For the past few years, every time I find myself in the presence of someone who claims that markets are efficient I offer them a simple challenge: explain the media. Explain why the American media produces a torrent of raw sewage while the commie pinko government-funded media outlets in other countries produce something that approaches actual news.

If the speaker is a complete Randroid he'll sputter something about how the American media are too heavily regulated, at which point I realize that I'm dealing with the Washington Generals of logic and I lose interest in going any farther. That's actually too stupid (and demonstrably false) to even merit a response. A reasonably intelligent person will respond that the market gives American news consumers exactly what they want (crap) hence they are efficient.

This is not wrong, but it is a red herring. It replaces "Markets are efficient" with "Markets are responsive." No one would argue that markets do not give consumers what they want. But free markets are supposed to make things better, right? The best product at the best price?
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That's why free enterprise built Cadillacs and Rolls-Royces while behind the Iron Curtain they puttered around in Trabants, right? The market sifts out the crap and the strong rise to the top.

But the free market and the fight for ratings (and advertising dollars) doesn't give us the best news. It gives us the loudest. The most "entertaining". The most interesting to the lowest common denominator. The networks (or newspapers, or blogs, or anything else) don't attempt to compete by offering "better" news. They just do more to make their product less like news and more like entertainment, which is why more than half of the news is sports, celebrities, irrelevant human interest stories, and opinion. They never respond to a dip in the ratings with, "Let's win new viewers with some hard-hitting investigative journalism!"

Competition only encourages the arms race among networks – who can provide the loudest, brightest, edgiest, most pleasingly biased content – the same way that it encouraged 19th and early 20th Century newspapers to use ever-larger headlines, lead with the most salacious picture, and make wild-assed accusations to get attention in a crowded marketplace. At the individual level, the incentive is always to push the envelope – to say ever more shocking and controversial things, to be the most outrageous and aggressive, to do whatever it takes to get noticed and land increasingly lucrative jobs higher up the food chain. All of this is incompatible with providing accurate, careful journalism about the important issues of the day.

If American journalism has ever been close to decent, it was during the era when the number of choices was limited, not infinite. When the only options on TV were ABC, NBC, and CBS – each running a scant half-hour of national news per day – the result was sober, relatively dull news. Sure, they didn't cover every important story.
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Sure, if you thought they were biased you didn't have a ton of alternatives. But is the three-ring shit-circus we have today really an improvement? Now you get to pick from a dozen different TV networks and an infinite number of websites…and almost everything you'll get, regardless of source, is crap. And the Important stories get less coverage than ever before. I'll take the half hour of Cronkite, librul bias and all.

If markets are efficient and if markets make things better, then there is no explanation for why we have the worst media in the world rather than the best. The problem is that markets don't really make things better or more efficient. They make things cheaper and they're responsive. That's why we get the news we want rather than the news we need.

37 thoughts on “COUNTERFACTUAL”

  • Out of the Park!

    Sadly, even the once revered BBC is now offering McFood style content.

    Everything is about trying to show more and more tits-n-bums. I'm looking at you Ariana with your little side bars.

    At least in the "old" days when you had to sift the bias out, you had a good idea what that bias was, and by reading between the lines you could find something closer to the truth. Now even Dr. Jenny McCarthy is given a place at the grown-ups table.

    What used to be considered hard hitting investigative journalism shows, e.g. 60 Minutes, 20/20, have devolved into a video version of the The Sun. We can thank Uncle Rupert for bringing that same kind of ethos to the medium.

    We can only hope that the fallout over his interests in the UK will spill over to Faux.

