Glasgow Media Group

"REASONABLE MEN AND RESPONSIBLE CITIZENS": Economic Coverage

Just as the coverage of industry is organised around limited and conservative explanations, so is news on the economy as a whole, In this case we show how television news was organised around an account which blamed inflation mainly on wages and then linked this explanation to the political policy of wage restraint, Here again what underpins media coverage is scrutiny of working people rather than an analysis of 'normal' operations of the economy and its ability to generate crisis.

Sky High Prices

The key problem underlying Britain 's economic decline is the failure of industrial investment. On rare occasions this has been acknowledged even on the television news. In January 1975 the industrial editor of ITN made the following reference: "Since the war, Britain 's overriding problem, almost universally agreed, has been a failure to invest adequately." (ITN 22:00 21.1.75). We have already shown how this affected particular industries such as cars. In fact the decline of investment was widespread across the whole of the manufacturing sector. Between 1960 and 1972 Britain re- invested 16-18% of its gross national product each year. By comparison Japan was investing 30-35%, almost twice the rate.

In some areas the difference was staggering. While in 1978 in the summer of 1978 Mr. Callaghan was announcing a government grant at around £100 million for the computer industry, the Japanese government and industrial interests were going ahead with the injection of £35,000 million into theirs. The main reason for the long term decline of manufacturing investment in Britain has been simply that profit returns from it have been low.

Consequently those with capital have invested in other areas. This had the effect of lowering productivity relative to Britain 's competitors, and also fuelled inflation as the money found other purposes. For example, The Investor's Chronicle here describes the effect

In the summer of 1973, the government was allowing the amount of money for use in the country to expand rapidly in the hope that industry would use it to invest in new plant to produce more goods and earn more foreign exchange by exporting.

It did not work out that way, because industry was not confident that it could sell enough goods profitably enough to cover the money for new plant. So the extra money being pumped into the economy found other uses.

At first some of it found its way into buying shares where it helped to force prices up. More important, vast amounts of money were being lent by the banking system to buy property. Since property is in limited supply, the main effect was to force prices sky high.

The relative fall in investment had another disastrous consequence: it raised the serious prospect of major unemployment. Since the Second World War all Western governments had been committed to maintaining high levels of employment and to intervening in the economy to ensure that there was no return to the slump of the thirties. Capitalism was not to be abolished either by Labour or Conservative policies, but it could be modified in the name of producing social harmony. In effect what happened was that successive governments were forced to step in either to buy up the bankrupt sections of manufacturing industry or to prop up the weak sections with grants and loans. This, together with regional aid grants and indirect subsidies to industry, such as expenditure on motorways, had a major effect on government spending. In May 1975, The Observer reported that public borrowing by the government had quadrupled in just over one year to £10,000 million. In effect the government was making up for the failures of private investment. The problem was that in doing this, it was spending more on this and in other areas such as welfare spending, than it was raising through taxation. This was a major factor in the development of inflation, since the government was effectively printing the extra money. A critical problem by the mid-1970s was how to claw this money back out of the economy. The three chosen solutions were to increase taxation, cut 'unnecessary' spending on areas such as hospitals and schools, and hold down wages. At the time of our study in 1975 wage restraint was very much in the air and political figures such as Denis Healey were arguing that wages had caused inflation as a way of justifying these policies. This view was espoused by most of the right and centre of the Labour Party. The unions did not in general agree that they had caused inflation and the TUC was divided over whether or not wage restraint was an acceptable way to reduce it.

The argument that wages had caused price increases was a dubious one. It hinged on the view that wages were shooting ahead and somehow dragging prices along behind them. In fact in the whole period 1970-75 real wages had remained about the same and for the first six months of 1975 had actually fallen. In any case prices do not have to rise simply because wages do. If sufficient investment is undertaken, then productivity can increase and manufacturers can afford to increase wages and in some cases may even lower the cost of the product. Workers in countries such as Germany and France , where there are higher levels of investment, receive higher wages, yet the rate of inflation there is lower than in Britain .

