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ABC Blames Bush But Ignores Soaring State Spending -- 01/09/2003 CyberAlert


1. ABC Blames Bush But Ignores Soaring State Spending

Spending by states soared by 39 percent over the past five years, but ABC on Wednesday night managed to air an entire story about the budget shortfalls in states, and how "President Bush's plan to stimulate the economy is going to make matters worse for them," without noting how much spending has grown -- but with reporter Betsy Stark citing how "several state officials we spoke to today said it would be impossible to balance their budgets with spending cuts alone."

2. Kim Jong Il "Rational" Until Bush Made Him Go "Crazy"
Everything was hunky-dory with North Korea until President Bush included the regime in his "axis of evil," ABC's Mark Litke suggested Wednesday night. Clinton's Secretary of State Madeleine Albright told Litke that she found North Korean dictator Kim Jong Il "perfectly rationale," but, Litke lamented, after Bush's "axis of evil" declaration "Kim seemed to resort to the crazy, unpredictable image again to get what he and his generals wanted."

3. NY Times Headlines Display Antipathy to Bush Tax Plan
"The Wrong Stimulant" announced the headline over a January 8 New York Times editorial, but it seemed the paper's editors and reporters fell in line Wednesday with the editorial policy as most of the news stories in the paper expressed hostility toward Bush's tax cut or reflected the liberal spin about how it helps the rich.

4. Dividend Tax Benefits Only the Rich, But Not Really
Nightline on Tuesday night concentrated on how the elimination of the dividend tax only really benefits the wealthiest, but a Tax Foundation report pointed out how 46 percent of those claiming dividend income in 2000 earned less than $50,000. Anchor Chris Bury declared as fact about the Bush plan: "Most of the immediate benefits would go to the richest Americans -- those who now pay taxes on stock dividends."

5. Real Stats: The Richer You Are the Smaller Your Tax Cut
After days of network reporting repeating the mantra about how the Bush tax cut plan only helps the rich, a couple of morning hosts on Wednesday acknowledged how those rich people pay the most and some charts in newspapers demonstrated how for families the wealthier you are the less of a cut you will receive percentage-wise. Plus, a Tax Foundation report documented how the top 50 percent of taxpayers pay a higher percentage of income taxes collected than they earn as a share of overall income while the bottom 50 percent get more from the government than they put in.

6. NBC Again Publicizes SUVs Support Terrorism Claim
NBC devoted another laudatory story to Arianna Huffington's effort to convince SUV owners that they are supporting terrorism, but on ABC's The View Joy Behar had the best rejoinder: "If I see a terrorist in the Hamptons I'm going to run him down with my SUV."


ABC Blames Bush But Ignores Soaring
State Spending

Spending by states soared by 39 percent over the past five years, but ABC on Wednesday night managed to air an entire story about the budget shortfalls in states, and how "President Bush's plan to stimulate the economy is going to make matters worse for them," without noting how much spending has grown.

Betsy Stark ABC's Betsy Stark, who used a woman from the unlabeled liberal Center on Budget and Policy Priorities as her sole expert, did, naturally, find time to cite anecdotal examples of the awful things states are doing to save money, such as letting prisoners go free and closing health clinics. Instead of informing viewers of how much spending increased beyond the inflation rate and population growth, Stark maintained that tax hikes are essential: "Several state officials we spoke to today said it would be impossible to balance their budgets with spending cuts alone, which means all kinds of increases in state taxes are being considered."

