Referendum Blog: May 13

Referendum Blog: May 13

DOUBLE BIAS: Yesterday’s coverage by the BBC of stories related to the EU referendum showed deep bias against the Brexit case. On immigration there was bias by emission, and on economics there was bias by exaggeration and by not including the Brexit side sufficiently

Mark Carney, the Governor of the Bank of England, elected to warn – on the basis of internal modelling – that if the UK voted to exit the EU, it could lead to a ‘technical recession’. This led the BBC1 bulletins at 6 and 10pm.  Economics editor Kamal Ahmad placed heavy stress on the importance of the warning and concluded that Carney and the Bank of England’s gloom was shared by many other leading economists and economic forecasters.  There were brief mentions at the beginning of the report that supporters of exit contested the claims, and there was a short clip of former Chancellor of the Exchequer Norman Lamont stating that. But there could be no doubt that in the BBC’s estimation, this was a game-changing information. The focus was on showing that increasing numbers of authoritative figures were warning against Brexit, and that the exit side’s response was inadequate and limited.

In the same bulletins, another story that was relevant to the referendum debate was totally downplayed. Yesterday, the Daily Mail was among numerous news outlets reporting that the Office of National Statistics had released figures that confirmed that immigration from the EU to the UK was up to three times previous estimates. The report included this:

Former Cabinet minister Iain Duncan Smith said the estimate showed migration was ‘running out of control’ and accused the government of trying to bury the news under other announcements.

‘The White Paper on BBC reforms was published today and David Cameron is hosting an international anti-corruption summit in London. They put it out on a day when they also put out something in the hope that you at the BBC will say ‘oh, we’ve got to really report the BBC’ and other bits they’re piling out. I’ve been in government long enough to know how these things are done,’ Mr Duncan Smith said.

His forecast proved to be correct. The heavy focus of BBC reporting yesterday (as well as on the Mark Carney comments) was on its own future, as is reported here. On BBC1 in the 6pm and 10pm bulletins, mention of the ONS figures was confined to a couple of sentences, and on the website, the main report on the figures here was focused on saying, in effect, that the claims by figures such as Ian Duncan Smith and John Redwood (who made similar points to IDS in the House of Commons) could be totally discounted because the ONS report dealt with temporary immigrants only.

Overall, the contrast between the handling of the Carney and immigration stories could not have been greater. The former was stoked up to the maximum extent so that the economic forecasting was elevated to major importance to show that Brexit was a dangerous option. The latter was heavily downplayed to the extent that the claims of Brexit campaigners were effectively rubbished on an official basis by the Corporation. Such efforts by the BBC to downplay the impact of EU immigration have been a constant feature of BBC reporting for many years, as previous News-watch reports have shown.

An exchange on the Today programme’s Business Update this morning illustrated the extent to which effort s are being made by the BBC to show that Carney’s warning should be taken seriously. This is the interview in full:


Transcript of BBC Radio 4, ‘Today’, 13th May 2016, Business Update, 7.19am

JOHN HUMPHRYS:          Is Europe growing? I mean, the European economy, I mean specifically the Eurozone economy, and that matters.  Lucy?

LUCY BURTON:  Yes, we’ve got figures on the Eurozone economy later today, and of course they’re important figures to look at, because it gives us an update on its health.  Last month flash estimates revealed GDP increased by 0.6% in the Eurozone, 0.5% in the wider EU. Well Dr Peter Westaway is the chief European economist from Vanguard Asset Management, he’s with us now, good morning.

DR PETER WESTAWAY:  Good morning.

LB:         What do we expect to see today and why?

PW:       I think we’ll probably see a repeat of the 0.6 number, when you get these second estimates they tended not to be changed very often.  If it is changed there is a possibility it will be downgraded, people were a bit surprised by the initial numbers and there’ve been some weak industrial production numbers out yesterday which could, could weaken it.  But, but broadly speaking I think we’ll see the same picture.

LB:         And one of the big questions people have been asking is whether the ECB is doing enough to support growth in the Eurozone, or whether it’s really run out of options.

PW:       Yes, it’s difficult to say.  I mean they’re, they’re really doing as much as they can at the moment, they’re now implementing quantitative easing, they’ve started buying, they’re going to start buying corporate bonds as well as government bonds in June, they cut interest rates into negative territory which was a big surprise at the time, they’ll probably not want to do any more of that, so . . . at the moment we’re in wait-and-see mode to see how effective that is, but . . . the jury’s out on whether they’ll need to do more.  Helicopter money is being bandied about as a possibility, that’s, that’s effectively printing money and giving it to people, which . . . I don’t think we’re going to see that in Europe, but it’s been talked about.

LB:         And of course, talking about growth, yesterday, the governor of the Bank of England, Mark Carney, said that’s something we can forget about if there is a vote to leave the EU. Now just how solid an estimate can that be, because, of course, it’s never happened before?

PW:       No it’s, it’s really speculating about the unknown, but I think, to be fair to Mark Carney yesterday, most commentators have been saying that if there were a vote to leave the EU it would have a major impact on volatility in markets, just because of the uncertainty that it would engender.  And indeed, we’re already seeing a little bit of softening in the numbers, simply because of that uncertainty . . . uncertainty already happening ahead of the referendum.

LB:         And the MPC, which is the Bank body that sets interest rates said it’s going to keep rates at present at the historic low of 0.5% – but they did say they’re ready to take whatever action is needed following the referendum.  Now, briefly, what does that mean?

PW:       Well, what’s interesting about the UK outlook at the moment is that we really are coming up to a fork in the road on June 23. I think if there is a vote to leave the EU it’s pretty likely that rates are going to stay low for a long time, they could even be cut again.  On the other hand, if we vote to stay in, then I think it’s entirely likely that the UK economy could see a bit of a rebound, we might even see interest rates rising by the end of this year.  So it’s a real binary situation at the moment.

LB:         Thank you very much, Dr Peter Westaway from Vanguard Asset Management.


Photo by Images George Rex

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