Does the media create perception and mass-market it to you and me, or does it merely reflect our own mass perception?

This question constitutes my favorite variation of the chicken vs. egg debate. But unlike Chicken v. Egg (in which Egg gets my vote every day of the week), the media debate contains no such easy right answer.

When the 72nd treasury secretary, Paul O'Neill, tendered his resignation last week, the talk was all about a troubled economy. Oops -- I mean "the ailing economy," as ABC news put it, or the "sagging economy," per CNN/Money. Or pick your other rag of the moment... they're pretty much all saying the same thing.

Is this your perception? Seems to be, for most. Trouble is, it runs up against the facts.

Indeed, the separation between how the media reports on the economy and how the economy is actually doing may be at an all-time high. And news events such as the president's economic team tendering its resignation seem likely only to increase the disparity.

Ready to be shocked?

The gross domestic product (GDP), the single best indicator of our economy's performance, was up an annualized rate of 4% last quarter. That part shouldn't actually shock you, since it was widely reported a few weeks back. What may be more shocking -- largely because the media usually ignores historical perspective in its focus on breaking the latest short-term news -- is the performance of the GDP for the past four quarters. For four consecutive quarters, our GDP is up, up, up, and up again:

Q4 2001: +2.7%
Q1 2002: +5.0%
Q2 2002: +1.3%
Q3 2002: +4.0%

Are we "sagging" and "troubled"? Are we "ailing"? Is this a "double-dip recession"?

And this is notwithstanding the headlines last week about the "highest unemployment in nine years." A rate of 6%, unemployment is right where this economy was in April, and neither that quarter nor the one coming after it were poor quarters. Further, 6% unemployment is historically very average, as we look back over the past 30 years.

In the end, whether the media creates this perception or we Americans all share it and the media merely reflects it, let's be quite clear: The widely held perception of an "ailing, sagging, troubled economy" is ignorant. One can always of course identify some aspect or sector of our economy that is doing poorly. But when you look at the whole picture -- something I wish more of us, and our media, would do -- you'll see that our economy is performing just fine, thank you, regardless of who's the treasury secretary. (Earlier today, President Bush nominated John Snow to fill the post).

We recently had former Secretary O'Neill on our radio show, and I thought he was a good straight talker. Following a tremendously successful business career running Alcoa(NYSE: AA), O'Neill had possibly burned too many bridges with government insiders when, for instance, he would use phrases like "a colossal mess" and "an abomination" to bemoan the 44,000 pages of IRS tax code. But how much more on target can a treasury secretary be? No one can be happy with the state of our present tax code, except those few whose business directly benefits from such needless complication. Let us hope O'Neill's ambitious push for fundamental tax reform doesn't flag.

Note to the media: If O'Neill's tax reform does flag, it would be one of a precious few financial initiatives truly "flagging" in the otherwise prosperous year of 2002.

Call a spade a spade!