again in the third quarter of 2012.
This observation has been recognized by others, causing The Washington Post's Ezra Klein to boldly state that "government is hurting the economy - by spending too little." Of course, any recognition of this fact from Fox News would require the network to abandon its longtime stance that increased government spending can only hurt the economy.
From the April 26 edition of Fox News' America's Newsroom:
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Fox News accused MA Gov. Deval Patrick of "playing politics" by refusing to release details of welfare benefits reportedly used by the Boston Marathon bombing suspects. But as Patrick has noted, state and federal law prevents the release of this information.
On April 24, an article in the right-leaning Boston Herald reported that the Boston Marathon bombing suspects had received some government assistance as children and that deceased suspect Tamerlan Tsarnaev's family received some welfare benefits until 2012. The paper later reported that Massachusetts state officials had "clamped down the lid" on the Herald's requests for more details on Tamerlan Tsarnaev's government benefits.
Fox hosts seized on this to criticize Gov. Patrick on the April 26 edition of Fox & Friends. Co-host Steve Doocy said that "the governor told all the state agencies to clam up" and on-air text asked if Patrick is "playing politics."
Fox & Friends co-host Gretchen Carlson said:
CARLSON: Well, apparently Governor Deval Patrick of Massachusetts won't exactly explain what taxpayer assistance the bombers actually received because he says it's a matter of protecting their personal privacy. Well, that's interesting because one of those suspects is dead, and so what kind of personal privacy would be at hand to not be able to at least release what should be public knowledge if the taxpayers actually were financing these two people and their families for the last 10 years.
Fox failed to note that state and federal laws prohibit the government officials from releasing such information, a fact that Patrick had pointed out after facing questions about why the government had not released more details. On April 25, the Boston Herald reported:
Gov. Deval Patrick defended his administration's refusal to release financial aid, welfare, unemployment and other information about the suspected Boston Marathon bombers today.
"It's not about a right to privacy, it's about abiding by the law," said Patrick in Jamaica Plain today. "We'll do what we can do within the law. I'm curious, too. I understand people's curiosity."
Patrick added that he would be "happy" to release whatever information the law allows.
The Associated Press reported that the Massachusetts welfare agency later acknowledged that it had been a "mistake" to release the information to the media, saying it "inappropriately confirmed" media inquiries on the issue. The agency further stated: "Disclosing such information is not allowed by law. Regardless of the circumstances, we are obligated to follow state and federal law."
From the April 25 edition of Fox News' Hannity:
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Fox News is using the struggles of electric automaker Fisker to smear the stimulus, even though the company received its loan from a completely separate Bush-era program, and both have created jobs.
On Thursday's Fox & Friends, Fox Business correspondent Charles Gasparino incorrectly claimed that Fisker received stimulus money, adding "when you use stimulus money, you're supposed to create jobs":
However, the Department of Energy's Advanced Technology Vehicles Manufacturing (ATVM) program is separate from the 2009 stimulus package signed into law by President Obama. Rather, it was enacted with broad bipartisan support in 2007 to award loans encouraging "meaningful improvements in fuel economy performance." More than half of that money went to improve the technology of conventional gasoline-fueled vehicles, but some went to support pioneering hybrid and electric cars. Since then, some of the latter, like the Tesla Model S and Nissan Leaf, have been successful.
While the primary focus of ATVM was different than that of the stimulus, the program has still supported more than 35,000 jobs.
The Wall Street Journal attempted to absolve ratings agency Standard & Poor's from allegations of fraud, ignoring the mounting evidence against the firm that indicates it contributed to the financial crisis.
On February 5, the Justice Department filed civil charges against S&P, alleging that the firm knowingly inflated ratings on investments leading up to the financial collapse. Following S&P's request on April 23 to dismiss the case, The Wall Street Journal editorial board quickly ran to the firm's defense, claiming "the judge ought to grant S&P's motion for many reasons, not least because otherwise no one will be able to sort Washington's list of victims and villains."
The editorial argues that federal action against S&P is unwarranted, because the Justice Department alleges that banks, who have previously been targets of lawsuits themselves, were defrauded by S&P's overly optimistic ratings. The Wall Street Journal's logic suggests that S&P couldn't possibly be accused of wrongdoing because the banks that used its ratings are also accused of wrongdoing:
The truth is that S&P's ratings on mortgage bonds, along with those issued by Moody's and Fitch, did inflict terrible damage. But this was not because employees at these firms are more stupid or unethical than those at other businesses. The damage occurred because the same government that's now suing S&P required financial institutions to use the ratings issued by S&P and the other raters.
Of course, in arriving at this conclusion, the editorial conveniently omits the facts behind the Justice Department's lawsuit. According to WSJ's own reporting in the wake of the financial crisis, internal emails at S&P suggested that analysts knew how risky mortgage-backed financial devices were, and that the firm adjusted ratings to satisfy their clients instead of providing objective analysis.
Furthermore, the editorial fails to mention that S&P's recent request to have the suit dismissed relies on the firm rejecting its long-standing position that its ratings are objective -- a fact that the Justice Department's complaint makes clear. Instead, S&P now alleges that its ratings "were never meant to be taken at face value by investors," as the WSJ noted in its own reporting.
WSJ's fact-free defense of S&P falls in line with previous attempts by conservative media to shield the firm from legal action. When the Justice Department's complaint was initially filed, right-wing media figures dismissed the suit as "government retribution" over S&P's previous downgrade of U.S. credit.
Fox News forwarded the notion that it might be appropriate for school children to be forced to work in exchange for free school meals, after a Republican lawmaker in West Virginia proposed such a requirement for a new law curbing child hunger.
On Fox & Friends First, on-screen text asked viewers whether students should have to "work for their school meals":
As The Washington Post blog "She The People" explained, the idea that students could be forced into labor in exchange for food comes from a Republican member of the West Virginia House of Delegates, who suggested the requirement be added to a bill intended to ensure no child goes hungry:
"I think it would be a good idea if perhaps we had the kids work for their lunches: trash to be taken out, hallways to be swept, lawns to be mowed, make them earn it," said Ray Canterbury, a Republican from Greenbrier and a member of the West Virginia House of Delegates, during debate over Senate Bill 663, also known as the Feed to Achieve Act.
The bill -- the first of its kind in the nation -- would create a partnership between private donations and public funds to make breakfast and lunch available for free to every student, kindergarten through high school senior, in West Virginia. It's based on a model program in Mason County that's improved attendance and decreased discipline problems, according to the school district's food service director.
Free meals are provided through the National School Lunch Program to students whose family's income is 130 percent or less of the federal poverty guidelines. For this past school year, that means a family of four with an annual income of $29,965 qualifies. Children with household incomes of 185 percent or less of the poverty guidelines can get reduced-price meals under the program, which -- I was surprised to learn -- was established in 1946 by the National School Lunch Act.
West Virginia's Feed to Achieve Act wants to go beyond that by making sure no child goes hungry at school, but Canterbury repeated the theme of "there is no such thing as a free lunch" during the delegates' discussion of the bill, which had passed the state Senate unanimously.