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C Is For Class Warfare

by Paul Krugman
November 21, 2012, 9:09 am

Ryan Chittum [ http://www.cjr.org/the_audit/rise_above_cnbcs_move_into_adv.php ] has a great piece about CNBC’s decision to drop even the pretense of journalistic objectivity and throw its weight behind the deficit scolds. Basically, the network has gone all in on behalf of the 0.01 percent.

One question Chittum doesn’t really get at, however, is why CNBC takes this tilt — why, in fact, it has been so dominated by the fake deficit hawk faction, the people who say that the debt is terrible, terrible, and that’s why we have to cut taxes on the rich. After all, the network’s audience does not consists mainly of the very rich; rather, it’s the 1 percent wannabees, who imagine that watching many hours of talking heads will somehow let them absorb the secrets of getting rich.

Now, one possible answer is that we’re looking at what the sponsors rather than the viewers want. But I don’t think that’s the main story; if there really were millions of people eager to get business news with a Keynesian flavor, my guess is that Wall Street would swallow its revulsion and buy ads all the same.

No, this is what the audience wants. And it’s what they want even though the Austerian stuff the network peddles has been wrong, wrong, wrong, wrong (have some fun with Chittum’s hyperlinks on Larry Kudlow). Never mind that the Keynesians have been right about interest rates [ http://krugman.blogs.nytimes.com/2009/05/02/liquidity-preference-loanable-funds-and-niall-ferguson-wonkish/ ], inflation [ http://krugman.blogs.nytimes.com/2009/05/04/a-history-lesson-for-alan-meltzer/ ], austerity [ http://www.nytimes.com/2010/07/02/opinion/02krugman.html?ref=paulkrugman ], and more; the audience wants to hear about the debt crisis and hyperinflation coming any day now unless we cut taxes on the rich, or something.

Actually, you see a lot of that in the comment threads whenever Joe Weisenthal [ http://www.businessinsider.com/author/joe-weisenthal ] says something reasonable about macroeconomics; what you see isn’t just disagreement, it’s blind, spluttering rage.

It is, I believe, a tribal identity thing; the consumers of business news want to see themselves as part of the economic elite, although they mostly aren’t. And Chris Mooney [ http://www.amazon.com/The-Republican-Brain-Science-Science-/dp/1118094514 ] wins again: we’re talking about personality types who aren’t responsive to evidence. Indeed, the more often you show them that their hard-money, anti-spending prejudices have been proved wrong, the more deeply those prejudices become entrenched.

So what’s the moral of the story? Maybe it’s this: don’t spend much time watching CNBC. It’s bad for your financial and intellectual health.

© 2012 The New York Times Company

http://krugman.blogs.nytimes.com/2012/11/21/c-is-for-class-warfare/ [with comments] [further to my earlier reply at http://investorshub.advfn.com/boards/read_msg.aspx?message_id=81373304 ]