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How the media misled us over Brexit and Donald Trump

Partisan newspapers and TV channels let "politicised truths" pass unchallenged, says Simon Wren-Lewis.

Both Brexit and Donald Trump’s victory are described as huge surprises. Of course that is partly about the polls, but in truth the polls were not that wrong. It is more a feeling that is summed up by the phrase "self-harm" being used to describe Brexit - and, with Trump, disbelief that someone who broke all the rules could win. Yet in reality both events were entirely predictable, if you thought about the information which voters had.

Take Brexit first. It was always going to be about a desire to control immigration, set against the economic harm caused by Brexit. This compares something which is certainty to something that can only be estimated. It is certain that within the EU we cannot directly control internal migration. How much economic harm Brexit will do is uncertain. What information did most voters have on this? They had a great deal of information available if they knew where to look and who to trust, but most voters do not know those things and have other things to do. What information was presented to them through the media they normally viewed? 

Many will have seen, every day for the last decade, relentless propaganda on the dangers of immigration and harm caused by the EU in their daily paper. Like advertising, that is hard to shut out. Those papers said Brexit would do no economic harm, and called claims that it would "scaremongering". The Prime Minister and Chancellor said something very different, but there were senior members of their own party who branded that stance “Project Fear”, and in any case most people do not trust politicians. Anyone who had watched the Scottish referendum should have realised that the tactic of branding objective economic assessments as Project Fear, although it may not have won the day on that occasion, still managed to convince many voters to dismiss the very real and severe short fiscal problems that independence would bring.

Yet the Chancellor and Prime Minister must have been sure that their economic case was so strong that they would prevail. And they were right about the economics: for every one academic economist who thought Brexit could bring economic benefits, 22 thought the opposite. Economists, not known for speaking with one voice, were united on this one. This was reflected in advice from the IMF and OECD. But how did ordinary voters receive that information if they listened to the broadcast media?

They did not receive it in the form I have just presented it. It was hardly ever presented as knowledge, or received wisdom, but nearly always as opinion, to be matched by the opposite opinion on the other side. Political commentators hardly ever used the weight of academic opinion as evidence in questioning Leave politicians, or in their commentary after he said/she said soundbites. Even though academics appear more trusted by voters than politicians or journalists, I suspect most voters were simply unaware of the academic consensus that Brexit would cause long term economic damage. 

Those who dismissed the warnings of economists as just another macro forecast were making the simple mistake of confusing conditional and unconditional forecasts. Yet rather than explain the difference, the broadcast media often made the same mistake. It is like ignoring advice from your doctor not to smoke because he cannot tell you exactly when you will die.      

That voters were so badly informed by the media was no surprise for me, because I had seen it happen just one year before in the 2015 general election. As every political commentator told you day in, day out during that election, the economy was the Conservatives’ strong card, indeed perhaps their only strong card. The polls showed the same thing. 

But to any macroeconomist looking at the data, this made no sense. We had seen the slowest recovery from recession for at least a century. Indeed, if you only call a recovery growth in GDP per capita that is above the long term trend (as you should), we never had a recovery. True, employment growth was strong, but that just meant productivity growth was awful. Partly as a result we had seen an unprecedented decline in real wages.

So why was the economy the Conservatives’ strong card? The answer of course is the deficit. The story most voters ended up believing came in two parts: first, austerity was necessary to appease the markets, and second that the Tories were just cleaning up the mess that Labour left. Both stories were clearly wrong in retrospect, and at least one was obviously wrong at the time. 

We do not know for sure, but what evidence we have suggests that a majority of academic economists had always disagreed with the Conservatives’ austerity plans, and that majority got larger as it became clear to them that the Eurozone debt crisis was a strictly Eurozone problem. There was no UK debt funding crisis and no evidence that one was even a possibility, and austerity was doing considerable damage.

So austerity certainly was not necessary, and should have been delayed until the recovery had been going long enough to let interest rates rise above their lower bound. If that had been done, monetary policy could have offset the deflationary impact of fiscal consolidation. By 2015 that was the received wisdom among most economists.

In contrast not many economists had studied the Labour government’s fiscal record in detail. But I had, for an article I was asked to write for an academic journal. The best you can say for the Labour profligacy myth is that it was based on a half-truth. Under Chancellor Gordon Brown, Labour had allowed the debt-to-GDP ratio first to fall significantly, and then to partially recover, when arguably they should have kept it flat after it had fallen.

But this was not profligacy by any stretch of the imagination, and Labour’s fiscal indiscretions were dwarfed by the impact of the financial crisis. The rise in the deficit from 2008 was all about the recession, and to blame Labour for this rise and subsequent austerity was simply ridiculous.

