An Ol' Broad's Ramblings
It’s The Economy…………And You’re Stupid?
When I hear the word ‘recovery’, my normal response is “Oh, he/she/it is getting better!” and soon, will be back on track in no time. Not so when I hear it reference to the economy. I automatically thinK… “What a flippin’ joke!” A recovery indicates getting better. Where is the economy getting better? Well, the government is sure healthy, with more and more jobs added, and salaries increasing, but I see no indication that out here in the real world. People are still unemployed, they are still losing their homes, they are still scraping to pay bills, and they are worried where their next meal is coming from. Does that sound like ‘recovery’? No, not to me either.
So, when I see a piece in the Commercial Appeal like this, and begin to read, I just want to shake someone.
One of the paradoxical elements of contemporary life is the 24/7 news cycle. It’s paradoxical because, while the format keeps us well informed, it simultaneously sustains a cottage industry of talking heads, the core products of which are the “Breaking News” syndrome and a phenomenon called “availability cascade.”
The simple definition of availability cascade is when we hear so much “Breaking News” about an issue that we begin to accept it as fact and take action based on that belief. Let me remind you of an old story that demonstrates how information can become dangerously disconnected from reality.
Is it just me, or is the author trying to convey that people should quit listening to the news? I suppose we should all just listen to the government officials, and believe their pretty words like the virgin on her first date when the boy tells her, “Of course, I love you! I’m going to marry you!” right before he destroys her world.
A baker saw this headline on a newspaper: “Economy headed for depression.” Reacting to this information, he cut his flour order in half with the local miller. The miller was then compelled to reduce his wheat order from the nearby farmers. The farmers then cancelled their new equipment orders with the local manufacturer, who promptly laid off hundreds of employees. These employees were now unable to afford to eat at the restaurants that purchased the baker’s bread, causing orders for bread to crumble.
As our baker, now out of business, locked his shop for the last time, he happened to notice the paper where he had previously seen the gloomy headline. Looking closer, this time at the date, he realized, too late, that the negative headline was on a newspaper that was 70 years old.
70 years ago, the population of the U.S. was 122,775,046, the highest unemployment rate was in 1934 at 24.9%. Today’s population is somewhere around 310 million, and the unemployment is 9.6%. I can’t imagine why the powers that be keep spouting “the worst economy since the great depression’. All you have to do is look at the number, and KNOW this is not true. Is it bad? Yes, it is. It’s especially bad for those who are doing the suffering. None of those who are working so hard to make it worse with their constant tinkering are hurting. No, they are being padded by your money, so the current economic environment doesn’t affect them one whit.
Availability cascade is made manifest when we, as consumers and business owners, make buying and operating decisions based on hype we hear, rather than facts in front of us.
All I can garner from the column is that we’re stupid, the baker is stupid, and we just don’t know how to discern fact from fantasy. Then again, maybe I’m misreading the author’s intent?
