Paul Krugman writes today (New York Times, 7/16/12) on media's failure to factcheck campaign claims:
Perhaps in a better world we could count on the news media to sort through the conflicting claims. In this world, however, most voters get their news from short snippets on TV, which almost never contain substantive policy analysis. The print media do offer analysis pieces–but these pieces, out of a desire to seem "balanced," all too often simply repeat the he-said-she-said of political speeches.
Trust me: you will see very few news analyses saying that Mr. Romney proposes huge tax cuts for the rich, with no plausible offset other than big benefit cuts for everyone else–even though this is the simple truth. Instead, you will see pieces reporting that "Democrats say" that this is what Mr. Romney proposes, matched with dueling quotes from Republican sources.
Indeed, the best example of this was an issue we flagged here last week: Whether Barack Obama's call for extending the Bush tax cuts only on income up to $250,000 represented a big tax hike for small businesses. According to reality, it does not. But Republicans say that it does, and they say it often. So it becomes one "side" in the debate.
Interestingly, after a few days of this, the Times ran a piece on Saturday (7/14/12) that seemed like it was supposed to factcheck these claims. But, like many other attempts, it failed to clarify the issue for readers, more or less concluding that everyone had a point.
Times reporter Trip Gabriel writes:
Mr. Obama is correct that only a tiny sliver of business owners make enough to land in the top tax brackets. The Joint Committee on Taxation, a nonpartisan Congressional office, estimated last month that 3.5 percent of taxpayers with business income in 2013 would fall in the tax brackets that would rise under the president’s proposal.
So this is settled, right? A tax increase that doesn't even affect 97 percent of "small businesses" can't really be criticized as an attack on small business owners, can it? Hold on a second:
But the tax committee also supported Mr. Romney's assertion that this sliver represents a significant share of the economy: those top earners generate 53 percent of all small-business income.
It's hard to see what that "supports" exactly–other than the idea that people in the top tax bracket are wealthy. Indeed, the next several paragraphs go on to explain how the definition of "small business" gets a little fuzzy; some counts (like Romney's) apparently county "flow-through" businesses, which can include hedge funds and the like. (Goldman Sachs, until 1999, was in this category of "small businesses," Gabriel points out.)
What about the idea that this small increase in the top marginal tax rate will destroy jobs? Here, too, the Times finds a way to suggest everyone maybe has a point.
So what about job killing? That, too, is a matter of one-hand-other-hand debate:
But the question of whether small-business owners are encouraged or deterred by marginal tax rates is robustly debated by economists.
The evidence? Former Bush economic adviser Douglas Holtz-Eakin says a business owner that has $80 instead of $100 is less likely to hire. It's hard to know how that relates to the current tax debate. The other side is William Gale of the Tax Policy Center, who notes that business can "deduct wages from their revenues… with the potential to lower their effective tax rate."
And, the Times says, "recent studies have challenged the notion that small businesses are a key engine of job creation."
If the point of such a story is to settle a key election season dispute, it fails. If the point is to muddy up the water enough to allow both sides to keep saying the same things, no matter what the facts say–it does the job perfectly.