“We had the Encyclopaedia Britannica at home and even when I was a small boy my father used to sit me on his lap and read to me from the Encyclopedia Britannica, and we would read, say, about dinosaurs(…) :
‘This thing is twenty-five feet high and the head is six feet across; Let’s see what that means. That would mean that if he stood in our front yard he would be high enough to put his head through the window but not quite because the head is a little bit too wide and it would break the window as it came by.’
Everything we’d read would be translated as best as we could into some reality and so I learned to do that – everything that I read I try to figure out what it really means, what it’s really saying by translating.”
~ Richard Feynman
Economic reporting in mainstream media is in need of an overhaul if it is to engage the wider public and encourage them to participate in a more open and informed discussion. News organisations have the tremendous ability to define the public agenda and lead the attention of the audience towards what they believe are issues of importance. The current fragility of the global economy poses serious threats to the livelihoods of all its participants, yet through a combination of enormous figures, technical jargon, and reporting events in isolation, too many people without a formal background in the subject may be left feeling overwhelmed and helpless.
Many of us avoid dealing with large numbers. It is difficult to relate to them and, thus, they are far more likely to go over our heads as cannot place them on scales we are more familiar with. The US Federal Government, as of January 2015, is carrying more than $18.000.000.000.000 in debt – enough to buy a new car for every person in America, Canada, and Mexico. Perhaps, if figures such as this were broken down into more relatable terms, there would be a more heated debate and a greater sense of public urgency to resolve the unsustainable levels of debt currently held in Western economies.
Stories sell. When sharing information with one another we tend to do so in the form of narratives. News is more easily followed when presented as a sequence of events leading up to a conclusion. When we hear stories of anguish, we often learn details about the victim that enable us to paint a more vivid picture of them in our minds: their interests, their aspirations, and the distress of their loved ones. We connect with these stories on an emotional level. This is not the case when it comes to economic news reports for it is served to us matter-of-factly, devoid of emotion. The serious tone of economic reports signal their importance amongst all news output; it is precisely for this reason that it should be made more inclusive, and not just reading material for the subset of society who study it. Perhaps, if economic performance were also reported from the perspective of citizens of differing classes, people would take more interest in critically examining the actions of leaders both domestically and internationally.
Economics is riddled with theories and jargon that may leave the layman bewildered and less likely to read the subject; humans are inherently lazy after all. Students of Finance and Economics are all too familiar with terms such as arbitrage, CPI, M1, M2, and quantitative easing, but it would be naive to suggest that the majority of readers are. In addition, the models defending the policies of central bankers and government are not widely shared, making it harder for people to understand the rationale behind them. A deeper understanding could be achieved with clearer explanations of the technical terms and greater use of infographics to help illustrate policy mechanisms.
The global economic system is multi-faceted and far too complex for anyone to understand in its entirety. What is more, media coverage has the tendency to expose brief fragments from a lengthy narrative that fail to provide any explanation of the wider context into which these segments fit. Whilst following the performance of a particular country or region is useful, we could also benefit from taking a step back to assess the “bigger picture” to better understand the fundamental drivers. For example, growth in China, previously led by significant real estate investment, is now slowing. This has significantly reduced demand for industrial metals such as copper and iron ore. Consequently, economies heavily reliant on the exports of these commodities have experienced notable weakening.
Copper has accounted for over half of total exports in Chile over the past decade and holds China as a strong trading partner. The Chilean peso has experienced a 25% decline against the dollar since the beginning of 2013. The intricacies and interconnectedness of the economic system is vast, but observing it from a broader scope would help us understand where potential sources of our problems are located.
As citizens of a globalised society, it is important that we all have a greater awareness of what is going on around the world and how the innumerable events taking place are interrelated. An issue with current mainstream reporting regards the seemingly apparent barriers to entry that prevent the general public from understanding economic news intuitively and how this affects their lives presently and in the future. Economics is a part of life, regardless of whether you have studied it or not.
Accessibility becomes a key point; economics should be more accessible. It is crucial to make reports more inclusive with more thorough explanations and an increased emphasis on global awareness. As a result of an ever increasing, universal engagement from a better-informed public, the decisions of policymakers will be placed under greater scrutiny. This monitoring can, in turn, lead to better decisions which are more reflective of the people our political leaders have been elected to represent.