The view that wages were responsible for the crisis was rejected by large sections of the trade unions, and was also criticised from the right. Monetarists in the Conservative Party blamed inflation on excessive state spending. Obviously to they did not relate this spending to a general theory of capitalist crisis. They saw the decline as coming from 'subsidised incompetence', 'lazy workers' and 'lack of initiative'. They were against subsidising weak sections of industry and saw the solution as allowing the economy to move into a slump. In this situation unemployment would force wages down and the new conditions would hopefully be taken advantage of by the owners of capital who survived the crisis. Although these policies were clearly not designed to help working people, it is the case that the theory behind them definitely implied that wages were not the initial cause of inflation. This was stated quite openly by monetarists at the Conservative Party Conference of October 1976. The policies of wage restraint were denounced as a 'con-trick' on these grounds. As early as January 1974 Nicholas Ridley (Under Secretary. for Trade and Industry in Edward Heath's Conservative government) wrote:

Contrary to the popular view, the cause of inflation is not high wage settlements but the way in which they are financed. In the public sector, wages must be paid for out of the earnings of the firm. If this is done, no inflation results. It is only when the Government pays for high public sector wage settlements or receives bankrupt companies with money that it prints, that inflation results. ( The Sunday Times, 20.1.75)

There were other arguments about what had contributed to inflation, such as the effects of oil price increases. Most economists are agreed that this had some effect, but it cannot really explain Britain 's economic problems since the oil crisis affected all Western countries in much the same way. Yet Britain 's inflation rate was higher than most.

Rampant Wages?

There were three main positions on what had caused the economic crisis and inflation, but only one of these directly blamed wages. Yet the news consistently pursued the theme that wages were the cause of inflation. Our study of the first four months of 1975 showed that on the news, statements saying that wages were the main cause outnumbered by eight to one those which rejected this view. The argument that wages were the problem was linked by news journalists to political policies such as the need for wage restraint. For example, the industrial correspondent of the BBC commented in January 1975:

With wages now as the main boost in inflation, just getting inflation down to a reasonable level seems to imply tougher wage restraint. (BBC1 21:00 20.1.75)

In this period there were 17 occasions when views were given on the news that the policies of wage restraint and lower wages were not the best way to solve the economic crisis. There were 287 occasions when the view was featured that these were exactly what was needed.

As we showed in the case of the car industry, the importance of these references is not so much in how many times they appear, but that they are used to organise coverage around limited explanations. Here again, the alternatives, where they appear, are mere fragments, while the dominant theme of wage inflation and the need for restraint is at the core of news gathering and reporting. The link between wages and prices was simply assumed in a series of discussions and reports. Month after month on the news we were shown graphs and charts to illustrate how much wages and prices had gone up. The link is a dubious one since, of course, many factors can cause price increases apart from wages. The conclusion of all these reports was that wages were ahead of prices. For example, BBC 1 informed us in one bulletin in January 1975 that "wage inflation is still accelerating sharply with earnings keeping well ahead of prices" - that "average earnings also soared" and that they were “far outstripping the retail price increases”. Such coverage was typical over the first four months of 1975.

Its conclusions are even more dubious since it is not clear that wages were in fact ahead of prices at this time. In a study of real

income published in 1976, Frances Cairncross concluded that "the purchasing power of the average male worker's earnings has been virtually unchanged for four years".

Unreliable Guides

One reason why wage rises constantly appeared on the news as if they were ahead of prices was that the official figures on these were often reported without important qualifications. These included at the very minimum the need to allow for tax and other deductions to indicate the real value of wage increases. Without these qualifications wages could be made to look as if they were "outstripping" prices. In the case of ITN on 11 occasions when they gave the figures, 6 made no reference to what real wages were. For the BBC the gross figures were given without reference to real wages on 17 occasions out of a total of 20 in their reports on wages and prices figures. The difference is clear if we compare a report which includes the qualifications and one from which they have been dropped. In its early evening news report on January 20 the BBC reported:

Meanwhile the nation's wage bill is going up faster than ever before. Official figures today show that average earnings last November were 25 per cent higher than in the same month in 1973, a record increase. Our economics correspondent says that} after taxation, the actual rise in spending power is just over 20 per cent. That is still ahead of the increase in retail prices of 18.3 per cent.