  • I think you fall into a trap with the second point in the last paragraph. From a market perspective (and I'm no economist to say the least) "better" translates to more in line with what the consumer is demanding. From this perspective the media is doing quite well.
    I would compare this to the current revolution in the music industry. In the past the pop music was considered by the majority to be the "best of the best." Now, with the proliferation of cheap recording and ease of deliver , those who want to put forth the effort to find something meaningful lyrically and stylistically can does so with very little effort. If you don't want to expend the energy to do so you can stick with the bland overproduced shit that is considered pop-music. The average music enthusiast will look at pop music the same way you are looking at the majority of the "news outlets" and ask "Why is this shit popular?"
    The answer, from my perspective, is that the average consumer either does not have the time/energy/drive to actually seek out that which is worth it. For the average person coming home after work, or trying to catch up on events during their lunch break, it is much easier to turn on CNN/FOX/MSNBC and see 4-5 stories that seem like news and feel like they gained something. This is the same as someone listening to pop radio in the car or going to some club one the weekends.
    The problem is the consumer not the market. The average consumer wants simple, easy, shit; so that's what they get. Anyone who is following your work is obviously going out of their way to get a different perspective. As sad as I feel to say this it is our responsibility to try and turn these consumers away form the easy an make them actually think about what it is that they are consuming.

    As a note: I don't mean to demean anyone for their choice of music. If you like pop music that's cool as long as you realize there's more to music than what's played on the radio (or whatever).

  • I think Brizer's got a great point. From an economic standpoint, responsive IS efficient. TV news outlets are behaving exactly as anyone would expect them to. I'm a huge fan, Ed, but I think this particular entry is based on a misunderstanding. It's like the belief that democracy is a truth machine – it's simply not a paradigm that accurately reflects reality (

    The problem is the consumer: the tastes, preferences, and behaviors of the average American. The news would provide exactly what you would consider "better" product if most Americans actually wanted it.

  • (Apparently this comment box chokes on typographic quotes, but just posts up to the first one without any indication that I needed to rewrite it with straight quotes.)

    1. Think of "efficient" in market theory like "survival of the fittest" in evolution. It's a value-free term; it doesn't mean "best." It just means a local maximum of output value relative to input costs.

    2. Most American media is primarily supported by advertising. Advertisers are the customers. Audiences are the product. The programs are a component of the production process (like fertilizer when growing soybeans).

    Media evolves deliver to its customers (advertisers) the products they want (audiences with desirable demographics) using the lowest cost inputs (effort and expense of producing programming).

  • (And in fixing THAT I lost my replacement of "output value" with "output utility" so as to avoid confusion with the other use of "value" in the same sense.

    What is with so many WordPress sites not having a freaking preview button?)

  • What Coises said.

    The internet has taught us that whenever advertising is concerned, the true customers are the ones buying ads. The "eyeballs" are the product, and the "programming" is the bait. This is why I feel so supportive towards content creators like you, Ed, who refuse to use advertising.

    It's sad that we had this in front of our eyes for so many years before Facebook, and it never reached the level of common-sense, axiomatic truth it deserves. The days you talk about of "sober" news and "dull" reporting, were those days when advertising wasn't the primary source of income (or at least was not perceived as such).

  • A few points:

    1) Coises and Brizer are ignoring externalities. The classic example of an externality is a factory which produces a lot of pollution; this may be cheaper than cleaning up, but only because the factory is not made to bear the wider costs of polluted air and water. In the case of the media, the wider cost is having most voters be completely ignorant about serious and important matters.

    2) The USA does not have the worst media in the world, or even the "democratic" world. Really. Italy is much worse — if you think Rupert Murdoch is bad, try Berlusconi. Also, the First Amendment keeps US media relatively free of direct government interference — either open censorship as in China or Russia, or more subtle effects such as draconian British libel laws, or blasphemy laws in India and elsewhere. That's not nothing.

    3) To the extent that other countries (UK, Canada, etc.) have better public service journalism than the USA, it does not come from having less choice. The UK has no shortage of tabloid trash masquerading as news. Rather, it comes from an *additional* choice, in the form of a respected, well-funded, and independent public broadcasting company. (The BBC certainly has its problems but it still does extremely valuable work.)

