Perception Versus Reality

Any American who travels internationally gains a perspective of the United States that is often quite different from that found in the news and prevailing politics back home. Returning from a developing country where the average income is less than $6,000 a year, with millions living on as little as $3.00 a day, where corruption and fraud are widespread, where unemployment is 8% or higher, where utilities and simple services we take for granted in this country don't work, and where health standards are low, you might find it hard to appreciate the constant blather about polls indicating how disappointed Americans are with the condition of the country. You might be a little less tolerant of the complaints of politicians and pundits about how "broken" our government is. While there are certainly things we'd all like to improve, America is still the standard by which the rest of the world defines success.

If, during a conversation about the country with a recent college graduate, you said that huge tax cuts for the rich and outrageous war spending was bankrupting the U.S. economy, he would probably agree with you. He has been told that the U.S. economy was a disaster--consistently--during the past six years. He believes the war in Iraq was justified solely by falsehoods and probably thinks the endeavor is doomed. He is convinced that American "go it alone diplomacy" has isolated the U.S. and increased the risk of nuclear disaster. He's heard endlessly that FEMA's poor response to hurricane Katrina demonstrated the incompetence and the apathy of the U.S. government. In fact, you could say almost anything negative about the U.S. and he would say, "Right... tell me something I didn't know."

The problem is, not one of these notions--which have in many circles become the generally accepted conventional wisdom--is true. Since, as we all know, "you're entitled to your own opinion, but not your own facts," Reality Check provides the ignored facts where important misconceptions exist. We can not cover every current issue, so we've chosen those where we felt the biggest gap exists between perception and reality. If you find these facts surprising, please do something to help set the record straight. You can recommend the book, the web site, order brochures, or just speak up when people start.

Why Should You Care?

When falsehoods prevail, bad decisions follow. It's hard enough to make good decisions on complex issues even when starting out with solid information. But if you start with bad information, wrong decisions and unintended consequences will almost certainly be the result. One of the most successful business leaders of our time, Jack Welch, had a well publicized set of rules that guided his decisions. The first was:

"Face reality as it is, not as you wish it were."

--Jack Welch, former CEO of General Electric

This was Jack's most important rule because wishful thinking and selective perception can influence judgment--and affect decisions--powerfully. Most people tend to hear what is emotionally expedient. We gravitate toward what reinforces our belief system and, therefore, won't require the difficult task of rearranging memory chunks and thought patterns. If people consistently select only those sources of information that comfortably fit their biases, false conclusions and bad decisions naturally follow. When the future of a country is at stake, we of course all want to avoid bad decisions.

Why this Book is Needed: Part 1 - Media Chaos

It's no longer news to say that the mass media is undergoing a major transition. This book is not about the media, but it is worth reviewing the key events that have changed the character of the news we get from the media. They include:

1. TV news fragmentation elevated competition.

2. Increased amounts of unfiltered, unchecked information became available through the Internet.

3. Classified ad alternatives like eBay, AutoTrader.com, Monster.com and Craigslist took revenue from traditional media.

4. Two very close and contentious presidential elections increased partisan rhetoric.

5. A controversial war in Iraq raised the emotional vitriol.

One might have expected that the dramatic increase in the amount of information available and its frictionless transfer would have led to more reliable and accurate news. It seems the opposite has actually happened. Not too long ago, we had a choice of three monolithic evening news programs, run by editors and producers who made their best effort to adhere to conventional standards of "journalistic ethics"--reporting unbiased information. These three news machines and their print periodical counterparts were supported by armies of reporters and analysts who, literally, covered the globe.

Today the news is delivered 24 hours a day by many networks and cable stations and anyone with a camera and a broadband Internet connection can deliver their own version of the news to a digital world. Increased competition and today's fragmented audience makes it harder to support large news staffs. Of equal importance, online goods and service exchanges like Craigslist, eBay, Monster.com, AutoTrader.com, and countless others have stripped the newspapers of classified ad revenue, which by some accounts represented as much as two-thirds of their total income, and went a long way toward supporting their core news functions and the necessary analysis on information.

The frantic scramble for ratings--which was intensified by increased competition and declining circulations, viewership, and ad revenues--pushed media outlets toward focusing on a particular market segment and a product designed to appeal to that segment, usually either liberal or conservative, that they caould count on tuning in to their program. With the simultaneous explosion of information careening through the newsrooms and less staff to fully evaluate its authenticity, the temptation to publish information that may or may not be true--but which reinforces its organizational bias--is stronger than ever. The result? Less information and more opinion--opinion designed to maximize entertainment value--which often means it's biased for effect behind either a liberal or conservative agenda. This, of course, is the opposite of journalistic integrity.

One result is a blurred line between fact and opinion with the obvious potential hazards that entails. More insidious though, is the danger that if each outlet serves up either a liberal or conservative slant, it becomes difficult to discriminate between objective truth and narratives chosen to feed a particular bias. Absent real trust, people either just settle in on what comfortably feeds their own bias, or they give up and move on to Brittney Spears, Paris Hilton and other sensational pabulum about the latest celebrity rage, which has cannibalized real news but requires less analysis on the part of news organizations. The importance of objectivity has been overtaken by the need to supply a narrative that gets a reaction or creates a "buzz." In this new, less reliable media context, critical thinking and skepticism are more important than ever. We must do our own homework to find the truth.

Why This Book is Needed: Part 2 - Media Bias

The liberal bias of the media is also nothing new. The facts on this subject could fill a book. Here are just a few:

• Five times more national journalists identify themselves as "liberal" (34%) than "conservative" (just 7%). By contrast the general public identifies itself as more conservative (33%) than liberal (20%).ⁱ

• In the nation's capital, reporters and editors are 12 times more likely to vote for a Democrat than a Republican.ⁱⁱ The general public is of course about 50/50.

