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Tax 'Cuts,' Tax Hikes, Media Back Obama Either Way

King Midas could turn everything he touched to gold. President Obama has a similar effect on news coverage of his policies.

Just look at the way broadcast journalists have covered (and covered for) Obama on the issue of taxes. It didn’t matter if he was cutting them with his stimulus bill or raising them in his proposed 2010 budget. The new president has a Midas touch.

Journalists praised Obama for his “middle-class tax cut,” but barely criticized him for proposing tax increases. These same reporters undercut Republican opposition to Obama’s tax increases and some had harshly criticized tax cuts in the past.

NBC’s John Yang praised Obama’s stimulus victory and partially described it as a “tax cut” bill because it included a temporary “Making Work Pay” tax credit of $400-800. “President Obama hasn’t been in office even four weeks yet and he’s already won passage of the biggest spending increase and tax cut bill in history,” Yang said on “Nightly News” Feb. 15.

But when Obama’s $3.5 trillion budget proposal was released Feb. 26 network journalists and other media deflected or ignored criticism that it included tax hikes. A few stories during the week of March 5-12 on NBC simply mentioned that tax increases were in the works, but didn’t explain whose taxes would be raised or by how much.

On March 5, NBC’s Yang himself undermined criticism of those proposals by labeling it “partisan division.” “Republicans don’t like Mr. Obama’s plan to pay for some of the costs with higher taxes on the wealthy,” Yang elaborated.

ABC’s Jake Tapper said March 20 that “Fiscal discipline was President Obama’s message of the day.” Although, Tapper noted that the budget would add $2.3 trillion in deficit spending in the next ten years.

ABC’s George Stephanopoulos didn’t even tell “Good Morning America” viewers why Obama “is facing a lot of flak on Capitol Hill” for his budget. Hint: tax increases to the tune of $1.4 trillion and enormous government spending.

Unlike many broadcast news reports, NPR detailed the entire budget, including the tax increases. If passed the top tax rate would shoot up to 39.6 percent by allowing the Bush tax cuts to expire, limit itemized deductions and raise the capital gains tax rate. An Investor’s Business Daily editorial for April 3 also claimed that the president’s budget includes a footnote to maintain the estate tax, commonly called the “death tax,” at its 2009 level of 45 percent.

The Obama administration has promised that taxes for people making less than $250,000 a year would not go up a “single dime.” Yet, Brian Riedl from the Heritage Foundation examined the budget and found it would raise taxes on all Americans by $1.4 trillion over the next decade – in addition to raising taxes on 3.2 million high income earners by about $300,000 in ten years.

 

Cuts, hikes – anything goes

Journalists on CNN, CBS, NBC and ABC have all praised Obama’s “middle-class tax cuts” in the past few months, despite criticism from conservatives and economists that the cut was actually a tax credit that would redistribute income.

Wolf Blitzer defended Obama on April 1 saying, “He did live up to his promise of a middle-class tax cut for the next two years as part of his economic stimulus package.”

Back on Feb. 12, CBS “Evening News” anchor Katie Couric teased Nancy Cordes’ report on the stimulus bill and specifically touted the tax cuts according to Newsbusters: “And we'll tell you what's in it for you, including tax breaks ... It's designed, in part, to get you spending again by giving you the money to do it.”

That tax cut puts roughly $10 into a person’s paycheck every week beginning April 1, yet the news media treated it like a guaranteed windfall for the economy.

Robert Barro, Professor of Economics at Harvard University, criticized Obama’s stimulus bill as a “terrible piece of legislation” in a Tax Foundation podcast for Feb. 19. He pointed out that the so-called “tax cuts” hyped by the news media “are really transfer payments, particularly redistribution of income from the rich to the poor.”

But the broadcast media weren’t just happy to promote Obama’s tax cuts. They also had his back when it came to his proposed tax increases, by not mentioning, not explaining or downplaying criticism of them.

NBC mentioned Obama’s proposed tax increases in five different stories between March 5 and March 14, but in each case ignored criticism of those hikes or downplayed the opposition.

On March 14, Amy Robach found good economic news to “take the juice out” of GOP criticism of tax increases in the budget.

Robach said, “Let’s talk about some of these pops of good economic news, at least the ones we’ve seen this week. How politically helpful is that to Barack Obama as, of course, he tries to push through his economic agenda in Washington?”