(BBC 1 17:45 20.1.75)

On the same channel three hours later, the qualifications have been dropped:

NEWSCASTER: The figures published today by the Department of Employment show that wage inflation is still accelerating sharply, with earnings keeping well ahead of prices. During 1974 basic weekly wage rates rose by a record 28½ pence in the pound. While in the year up to last November, average earnings, which include overtime and bonus pay, also soared by a record 25.3 per cent, far outstripping the retail price increases of 18 per cent during the same period.

(BBC 1 21 :00 20.1.75)

Indeed the BBC became so wedded to the view that wages were far ahead of prices that at one point it actually altered the normal way in which these figures are reported, to draw the conclusion more firmly. The usual way of measuring increases in pay is the index of average earnings. Both channels have acknowledged that this is the most reliable guide; for example, a BBC correspondent noted on 19 February 1975 that "it is the best guide that there is to the relationship between pay and prices." (BBC 1 17:45 19.2.75). Similarly ITN in comparing wages and prices figures had concluded: "This is the comparison which really counts, the average earnings of seven million workers." (ITN 22:00 20.1.75).

There is another index of wages called the index of basic weekly wage rates. This can be unreliable since it measures only

what the basic rate is supposed to be. If, for example, people are on short-time because of recession, then the figures will

over-estimate what people are receiving. This is exactly what was happening by April of 1975. Yet the BBC main news introduced the wages and prices figures for that month as follows:

Well, these figures rub in Mr .Healey's warnings about wage-led inflation, and pay rises well in excess of the cost of living. And they reveal a widening disparity between pay and prices. The percentage increase in basic weekly wage rates for the year to March is 32.5 per cent against an increase of 19.9 per cent in the latest retail price index in the twelve months to February.

(BBC 1 21:00 16.4.75)

Of the six BBC bulletins which discussed these figures (on 16, 18 and 20 April) only two mentioned even briefly the index of average earnings. The average earnings index showed that falling industrial output was holding back the rise in real income. The Times in fact commented on the day after the above BBC bulletin:

There is accumulating evidence that falling industrial output and the increase in short-time working is beginning to hold back the rise in actual earnings, which include payments for overtime and bonuses.

(The Times, 17.4.75)

Figures and information on the economy were thus organised to lay the blame for inflation on wages. The above example shows how this account was then used to 'rub in' the views of Healey.

Rubbing in Mr. Healey's Warnings

We are obviously not complaining here about the presence of Mr. Healey on the screen. It would be naive to imagine that a national television service could or should avoid reporting the views of the Chancellor. Our criticism is that the resources of the media were used to underline, develop and give legitimacy to these views. They provide the logic around which coverage is organised - they are embraced by the journalists and are constantly reiterated and given credence by being linked with apparently incontrovertible information. For example in the BBC coverage of March 1975 a speech by Healey on the 'lunacy of wage increases' is linked to unqualified figures on wages and prices.

NEWSCASTER: From the Chancellor of the Exchequer, Mr .Denis Healey, a stern warning on the effect of wage inflation, The Chancellor told a meeting of the Parliamentary Labour Party this morning that to ignore current wage rises was irresponsible lunacy. At the same time official figures were published showing that wages are now about 29% higher than a year ago while prices have risen by 10% less. Here's our economics correspondent. . .

ECONOMICS CORRESPONDENT: The gap between wages and prices is one of Mr. Healey's big problems as he plans his

budget. He said this morning wage settlements were just not close enough to the social contract guidelines and were responsible for the worst rise in prices. (BBC 1 17:45 19.3.75)

The report is consistently from the point of view of Mr. Healey. Journalists feel quite able to underline what he knows and doesn't know. Later in the same report we are told:

Last year wages did keep ahead of prices and current wages are also doing so, for thousands of workers in many trades, getting rises of 35 and 40% above a year ago. Mr. Healey knows this can't go on.

