The discussions surrounding the Budget were a low point in the reporting on economics, in my opinion. You might think that experts on, say, fiscal policy would be included in these Budget discussions. However, the Newshub “expert” panel consisted of a journalist (Dita de Boni), a sociologist (Dr. Ella Henry), and an economist (Shamubeel Eaqub), who quickly disqualified himself from being considered an expert.
In response to David Seymour’s comment that government spending drives inflation, Eaqub called Seymour “economically illiterate.” However, among serious economists, there is no disagreement that government spending is a key driver of inflation. In fact, it is what students of economics learn in their first year.
Another example is the “debate” around the Emissions Reduction Plan, which was at best unbalanced. With an ETS in place, the vast majority of additional policies will not help in reducing emissions – yet this was hardly ever mentioned in the media.
Bad economic commenting is a common feature in the New Zealand media: Take Richard Prebble’s comment in a Herald column last month about “thinking the unthinkable, a return of stagflation”. That was not wrong but a bit late to the party. I wrote a piece in May 2021 predicting that New Zealand would end up in stagflation - and I was not the only economist warning.
Liam Dann, also from the Herald, wrote in May that New Zealand might be headed to a recession, but this “[…] might not be such a bad thing for the economy […]”. In short: Nuts!
My favourite piece, and a prime example of what is wrong with economic reporting, comes from Melanie Carroll of Stuff. In January, she wrote a piece about what economists got wrong in 2021.
Carroll claimed that economists were surprised by inflation, the resilience of the economy, and the conduct of monetary policy. All of this is true if you only talk to those commentator types who dominate our media. But read the work of the Initiative, or read my op-eds, or indeed the op-eds of some of my academic colleagues, and you will find the opposite.
Overall, the way the media reports on economic issues is uninformed, unbalanced, and lacks experts (that is independent, and properly trained economists). This is not only a disservice to the country but also the source of New Zealand’s lack of economic literacy.
Bad economic commenting is a common feature in the New Zealand media: Take Richard Prebble’s comment in a Herald column last month about “thinking the unthinkable, a return of stagflation”. That was not wrong but a bit late to the party. I wrote a piece in May 2021 predicting that New Zealand would end up in stagflation - and I was not the only economist warning.
Liam Dann, also from the Herald, wrote in May that New Zealand might be headed to a recession, but this “[…] might not be such a bad thing for the economy […]”. In short: Nuts!
My favourite piece, and a prime example of what is wrong with economic reporting, comes from Melanie Carroll of Stuff. In January, she wrote a piece about what economists got wrong in 2021.
Carroll claimed that economists were surprised by inflation, the resilience of the economy, and the conduct of monetary policy. All of this is true if you only talk to those commentator types who dominate our media. But read the work of the Initiative, or read my op-eds, or indeed the op-eds of some of my academic colleagues, and you will find the opposite.
Overall, the way the media reports on economic issues is uninformed, unbalanced, and lacks experts (that is independent, and properly trained economists). This is not only a disservice to the country but also the source of New Zealand’s lack of economic literacy.
Dennis is a Senior Lecturer in Economics at the University of Otago, the Vice President of the New Zealand Association of Economists, Editor-in-Chief of New Zealand Economic Papers and Associate Director of the University of Otago’s Economics PhD Programme. This article was first published HERE
3 comments:
perhaps lincoln university did not teach the basics of macroeconomics in 1997 when mr eaqub did his bcom...
Spot on! Couldn’t agree more.
As an old Lincoln alumniI I am shocked to think that Macroeconomic teaching may have slipped. Think the great Prof Brian Philpott and his cluster of first class economists who were very influential in the 1980s reforms of the Lange/Douglas government. Maybe Mr Eaquab wasn’t paying attention when he was there.
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