CNBC’s John Harwood responded saying it was “extremely” helpful. “It changes the framework for the conversation, takes some of the juice out of Republican complaints that his tax increases are tanking the markets and hurting the economy.” Harwood didn’t explain what increases Obama was being criticized for or name anyone critical of the budget tax increases.

Two other segments, from the March 8 “Today” and March 12 “Nightly News,” also excluded critics of tax hikes and failed to explain the proposed increases.

“Good Morning America,” took it a step further on March 25 when Stephanopoulos was being interviewed about Obama selling the budget. Stephanopoulos mentioned that the president “is facing a lot of flak on the Capitol Hill,” but didn’t mention one reason for much of that criticism – the proposed tax increases. Still, Stephanopoulos graded Obama’s March 24 speech as an “A minus” and said Obama had the right “tone.”

 

Media Hypocrites Praise Obama Cuts, Blast GOP

The media have let Obama play both sides of tax policy, but they won’t even let the GOP play one side.

While outlets like “Evening News” touted the stimulus tax cuts, the same program blasted tax cuts in 2001 under President Bush.

According to a Newsbusters post from Feb. 13, Couric touted the “tax breaks” in Obama’s stimulus bill. But previous “Evening News” anchor Dan Rather warned in July 2001: “ … new worries that his big tax cuts, along with a shrinking budget surplus, are re-shaping the political and fiscal landscape of the country.” That’s not surprising since CBS led the networks’ charge against the Bush tax cuts in 2001, according to an Media Research Center special report.

Hypocritically, the media have been critical of Republican proposals for tax relief sometimes making fun of consistent calls for lower taxes.

Legitimate criticism of Obama’s budget drew confusion from one CBS reporter. Maggie Rodriguez interviewed Sen. Richard Shelby, R-Ala., on the March 25 “Early Show.”

Rodriguez asked him why Obama was being criticized for his budget. Shelby described his view of what would result from the $3.5 trillion proposal: “We’re looking at inflation and financial and economic destruction. We cannot go down this road.”

Missing the point, Rodriguez asked, “But it looks like we are, and what good does it do the American people to – to point that out? Why not work with the President to try to reach a compromise?” according to Newsbusters March 25.

Republicans were also portrayed as a one-note party as CNBC’s Steve Liesman pointed out on March 15 “Meet the Press.” “That’s the parody of the Republican Party that goes around in economic circles, ‘Well, you have cancer, cut taxes.’”

On April 1, MSNBC’s Rachel Maddow echoed that when she mocked a GOP alternative to Obama’s budget saying it included a “whopper” of a “tax cut for wealthy people.” She also suggested the GOP’s answer to everything is tax cuts. “We are going to fill in potholes with tax cuts,” Maddow said.

 

Blasting Obama’s Budget

The media might not have pointed out the problems with tax hikes in Obama’s budget, but researchers at conservative think tanks have.

Riedl pointed out the philosophical departure between Obama and Bush on tax policy: “President Bush reduced taxes by approximately $2 trillion; President Obama has proposed raising taxes by $1.4 trillion. In doing so, President Obama has rejected the most successful Bush fiscal policy. In the 18 months following the 2003 tax rate cuts, economic growth rates doubled, the stock market surged 32 percent, and the econ­omy created 1.8 million jobs, followed by 5.2 mil­lion more jobs in the next 27 months.”

His breakdown found that all Americans would be hit by tax increases and pointed out the problem with raising them specifically on “the rich.”

Those tax increases would land on only 3.2 million people - and “would signifi­cantly reduce economic growth rates by reducing incentives to work, save, and invest. Specifically, higher investment taxes may prevent the economy from receiving the investment capital that it needs to recover,” Riedl wrote.

Chris Edwards of Cato Institute also argued against the raising taxes on the rich in the Economist April 7 arguing that it would “reduce production and increase avoidance by highly skilled people.”

The Center for Individual Freedom also warned that the tax increases wouldn’t just be landing on “individual fat cats or trust-fund babies,” but on America’s small businesses.

“By raising taxes on small business and reneging on his campaign promise to provide them capital gains tax relief, he will punish the very entrepreneurs that create most American jobs and market innovations,” said a current events piece on the CFIF Web site.