So much economic disinformation comes out of the network news shows that they should start their broadcasts with this warning: “Beware, you may not be getting the full story in this report.”
Take last week’s news about incomes and poverty. What they reported was largely accurate as far as it went, but what they left out gave viewers a distorted picture of the true nature of poverty and household incomes in America today.
Yes, the number of people below the poverty income level rose last year as a result of a number of factors. The economic slump between 2000 and 2002 was the chief reason. (Divorce is a big factor in rising poverty, though this is rarely mentioned in these stories.)
But it wasn’t reported that the number of poor in 2002 was still below average poverty levels of the past 20 years.
Nor did the networks point out that last year’s 12.1 percent poverty rate (up from 11.7 percent in 2001) was still below the 15.1 percent rate in 1993.
The poverty number falls and rises with the economic cycles, but over the long term poverty has been falling in America — especially over the past decade.
Also unreported was the remarkable fact that the poverty rate was the same as it was last year for whites, Latinos and Asians. The big increase was among blacks — rising from 22.7 percent to 24.1 percent — which sent the overall rate up by four-tenths of 1 percent.
The Census Bureau numbers also told us the median household income fell last year. OK, incomes fall when the economy declines and unemployment rises, but this is a moving number, and that was last year’s news.
The good news story this year is that incomes have been rising, thanks to the Bush tax cuts. And that has increased consumer spending, which has produced two big improvements:
(1) Retail sales are up by eight-tenths of 1 percent in August alone, following a 0.9 percent increase in July.
(2) That’s fueling faster economic growth — 3.3 percent in the second quarter and an estimated 4 percent to 5 percent growth in the July through September third quarter.
There were other strong economic reports last month that did not get even a mention on the network news shows: Home sales rose to another record level in August. Single family home sales increased 3.4 percent to 1.15 million homes. Previously owned home sales rose by 5.5 percent.
So we have rising incomes, higher retail sales, the continued boom in housing, increased economic growth and the Fed’s pledge it will keep interest rates low for sometime to come.
This has kept the Conference Board’s index of leading economic indicators — the measure of how the economy will perform over the next half year or more — rising for four straight months.