It might be noted that thousands of workers were not receiving such increases. The Times reported in August of that year that average earnings in the first six months of 1975 had fallen in real terms by 10%. In the above bulletins the correspondent's claims on the effects of wages were followed by further references to what Mr. Healey wanted. After these is what amounts to a throw-away line referring to alternative views on the economy:

He (Mr. Healey) wants more modest wage deals and better output per man. Without it he forecasts prices will be rising twice as fast in Britain as in those countries competing with us. The message from the Chancellor called for belt-tightening and the party meeting rejected a call from the left-wing Tribune group for an opposite give-away budget. This afternoon MPs were gloomily forecasting higher income tax. (BBC 1 17:45 19.4.75)

A whole tradition of Keynesian economics is here reduced to a call for an "opposite give-away budget". There are no reports

or information included to make sense of, or to underline, Tribune view. What there is here is an illusion of balance whereby statements are included from what appear as different sides. But the reported views have a totally different status, legitimacy and meaning in the text. Only one set 'makes sense' in that we are systematically given the information necessary understand the explanations and policies to which they relate. When the budget did appear a month later, it was presented the news as if it were a necessary response to the inflation had allegedly been caused by trade union activity. On ITN example, it was introduced as follows:

Good evening. In the toughest of budgets the Chancellor, Mr. Healey, has fired a broadside at all those who have taken high pay rises. These, he said, were the main cause of the present rate of inflation.

(ITN 22:00 15.4.75)

We may ask who were "all those who had taken high pay rises". ITN had reported in the previous month that according to the government, 75% of all pay rises were being settled within the social contract. Most of these workers had in effect taken wage cuts.

The effects of the budget of that year were in fact heavily deflationary. It increased taxation and was designed to claw back money out of the economy. This was a bitterly controversial move: the unions predicted that it would massively increase unemployment. A justification and rationale for the budget were thus essential for the government. A series of reports was released from official sources, such as the Bank of England and the Price Commission, and these were used in the media to underline the necessity of the Government's position. The report from the Price Commission appeared shortly after the April budget at a critical moment in the arguments. This was covered intensively on both channels. The message on wages and

inflation was clear:

NEWSCASTER: And now the economy. Prices in Britain rose at their fastest rate ever between December and February, mainly due to high wage settlements, according to the Price Commission report published today. In three months up to last December, the Commission approved an average of £.350 million in price increases each month, particularly in nationalised industries, but subsidies started to be phased out and the big pay increases started to push labour costs higher, the Commission were forced to allow an average of £1,105 million in increases each month between December and February. This quarterly figure is about as large as the previous nine months combined. Well, here with a report is our industrial correspondent, Giles Smith.

GILES SMITH: Today's message from the Price Commission is grim and it's no less grim because it's not a new one. Inflation is now rampant and, according to the Commission, wage inflation is almost entirely to blame. Ominously, they say the pace of the prices explosion has so far been understated. In the three months covered, the retail prices index went up 5.8 per cent, wholesale prices 6.5 per cent, but the Commission's own index, which should be more up to date, rose 7.5 per cent. For this the Commission firmly blame wage-cost increases. (ITN 22:00 29.4.75)

ITN reported the Commission as saying that wages were "almost entirely" to blame for inflation. The BBC that night actually put a figure on the precise effect of wages. They reported that "between 60 and 75 pence in the pound" of price increases came from wages. Such a heavy and unqualified repetition of the theme of wage inflation seemed extraordinary, given the alternative evidence that real wages (for most workers) were probably falling. When we examined the actual document that the Price Commission published it was apparent that it blamed inflation on a range of factors including, for example, the increases in oil prices. It estimated the precise effect of each factor on price increases. The Commission had calculated that the direct contribution of labour costs to price increases was only 20%. Yet both ITN and the BBC reported the effect of wages as massively above this. We were curious to see how this disparity had occurred. The reason was that the Price Commission had estimated upwards its own figures for the effect of wage costs on prices.

According to a report in The Financial Times the following day, it had done this in two ways. Firstly, in its revised figures, the Commission had removed the effects of oil from the calculation and this had put the contribution of wages up from 20% to 30%. Secondly, they introduced the concept of 'indirect wages', on the grounds that everything, even raw materials involved a wage element.