• Democrats get more coverage than Republicans (49% of news stories for Democrats versus 31% for Republicans).ⁱⁱⁱ And the "tone" of the coverage was more positive for Democrats (35% to 26%) than for Republicans.^iv

This whole area of debate was recently alluded to in an amusing column by Wall Street Journal columnist Peggy Noonan. In one of her more memorable columns, the former White House staffer said it's refreshing that journalists and broadcasters no longer pretend to be objective reporters. She writes:

Charging the news media with liberal bias is like charging the rain with being wet. It is of their essence, it is what they are. And pretending this is not so is a dull and stupid game. It's also over. It is a fiction that has been overtaken by events. In the new, more competitive era, with scores of stations competing for viewers, with everyone looking not for a broad base but a solid niche, it's foolish to force highly opinionated reporters to act as if they don't have opinions. After all, it's not as if they are fooling the audience. It would be more practical, and probably better and less infuriating for everyone, if all the TV news shows and networks would admit the truth, declare one's bias.

But therein lay the problem. If every reporter declared his or her bias, it might help, but they all claim to be unbiased. In a 2001 C-SPAN interview, former NBC News anchor Tom Brokaw insisted, "The idea that we would set out, consciously or unconsciously, to put some kind of an ideological framework over what we're doing is nonsense." Whatever Tom Brokaw says, the typical viewer of the news no longer believes the presentation will be objective. A 2004 Gallup poll examining public attitudes about the credibility of the news media found that 48% of Americans view the media as "too liberal" while just 15% view it as "too conservative." Roughly a third says the media's slant is "about right." The repetition of the same narrow version of the global events has killed the standards of carefully considered analysis. With such low expectations it is not surprising many viewers now gravitate toward those sources that deliver news and opinion that supports their own point of view.

So news fragmentation and extreme partisan divide fed the new world of blogs, email tirades, talk radio rants, and YouTube sarcasm. In this world, anonymous opinions ricochet off others' bluster without anyone considering that their ardent positions might be founded on quicksand. People stopped listening. Facts and critical thinking were left in the dust behind an information overload juggernaut. Chaos and confusion now reign.

Media organizations could have stepped into the breach and added value by doing the hard work of sorting through the morass and delivering unbiased truth. Instead, most took the easy route. They tried to exploit the public's confusion by advancing their own ideological biases in a misguided attempt to increase ratings by "giving the people what they want." In doing so, most of these media outlets have diminished their value, undervalued the intellect of the average American and driven many of us to look for other alternatives.

Thus, this book.

Critical Thinking

An important lesson in critical thinking is that whenever we see information designed to imply that a trend is either good or bad, we ought to ask the question: Compared to what? There is a tacit implication that if something is up or down compared to what it was before, then it must be really good or really bad. But that's not always the case.

Here is a good example: A chart published in The Economist in 2008 shows a skyrocketing U.S. trade deficit with China. The U.S. is importing more goods from China than we export to China, and the chart shows this fact on a rapidly increasing basis. The chart makes the situation look dire. The average person seeing this chart would naturally assume that the nation is facing financial disaster, and our leaders are steering us toward imminent economic doom. They would believe America is exporting all of its jobs, and Americans will be working for the Chinese in no time at all. But is that really true? Most people have no idea whether a $250 billion trade deficit is significant in the context of the overall U.S. economy.

So let's ask: Compared to what? The chart below shows how this trade deficit with China looks in comparison to U.S. Gross Domestic Product over the same period.

It's the same information but with some perspective. The trade deficit with China increased from 1% of U.S. GDP ($39 billion) in 1991 to 2% of GDP ($250 billion) in 2007, an increase of $211 billion. Meanwhile, the U.S. economy grew by $8 trillion. The economy's growth of $8 trillion is 38 times the deficit increase of $211 billion. Whether the increasing deficit with China is a good thing or bad thing for America can be debated, but it's not in itself cause for alarm. It is, however, undoubtedly a big deal for China, where $250 billion represents more than 8% of the nation's GDP.

For another lesson in critical thinking--about how public opinion polls can mislead, through non-neutral language and biased sequencing of questions--see the afterword at the end of the book.

Setting the Record Straight

This book is not designed to be an indiscriminate defense of the White House or as a broad-brush attack of any particular group. We do believe though, that one-sided and often unfair coverage of the current administration cause mny widespread misconconceptions, and that the generally negative narratives further damaged an already poor global view toward the U.S. Given this, and given that we specifically chose issues where the perception/reality gap seemed to be the greatest, it should come as no surprise that we often benchmark trends from the start of the Bush administration. It should also come as no surprise that much of what we have to say is positive, because the media, by definition, tends to focus on the negative. At any moment, the story about a house that burned is more interesting than a story about the houses that didn't burn. Every once in a while, though, it's good to get away from the drumbeat of bad news and look at the big picture in perspective.

In each chapter we've followed a simple pattern, offering conventional wisdom, typical headlines or quotes from the media, followed by the facts, and our own analysis and opinions on the issues. Our plan has been to keep the opinions brief so that the salient material in each chapter will be the facts themselves, setting the record straight. For example, a section might begin with the conventional wisdom is that China is about to overtake the United States economically, but that's not true. As the figures in this book will attest, China's economy is a fraction of our own, and while the so-called "Asian Tigers" are growing rapidly, it will be a long time before China or any of the other economies in the Far East come close to the size and affluence of the American economy.

It is important to note that, while assembling the information for this book required a good amount of homework, we didn't have to go to arcane websites and lots of dusty old tomes to find the facts. Everything here is readily available from sources anyone can examine.