Yet for most voters and political correspondents, all they heard was the Conservative story with no kickback from Labour. As a result, it became what I call a politicised truth: something that is not true, but is treated as true by the media. 

You should certainly blame Labour for letting this pass, but it is surely wrong that the media should treat as true something that is not true, just because it is pushed by politicians. On this occasion you did not need to ask experts who had studied this period to establish the truth, because one glance at the data would have shown that it was the recession that increased the deficit.

During the Coalition government I became so exasperated at the gulf between the media’s presentation of macroeconomics and what first year undergraduates are taught the world over that I coined the word “mediamacro”. In the textbooks you will not find controlling the deficit described as more important than achieving growth and raising living standards. In textbooks cutting the deficit in the middle of a recession is a sin, not a virtue. But by 2015 mediamacro was well entrenched, so no political commentator expressed any surprise that the economy was the Conservatives’ strong card.

The media played a major role in winning the Conservatives the 2015 election. Not from bias in the usual sense, but from bias against economic knowledge and economic facts and by substituting it with a false narrative. To manage, as the Conservatives did, to pass off blame for their own damaging actions on to the previous Labour government was a supreme victory for spin over reality. It could not have been done without the compliance of the broadcast media.

The broadcast media also played an important role in the Brexit result. By presenting the views of economists not as knowledge which needed explaining to viewers, but as an opinion that always had to be matched by the opposite, it effectively neutralised that knowledge. 

This neutralisation mattered. The polls clearly showed that most people did not expect themselves to be worse off in economic terms in the long run as a result of Brexit. Polls also showed that most were not willing to pay for a reduction in migration. Many wanted immigration controls because they erroneously believed that more immigration had led to greater pressure on the NHS. In reality, as most economists agree, migrants put more money into public services than they take out because they tend to be young. So the idea that immigration adds to pressure of public services is a myth perpetuated by politicians trying to deflect attention from their own actions, and a myth that the media does little to counteract. It is another politicised truth.

The same thing almost happened with climate change in the UK, when broadcasters started putting climate scientists up against media savvy climate change deniers. Pressure from the scientific establishment helped the BBC change its policy and treat climate change as knowledge rather than just opinion. Economists need to organise in the same way as scientists did. That will be much more difficult to achieve, not least because a great many politicians will not like it. 

Many were surprised by the election of Donald Trump because they wondered how on earth the electorate could vote for someone who appeared to have views that would make Nigel Farage blush. Others think the policies he advocates, which will increase government borrowing substantially and increase protectionism, will do the US economy long term damage. But once again it is important to see what information a great many voters who are not that interested in politics or economics receive.

There are similarities and differences with the UK. Both countries have a highly partisan section of the media, with Fox News acting like the right wing tabloids in the UK. In both cases this media does not just passively push the position of a political party, but actively promotes the agenda of its owners and editors. 

Bruce Bartlett, who worked in the Reagan White House and for George HW Bush, argues that Fox is now the real force in Republican politics. Although they have their occasional spats, which are in reality a power struggle, Fox has for many years promoted Trump as a Republican candidate. So the fact that the Republican base supported Trump is no surprise. In addition Fox helped demonise Hillary Clinton.

In the non-partisan section of the US broadcast media, there has been a steady reduction in the amount of time devoted to issues when covering the election on the nightly news, and an increasing amount of time devoted to supposed scandals like Clinton’s emails. These emails also showed the problem of false equivalence: they were given as much or more time than Trump’s evident sins. Only in this context can you see why a poll during the election said more people trusted Trump than Clinton. 

This focus on the role of the media has two big groups of critics. The most common is the media itself, which likes to cultivate an image of a passive player which simply presents the views of others, and in the case of the partisan media simply reflects the views of its readers. 

It is of course in their own interests to promote this story. But politicians do not court media barons for the deep insight they might provide about their readers’ views. It is incredulous to argue that the 80 per cent of tabloid newspapers that campaigned so hard for Brexit were just expressing their readers’ views. There is also clear empirical evidence that watching Fox news increases the Republican vote. Equally the non-partisan media hardly informs its viewers on issues like climate change or EU membership by showing soundbite debating contests.   

A second group of people who play down the autonomous role of the media are those that talk about broad historical movements like neoliberalism. They typically deny the media agency by arguing that it simply serves the interests of dominant groups or ideologies. Yet it is unclear what group or ideology Brexit serves. It certainly is not in the interests of large sections of business to make trade with the EU less competitive and more bureaucratic. Those ideologues who thought Brexit would allow a bonfire of regulation and free trade now seem politically naive. 