Of course such a very general conception makes the precise calculation of exactly what is happening to wages very difficult if not impossible. Nonetheless the Price Commission concluded that the effect of 'indirect wages' could be calculated by multiplying the figure for the direct effect of wages by "probably two to two and a half times". The BBC had presumably arrived at its own figures by multiplying the figure of 30% (which was wages after removing oil) by two to two and a half. Whatever the logic of all these calculations they become simply absurd mathematically at this point. Percentages cannot be multiplied by fixed amounts in this way. Both BBC and ITN were in grave danger of having more percentages than would fit into a hundred. They had given such high figures for the effect of wages that all the other factors could no longer be fitted in. The logic of the report was that well over a hundred per cent of all price increases now came from wages, oil, and all the other factors.

These figures were indeed attacked the next day in the press - from both right and left. The Daily Telegraph argued from a monetarist position that wage increases "are not themselves the cause of inflation" and blamed the problem on government printing money. The Morning Star attacked the calculations in detail and argued that the Price Commission had used "highly dubious arithmetic and reasoning".

Given the history and established traditions of the television news it would be naive to think that journalists would be allowed to attack such an 'authoritative' source as a government commission. It would be inconceivable to imagine the news beginning with: Good evening, with highly dubious arithmetic and reasoning the Price Commission has claimed tonight that wages are almost entirely to blame for inflation." Yet by the standards of impartiality and neutrality which broadcasters lay claim to, the reporting of such documents is totally inadequate. In the case of the Price Commission report at no point in any of the bulletins was there a comment on how the high figures for the effect of wages had been arrived at, and at no point is the information given that the proven figure for the effect of wages was only 20%. This figure in fact represented a decline in the effect of wages on the previous quarter, which was again not reported on the news. On both BBC and ITN the highest possible estimate of the effect of wages on inflation was taken. The media here are not merely reporting the views of important people, but are actually developing them. The journalists feel able to step into the minds of senior civil servants and tell us what they are thinking or who is to blame. The above report on the Price Commission was followed on ITN by a list of the culprits:

As the Commission Chairman, Sir Arthur Cockfield, states, "taking industry as a whole, the primary factor causing wages to rise is and can only be rising labour costs." Well the sort of wage rises the Commission is thinking about are those in the 30 per cent plus bracket and today there came another: the 11,000 London dockers who were on strike for 5 weeks just a while ago were today offered and accepted a pay deal which averages out at well over 30 per cent. On the face of it well outside the Social Contract guidelines. Tonight, too, a new threat from the electricity power engineers to strike in support of a 33 per cent pay claim. (ITN 22:00 29.4.75)

The shots of the dockers at a mass meeting function simply as 'wallpaper' over which the commentary about their pay award is read. No docker is asked to comment on the views of the Price Commission. The 'authoritative' source takes precedence, and the shots of the meeting stand in sharp contrast to the picture of the Commission Chairman and the high status which is given to his words.

The content of the news is organised in such a way that coherence is given to only one set of explanations and policies. What we are indicating here is not isolated pieces of 'bias'. The problem is much more profound than this. The logic of one group of explanations is built into the text. This logic dictates the flow of information, the range of accounts and the legitimacy that is given to these. In the case of economic news, the premise that wage increases have caused inflation and the economic crisis is followed through to the conclusion that wage restraint and higher taxation are necessary. This item from BBC 2 News Review summarises this position:

Now home, and as you know this week there's been a lot of heavy news on the country's economic front. Two figures from the week give the real story. Everything else in one way or another is reaction to those figures. One: prices rose in the last twelve months by the biggest ever increase, 21 per cent, Two: wages rose in the last twelve months by a far greater figure, 32 per cent. The Chancellor for one regards that extra 11 per cent on wages as the main cause of inflation. His answer, as we saw in the budget on Tuesday, is to take the extra money away in taxes.