Anchor Peter Jennings introduced the January 8 World News Tonight story: "We're going to take a Closer Look tonight at how tough things are financially in many states, and there is hardly one that is not short of money. Moreover, the National Governors Association has just said that President Bush's plan to stimulate the economy is going to make matters worse for them."
Betsy Stark explained, as taken down by MRC analyst Brad Wilmouth: "Peter, states are facing their worst fiscal crisis in more than 50 years, and state governors were hoping the President's plan would deliver some much-needed fiscal first aid. They got none. In fact, the centerpiece of the President's plan, the elimination of the tax on stock dividends, could cost the states several billion dollars, the share of revenue the states now collect on that tax. The loss of that revenue will widen budget gaps that by law the states are required to close."
Iris Lav, Center on Budget and Policy Piorities: "Unless there's federal aid forthcoming, states will have to take actions to balance their budgets. They will have to cut spending or raise taxes. They really have no other choice."
Stark: "States are already making hard choices. In Kentucky, more than 500 prisoners were let out of jail early to help close the state's deficit. And the state treasurer of Nevada expects his state and others to follow suit."
Brian Krolicki, Nevada State Treasurer: "Anything that can legally be on the table is on the table, and early release programs for prisoners is certainly one of those possibilities."
Stark: "Further cuts in health care services are also likely. Medicaid alone accounts for 20 percent of state spending. In Los Angeles, 16 health care clinics have already closed."
Sylvia Drew Ivie, T.H.E. Clinic Director: "If our funding is cut, we would have to lay off some of our physicians, some of our nurses, health educators. We may have to close one of our two clinics. All of these scenarios would be dreadful for our community."
Stark: "What's more, spending cuts and layoffs are hardly a recipe for economic growth."
Lav: "You could think in a $674 billion plan that's going to greatly increase the federal deficit there could be something in there to help states prevent the budget cuts and tax increases that will contract the economy."
Stark: "Several state officials we spoke to today said it would be impossible to balance their budgets with spending cuts alone, which means all kinds of increases in state taxes are being considered. A spokesman for the President said today Mr. Bush believes the best way Washington can help the states is to get the national economy moving again."

But as the Cato Institute's Stephen Moore and Stephen Slivinski pointed out last September in their report, Fiscal Policy Report Card on America's Governors: 2002, there was a state spending "splurge" during the 1990s:
"To provide context for this year's governors report card, readers can look at state budget trends during the past decade. The state fiscal crunch that many governors now confront resulted from excess spending in recent years. Between 1996 and 2001, total federal government spending rose 19 percent. By contrast, state general fund spending rose 39 percent during the same period. State general fund spending grew 5.0 percent in 1997, 5.7 percent in 1998, 7.7 percent in 1999, 7.2 percent in 2000, and 8.3 percent in 2001.4 (All budget figures are for fiscal years.) As the economy slowed down and large budget gaps started appearing, states still increased spending by 2 percent in 2002, on average.

In the states highlighted by ABC's Stark, real per capita spending increased by 44 percent in Kentucky between 1991 and 2000 and by 32 percent in California.

For the Cato report: http://www.cato.org/pubs/pas/pa454.pdf

A January 8 New York Times story, "States Fear Double Whammy From Tax Plan," also failed to mention the soaring state spending. And where might Stark have gotten the idea to use Iris Lav of the Center on Budget and Policy Priorities as her only expert? From Times reporter Michael Janofsky who highlighted her complaints about the Bush plan without labeling the liberal group. For the story: http://www.nytimes.com/2003/01/08/politics/08STAT.html

Kim Jong Il "Rational" Until Bush Made Him
Go "Crazy"

Everything was hunky-dory with North Korea until President Bush included the regime in his "axis of evil," ABC's Mark Litke suggested Wednesday night. Clinton's Secretary of State Madeleine Albright told Litke that she found North Korean dictator Kim Jong Il "perfectly rationale," but, Litke lamented, after Bush's "axis of evil" declaration "Kim seemed to resort to the crazy, unpredictable image again to get what he and his generals wanted."

Checking in from Seoul, for the January 8 World News Tonight Litke profiled Kim, recalling how he's thought to have a "bizarre personality cult," to use "brainwashing" on his citizens and be a "vain playboy" who was behind terrorist attacks. When he wanted outside help in the late 1990s he invited in Secretary of State Madeleine Albright who "found Kim wasn't as odd as the world thought."
Albright: "In having discussions with him, he is perfectly rationale and he is not, he is isolated but not uninformed."
Litke: "But Kim's apparent willingness to engage in dialogue with the outside world began to fade with the arrival of the new Bush administration and that 'axis of evil' declaration. It was then that Kim seemed to resort to the crazy, unpredictable image again to get what he and his generals wanted."

