The day after the government released July 2006 consumer price index (CPI) data, most media outlets portrayed the new numbers as a positive development, including the Associated Press. Yet The Washington Post gave a pessimistic slant to the news.
Nell Henderson’s article, “Cost of Living Gets Costlier,” commanded the reader’s attention on the front page of the August 17 Business section. After complaining that inflation was “eating into people’s paychecks and savings at a quickening clip,” Henderson cited Georgetown nursing student Linda Dodd’s textbook shopping woes.
“I just spent $85 and $90 on two books,” sighed Dodd. A graphic accompanying Henderson’s article showed textbooks have risen 5.6 percent in price since last year.
But Dodd was purchasing brand new textbooks from a university bookstore, which is considerably more expensive than shopping online or buying used books elsewhere, a point that Henderson left out.
As shown in a photograph accompanying the print edition of the story, the books Dodd purchased – “Community and Public Health Nursing” and “Critical Care Nursing: A Holistic Approach” – are $75.61 and $80.06 respectively on textbooks.com. At Amazon.com, used copies of those books can be purchased starting at $55 and $67.50 respectively.
While Henderson focused on the bite consumers have seen in spending power from rising prices, she missed the good news on the horizon that other media outlets, including her own paper, reported.
Buried in the August 17 Business section, an AP story heralded “a second straight day of tame inflation data” that helped rally Wall Street.
But the AP wasn’t alone in picking up the positive developments from the inflation data.
Filling in for regular business contributor Andy Serwer, CNN’s Carrie Lee led an August 17 “Minding Your Business” segment noting a hundred-point rally the day before. “Basically, some tame inflation data causing the gains,” Lee explained, adding that “a lot of people” think “the Fed may have done enough to control inflation without slowing the economy too much.”
The same morning in USA Today, reporter Adam Shell also picked up on Wall Street’s rally. “The inflation reports over the past couple of days have been encouraging,” Shell quoted JP Morgan global market strategist Stuart Schweitzer. The market expert added that “this buys some breathing room for the Fed” and might signal that “they have done enough” to contain inflation.
Even The New York Times’ Louis Uchitelle found the inflation data reassuring, writing that the “latest report” on CPI “suggests that inflation is slowing.” Uchitelle cited JP Morgan economist James Glassman commenting that core inflation – the rate of inflation when factoring out food and fuel – “was on the tamer side of what people on Wall Street expected.”
Hardly a cheerleader for the Bush economy, Uchitelle has had such a pessimistic view of the American economy that he asserted in his book “The Disposable American” that the psychological impact on workers now is worse than it was during the Great Depression.