(BBC 2 18:15 20,4.75)

A synthesis is thus made between a restricted and narrow economic explanation and the political policies that apparently flow from it. When this economic view is pursued the logic of who is to blame is inescapable. It seems perfectly natural to monitor wage claims, rather than the actions of those who own capital. This becomes so routine that journalists could dispense with apparently emotive terms such as ‘excessive'. They have only to say, “and tonight another wage claim”, foe everyone to know what they mean and at whom the finger is being pointed.

In fact journalists do sometimes use emotive terms and make their attitudes to trade unions quite clear. In the following interview, an ITN newscaster asks a trade unionist from the National Union of Bank Employees about their wage claims:

INTERVIEWEE: Our job as a trade union is to maintain the purchasing power of our members' salaries and that's all we're trying to do with the pay claim that we've now formulated.

ITN PRESENTER: But as reasonable men and responsible citizens can you say that's all you are trying to do and all you are interested in when you hear warnings from the Chancellor to the effect that increases of this sort are going to wreck the national economy?

Two months later the, same newscaster is pursuing the same theme - this time with the General Secretary of the train drivers' union:

Can we look at your claim you've already got in; you see, I mean, , you said to one of my colleagues not long ago on this programme that this claim was likely then - this was in February - to be in the range of 25 per cent to 30 per cent; now, you see, that is already between 5 percent and 10 per cent more than the rise in prices and it's just this excessive demand above the price rise that Mr. Healey was saying was endangering our whole national economy.

(ITN 13:00 16.4.75)

Wage claims in the period which we studied were carefully monitored and examined on the news to see whether they were acceptable on the terms that were being set by the government - whether they were inside or outside the social contract. The most dire warnings interpenetrate such reports of wage claims. In this example we are unable to hear what the miners are doing without being told what Mr. Healey would think about it:

The Chancellor of the Exchequer, Mr. Healey, has warned again of excessive wage increases as the miners start negotiating on their claim for up to 43 per cent. Mr. Healey said in London tonight that Britain could be bankrupt if the national wage bill were too high this year - but it needn't happen if the workers stuck strictly to the Social Contract. During the day the Coal twice increased their offer to the miners, mainly to the benefit of those working underground.

(BBC 1 21:00 11.2.75)

The monitoring of pay claims and their 'acceptability' was consistently from the Healey point of view. At the time of our study the Social Contract was supposed to mean that wages should go up by about as much as the cost of living. In other words wages should not rise in real terms, but neither should they fall. But on the television news the Social Contract was deemed to have been broken only in the sense that workers were thought to have received 'too much'. There were cases in this period in which working people took wage settlements which could not possibly have kept up with the cost of living - which were in fact wage cuts. These were reported merely as being 'inside' the Social Contract. There were no fears expressed by television journalists on no Chancellors were questioned on the breaking of acts of faith.

In subsequent years it became impossible to sustain this impression of wages soaring above prices. Living standards

began to fall quite dramatically in many employment sectors. An analysis of the four years after 1975 demonstrates this, even if wages are taken in gross terms. In real terms, living standards fell between January 1975 and January 1977 by approximately 10 per cent. A study by us in 1979 showed that by then, wages and prices figures were being reported quite differently. They were still reported, but separately - without comparison. For example, the BBC reported on 14 February that the latest figures from the Department of Employment meant that most settlements were "around 10 per cent". Two days later, the same programme (BBC l's Nine O'Clock News) carried a report on prices which said that "inflation could be back in double figures by early summer". The BBC did not report that for the low paid, the inflation rate would be even higher than the official figure suggested, since the cost of basic essentials such as food tends to rise faster than the general level of prices. Nor did the BBC point out that by the time tax was paid on the new wage settlements, living standards would continue to remain low and would probably fall for some groups. Direct comparisons of wage and price levels were now significantly absent.

If such comparisons had been broadcast, they would have shown that wage increases at the time were, on average, barely ahead of prices. Far from there being any 'wage explosion', these settlements had no hope of recovering even the real income levels of 1975. There were no headlines to announce that fact, nor any which linked 'official' figures, showing the fall in real income, to the industrial unrest of 1979. The television news used official information to criticise the trade unions for their alleged effects on the economy and government policy. But the same figures were not used to draw conclusions which might be damaging to government policy, or which might question its economic logic or validity.