    4) How could things be improved in the USA? Elevating PBS to the status of the BBC or CBC would be nice but is probably a pipe dream. A more interesting alternative might be some sort of non-profit, financially independent foundation devoted to quality journalism. But the ignominious failure of Al Gore's Current TV shows that this isn't as easy as it might seem. Building up a reputation for good journalism, a loyal base of viewers, and some degree of respect from those in power, is difficult and takes time.

  • The media is efficient. They expend the least amount of effort to produce a product that is consumed by the most amount of marketable eyeballs that yield the most amount of revenue.

    Efficiency isn't your problem. The fact that this efficiency has the majority of society caught of a feedback loop of ever decreasing intellectual content and discourse to parcel out more marketable eyeballs to generate ever more revenue is your problem.

    Your problem is that we as a society don't pay enough attention to substantive quality journalism, because that has become a high cost low return commodity in which investors and shareholders have little interest, in no small part because what they investigate is often detrimental to their interests.

    And I don't disagree with any of this. The issue just needs to be framed a bit differently. Efficiency shouldn't be your target. You can concede that the market is efficient and still dislike the result of the drive for efficiency, particularly the expense saving pack mentality that has permeated mass media since the mid 1990s. The result of the quest for this efficiency should be the target of your ire.

  • c u n d gulag says:

    Back in the day, TV news was considered a "loss leader," that led the viewer into the prime time product. None of the evening news shows on the networks really made any money, in an of themselves. All of the networks had journalists working all around the nation and world – and that was expensive.

    Then came three things that changed the dynamics of TV Network news – ubiquitous remote controls, People Magazine, and CNN.

    The tendency 30+ years ago, was, after watching Cronkite or Huntley & Brinkley, to stick with that channel after the news – because we had to get up off our fat asses to change channels. And who the hell wanted to do that?
    Oh, sure, there was some great sit-com or cop-drama over on channel X or Y, but I'll stay here at Z, because the ones here aren't too bad, and I don't have to move.
    Remote's changed all of that. After the news, now people could stay on their fat asses, and go to the other channels. Since people now changed channels more frequently, now, the news could no longer be a loss leader – it had to make money.

    Then, came the People-Magazinization of TV news. Having 'entertainment' segments brought in more viewers (in theory, women) – and the more salacious (in theory, for the men), the better. After all, T&A, and manly hunk's, had a history of attracting people to buy newspapers. Why not to watch TV news?

    And then came Ted Turner, and CNN. People laughed at him. Sure, we can laugh at CNN today – but when it came out, it was a radical idea – 24 X 7 X 365 news!
    A news junkie like me fell in love.
    And then, came CNN Headline News (which wasn't an original idea – Turner mimicked a competitor), allowing people to watch a 1/2 hour news summary, like the Network news, at anytime of the day and night.
    That further undermined Network TV News.

    Right after it launched in 1980, some news channels started as competition to CNN. But all of them failed – until 1996, when MSNBC and FOX News, started up.

    And competition didn't make all of them better – it made them all more partisan, and worse at providing news, which, after all, is what they were supposed to be about in the first place.

    And, now, like the Network news shows did ever since they were no longer allowed to lose money because they were loss leaders for Prime Time, and had cut journalists and bureau's around the nation and world to save money, and included more pre-packaged entertainment in the news shows – CNN, MSNBC, and FOX followed suit.
    Competition is expensive. And it was expensive keeping journalists and bureau's all over the place, so, like the Networks, they hired on local "stringers."
    They also featured more entertainment, and started to include more and more Talking Head bloviation shouting matches. It's cheaper than hiring and keeping real journalists and editors – opinions are a dime a dozen, and every @$$hole has one.

    And, so here we sit:
    We have FOX for the Conservatives.
    Evenings on MSNBC for the Liberals.
    And don't ask me to tell you who or what CNN is supposed to appeal to? That once great channel looks like someone who was once attractive, but had so many botox treatments, and plastic surgeries, that you can't recognize them anymore – and the only thing you can say, is they look like Picasso was their plastic surgeon, if he were allowed to wield a scalpel in the operating room when he was drunk and high.

