Germany’s economy did worse than the U.S. economy last quarter, but liberal journalists are convincing the public otherwise by playing number games.
These journalists are showing that they don’t understand economics, math, or calendars — or that they care more about attacking President Trump than they care about telling their audience the truth.
We had a horrific quarter economically thanks to the coronavirus and 50 states shutting down businesses. The economy shrank by an astounding 9.5%, which at an annualized rate is 32.9%. That is, if four quarters in a row were as bad as last quarter, our economy would be down 32.9%.
We could argue about whether newspapers and cable shows should lead with the 9.5% quarterly number or the 32.9% annualized number (I’ll get to this below), but there’s no argument over this fact: An honest journalist cannot choose the bigger (annualized) number for the United States and the smaller (quarterly) number for Germany in order to argue that Germany is doing better.
Yet that’s exactly what CNN anchor Chris Cuomo did last night.
“We were down almost 33%, and of course, the reason is COVID.” Cuomo began. That’s slightly misleading, but for a moment, let’s give him a pass on sloppiness. From there, he said, “But it’s how this president mishandled COVID. What’s the proof? Lots of countries are dealing with COVID, right? Why are we down almost a third of our GDP growth, and yet Germany was down 10%?”
This is utterly misleading and actually backward.
The U.S. economy shrank at an annualized rate of 32.9% last quarter, while German’s economy shrank at an annualized rate of 34.7% — which is worse. Alternatively, if you want to scrap the annualization and just look at the second quarter on its own, the U.S. GDP shrank 9.5% while Germany's shrank 10.1%.
So if Chris Cuomo thinks GDP shrinkage is the scoreboard for who did better on COVID-19, it’s Trump: 1, Angela Merkel: 0.
Imagine a Germany versus U.S. baseball game in which Merkel and Trump were the starting pitchers. If after three innings, Merkel had given up three runs while Trump had given up two, Cuomo might say, “Trump’s ERA is 6.00, but Merkel has given up only three runs.”
I don’t think Cuomo was intentionally lying. You see, European countries tend to report quarterly, nonannualized GDP numbers. In the U.S., we have a custom of annualizing those numbers.
And Cuomo wasn’t alone in seeing the 32.9% annualized number and telling the world that the economy actually shrank by one-third. Brian Williams did the same thing.
The result of this misleading reporting was many misled readers.
Again, we can debate the best number to use. In almost every case, I think the annualized number is better, especially because in the U.S., readers are used to seeing that number. In extraordinary cases that you know will not repeat themselves quarter after quarter, I think we should report both the quarterly and the annualized numbers. (A quarter in which millions of businesses went from open to closed won’t happen this next quarter since so many businesses started the quarter closed.)
My colleague Tiana Lowe, I believe, did it perfectly here, including both numbers in her first sentence.
A final note: There’s a case to be made that Trump’s coronavirus response is worse than, say, Merkel’s. You could measure that by looking at our economic rebound — or our per-capita deaths. But if GDP is your scorecard, Trump won.
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