I confess to harboring snobbish feelings about having studied economics. Not that my training was especially advanced; before embarking on a career in journalism, I took several economics courses in college, which I supplemented with a degree in Philosophy, Politics and Economics (PPE) at Oxford. But compared with many of my fellow reporters, editors, and competitors who had little or no academic background in the subject, I couldn't help feeling that I was significantly better equipped to understand economic issues than they. Curmudgeonly as this may sound, when I come across economic or financial journalism that strikes me as shoddy—in news articles, op-ed columns, or books—I sometimes check the author's credentials, almost invariably finding that, for all their talent at glib writing, their fields of concentration at university were subjects such as English literature or “mass communications.” Teeth-gnashing ensues.
Examples abound in news coverage and commentary about cryptocurrency. Prior to the latest “crypto winter” of mid-2022, the media was full of noncritical, credulous reporting about the riches being reaped by crypto entrepreneurs and their claims that, say, bitcoin would not only gain widespread adoption but would supplant the US dollar as the dominant international currency. Even Wall Street Journal articles sometimes treated bitcoin, Dogecoin, and other cryptoassets with gravity, as if they were worthy of consideration for investment by middle-income people. As a former Journal reporter, I could think of quite a few former bosses who must have been rolling over in their graves.
No doubt the reporters and editors who worked on those pieces are intelligent and conscientious. But they would have been far less prone to misinforming the public if they had a basic grasp of the material I studied in macroeconomics courses, where I learned that a nation's money supply needs to be elastic rather than rigidly fixed, as bitcoin's is. They would have benefited, too, from taking courses in money and banking or monetary economics, which would have given them a healthy dose of skepticism about crypto enthusiasts' conspiratorial claims regarding fractional-reserve banking and central banks. And if they had studied portfolio selection theory, which taught me how financial instruments should be priced according to the discounted present value of future cash flows, they would have recognized the absurdity of squandering money on assets lacking the slightest intrinsic value.
A retrospective look at my own coverage suggests that a measure of humility is in order. Some of my pieces, in which I relied on economists whose analyses aligned with my training, were too alarmist about the risks of US budget and trade deficits, for example. Does that mean my economic studies were pointless or, worse, fallaciously based? No, it would be much more sensible to attribute the problem to the fact that macroeconomics, hardly a precise science to begin with, has evolved with time and the emergence of new evidence. The most fundamental lessons that were drilled into me fifty years ago remain as valid today as ever, and also highly useful in understanding economic developments for purposes of informing the public. In addition to the ones mentioned above (e.g., how to properly value financial assets), I would cite the principles that monetary policy works with a lag, that central banks have essentially one blunt tool for influencing economic activity, and that comparative advantage makes international trade welfare enhancing albeit imperfectly and often with undesirable distributional effects.
If anything, the biggest struggles I encountered as a journalist trained in economics involved excessive sensitivity to nuance. I sometimes had a hard time getting articles I deemed important onto the front page, or even into the paper, because my concern for economic veracity led editors to complain that my writing was insufficiently comprehensible for lay readers. I learned a lot from those editors, who were sometimes brutal in demanding that I oversimplify at the top of my articles, without sacrificing accuracy, and push the hedging material—the “to be sure” paragraphs, as we journalists call them—lower down. Perhaps I should have substituted a mass communications course for one of my economics classes; I would have appreciated the need for clarity and straightforwardness earlier in my career.
Fortunately, most of the people covering economics at major media outlets are highly competent in both their command of the subject and their ability to write accessibly. (Since I was so caustic about the Journal's coverage of crypto, I should add that Greg Ip, the paper's chief economics commentator, has produced superb work on the subject—and it should come as no surprise that Greg holds an economics degree.) I don't know how much formal university training others have had; one of the most insightful economic journalists, my friend David Warsh, got his Harvard BA in 1972 without even taking EC10, the introductory course. But David has probably read more books and articles by academic economists than any of us in the journalism business.
Having an economics background is no guarantee that your journalism will enlighten the public. I learned this to my chagrin when I wrote an article in 1987 about John Culbertson, a professor at the University of Wisconsin (my alma mater), the only economist anyone knew at a major academic institution who was an outright protectionist. The point of my article, which appeared on the Journal's front page, was that although economists disagree about almost everything, they are virtually unanimous in their belief about the broad welfare-enhancing benefits of trade. Culbertson, as I discovered on a trip back to my old Madison stomping grounds, was a specialist in monetary economics who had been granted tenure in 1956 on the basis of a highly regarded article but then denied merit increases because the higher-ups in his department deemed him insufficiently productive in subsequent years. Increasingly isolated from his colleagues, he began speaking out in favor of the heretical view that imports were severely detrimental to the US economy, much to the department's embarrassment.
My article made it pretty clear, I thought, that Culbertson's apostasy stemmed from resentment and a desire for revenge on his colleagues—the implication being that the profession's consensus on trade was based on rationality and logic. I felt pleased with myself for having struck a mighty blow for economic literacy until I received a letter from a reader that went as follows: “Dear Mr. Blustein, Thank you for your fascinating article about Professor Culbertson. Like him, I have long known that imports are destroying our nation's economy, and am thrilled to see that someone of his stature agrees . . .”
Oh well. Snobs like me need deflating. Still, I'm glad to have avoided spending my career in blissful ignorance.