It's probably more than just an "image."

NY Times Headlines Display Antipathy to
Bush Tax Plan

"The Wrong Stimulant" announced the headline over a January 8 New York Times editorial, but it seemed the paper's editors and reporters fell in line Wednesday with the editorial policy as most of the news stories in the paper, the MRC's Rich Noyes noticed, expressed hostility toward Bush's tax cut plan or reflected the liberal spin about how it helps the rich.

Here's a look at the headlines and subheadlines on the stimulus plan as run in the "Washington Final" print edition. From the "A" section:

-- "Bush Unveils Plan to Cut Tax Rates and Spur Economy:
Subheads: "Ideological Battle Seen"
"President Says Proposal Will Create Jobs, but Democrats See Fiscal Recklessness"
by Richard W. Stevenson (A1)

-- "A Bold Plan with Risks"
Subhead: "Bid to Help Economy and the '04 Campaign"
by Elisabeth Bumiller (News Analysis, page A1)

-- "Plan Gives Most Benefits to Wealthy and Families"
by Edmund L. Andrews (A17)

-- "The Effects
"States Fear Double Whammy from Tax Plan"
by Michael Janofsky (A17)

From the business section:

-- "Few Officials at Companies Expect Surge In Dividends"
by David Leonhardt and Claudia H. Deutsch (C1)

-- "Wall Street Finds It Likes Much of Bush Proposal"
by Jonathan Fuerbringer (C1)

-- "Stocks & Bonds
"Shares Are Mixed as Excitement Over Tax Plan Subsides"
by Kenneth N. Gilpin (C10)

Dividend Tax Benefits Only the Rich, But
Not Really

Nightline on Tuesday night concentrated on how the elimination of the dividend tax only really benefits the wealthiest, but a Tax Foundation report pointed out how 46 percent of those claiming dividend income earn less than $50,000.

Anchor Chris Bury declared as fact about the Bush plan: "Most of the immediate benefits would go to the richest Americans -- those who now pay taxes on stock dividends." Later, an expert in a soundbite insisted: "Looks to me like about 90 percent of that benefit is going to go to, roughly, the top 10 percent of the population."

ABC, of course, measured benefits on a dollar-value instead of on the basis of a percentage cut, so naturally those who pay more in taxes will get a larger dollar-value reduction.

But as a Tax Foundation report noted: "Of all taxpayers that claimed some dividend income in 2000, nearly half (45.8 percent) earned less than $50,000 in adjusted gross income (which includes dividends). Moreover, 63.8 percent of those taxpayers claiming dividends earned less than $50,000 in just wages and salaries." See: http://taxfoundation.org/DividendIncome.html

Later in the show, MRC analyst Jessica Anderson observed, Bury wanted to know why former Congressman Kasich would support the Bush plan, which "is going to lead to billions of dollars more in red ink and expand the deficit," when he was once "a deficit hawk." And Bury kept up his mantra about how "only the wealthiest will really benefit from" cutting the dividend tax.

Bury set up the January 7 show: "In Chicago today, the President performed as the Salesman In Chief. He began pitching a product -- a plan to stimulate the economy -- to a market of wary buyers -- Americans who vote. Like all good sales pitches, this one has something for everyone. Most of the immediate benefits would go to the richest Americans -- those who now pay taxes on stock dividends -- but middle-class couples with kids would also receive a tax cut, and even the jobless would get some help to look for work. The price tag is steep: just eliminating the dividend tax alone could cost the Treasury $300 billion over the next ten years. But that's not what makes it such a tough sell. A new ABC News poll out tonight shows Americans are far more concerned about the fairness of the President's tax policies. When asked whether they benefit the wealthy or the less well-off, fully half say the wealthy. Thirty-six percent suggest his plan treats both about equally. That something is needed to kick start the economy is no longer at issue -- the Democrats, too, have a modest stimulus plan of their own -- but the big question is whether what the President began selling today will really deliver what he's promising."

