The media have an important role to play creating this future; they are not just disinterested bystanders. Whether they like it or not, journalists are not just reporting a financial crisis, they are performing it.
The BBC’s new favourite goto expert voice, IHS Markit, the people who bring us the PMI figures that the BBC insisted showed we were definitely heading for recession, has released some figures on the jobs market that say permanent job recruitment has fallen as employers turn to temporary or contract workers in uncertain times due to Brexit.
The BBC tells us:
Which is an odd way of interpreting the data as IHS Markit tell us:
Data were collected between the 13th and 24th June, meaning the vast majority of responses were received prior to the result of the vote being known, so the survey illustrates the extent to which UK companies were pulling back on hiring ahead of the vote rather than after.
So not a reaction to the vote but to the Remain camp’s strident alarmism, strongly encouraged by BBC coverage, pre-vote.
And IHS Markit’s own graphs show a different tale to that being peddled…..to me they show that demand for permanent jobs has been on the decline since 2014…….with a couple of peaks on the way…but the trend is down…..Was Brexit on the radar in 2014 for employers?….
Did laugh to hear the Today programme suggesting that the Bank of England was talking the economy down with its interest rate cut. The BBC has been doing that for months…and on the same programme that they criticised the BoE the BBC fed us a continuous stream of news trying to suggest that Brexit had destroyed the economy or was just about to. [And what of the scare stories about the ‘plunging Pound’? The interest cut meant that the Pound would again drop…if that was so bad why did the BoE implement a policy that they knew would make the Pound drop…whilst the .25% interest rate drop was in reality a political move and not an economically necessary one?]
Remember it was the BBC’s reporting that helped turn an economic problem into an ongoing disaster that nearly destroyed us all…
Peston has been blamed by many others for the Northern Rock bank run, most notably by members of the Treasury select committee. Peston’s reactions to committee members suggest that he thinks he is being blamed personally for all of Northern Rock’s problems. Like the committee, I am not arguing this at all. The roots of Northern Rock’s woes quite clearly lie elsewhere. I am instead arguing that he had a role in causing sufficient panic among depositors for them to run on their bank.
Does the BBC’s continously negative reporting actually create a self-fulfilling prophecy and bring on a recession that might otherwise not have happened? The tone and accuracy of reporting is important…..
In recent weeks the BBC’s business editor Robert Peston
has come in for criticism about his role in breaking stories of banks in trouble.
Of course the title of this article is mostly a rhetorical flourish. It would be unfair and untrue to accuse Robert Peston of single-handedly causing a recession. However, it is very much the case that media stories on the current turmoil are not just reflecting events; they are also creating them.
Two ideas from social psychology and sociology can be helpful in understanding what is going on here: social amplification and performativity.
Social amplification of risk is the process though which public perceptions of risks can be produced and magnified as a consequence of the ways in which hazards come to public attention. A key issue in social amplification is the interest key parties have in the story. For example, media outlets have an interest in generating high circulation or viewing figures and ‘scare stories’ sell. This media focus on generating headlines can thus be a key factor in amplifying risk perceptions.
If I drop a rock, it will fall to the ground (or perhaps on my toe) whether I believe in gravity or not. Gravity is independent of my belief in it. But many ‘facts’ I believe in are social facts and are true only so long as enough people believe in them; the value of money for example. What you believe does not just reflect our social world; it helps create it.
Performative statements or beliefs are those which help bring about the conditions they describe.
The beliefs we subscribe to about banks are performative. By trusting that banks are safe places to keep our money we help bring about the stability which makes this true. By trusting each other with funds, banks ensure the stable operation of financial systems which in turn helps make that trust justified. Equally though, when we withdraw trust we help bring about conditions in which trust would be ill advised.
What we all think and feel about our financial security will have important consequences over the next few months. If we mostly fear the future, stop spending, withdraw our savings from banks, this will be part of the process which makes our fears true. Likewise as businesses take a view on the future and take decisions about investment and disinvestment, new hiring and layoffs these decisions will have a part to play in bringing about the future market conditions which that view is based on.
The media have an important role to play creating this future; they are not just disinterested bystanders. Whether they like it or not, journalists are not just reporting a financial crisis, they are performing it.
