Confusing cutting the deficit with cutting taxes for the rich
The GOP took control of Congress by positioning themselves, with the help of corporate media, as the party of fiscal responsibility. As the press corps chastised Democrats for failing to get serious about the deficit (Extra!, 1/11)—ignoring economists’ warnings that running a deficit is necessary to recover from a recession—Republican policies past and present that have played starring roles in generating federal red ink got a free pass.
Following Obama’s State of the Union address, the Republican response issued by Rep. Paul Ryan (Wisc.) was unsurprisingly greeted by right-wing media as a “moral argument for why it is important for us…to rein in the spending and deficit” (Fox News, 1/26/11). Fox’s Frank Luntz concluded that “Barack Obama was the focus, but Paul Ryan seems to be the star.”
What is less clear is why mainstream media have accepted the GOP’s characterization of Ryan, who emerged as its leading voice on fiscal responsibility following publication of his “Roadmap for America”—a 50-year plan for eliminating the national debt. Reuters journalist James Pethokoukis (1/26/11) called on Obama to talk to Ryan in order to make progress on the deficit. The New York Times (1/19/11) singled out Ryan as “a respected voice on fiscal issues.”
How much respect Ryan’s fiscal prescriptions have outside GOP and corporate media circles is unclear. Ryan’s “plan” rests on the premise that his proposed tax cuts will increase revenue, an article of conservative faith that is disproven by real-world evidence (CPBB, 7/21/08). (His plans also include an increase of the consumption tax, disproportionately affecting low- and middle-income households–Citizens for Tax Justice, 3/9/10). Using more realistic estimates of the cost of his tax cuts, his plan is projected to cause U.S. debt to soar over the next 40 years, to an unprecedented 175 percent of GDP (CPBB, 7/7/10). And Ryan has a record of supporting GOP legislation that increases the deficit, while opposing deficit-cutting legislation such as the Dodd-Frank Wall Street bill (Yglesias, 1/6/11).
Despite its deficit-busting rhetoric, the GOP has made repealing the Affordable Care Act a top priority; without the law, the Congressional Budget Office (CBO) estimates the deficit would be $230 billion over the next 10 years (AlterNet, 1/5/11). Party leadership has also maintained a hands-off approach to the military budget, which now stands at over $700 billion a year.
But prominent media outlets consistently fail to report the costs of such GOP policies. A January 4 Washington Post article on the deficit that previewed the House vote on healthcare reform repeal in the first paragraph ignored the massive deficit increase that would result.
In an article detailing Obama’s handling of the economy, the New York Times (1/19/11) cited without challenge the GOP’s commitment to deficit reduction, calling it “the central issue of the newly installed Republican house.” It reported that “Republicans have made shrinking government the core of their economic message, appealing to many Americans who think Obama (and before him, Bush) let spending get out of hand.”
It’s only in this media funhouse that CNN’s Charles Riley (1/26/11) can report, after Ryan’s speech, that “Republicans are serious about cutting spending.”
What the new Republican Congress is really serious about is cutting taxes. GOP lawmakers reinstated a revised version of the Congressional PAYGO (“Pay As You Go”) rules, a Clinton-era policy that required that all new tax cuts and spending be paid for by revenue increases or spending cuts elsewhere in the budget.
Republicans abolished the rules when they took control of Congress in 2001, allowing the Medicare drug benefit law and major tax cuts to be passed without offsets—thus exploding the deficit (New Republic, 10/27/10). Now a revived PAYGO has morphed into what Republicans term “CutGo,” which would require new spending to be balanced by cuts—but would specifically exempt such revenue losses as the 2001 and 2003 Bush tax cuts, the estate tax break of 2010, Affordable Care Act repeal, small business tax relief and trade agreements (Yglesias, 1/6/11). (The two main tax breaks for low income brackets—the Federal Earned Income Credit and the Child Tax Credit—are pointedly not excluded from CutGo rules—Washington Post, 1/2/11.)
CutGo is part of Republican strategy to make permanent the Bush tax cuts for wealthy Americans, which the CBO estimates would cost $3.7 trillion over 10 years (CNN, 9/15/10). Despite the CBO’s findings, corporate media parrot the Republican position that tax cuts and the deficit are unrelated. The Washington Post’s editorial board (12/24/10) celebrated the extension of the Bush tax cuts in an article praising the bipartisanship of Congress’ lame duck session, and at the same time called on “Mr. Obama to rise above the fray with a long-term, make-the-hard choices plan to reduce the nation’s debt while fostering economic growth.”
The paper’s repeated inability to make the connection between taxes and the deficit was evident again in a January 5 article that blamed “the country’s bleak fiscal outlook” on “heavy government spending and ballooning retirement costs,” with no mention of tax cuts or military spending. The Post recognized the role of tax cuts in an editorial just ” title=””>three days before, but its overriding narrow logic may explain why the editorial board seemed downright surprised to find that the GOP is not the party of “fiscal sobriety,” but rather is “determined to continue the spree of unaffordable tax-cutting.”
In a lengthy report on state deficits (12/19/10), CBS’s 60 Minutes failed to challenge Republican New Jersey Gov. Chris Christie’s claim that the state’s inability to pay out pensions and contracts is “not an income problem. It’s a benefit problem.” The report noted the cost of “gold-plated retirement and healthcare packages” and made no mention of the fact that New Jersey’s pensions were underfunded by Republican Gov. Christine Todd Whitman to pay for deep tax cuts (New York Times, 8/19/10).
The idea that Republicans may not be the leading party on fiscal responsibility has long been so unpalatable to corporate media that when an NBC/Wall Street Journal poll (7/27-30/07) found the public regarded Democrats as more fiscally responsible, MSNBC’s Chris Matthews was incredulous (8/6/07): “I don’t think it’s fair, but it is public opinion right now. The people now think the Democrats are better at balancing the budget…. Give me a break.”
Veronica Cassidy is a freelance writer based in Brooklyn and a graduate student in the New School for Social Research’s Liberal Studies program.