13 September 1999
Our current howler (part III): Fiscal omerta
Synopsis: No fiscal argument, no matter how bogus, gets challenged by the mainstream press.
GOP tax cut would hurt entitlements, Clinton warns
Bill Sammon and John Godfrey, The Washington Times, 8/26/99
Clinton: Big tax cut would gut programs
William Welch and Richard Benedetto, USA Today, 8/26/99
Taxes rise as share of GDP
Bruce Bartlett, The Washington Times, 8/16/99
Earners and looters
Doug Bandow, The Washington Times, 8/26/99
Tax cutting lies by the numbers
Stephen Moore, The Washington Times, 9/12/99
Who Needs a Tax Cut?
John Greenwald, Time, 8/2/99
What do we tell our kids when it's back-to-school week? Cut
the clowning and get back to basics. And maybe our technically
limited press corps could consider the same advice too. This past
summer, Jeff Birnbaum started clowning around, then couldn't explain
his basic lessons (links below). And Bill Sammon, inventor of
canoe story nonsense, has been having problems with that "lockbox"
SAMMON AND GODFREY: "The truth is congressional Republicans
have already locked away the...surplus to strengthen Social Security
and Medicare," and plan to pay off $2.2 trillion in debt
over the next decade, Mr. Hastert said. [Sammon's deletion]
Do you see why our Cody caller is confused by the lockbox?
Sammon makes it sound like Hastert is doing two separate thingslocking
away the surplus to strengthen SS, and also reducing the debt.
But that's not how the lockbox works at all. Meanwhile, William
Welchwho doesn't clown around with bogus storieswas able
to explain it (same day):
WELCH AND BENEDETTO: Congressional Republicans contend they
are devoting nearly three-fourths of projected federal budget
surpluses over the next decade, including all that come from excess
Social Security payroll taxes, to pay off national debt and
thus indirectly strengthen Social Security.
Instructive, isn't it? How scribes who waste time on gossip
and spin have so much trouble reciting their basics? (See THE
DAILY HOWLER, 9/9/99 and 9/10/99, for our reports scolding Birnbaum-on-lockbox.
For Sammon-on-canoe, see postscript.)
But then, the press corps is frequently over its head with
the simplest fiscal topics. In 1995 and 1996for two solid yearsit
failed to clarify the seminal Medicare discourse; for more than
a decade, the press has created mass confusion when it explains
the Social Security "trust fund" (see tomorrow's DAILY
HOWLER). To all intents and purposes, there is no fiscal argument
so bogus or false that the press corps will ever challenge or
correct it. To do so would require a technical competence normally
lacking in the corps. And it would require our scribes to correct
other scribesand that is simply not done in this group.
And so Bruce Bartlett found himself making this presentation
last montha presentation found all through the press as the GOP
pushes for tax cuts:
BARTLETT: [E]ven with the proposed $792 billion tax cut...federal
revenues will continue to be at record levels...Since 1995, federal
revenues have been at their highest level in American history.
Bartlett points out that federal revenues averaged 18.6% of
GDP "during the entire period after World War II prior to
the Clinton presidency." In 1992, federal revenues took 19.2%
of GDP. But during the first six years of the Clinton administration,
they have averaged 20.5%, he states. And he is hardly alone in
citing this statistic:
DOUG BANDOW: As a result [of the Bush and Clinton tax increases],
Americans now face the highest peacetime tax collections ever,
20.6 percent of the gross domestic product.
Stephen Moore did some rounding:
MOORE: The federal tax rate has increased from 18 percent to
21 percent of GDP in just the past six years.
Time alerted its readers too:
GREENWALD: As a Wall Street Journal editorial-page headline
framed the issue last week, WHOSE SURPLUS IS IT ANYWAY? Indeed,
Americans now pay an amount in taxes equal to 20.7% of GDP, a
post-World War II high that is up from just over 18% ten years
Stop us before we quote more.
The cited figures are perfectly accurate, but the presentation
is grossly misleading. In making this presentation, writers implicitly
use tax receipts, rather than expenditures, to measure the size
of the government. The implication? Ol' debbil government is gettin'
bigger and bigger. But the principal reason receipts are higher
is because the federal government is no longer borrowing. We
tax-payers now are paying full fare, not throwing off debt on
Why were tax receipts lower through the early 90s? Because
the government was borrowing so much. In 1992a year Bartlett
citedthe following profile obtained:
Federal receipts: $1.09 trillion
Federal outlays: $1.38 trillion
Federal deficit: $290 billion
The federal government borrowed 21% of its budget. Anyone can
keep federal tax receipts down if he's willing to finance like
If we had anything resembling a real public discourse, you'd
have seen this point made before this. Various scribes would have
spoken up, and pushed the current tax debate forward. Instead,
the mainstream press corps gossips about Hillary, and the ideological
press corps churns out favorite factsincluding facts that grossly
mislead, like this misleading fact about taxes.
Why do we have this kind of discourse?" We don't want
to guess about motive. But this press corps typically lacks fiscal
competenceand mainstream scribes don't correct other scribes.
And the mainstream press corps simply loves to gossip. Who has
time to construct a real discourse when their time is taken up
But the granddaddy of all the bungled basics is that nagging
Social Security trust fund. They've created confusion around that
one for years. We'll take a quick look back tomorrow.
Tomorrow: Five papers described the SS problem. In fact,
they described it in five different ways.
Visit our incomparable archives: Bill Sammon
does know his canoes. See THE DAILY HOWLER, 7/30/99 and 8/4/99.