Media Matters

Clueless Lou

On CNN, the least-trusted name is Lou Dobbs.

By 8.31.05

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Every night, he rails against "corporate greed," "so-called free trade," and rapacious businesses that export "American jobs to cheap overseas labor markets." Deadly serious, he warns of high-unemployment despite two years of positive job growth and a paltry 5.0% unemployment rate. He tells his viewers there will be hell to pay for trade deficits that are "literally choking our economic growth" as our gross domestic product grows in earnest. No, this certainly isn't your father's Lou Dobbs.

To chronicle the new Lou, the Media Research Center's Free Market Project studied 69 news reports on free trade and outsourcing from CNN's "Lou Dobbs Tonight" on the 86 broadcasts from March 1 to June 30, 2005. While Dobbs's viewers won't be surprised by the study's findings, true journalists would be appalled.

On free trade, Dobbs doesn't simply think outside the box; he pretends the box doesn't even exist. Ninety-four percent (65 out of 69) of the stories were not only anti-free trade, but rife with factual inaccuracies and misstatements. His bias ignored basic economic principles and left his audience sorely misinformed about a cornerstone of the free market system.

Dobbs relentlessly hammered trade negotiations like the Central American Free Trade Agreement (CAFTA) and misrepresented the impact of its counterpart, the North American Free Trade Agreement (NAFTA). He devoted 33% of his free trade stories to criticizing CAFTA and the supposed cabal of business interests supporting it without ever giving the other side.

In a March 1 story, Dobbs mused that CAFTA was met with skepticism by lawmakers who "are now wary from NAFTA and our exploding trade deficits." Reporter Lisa Sylvester stated, "Lawmakers can point to a 10-year record on NAFTA, the North American Free Trade Agreement. Hundreds of thousands of jobs lost, and a record $618 billion trade deficit." Ernest Baynard of Americans for Fair Trade, a group mobilized solely to oppose CAFTA, then claimed "NAFTA has a very negative legacy, and a history of failed promises."

The numbers show that that isn't the case. Research from the Heritage Foundation reveals that during the first 10 years after NAFTA was implemented, the economy created some 18 million new jobs, grew by 38%, and increased exports to our neighbors while bolstering manufacturing output.

His incendiary attacks on trade deficits shouldn't be taken seriously, either. A January 2005 Cato Institute study found the economy grew the most when the deficit was "rapidly worsening." Likewise, the economy grew the least as the trade deficit "improved." But all of that was lost on Dobbs, who fanatically toed the line against economic reality.

Dobbs also droned on about the outsourcing bogeyman. In 97% of the stories studied, Dobbs lambasted companies that send jobs to "cheap overseas labor markets." He ignored the fact that free trade brings jobs insourced from foreign companies to the United States. He even used insourcing to criticize free trade by citing the news of an Airbus factory coming into the United States.

Dobbs led into a June 22 Lisa Sylvester report by announcing that "Europe's largest defense contractor today said it plans to build a new factory for its Airbus unit in Mobile, Alabama. Airbus hopes the plant will help it win a multibillion-dollar contract to build refueling tankers for the U.S. Air Force. Airbus also hopes that its new friends in Congress will help it win that contract." Sylvester remarked, "The new Airbus Alabama factory will create 1,000 new jobs. But if Airbus ultimately gets the tanker contract, an estimated 20,000 jobs could leave the United States."

Dobbs then cynically called Sen. Richard Shelby (R-Ala.), "the Senator from Airbus" because of his role in brokering the deal.

According to a report by the Kansas City branch of the Federal Reserve Bank, outsourced jobs amount to some 0.1% of total employment. Also, the Organization for International Investment notes foreign companies have sent 5.4 million jobs to the United States. These jobs pay 31% more than the average salary at U.S. companies. In a Sept. 17, 2004 article for National Review Online, Jerry Bowyer used a simple graph to compare outsourced jobs during the first quarter of 2004 to average quarterly job growth. At the present rate, he calculated that "America will lose all of its jobs in a little more than... 7,000 years."

The beauty of free trade is that it benefits everyone. This is important to remember when appraising the merits of trade, for it's not a game of winners and losers but a win-win relationship. Free trade reduces poverty, promotes stability, and will create new opportunities for the U.S. economy. Whether it will keep Lou Dobbs unbiased is another issue.

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