Hikes Good; Tax Cuts Bad
The number one truism of the
media: Tax hikes good; tax cuts bad. The latest evidence:
1) Last Friday CBS
economics correspondent Ray Brady reported that President Clinton's tax
hike was responsible for lower interest rates, a smaller deficit and a
2) Before Bob Dole
presented his tax cut plan Washington Week in Review and USA Today
delivered pre-emptive strikes.
3) Once Dole had
outlined his plan CNN brought on Susan Dentzer of U.S. News & World
Report to discuss it and NBC Nightly News asked reporter Mike Jensen about
it -- both denounced it and relayed a false history of Reaganomics. NBC's
Mike Jensen: Economists "say say these tax cuts could cause huge
budget deficits as they did during the Reagan years."
For the Friday, August 2 CBS Evening News, Ray Brady reviewed Clinton's
economic record. As transcribed by our staff back in Virginia, here's the
second half of his story:
After a soundbite of Senator Connie Mack
(R-Florida), charging, "President Clinton's economic policies have
robbed the American economy of its full potential," Brady reported:
"Sure the Administration slowed growth, but it did it with a giant
tax increase. 241 billion dollars, the biggest in ten years. But look at
what happened. That tax money went into the treasury, government had to
borrow less, so interest rates stayed low. That in turn fueled the bull
market and the economy, both creating new companies and new jobs. But
President Clinton has not solved the country's top problem entitlement.
The huge cost of Medicaid and Medicare."
Note that he's "solved" everything but
Ken Bode, CNN's political analyst, offered his opinion of tax cuts as he
moderated Washington Week in Review on July 26: "Americans might
remember that the last time we tried to grow our way out of the deficit,
that the tax cut happened, the growth didn't happen and the deficit was
huge at the end of it. How are they going to explain this new version of
in the August 5 USA Today: "Dole's Tax Plan Could Backfire, Experts
Say: Deficits, interest rates could rise."
Minutes after Dole completed his speech in Chicago on Monday, CNN
interviewed Susan Dentzer of U.S. News and World Report. She's no fan of
tax cuts or of those who would like one: "I think it's going to sell
very well among those who, for one thing, think that government is taxing
them too heavily and don't have a calculator, don't particularly care
about the details of federal fiscal policy and don't particularly want to
add up the dimensions of the problem or stare into the future that we know
we face. We know that the future fiscal situation for whoever is
president, come January, is going to be getting worse not getting better.
A lot of people are not necessarily aware of it, but it's very clear that
if we stay on our current path, the budget deficit widens, it doesn't get
narrower, and the notion that in that kind of environment we could pass a
very large tax cut, strains all kinds of credibility. Nonetheless, there a
lot of people who don't want to hear that, they want to see the government
shrunk, they want to believe they can get a tax cut and everything will be
Later on ABC's Nightline she called it "a
Nightly News Monday night reporter David Bloom declared: "Most
economists say the Reagan tax cuts did worsen the budget deficit and many
are skeptical of Dole's plan." As transcribed here in San Diego by
MRC analyst Steve Kaminski, NBC's Mike Jensen concluded the subsequent
piece by looking at what economists think: "They say these tax cuts
could cause huge budget deficits as they did during the Reagan years, debt
that would have to be paid off by future generations. Brian."
This exchange followed:
Anchor Brian Williams: "Mike, what about
this issue that's been around a longtime, the cut in the capital gains
Jensen: "Well, that would favor the rich and
the well-off, people with investments, they'd be the big winners."
Williams: "What about the $500 per child tax
Jensen: "Well, not really very good
economics, good for families with kids. A family wih three children would
be able to take $1,500 off its tax bill -- but it's very preferential,
retirees wouldn't benefit and people without children wouldn't
Williams: "Overall, in the hours since this
has been announced, in what you've been able to gather so far today, is
this good economics?"
Jensen: "Brian, most analysts say it's not
good economics. Bob Dole says about a fourth of the tax cuts would be paid
for by an expanding economy, but the rest would have to come from spending
cuts and those haven't been spelled out yet."
brief reality check, from Ed Rubenstein in his Right Data book:
"Since 1980, aggregate federal tax revenues have grown 111 percent.
Had revenues grown at the rate of inflation, the government would have
collected $225 billion fewer dollars in 1992. Congress spent the
additional money, and then some....The Republican record 1980-92: Social
welfare spending rose 44 percent. Defense spending rose 30 percent."
media weren't so biased Steve, Gene Eliasen and I would be off to the
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