I do not want to imply that the media does not often act to promote what might be called a neoliberal agenda: by not questioning the need for austerity it did just that. Deregulation of the media under Ronald Reagan allowed the creation of Fox news. But this relationship is neither automatic or inevitable. You could instead argue that the media, by portraying expert knowledge as just another opinion, and by spending more time on political scandals (real or imaginary) than policy issues, facilitates the rise of populism.       

Democracy does not work very well when voters are not presented with relevant information or are wilfully misled. Unfortunately many people use the internet to access sites that tell them what they want to hear rather than challenge their preconceptions. In the UK the role of broadcasters is crucial because we have a large section of the press which distorts the information it gives its readers. Yet the broadcast media in the UK appears, at least in the case of economics, to have given up its mandate to inform, and in some cases actively misinforms. In my view that has helped lead UK voters to make two major mistakes within the last two years.

Simon Wren-Lewis is Professor of Economic Policy, Blavatnik School of Government, Oxford University

 Simon Wren-Lewis is is Professor of Economic Policy in the Blavatnik School of Government at Oxford University, and a fellow of Merton College. He blogs at mainlymacro.

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The tale of Battersea power station shows how affordable housing is lost

Initially, the developers promised 636 affordable homes. Now, they have reduced the number to 386. 

It’s the most predictable trick in the big book of property development. A developer signs an agreement with a local council promising to provide a barely acceptable level of barely affordable housing, then slashes these commitments at the first, second and third signs of trouble. It’s happened all over the country, from Hastings to Cumbria. But it happens most often in London, and most recently of all at Battersea power station, the Thames landmark and long-time London ruin which I wrote about in my 2016 book, Up In Smoke: The Failed Dreams of Battersea Power Station. For decades, the power station was one of London’s most popular buildings but now it represents some of the most depressing aspects of the capital’s attempts at regeneration. Almost in shame, the building itself has started to disappear from view behind a curtain of ugly gold-and-glass apartments aimed squarely at the international rich. The Battersea power station development is costing around £9bn. There will be around 4,200 flats, an office for Apple and a new Tube station. But only 386 of the new flats will be considered affordable

What makes the Battersea power station development worse is the developer’s argument for why there are so few affordable homes, which runs something like this. The bottom is falling out of the luxury homes market because too many are being built, which means developers can no longer afford to build the sort of homes that people actually want. It’s yet another sign of the failure of the housing market to provide what is most needed. But it also highlights the delusion of politicians who still seem to believe that property developers are going to provide the answers to one of the most pressing problems in politics.

A Malaysian consortium acquired the power station in 2012 and initially promised to build 517 affordable units, which then rose to 636. This was pretty meagre, but with four developers having already failed to develop the site, it was enough to satisfy Wandsworth council. By the time I wrote Up In Smoke, this had been reduced back to 565 units – around 15 per cent of the total number of new flats. Now the developers want to build only 386 affordable homes – around 9 per cent of the final residential offering, which includes expensive flats bought by the likes of Sting and Bear Grylls. 

The developers say this is because of escalating costs and the technical challenges of restoring the power station – but it’s also the case that the entire Nine Elms area between Battersea and Vauxhall is experiencing a glut of similar property, which is driving down prices. They want to focus instead on paying for the new Northern Line extension that joins the power station to Kennington. The slashing of affordable housing can be done without need for a new planning application or public consultation by using a “deed of variation”. It also means Mayor Sadiq Khan can’t do much more than write to Wandsworth urging the council to reject the new scheme. There’s little chance of that. Conservative Wandsworth has been committed to a developer-led solution to the power station for three decades and in that time has perfected the art of rolling over, despite several excruciating, and occasionally hilarious, disappointments.

The Battersea power station situation also highlights the sophistry developers will use to excuse any decision. When I interviewed Rob Tincknell, the developer’s chief executive, in 2014, he boasted it was the developer’s commitment to paying for the Northern Line extension (NLE) that was allowing the already limited amount of affordable housing to be built in the first place. Without the NLE, he insisted, they would never be able to build this number of affordable units. “The important point to note is that the NLE project allows the development density in the district of Nine Elms to nearly double,” he said. “Therefore, without the NLE the density at Battersea would be about half and even if there was a higher level of affordable, say 30 per cent, it would be a percentage of a lower figure and therefore the city wouldn’t get any more affordable than they do now.”

Now the argument is reversed. Because the developer has to pay for the transport infrastructure, they can’t afford to build as much affordable housing. Smart hey?

It’s not entirely hopeless. Wandsworth may yet reject the plan, while the developers say they hope to restore the missing 250 units at the end of the build.

But I wouldn’t hold your breath.

This is a version of a blog post which originally appeared here.

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