    The epitome of how bad it had become, to me, was when Anna Nicole Smith died almost 6 years ago.
    We were involved in two wars and occupations, the economy was starting to show some real strain, again, and W, Cheney, & Co, were doing some more FSM-awful things, AGAIN!, and the new Democratic Congress was trying to reign in the Beltway Machiavelli's.
    And what did our Cable TV and Network news choose to cover?
    Feckin' Anna Nicole Smith!
    The Networks covered her death in every segment – making it the lead story for days.
    And CNN, MSNBC, and FOX, all spent ENTIRE DAY'S for damn near a week on this not-even "B"-list celebrity.

    Maybe we deserve this mess we call TV news.
    But we must have been really terrible people in prior lives, to deserve what we have now.

  • @CU: So really the issue is competition?

    But to pick up the point you made about Smith, we could see that kind of shit happening even before that.

    Let me take you back in time, back to when the grass as green and ANS was the Guess girl w/ the lacey bra.

    Remember when a whole lotta money disappeared in the S&L collapse? Like how Wall St. cratered too, except are there any S&Ls today? And the FSLIC for that matter?

    Back when Papa Bush was at the levers of power. I remember reading that one of his boys was up to his eye balls as that black hole formed, and suddenly something else crops up. Funny that.

    However, how much did we hear about that? Hmmm? Oh wait you're older than a fresh faced college grad at that time, and you're talking ANS*.

    What was the red herring of the day? So did Clarence flash his tackle or not?

    Who F-in' CARES! Where did the money go that that Bush boy made disappear??


    History repeated itself.

    A Bush was in power and suddenly there's a singularity where the banking system used to be. So was it the same Bush that created the S&L singularity or a different one?

    *FYI that was a humours comment. Which is not the same as a "factual statement".

  • Thanks, gulag and xynzee; i just realized something. During my college years, my school was in a valley and cable had not yet come to campus, so I only watched tv when off campus (like over school breaks). It was the Reagan-Bush era, and what I remember most about tv at that time was a program called Hard Copy, that my elders derided as trash (and it was–pure Murdochian garbage), but was run against the local news broadcast and was winning. I do suspect that was an attempt to diminish the news' impact and replace it with pretty shiny garbage to satiate and dumb-down the masses. "Our money disappeared in the S&L debacle? Who cares–look at that supermodel bouncing around in a bikini!"

  • c u n d gulag says:

    I can't argue that there were a lot of other things that our MSM missed, long, long, before Anna Nicole Smith.
    To me, it was the focus on the death of this 'reality' show "celebrity," over any other news, that showed me how bad the TV news had finally become.

    Of course, you could say that Michael Jackson's death, was another low-point for our news.

    And yeah, Clarence did "flash his tackle" at Anita Hill. And Rush did his first 'slut-slammin',' at Anita Hill, and distracted the issue, by, as usual, blaming the victim, and making the perp seem to be the real victim. Librul media, dontcha know…

    And that son of Papa Bush, who was involved with the S&L scandal, was that notable crook, Neil.
    Right before his brother became President, and to take advantage of his coming "No Child Left Behind" scam, Neil co-founding "Ignite! Learning." And he made a lot more than chump-change off that scam.

    The Bush Crime Family has a lot it should have to explain.
    Unfortutunately, our MSM has no interest in asking them to explain. Certainly not all of them, but too many "journalists" are lazy, cowardly, compliant, or complicit. And get paid nice wages to stay that way.

    Basically, my point was that it is cheaper now for TV news to focus on anything and everything but the news, and how it affects the lives of viewers.
    News shows have to make a profit.
    And things like entertainment, or talking-heads screaming at each other, on the news, get ratings – much more cheaply than in-depth reporting.

    And the powers-that-be, the individuals and the corporations they control, have absolutely no interest in an informed public.

    And I wish I was smart enough to come up with a solution.
    But the only thing I can tell people is, don't watch the TV news shows. They rot your brain, and drain it of any critical skills.
    Try the internet.
    Check the sources that the sites you like uses.
    And use your brain.
    If something sounds too good to be true – it probably is.
    And if something seem like a lie, or someone seems like they're lying – it probably is, and they probably are.

