Media’s approach to economic issues
By: Asad Umar
THE media has played a pivotal role in improving the public’s awareness about economic issues.
Thanks to the media the citizens have become aware of what is happening to the nation’s economy and what shape public policy is taking.
However, the way media is covering economic events is also in my opinion hindering good public policy and reducing the probability of structural reform taking place rather than increasing the chances of it happening. Perhaps the media should reflect on whether their coverage of economic events is serving the public interest.
The most insidious manner in which the media’s coverage is resulting in poor public policy choices is what I call the upper middle-class urban bias of the media (declaration of conflict of interest … I belong to this economic segment myself!). Any difficult decision taken by the government to deal with structural issues of the country is met by shrill voices in the media supposedly on behalf of the ‘aam aadmi’.
Take the example of the hundreds of billions in subsidy being doled out to the electricity sector. There is no doubt that a large part of this subsidy is caused by the corruption and incompetence of the decision-makers in the shape of non-collection of bills, theft of electricity, severely degraded generation, transmission and distribution system, wrong fuel choice etc.
There is also no doubt that a big part of the problem is the run up in global energy prices and our unwillingness to recognise that reality and pass on the cost to the consumer. The whole media discourse is about the ‘awaam par bojh’ of the increase in tariffs and hardly any discussion about the fact that the poorest half of the population barely consumes any electricity and the vast majority of them do not even have an electricity connection.
However, they are paying a steep and highly regressive tax in the shape of double-digit inflation which is being caused in large measure by the massive fiscal deficits. The jobs lost due to electricity shortages are also those of the poorest and most vulnerable, the daily contract labour.
Hence, by opposing measures which reduce the subsidy and lower fiscal deficits, the media is helping prop up the status quo which is decidedly anti-poor.The story of gas is the same. We are giving away this precious resource at one third the value at which we are meeting the incremental energy needs of the economy through costly imports. As a result, on the demand side, everyone is rushing to grab hold of this under-priced energy source.
On the supply side, this has resulted in drilling activity way below what the country needs and way below the hydrocarbon potential of the country. If you had to invest your money for gas discoveries in a country where you would get full value versus less than half that value, where would you invest?
As a consequence, the economy is bleeding with some sectors seeing steep price increases caused by shortages and others seeing thousands of units shutting down and millions of jobs being lost.
However, when the petroleum ministry proposed the first fairly modest move towards pricing gas close to its real value to the economy, there was virtually no one in the media who stood up to support the courageous decision to do what is a dire need of the economy. As a result of resistance from directly affected interest groups and no popular backing of the media or the public, the initiative got stalled.
Which leads us to the second aspect of media reporting which is resulting in poor public policy choices. The media plays a very positive role of criticising what is wrong. However, it is far less keen to stand up and vigorously support the difficult public policy choices required desperately for dealing with the structural problems facing Pakistan’s economy.
This is not just restricted to the media’s own opinion or editorial pieces but also the reaction from the public that they report.
In a situation where opinion is divided by and large the media reports more of the negative opinions expressed rather then the supportive ones.
The third aspect is the media’s focusing on individuals and corruption as opposed to the institutional and structural. The unintended consequence is that it forms an opinion amongst the citizens that there are easy and pain-free options available for reforming the economy. As a result, the constituency for reform stays limited and powerless.
In a democratic environment where public policy is, and should be, influenced by public opinion, this media behaviour creates an anti-action bias on the one hand.
Since if you take a difficult decision and the media does not like it, you will be castigated for it and if the media likes it there will be, at best, muted support, the rational response is not to do anything. On the other hand, it strengthens the hands of those who oppose reform in government and weakens pro-reform elements within the government.
In conclusion, I would state that if the media made changes to the way it deals with economic issues, it would become a formidable agent of reform that is badly needed. Firstly, it needs to be more aware of the impact of different policy choices on the different economic classes and champion the cause of the most vulnerable and poorest segments of society.
Secondly, a balanced editorial policy and reporting, which uses both the carrot (support and praise) and stick (criticism) to encourage difficult but necessary public policy choices and discourages poor policies and flawed implementation, must be developed.
Thirdly, by placing more emphasis on structural issues it can help strengthen the pro-reform constituency in the country.