There is an ongoing refrain in economic reporting that the European welfare state is an outmoded relic that is dragging Europe into an economic abyss. It's a very compelling tune, since it gets repeated endlessly by "experts" who pretend to know what they are talking about. The only problem is that there isn't really any evidence to support the story. By most standard economic measures Europe is doing about as well as the United States. On the most basic measure of economic prowess, productivity, Western Europe is pretty comparable to the United States with some countries, like France, actually reporting somewhat higher levels of productivity. But that story rarely finds its way into media coverage of Europe. That is why it is amusing to see a major NYT story complaining that Germany exports too much. Yes, that would be Germany, the country with a generous welfare state, 5 weeks of paid vacation every year, strong unions, and all those pesky regulations that are supposed to make it...

The reporting on the revisions to fourth quarter GDP noted that the growth rate was revised up from 5.7 percent to 5.9 percent. However, this increase was attributable to revisions to the rate of inventory accumulation (actually slower de- accumulation). The rate of final demand growth was actually revised down from 2.2 percent to 1.9 percent. This bad news went largely unnoticed. --Dean Baker

Fannie Mae and its sister institution Freddie Mac buy mortgages from banks. That is what they do. This means that when Fannie and Freddie lose money, they paid banks too much money for the mortgages. This point should be so simple that even an economist could understand it. This is why it is disturbing when news articles on Fannie's newly announced loss of $15 billion in the last quarter don't point out that this is money given to banks. The key issue is whether Fannie and Freddie's losses are due to mortgages and mortgage-backed securities purchased prior to their takeover in September of 2008 or whether they are the result of mortgages purchases subsequent to that date. If the latter is the case then the Treasury Department is effectively using Fannie and Freddie to run a TARP program, purchasing mortgages from banks at above market prices. This amounts to a huge taxpayer subsidy to Jamie Dimon, Lloyd Blankfein and our other favorite bankers. --Dean Baker

It is not the job of reporters to just report what partisans to debates say about events. The vast majority of readers do not have the time and background to assess competing claims. When one party says something that is not true, the news is that this person is lying, not their lie. Therefore when the Post told readers that Michael Morris, the chief executive of American Electric Power said that cap and dividend rules "would take money from 'mom in the Midwest and dividend it to Paris Hilton,'" it was not engaged in serious reporting. The bills being considered would tax carbon emissions and dividend them to low and moderate income families so that they are largely protected from price increases. Unless Paris Hilton loses her inherited wealth, she would not be a recipient of this money. The Post should have reported that the chief executive of American Electric Power felt the need to make things up to advance his case against restricting greenhouse gas emissions. Most readers of this...

The number of unemployment claims filed last week jumped by 22,000 from the prior week. USA Today told readers that analysts expected that claims would fall by 19,000. It is hard to understand why anyone who analyzes economic data for a living would have expected unemployment claims to fall from the prior week. In that week heavy snowstorms on the East Coast had made it difficult for many workers to get to unemployment insurance offices and in some cases even forced their closing. It should have been obvious that claims would jump last week as people prevented by the weather from filing earlier would turn up last week. That is why the relatively high level of claims reported two weeks ago should have been given more attention . --Dean Baker

The WSJ told readers that Democratic senators claimed that the employment tax credit in a job bill passed by the Senate would create 1.3 million jobs. It then added: "but some independent economists said they expected it would have less impact than that." It would be surprising if any independent economists believed the tax credit would create even one-tenth this many jobs. Every month, roughly four million workers leave or lose their job. Employers hire roughly 4 million workers to replace these workers. (The job growth/loss number reported every month is a net figure, which is the result of this massive churning.) The vast majority of the 4 million workers who are already being hired every month would qualify for the Senate's tax credit. This means that the overwhelming majority of the money would be paid out to firms that are hiring anyhow. Since the incentive provided by the credit is small, there is little reason to believe that it will have any noticeable effect on employment...

Some folks at the NYT seem to think so. The paper published a blogpost telling readers: "Mr. Obama has directed the commission to recommend by Dec. 1 how to balance the budget by the fiscal year 2015, not counting interest payments on the debt, as well as to propose long-term changes in revenues and entitlement programs to avert fiscal calamity." I wonder if the words "fiscal calamity" appear in the formal charge of the commission? As always, those who follow the news know that the real story is health care, health care and health care , which is why serious people focus on fixing the country's health care system. --Dean Baker