  • Cromartie comes close to making the same point I was going to, but not quite. I would revise one word from the original post. You said, "But the free market and the fight for ratings (and advertising dollars) doesn't give us the best news. It gives us the loudest."

    Change "loudest" to "cheapest," or maybe just add it instead of changing, and then keep going. The problem isn't just the for-profit media's willingness to sacrifice decent coverage for ratings; it's their unwillingness to spend money on doing anything well in order to maximize profit margin.

  • I don't have time to read other comments yet, but before I go out the door let me underline Ed's point by connecting you to the "Top Censored Stories of 2013:"


    These are stories that the (American) media failed to cover at all, or to provide adequate coverage for, because the subjects weren't (a) entertaining enough; (b) might upset Americans' self-congratulatory worldview; (c) run counter to the best interests of the news corporation; (d) might distract from advertisers' hawking their wares.

    Where did I learn of this, you ask? It was featured at the Al Jazeera website, owned by the selfsame organization that the TimeWarner Cable monopoly in NYC gave the heave-ho as soon as AlJazeera bought the Current TV network.

  • I just went to to check what the high temperature for the day is going to be and I saw an ad for their new series premiering tonight, "Deadliest Space Weather." I told my wife, and she thought I was making it up. I haven't had cable in about 5 years, but I remember when the weather channel just showed the weather, the local on the eights. I kind of want to check out an episode of Deadliest Space Weather though, just out of curiosity, I hope they show it on hulu.

  • What Coises and LK said. You want news to serve the common good, by helping create an informed citizenry. "Markets" are not going to do that unless we build the system with market incentives that correspond to that – or just insist they do something they don't want to do. Obviously at present they don't. As I understand it, since the broadcast spectrum was considered common, public property, broadcasters were only allowed to use it if they served the common good. The News – which was never loved by the markets – was the way broadcasters paid back. I don't know the history of it, but once that broke down, we have the so-called News – which shares the same kinship to journalism that Pro Wrestling shares with athletics.

  • Another paraphrased observation from Ryan Holiday's Trust Me I'm Lying, which I'm rather obsessed with at the moment:

    The LCD, pay-per-click info economy right now is so dark and depressing that only the most craven, cynical, insensitive bastards among us would want anything to do with it on the supply side. It's why we get unrepentant narcissists for celebrities, red meat for comment-section take-down mobs instead of "news," and Shoot First in lieu of Quality Control. Anyone who still believes in dignity and nuance is hiding in the shadows.

    I realize I'm getting dangerously close to Aaron Sorkin territory here.

  • I always understood the efficiency argument to mean markets are more efficient at allocating resources productively (in the economic sense of return, not social utility pe se) than other systems, especially central planning. Perhaps the people Ed is arguing against do not understand what they are talking about, or are using a different definition than I am. In any case, our media is a spectacular shitshow and you'll never convince me it is anything but bad for our country.

  • To the 3 things gulag listed that changed network news, I would add one more: the Internet. Or more specifically, blogs. Somewhere around 2006, the morning news shows started showing funny cat videos and a lot of mommy-wars type of stories, supposedly to "keep up" with what people (esp. women) were seeking out at that same time of day online. This has evolved into segments like "Pop News" on Good Morning America and whatever Diane Sawyer's little bullet-point news-bits segment is on the evening news. And Anderson Cooper's Ridiculist. And now you can't get through the first 20 minutes of any"news" show without seeing a monkey in Ikea or a dog driving a car.

  • Purple Platypus says:

    On what may or may not turn out to be a related note, where's the Cocksucker of the Year award?

    We want our cocksucker, dammit.

  • @ what the karp, space weather shows usually come along with cheesy narration but they are FUCKING AWESOME.