John Donvan later noted: "The President also offered something to the business side of the equation: bigger tax write-offs for small businesses on the equipment that they buy. But then there was the most-discussed part of his proposal. The President wants to eliminate totally the tax that people who own stock have to pay on their dividends, and the reason that's controversial is because of who will benefit."
David Wyss, Standard & Poor's chief economist: "There's something for everybody in here, but let's face it, the big chunk of money, about half the money being spent here is on the dividend exclusion. Looks to me like about 90 percent of that benefit is going to go to, roughly, the top 10 percent of the population. The rich people have more money than the poor, and especially they get more dividends than the poor."

Bury discussed Bush's plan with Diane Swonk, Bank One's chief economist, and former Republican Congress John Kasich. Bury's unchallenging question to Swonk: "Did Mr. Bush sell you today, Diane?"

Turning to Kasich, Bury lectured: "Congressman, you were known, when you were chairing the Budget Committee, as a deficit hawk, an architect of the balanced budget amendment. Why would you support a plan which even Congress and the White House concede is going to lead to billions of dollars more in red ink and expand the deficit?"

That assumes static analysis in which the tax cuts do not generate any new revenue from increased economic activity.

Bury also demanded of Kasich: "Congressman, you say that it will make Americans feel wealthier to cut the dividend tax. Isn't that part of the problem, that only the wealthiest will really benefit from such a cut?"

Real Stats: The Richer You Are the Smaller
Your Tax Cut

After days of television network reporting repeating the mantra about how the Bush tax cut plan only helps the rich, a couple of morning hosts on Wednesday acknowledged how those rich people pay the most and some charts in newspapers demonstrated how for families, the wealthier you are the less of a cut you will receive percentage-wise and even for singles, who don't get the increased child deduction, those on the lower end would receive an only slightly smaller tax break than those much richer.

Plus, a Tax Foundation report documented how the top 50 percent of taxpayers pay a higher percentage of income taxes collected than they earn as a share of overall income.

On Wednesday's Fox and Friends on FNC, MRC analyst Patrick Gregory noticed, Steve Doocey told Senate Minority Leader Tom Daschle: "But Senator, you know, you mentioned the people who are going to get the larger dollar tax cut, those are the people who pay most of the taxes in America."

Even Harry Smith on Wednesday's The Early Show on CBS, MRC analyst Brian Boyd observed, acknowledged that the middle class gets the greatest percentage cut. Smith suggested to Daschle: "Aren't there a lot of Democratic friendly ideas in this tax plan, though? Extending unemployment benefits, if you look at some of the tax cuts for low and middle income earners by percentage they're actually larger tax cuts than for larger taxpayers."

Smith, naturally, soon returned to his liberal mode: "Isn't the real gamble in all of this though if these tax cuts don't actually stimulate the economy, that the debt grows and the problems with interest rates and everything else just go on etc. etc.?"

Now for some facts the networks have yet to detail:

-- The MRC's Rich Noyes alerted me to a Tax Foundation report, based on IRS data, which documented how those in the top one percent, top five percent, top ten percent, top 25 percent and top 50 percent all pay a greater share of the income taxes collected than they earned as a share of overall income. Only the bottom 50 percent, those earning less than $27,682 in 2000, paid less in income taxes than their share of income.

The Tax Foundation observed: "While the highest-earning one percent of tax filers earned 20.8 percent of the nation's total adjusted gross income in 2000, they paid 37.4 percent of federal individual income taxes during that year."

For the November 2002 report in PDF format: http://www.taxfoundation.org/SR118.pdf

-- A new Tax Foundation report picked up by the MRC's Liz Swasey outlined how, thanks to the increased child care deduction, under the Bush plan the lower your income the greater percentage reduction you would see in your taxes. For a family with two kids, the adjusted gross income, their current tax, their tax under the Bush plan, and the percentage cut that represents:

$40,000: $1,178 to $45 = 96% cut
$50,000: $2,678 to $1,545 = 43%
$75,000: $7,316 to $5,295 = 28%
$100,000: $10,812 to $8,570 = 21%
$150,000: $22,878 to $20,632 = 10%

That report is online at: http://taxfoundation.org/BushTaxCut.html

There's no listing for a lower tax level since those much below $40,000 with two kids already live tax-free, a situation the Bush plan would compound in moving millions more into a situation of paying little or no income tax, a trend which should concern conservatives since it means more people will be able to vote for increased government spending without fear of having to pay for it -- just the kind of angle a less liberal media would pursue.

