Paradigm Shift: Don't Read Today's Newspaper, Read Yesterday's

Posted by Greg Allen on 09.04.2007

One often hears that hindsight is 20/20. Why is it then, that newspapers are full of predictions and fuzzy foresight? If you want to understand how to discern which of those modern predictions are garbage, read the old ones. 411's Greg Allen tells you why you need to start looking through the archives.

You know, I've always wished more people would follow the news. I really do. There are few things that would please me more than being able to say I live in a country with lively and intelligent political debate and an overall informed citizenry. However, a close second to the wish that more people would read modern happenings is the wish that more people would study the occurrences of the past, and more importantly, how people viewed those events when they were contemporary. What I'm trying to say is, I wish people would read OLD newspapers as often as they read the new ones.

Okay so that sounds a little crazy, but hear me out. Much of the news that people read day in and day out isn't actually news, it's prediction. In other words, much of the information that people are consuming are extrapolated trends about what the future is going to be like. Of course, the newspapers from ten and twenty and even a hundred years ago were also chock full of pundits writing about what the future held.

So why is that so important? Because those pundits are very very very often very very very wrong. People say stock prices are going to go up and the prices go down. People say one program is a great idea, and it turns out to be a colossal waste of public cash. Other people say that history teaches iron clad lessons and it turns out history still has a few surprises up its sleeve. The point is crummy predictions are still published as often as good ones, and if you want to learn how to evaluate current predictions, there's no better teacher than predictions made in the past.

As an example, take a look at this New York Times Editorial piece about the European adoption of the Euro from the back in May of 1998

"But a single currency also poses risks, because it robs countries of control over their own economies. If the French economy takes a nose dive, the Government can pump in francs, devalue the franc or cut taxes and raise spending. But under the euro, France would have no francs to inject into the economy or to devalue and would operate under rules that severely limit deficit spending.

Unlike the United States, where citizens commonly move from one state to another in search of economic opportunity, Europeans are unlikely to migrate to countries with different languages, cultures and laws. If the French economy slows, and the European central bank does nothing because the rest of Europe is thriving, the French may be resentful. A policy designed to unify Europe could intensify divisions instead."

The New York Times is undoubtedly one of the best newspapers on the planet, but that doesn't mean they haven't analyzed situations improperly. "If the French economy takes a nose dive" is more or less useless because the countries within the European Union are so interconnected that it's unthinkable that France's economy should take a dive that did not also make waves in the rest of the Union. "Citizens are unlikely to move"? Who were they kidding? If people don't move for economic reasons, then why are the French now complaining about surplus immigration and the dilution of the French language? As far as intensifying divisions goes, no one over the age of twelve could imagine France taking any kind of malicious action against another member of the EU because every way they might hurt another member would inevitably end up hurting France. Long story short, the Euro has ensured that the Chancellor of Germany loves watching the French economy grow, and vice versa for the President of France.

In hindsight all of these arguments seem patently obvious, but at the time there was impassioned debate about whether or not the Euro actually had anything to offer the economies of Europe. But by analyzing the flaws in the Times' predictions and others, we learn tricks that can help us evaluate contemporary claims about the future. I'm going address two conclusions I've come up with from reading old newspapers, but in truth, I think they are best learned individually through constant study.

First, there is a bias towards extremism. I recall a conversation I had with the Editorial Board of the Saint Louis Post Dispatch last year. There, Eric Mink, a nationally syndicated columnist asserted that newspapers have as their competition anything that consumes time—including brushing ones teeth. To an extent he's right; competition, even more so in a digital age, is rampant within the news industry. With many papers folding up across the country, news organizations have increased their focus on the sensational (Paris Hilton etc) but they've maintained and expanded a focus on the types of people whose predictions are the most jaw dropping. Ask yourself, why is it that there are hundreds of scientists in the media railing that Bird Flu could be a disaster of epic proportions, but they have to be prompted by questions from the audience before they talk about the odds of that disaster. (Note: this is not me commenting on the Bird Flu issue.)

Second, lots of somebodies are in somebody else's pocket. Imagine that all the Airline companies jointly decide to raise prices by one dollar per flight. To most American flyers, such illegal collusion would go unnoticed, and even if the scam was noticed, it would cost far more than a dollar in order for the consumer to take legal action against the company. The result is that companies (who have to coordinate the actions of very few actors with much at stake) are far more passionate than most people (who have to coordinate the actions of a great number of actors who each have very little at stake.)

That sort of mobilization dichotomy can often show up in the information gaps of the media. Since wealthy wrongdoers have much to lose, they're willing to spend a lot in order to get public opinion on their side. Ask yourself why Americans love agricultural subsidies so much. Is it because farming is a crucial part of America's heritage? Or is it because gigantic agricultural conglomerates are spending hundreds of millions of dollars to make it seem like robot combines are a crucial part of America's heritage? It takes an awful lot of effort to properly "follow the money trail" in current events, but one can almost always discern what's at stake for some people. Even though the Euro was great for France and for the European Union, and it was possible to foresee this before its adoption, there have always been powerful people with a lot to lose from the Euro. One can forsee the types of arguments they would come up with to falsely user public opinion. Oh wow, they seem a lot like the arguments that the NYTimes editorial board eventually bought into. (Note: I am not asserting that the Times is in the pocket of rich Frenchmen. They probably just accepted the arguments of those Frenchmen because they didn't do enough to foresee the lies.)

There are some arguments that have been recycled almost verbatim for centuries (see everything ever written about standards of decency), but while it might be tempting to discount arguments on those grounds alone, unfortunately one must do more work. For example, people have been arguing for decades that the United States deficit will collapse the economy. It hasn't so far, but that doesn't mean it still couldn't in the future. One must analyze why deficit predictions now are different from those in the past in order to be able to speak confidently about an older prediction's current relevance. It's all rather convoluted, but I assure you it's very worthwhile.

There's one more lesson to be learned from reading old newspapers, and that's that most of the problems we deal with today have their roots in the past. President Nixon spoke against our "Dependence on Foreign Oil" (in fact he may have been the originator of the phrase). Jimmy Carter campaigned for Energy Independence. These are problems that have been given nothing more than lip service for decades. Shouldn't my car be running on hydrogen by now? Unless you become a student of the past, you're equally likely to mistake lip service for genuine action.