The half full glass (Hamodia, November 21)
With the Israeli government increasingly riven by internal feuds and even the country’s security forces engaged in squabbling between themselves, it is hardly surprising that most Israelis are dissatisfied with their leadership and concerned about the way things are going — for the country and for themselves.
However, the way people feel on these issues is primarily determined by what they see, hear and read in the media. Although it is facile and basically wrong to say “the media is to blame” — because the media doesn’t generally make stuff up and because intelligent adults should be able to think on their own — the fact remains that the public mood, as distinct from reality, is largely created by the media. The facts are as they are, but the media tend to portray them in a biased manner — and the people, intelligent or otherwise, are mostly too lazy to make the effort needed to see beyond the headlines.
It is essential to define what this ‘bias’ is and how it is created. The main problem with media coverage — in every field, but perhaps especially in economics and business — is not with what appears, but with what doesn’t appear. The stories that do appear are rarely untrue, although the details in them may be inaccurate. But if negative-but-true stories are consistently given major play, while more positive ones are awarded little space or air-time — or even none — then the inevitable result is that a biased picture is created, leading people to draw mistaken conclusions.
In a nutshell, the issue is that not everything is bad or going wrong — although some important things certainly are. But other things are good and/or going well. That mixture is what may be described as ‘business as usual’ and the challenge it creates is to assess what the overall picture is. If it was all black or all white, assessment would be simple — but life, of which business is an important part, just isn’t like that.
Let’s take two examples of things that got little or no exposure in the media, but deserved to get a lot. The first is from last week and relates to the trade data — boring economic statistics published monthly, to which hardly anyone pays attention. However, the latest trade data, relating to October, provide conclusive evidence that there has been a significant improvement on the export front. After more than a year of decline, exports have begun to climb again. This became noticeable in September, but since the improvement continued and intensified in October, the new trend is now clear-cut.
Even better, it is across the board. The key sector is manufacturing, which has also turned around and most of the industries within the manufacturing sector are expanding again, including high-tech. But it also includes the diamond sector which, although small, is a self-contained and important component of overall Israeli trade.
Here, too, exports had been falling since last year but, beginning in August, they began to turn around. September was better and October better still — and this occurred during the critical time of year for the industry as retail chains in the US and Europe stock up ahead of the holiday season.
True, the level of export sales is only back to where it was in early 2014 — but that is a lot higher than it was in mid-year. In other words, whether business at this point in time is good or bad in the diamond industry depends entirely on how you want to look at it. You could say it’s worse than last year, or that it’s improving, and both statements would be factually correct.
But in this example, the question of whether the glass is half-full or half-empty is secondary — because the trade data themselves are given little or no coverage, let alone their implications. The second example I want to present is much more dramatic — indeed, I would say it is the most important single even in the Israeli economy in the whole of 2014, although almost no-one knows about it. But it will have to wait for next week…