-- The January 8 Boston Globe featured a Tax Foundation table for Massachusetts families of four, with these tax rate reductions:

$50,000: 42% tax payment cut
$62,000: 25%
$167,000: 10%

For that table in full, go to:
http://www.boston.com/dailyglobe2/008/nation/Bush_wants_670b_
cut_in_taxes_over_10_years+.shtml

And then under "related graphics" click on: "Bush's new tax proposal"

Even the New York Times illustrated how the poorer you are the bigger your cut. Using figures provided by Deloitte & Touche, the January 8 Times showed figures similar to those above for a family with two kids. For head household with one child:

$40,000: $2,935 to $2,535 = 13.63% reduction in income taxes
$100,000: $14,887 to $14,170 = 4.82%
$250,000: $56,130 to $52,772 = 5.98%

Only with singles do the richest cut the greatest break, but not much more of one:

$60,000: $7,943 to $7,598 = 4.34%
$100,000: $17,313 to $16,292 = 5.90%
$250,000: $59,857 to $56,214 = 6.09%

All those numbers certainly contrasts with the distorted network television reporting of recent days:

-- "Mr. Bush's plan has unleashed a very political debate about whether it will stimulate the economy or just further enrich the wealthy," intoned ABC's Peter Jennings who ignored elements which would be implemented immediately as he focused on how the dividend tax cut would not matter until 2004. Jennings also worried about "how much is this going to cost the government?" and he noted how an ABC News poll found that 50 percent "believe the tax cuts... favor the rich." Profiling the impact on two families, Betsy Stark failed to point out how the one earning $35,000 would get a larger tax cut as a percent of their income than the one making $70,000. See:
http://www.mediaresearch.org/cyberalerts/2003/cyb20030108.asp#1

-- The broadcast networks on Monday night, especially CBS, pushed the liberal spin that the Bush tax cut proposals will unfairly benefit the rich. Assuming all money belongs to the government, CBS's John Roberts insisted "the President's plan would give the most to the rich." CBS's Byron Pitts highlighted how "a middle class wife" saw Bush's plan as "little more than a feel-good gift that won't give much to most Americans -- especially the middle class." ABC's Peter Jennings conveyed how Democrats "say that it grossly favors the wealthy." See: http://www.mediaresearch.org/cyberalerts/2003/cyb20030107.asp#1

-- Even though he opposed then-candidate Bush's tax cut plan during the 2000 campaign, on Sunday night ABC and NBC trumpeted Senator John McCain's opposition to Bush's new tax cutting plans as both NBC's Rosalind Jordan and ABC's John Cochran used the identical phrase in heralding how the "prominent Republican" claimed the cuts would be skewed too much toward the rich. See: http://www.mediaresearch.org/cyberalerts/2003/cyb20030106.asp#2

-- The New York Times on Saturday advanced the liberal effort to portray the expected Bush tax cut plan as beneficial only to the wealthy. Reporter Edmund Andrews noted how with a dividend tax cut "the tax benefits flow almost exclusively to the very wealthiest taxpayers" and, without challenge, relayed how, Tom Daschle "said that a person making more than $1 million a year would save $24,000 in taxes under Mr. Bush's plan while a person earning from $40,000 to $50,000 a year would save only $76." See: http://www.mediaresearch.org/cyberalerts/2003/cyb20030106.asp#3

-- ABC, CBS, CNBC and NBC on Thursday night all gave credence to the assumption that Bush's tax cuts unfairly benefit the wealthy. ABC anchor Elizabeth Vargas worried: "President Bush will roll out more tax cuts, but will they benefit everyone?" CBS's Bill Plante reported that Bush's plan will lower "the very top tax rate despite the criticism that that will disproportionately benefit the wealthiest taxpayers." NBC's Tom Brokaw stated that Bush insisted his plan will "help all Americans -- not just the wealthy." See: http://www.mediaresearch.org/cyberalerts/2003/cyb20030103.asp#3

NBC Again Publicizes SUVs Support
Terrorism Claim

The media just love Arianna Huffington's gimmick of trying to get people to stop driving SUVs by convincing them that using them supports terrorism. She appeared on by CNN and MSNBC on Wednesday afternoon after Tuesday's NBC Nightly News featured a piece on her efforts.