  • mel in oregon says:

    markets are not fucking efficient, not for the bulk of people on the planet, not for a huge portion of the american populace. what is happening is automation & robotics are repacing labor & making workers obsolete. every adult in the united states cannot be a surgeon or a hedgefund manager. so that means a lot of people will get fucked over throughout their life. i believe that's why there are so many mass killings. they make no fucking sense, killing children & other innocents. but a wacked out evil motherfucker acts out of frustration, like a rabid animal. our system is fucked, that's all there is to it.

  • When the movie Network premiered, it was seen as a absurdist satire of a dystopian possible future. Now, I suppose, many readers cannot remember a time when the Howard Beale show would have been more than a mild exaggeration.

    Rather than say that "having most voters be completely ignorant about serious and important matters" is an externality, I would say that providing a reasonably reliable, professional source of basic news to the viewing public was a positive externality of the broadcasting system up until the early eighties. Before then, major broadcasters took seriously the Federal Communications Commission's requirement that they serve the needs of the public: responsible journalism being one of the key elements of public service. Now, of course, the FCC uses its regulatory authority to ensure that no one sees a nipple.

    There's a metaphor I like to use for a problem that frequently besets the free market:

    Why do we forbid performance-enhancing drugs in athletic competitions?

    A great part of the perceived value of athletic competition lies in its promotion and celebration of things we consider to be virtues: self-discipline, dedication, etc. Performance-enhancing drugs change all that; the most dedicated cannot win without drugs in the face of others who use them, and the competition devolves into a contest to see which individuals are willing to endanger their safety and future health the most in order to win now.

    Any competition can suffer from this problem when the rewards for success become great enough to motivate some participants to look for ways to game the system. The original virtues that made the exercise worthwhile are abandoned unless some management outside the competition sets boundaries to keep it on track; and those boundaries cannot fixed matters of principle: they have to evolve as new methods of gaming the system are developed.

    Since the Reagan revolution we've been on a steady path towards giving those who game the system free reign to be efficient in the pursuit of goals that do us collective harm instead of good.

  • Sweet jeebus, people. The teal deer are runnin' the farm today. Some of these comments are visible from space.

    A good point well made, Ed. You are in some fine form at the moment.

    At the risk of repeating your nutritionist, keep pumping out the good stuff!

  • Gresham's Law at work. That and deregulation which led to commodification. The market is now an oligopoly controlled by fewer and fewer owners with no chance that anyone can underbid any other competitor.

    There is no news, Mal, there is only the signal.

  • Major, As far as I know, at no point did the history channel focus on actual history. When cable was first available in Philly, I was excited, especially in expectation of C-SPAN. The Temple U channel had a history series that was professors and guest lecturers talking about their areas of expertise. Wonderful! The channel was axed for some stupid reason or another. I flipped on the history channel, and it was some old cowboy movie. I went to that channel many, many times, and sometimes there was an old show about World War II, usually one I'd seen before. And because WWII documentaries have been on TV since at least the 1950s, we know more about WWII than anything else in history. Where was the rest of history? The last time I saw the history channel, I think it was about Nostradamus, credulously. CNN was good then, and I had C-SPAN. But so much wasted space on TV.

    Well, now I haven't had a TV for some years. When I have to sit in front of one in a doctor's office, I get grossed out.

  • To all those saying "Hurr, but the market IS efficient, but efficiency is not the same as good! I am a clever pedant!" Thanks. For. Nothing.

    I find it similarly facile to say "the problem is the consumer". I think the broader point is that the free market, and by extension Capitalism, just does not make the world a better place. It seems to work ok for some industries, but for others it demonstrably makes things worse. And it seems like most of you acknowledge that, so I'm unclear as to what is being argued because that is pretty much the entire point.

    Maybe what you are missing is that there are a disturbing number of people in the world who hold as an article of faith, undeniable in it's truthiness, that Capitalism and the Free Market is the one and only way to make the world better. That is creates the best of all possible worlds, free of the kind of efforts implied in "the problem is with the consumers". These people are clearly insane, and must be stopped, and it is to them that arguments such as Ed presents must be presented. Not that it will help.

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