The Role of the Media in the Economy

Many different sources have been blamed for the economic downturn but, the media can be blamed for its continuation.

It seems that every time you turn on the news there is something about the economy. A new government spending plan, another company declaring bankruptcy, or a drop in the stock market. All of this negative coverage of the economic downturn may be keeping the economy from bouncing back as quickly as it would have without the influence of the media.

You may or may not know that the economy will be helped by additional spending. Every time a dollar is spent that dollar helps pay investors and employees who will then use their earnings to buy more goods or services and their spending will pay more investors and employees. This circular way the economy works also explains why the economy is spiraling downward now. Because people are afraid of what is going to happen with the economy they are saving their money. When they save their money, they don't spend it and the employees and investors don't get there share of the money.

The media is unintentionally contributing to the fear which is preventing spending. All of the reports on the downturn of the economy and all of the negative statistics about the economy causes people to save their money. If the bad news about the economy was not as widely reported then people would be more likely to increase their spending and bring the economy back up to a more comfortable level.

The media cannot necessarily be blamed for their reporting on the economy, as it is expected that the media cover all stories. Because of the economic downturn the economy is one of the most important things to may people and it makes sense for the media to provide coverage on it. This is just one more way in which it becomes much harder to bring the economy back out of a recession.

There is no easy solution for this because it is not possible to stop coverage of the economy. However, it may help if there were more positive aspects in the economy reported, even though they will be harder to find. Also, if people understand that their spending will help the economy improve, they might not be as discouraged by the economic news stories. Consumers just need to keep in mind that if they do more spending the money will make it back to them as employees or investors.