The front page of the New York Times is filled with hope about the nation's economic situation. The lead story, "Job Losses Slow, Signaling Momentum for a Recovery," reporting a decline in the unemployment rate from 9.5 percent in June to 9.4 percent in July, begins by declaring that, "The most heartening employment report since last summer suggested on Friday that a recovery was under way -- and perhaps gathering steam."
"Employers are no longer in a panic," one expert tells the Times. The paper reports that Obama administration officials "credited the stimulus package" for the improvement, and "some said" job losses would be far worse had the $787 billion stimulus not been passed. The paper quotes President Obama saying his administration has "rescued our economy from catastrophe."
Put that together with earlier data that the economy shrank at a one percent annual rate in the second quarter, and the Times reports that the news has "convinced many forecasters that when the history of the Great Recession is written, these summer months will be the big turning point, when the economy started to grow again." Of course, there's some "unsettling information" in the new economic data, but overall, the message of the Times story is: Good news -- the recovery is underway.
The Times hasn't always been so optimistic when it comes to one-tenth-of-a-point declines in the unemployment rate. On this very day in 1992, in the midst of the presidential campaign between George H.W. Bush and Bill Clinton, the government also reported that the unemployment rate ticked downward by one tenth of a point, and the Times' treatment was far more restrained.
"Jobless Rate Dips a Notch to 7.7% in Mixed Showing," was the front-page headline of the August 8, 1992 Times. "The nation's jobless rate improved marginally last month, edging down to 7.7 percent from 7.8 percent," the Times reported. "But the improvement was not enough to signal a stronger economic recovery or to help President Bush as he heads into the Republican National Convention." Even though the number of jobs actually went up in July 1992 (as opposed to the decline of 247,000 jobs in July 2009), the 1992 Times reported that the economic news "gave no suggestion that the economic recovery was breaking out of its painfully slow pace or, more important, that the job growth was picking up enough to push the unemployment rate down significantly before the election in November." Pollster Peter Hart told the paper that, "There couldn't be worse political news for George Bush."
Under the sub-headline "Stagnant Period Seen," the Times reported that "most forecasters" predicted "more of the same: an economy that is just muddling along." The Times looked deep into the data to find "disappointing" numbers everywhere; many of the new jobs were in the service sector, there weren't enough construction jobs, some of the improvement was the result of a government program. (The Times appeared less enthusiastic about government stimulus back then.)
As it turned out, the one-tenth-of-a-point drop in the unemployment rate in July 1992 signaled the end of the increase in the jobless rate. Looking at this table from the Bureau of Labor Statistics, you can see that at the very moment the Times was declaring a period of stagnation, the unemployment rate was in fact beginning a long decline that would extend through the Clinton years.
Of course, the Times' editors and writers didn’t know that then, and they stressed the negative aspects of the economic news. But they don't know what's going to happen now, either, and they're filled with hope. Quite a difference.