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The language economy and the credit crisis

These days, we’re all talking economics - but most of us aren’t fluent.

When the story of the day is veiled in jargon, the journalist must become more dilligent in his or her efforts to serve readers bite-sized, well-considered stories. According to Geoffrey Geuens, journalists have done little to ease their readers’ digestion. In fact, Geunes says, journalists are perpetuating a culture of misunderstanding in the current credit crisis.

Journalists have employed an incorrect rubric of language to describe the financial crisis, Geuens says, and are responsible for a world of misinformation.

“It is important to show that journalists are using words that don’t [belong in the stories] they write,” Geunes says. Words like ”nationalisation”, terms like “the globalization of power” and “the state entered the market” should be left out of reporting on the American economy altogether. According to Geuens, journalists use these words completely unaware of the consequences.

Interlocking boards

Geuens’ take on the shortcomings of business reporting during the financial crisis is predicated upon his theory of American economics.

“The American market cannot be understood as a [purely] financial economy - it is also a social one,” he says. On 16 October, during lecture at the University of Maastricht, “New Economy, New Myths?”, Geuens’ musings revolved around a sociological understanding of the American economy. It is one which reveals a highly centralised system of power, a contrast to its globalised, transnational image.

Geuens showed slides depicting his analysies of the boards of directors overseeing the major players in the US economy. He revealed deep social links between many of them. From media to agriculture to private banks, Geuenes’ research points to an eyebrow-raising amount of overlaps. Politicians in particular, Geuens says, most frequently sit on overlap boards, especially in the financial sector.

“Two of the most financial institutions of the United States, JPMorgan Chase & Co. and Citigroup had Gerald Ford on their board of directors,” Geunes says. ”Henry Kissinger and Condeleeza Rice both serve on J.P Morgan Chase’s International Board of Advisors, after being international advisors of President Bush, Sr.”

According to Geuens, politics have always had a place in the economy.

“There has never been an entirely free-market,” he says.

Deep linking in the media

The media industry has the highest number of links between its directors and those of other sectors. On average, each American media group is linked to 30 big industry or financial groups. Geuens says this is not a plot theory, but sociology.

“In the USA the elite journalists sit on board of directors with businessmen and politicians. Sometimes they have common interests and or values and participate together in common private circles, think tanks, etc. This is not a plot theory, this is sociology. They have similar social origins, similar scholarly courses (high school and universities) and these conditions prepare these media elite to be integrated into the ruling class and to have the common view and value with the members of the state operators, business, directors of think tanks, et cetera.”

Geuens hopes a sociological understanding of economics will become more prevalent. He sees an opportunity for this in the financial crisis.

“It’s a good opportunity for journalists to educate public opinion about the true nature of the economy,” he says. If only they would do it right.

To report on the financial market as Geuens sees it would involve an overhaul of the everyday language used to describe the economic climate.

“Journalists always talk about nationalisation, using this word to describe what the government is doing to save the banks. But its not a real nationalisation,” he says. “[In this nationalisation,] benefits are privatised, and when companies fail they are nationalised. A real nationalisation would be a nationalisation of big successful companies with no problems - to give the benefits to the common good.”

Stories written as if today’s governments are the first to enter the financial sector is another mischaracterisation with which Geuens takes issue.

“What is also interesting is the idea that now ‘the state came into the market’. The idea that the state didn’t come into the market before. But I’m showing that the state has always been involved in the market. Big financial institutions have always been linked to political powers by board of directors, governing, etc.”

What we talk about when we talk about the economy

A quick overview of the language used in in the 16 October editions of three moderate English-language daily newspapers reveals the most common words used. The text of stories related to the economy were pasted into Wordle, a tag-cloud generator also used by the Pew Center. Here’s what we saw:

From the 16 October edition of The Times:

From the 16 October edition of The International Herald Tribune:


From the 16 October edition of The Guardian:

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