Though the precise content of the news changed between 1975 and 1979, the organising principle remained the same. The news was still presented from the point of view of the government's pay policy: 'Good News' was measured in terms how well this was doing. So instead of comparing wages with prices, the BBC on 14 February 1979 compared them with earnings in the preceding phase of the pay policy.

In a similar vein, ITN reported the new earnings figures as follows:

The authorities were happy to announce two bits of economic news today. First, Britain made a profit of a million pounds last month; they'd thought the balance of payments might be much worse because of the lorry drivers' strike - but it wasn't. And second, the official figure for earnings is that in the five months until the end of December - that's the first five months of Stage Four - they rose by just 3.4 per cent. That included the Ford settlement, but the total of workers settling was only a million.

(ITN 22:00 14.2.79)

Only a million? With such a small number, apparently, ITN could not find any of them to see if they were as 'happy' with the figures as the authorities were. Two days later ITN juxtaposed their report on retail price increases with a NUPE pay claim:

… the government will be able to say that the increases in basic rates which the unions are resigned to, have been kept to a strict nine per cent - and that amounts to a significant morale booster in the battle against inflation.

This assumes not only a direct link between wages and prices as the source of inflation, but also that the battle to be fought is

against wages, rather than, for example, against unemployment. And for whom are these figures supposed to be a "morale booster"? Many economists believe that allowing wages to fall in real terms must produce high rates of unemployment. There is no single analysis which everyone accepts. The Financial Times noted (8.2.79) that while some experts suggested higher wages would produce real growth, others argued almost exactly the reverse.

It is only because the BBC and ITN argue consistently from one point of view that they are able to use concepts such as million 'wage inflation' and its 'dangers' quite uncritically, and to express .hopes and fears from within such partial and limited assumptions. What is reasonable and what is excessive is determined, from within the same limits. An interview with the Prime Minister on BBC 1 s Nine 0 Clock News (8.3.79) was introduced with these words: "Mr. Callaghan has been concentrating, a lot this week on the government's stand against excessive pay claims.” It would be difficult to such an uncritical reference to trade union policies - for instance that they had been 'concentrating a lot on getting a living wage for their members'.

On News at Ten the same day, Mr. Callaghan was reported in the headlines as saying: "There's no more money." In the interview itself, which was shown on both channels, he commented: "You can't get more money out of the bank than there is in it." The interview was reported in conjunction with the government's decision to restrict credit by putting up interest rates. An ITN reporter underlined the whole message by declaring that the decision "reinforces the government's determination to stand firm in the face of mounting pay claims. Mr. Callaghan won't print what he calls 'confetti money' to finance these claims."

At no point in this coverage were any of the government's economic assumptions challenged. In the interview, there are no interruptions; nor do we see any questions put to Mr. Callaghan on the news programmes of either channel. He gives his message. unchallenged, direct to camera. Yet within the current political and economic spectrum, a wide range of critiques was available. On the same day as this interview, The Financial Times argued that the government's pay policy was a series of 'ad hoc stop gaps', with each year's limit having no special coherence. Just three days earlier, on 5 February 1979 , The Financial Times had attacked the very calculations which were being used to relate wage increases to inflation and unemployment.

While there is no sustained critique on the television news of the 'official' figures, or of the views of the 'authorities', there are severely critical analyses of calculations and claims made by other groups such as trade unions. Perhaps there is a fear – felt by the BBC and the IBA alike - of offending the powerful. 'A million workers' can be dismissed without worrying about the consequences, but the Cabinet, the Bank of England and the Treasury are altogether more immediate and potent forces. But such coverage leads inexorably to the view that working people are responsible for the crisis and that it is acceptable that they should pay for it. Alternative ways of understanding the crisis and other possible ways of resolving it are excluded.

In the next chapter we look at how journalists intervene in political coverage to establish this view of the world.

Figures from D. Yaffe, ‘The Crisis of Profitability', New Left Review 80, 1973

C. Evans, The Mighty Micro , Victor Gollancz, London , 1979, p.93.

The Investor's Chronicle, Editorial, 11 September, 1974 .