Media are diverting attention from the fact that Republicans are obstructing a jobs bill that economists estimate would create millions of jobs by fixating on President Obama's comments that private sector job growth is "doing fine."
With the major oil and gas companies reporting massive third quarter profits, the industry is scrambling to explain why it still needs billions of dollars in taxpayer subsidies. The American Petroleum Institute has released a study arguing that oil profits are good for the "middle class Americans" because mutual funds, IRAs and pension plans hold most of the oil and natural gas shares.
It's an argument that has been denounced as "ridiculous" by a fiscal watchdog group, but U.S. News repeated API's claims without an ounce of skepticism. Instead, U.S. News & World Report claimed that API "[d]ebunk[ed] Democrats' argument that Republican-support for the oil and gas industry hurt the middle class in favor of the rich."
Responding to an interim version of the same study rolled out after oil companies announced huge first quarter profits, The Center on Budget and Policy Priorities, pointed out that "the reason why oil and gas stocks go up is because energy prices are going up, and that hurts the same people they're talking about."
Indeed, oil companies' soaring third quarter profits are a result of higher oil prices that Americans have to pay for at the pump this year. "Merrill Lynch estimates that every penny increase at the pump is equal to $1 billion in lost consumer spending" that could be helping the economy recover, ABC News reported. Economist Kathy Bostjancic characterized higher gasoline prices as a "tax" on consumers and businesses.
Indeed, the fact that we use so much of the product API is selling has us "locked into a situation where even modest bumps in gas prices end up torching the middle class," in the words of the Washington Post's Brad Plumer.
A study published in the prestigious journal American Economic Review estimates that the costs imposed on society by air pollution from coal-fired power plants are greater than the value added to the economy by the industry. The study concluded that coal may be "underregulated" since the price we pay for coal-fired power doesn't account for its costs.
According to a Nexis search, not a single major newspaper or television network has covered the study. By contrast, an industry-funded report on the cost of EPA regulations of these air pollutants has received considerable media attention.
The authors of the American Economic Review paper -- Nicholas Muller of Middlebury College and Yale's William Nordhaus and Robert Mendelsohn -- are considered centrists. Mendelsohn opposed the Kyoto climate treaty and spoke this year at the right-wing Heartland Institute's conference on climate change.
Economist Paul Krugman wrote that the study should "be a major factor in how we discuss economic ideology," adding "It won't, of course." From Krugman's post:
It's important to be clear about what this means. It does not necessarily say that we should end the use of coal-generated electricity. What it says, instead, is that consumers are paying much too low a price for coal-generated electricity, because the price they pay does not take account of the very large external costs associated with generation. If consumers did have to pay the full cost, they would use much less electricity from coal -- maybe none, but that would depend on the alternatives.
At one level, this is all textbook economics. Externalities like pollution are one of the classic forms of market failure, and Econ 101 says that this failure should be remedied through pollution taxes or tradable emissions permits that get the price right. What Muller et al are doing is putting numbers to this basic proposition -- and the numbers turn out to be big. So if you really believed in the logic of free markets, you'd be all in favor of pollution taxes, right?
Glenn Beck and James Pethokoukis each cited a study by the George C. Marshall Institute to criticize the carbon cap-and-trade system described in President Obama's budget proposal. But neither Beck nor Pethokoukis noted that the Marshall Institute has received funding from ExxonMobil.
A New York Times essay by Jason DeParle highlighted a resurgence of the use of the word "welfare" among conservatives, this time to attack President Obama's economy recovery plan. Indeed, while economists agree that provisions in the legislation targeting needy people are among the most economically stimulative, Media Matters documents below the pervasiveness of what DeParle called the "weaponiz[ation]" of the "very word, welfare," in the media, particularly, but not exclusively on Fox News, to denounce the stimulus bill.
On MSNBC Live, James Pethokoukis claimed that "Senator [John] McCain is not calling for privatizing Social Security. He's talking about perhaps separate accounts, but he's not actually talking about taking your Social Security payments and funneling them in the stock market." In fact, in a March Wall Street Journal interview, McCain reiterated his support for private Social Security accounts that would be funded through existing payroll taxes and could be invested in the stock market.
Supporters of the Iraq war -- rather than waiting for testimony by Gen. David Petraeus and U.S. ambassador to Iraq Ryan Crocker on the effect of President Bush's troop increase in Iraq -- have engaged in a campaign to convince the media and public that progress is being made in Iraq and that the "surge" is "working." Media Matters has compiled some of the most pervasive myths and falsehoods advanced by opponents of withdrawal in service of the "surge is working" message, which many in the media have been complicit in perpetuating.
In her U.S. News & World Report column, Gloria Borger asserted that "[n]o one would accuse [Sen. John] McCain [R-AZ] of equivocating on anything." But McCain has done just that on a variety of issues, including tax cuts for the wealthy, abortion, teaching intelligent design to public school students, and the Confederate flag.
Republican National Committee chairman Ken Mehlman has been inconsistent in his public statements about his relationship to disgraced GOP lobbyist Jack Abramoff. In recent interviews, CNN's Wolf Blitzer and U.S. News & World Report staff writer Will Sullivan passed up the opportunity to challenge Mehlman about these inconsistencies.
U.S. News & World Report senior writer Michael Barone claimed that the St. Petersburg Times concluded that emails then-Rep. Mark Foley allegedly sent to a former page in 2005 "were so innocuous as to be unworthy of publication." Contrary to Barone's claim, the Times stated that it assigned two reporters to the story and decided not to publish the emails not because they were "innocuous" but because the family of the former page did not want the matter explored further.