Just last month NBC's Today publicized Huffington's campaign. As noted in he December 18 CyberAlert, NBC found the real terroristic weapons of mass destruction and they're not in Iraq; they're in your garage. Today hyped the efforts of some liberals to scare people away from driving SUVs. "Is your SUV a weapon of terrorism?" co-host Lester Holt asked at the top of the December 17 show. Later, Holt promised: "Coming up in our next half-hour. Is your SUV a weapon of mass destruction?" Citing the What Would Jesus Drive? PR gimmick, co-host Ann Curry trumpeted a "drumbeat" against SUVs. See:
http://www.mediaresearch.org/cyberalerts/2002/cyb20021218.asp#5

Fast forward to this week, and Tom Brokaw announced on the January 7 NBC Nightly News: "Sport utility vehicles, SUVs, are in a peculiar position in the American psyche these days. They are at once very popular and despised. Popular for the room, power and safety, despised for their gas-guzzling, more-power-than-is-necessary appetite. Now a familiar political and social commentator has decided the best way to attack SUV drivers is to accuse them of aiding terrorism. True or false? Fair or unfair? Here's NBC's Dan Lothian."

Lothian began: "On the crowded highway of giant SUVs, columnist Arianna Huffington took an exit, trading in her gas-guzzling Lincoln Navigator for a 50-mile-per-gallon Toyota Prius hybrid."
Arianna Huffington: "Now I was after all driving that SUV without connecting the dots, without being conscious of the impact it was having."
Lothian: "Figuring no one else was connecting the dots either, Huffington hooked up with some Hollywood heavyweights to produce three TV spots with a high level of shock value. In this spot, the evolution of George's gas purchase leads to the creation of terrorists."
Clip of ad: "-get money from those countries every time George fills up his SUV."
Huffington: "We need to be equating driving gas-guzzling SUVs with supporting our oil addiction and our dependence on nations that are supporting terrorism."
Clip of ad, person #1: "I helped our enemies develop weapons of mass destruction."
Clip of ad, person #2: "I helped hijack an airplane."
Lothian: "The so-called Detroit Project is a parody of the edgy government-supported anti-drug ads. The in-your-face campaign, so far supported by small donations, is only partially aimed at consumers. The real targets? Oil companies and their dependence on foreign suppliers and automakers who build the SUVs that guzzle gas. Washington, D.C., and Detroit are two of the four markets where the spots will air, an attempt to influence lawmakers and the auto industry. But is the premise from tank to terrorist a stretch? Kathleen Hall Jamieson analyzes ad campaigns at the University of Pennsylvania."
Kathleen Hall Jamieson: "There are going to be people with SUVs in their driveway who are going to look at this ad and say this is the most ridiculous claim I've ever heard."
Lothian: "But Jamieson says controversial campaigns can be powerful."
Jamieson: "That breaks through the clutter. It gets people to talk about the ads."
Lothian concluded his largely laudatory piece: "And Huffington hopes conversations will lead to change down the road less traveled by SUVs."

Huffington's Web page: http://www.ariannaonline.com/suv

A key point overlooked by the media: The argument of the anti-drug ads is that even casual drug users support terrorism, that it isn't how much you support terrorism through drug use but that you do. By that logic, driving a 50 mpg car using gas imported from the Middle East is no less bad than driving a 15 mpg truck, to say nothing of how an SUV owner who only drives 15 miles per day uses less gas than a hybrid owner who drives 70 miles per day.

But on Wednesday's The View, the ABC daytime show, Joy Behar had the best line. After former CBS News reporter Meredith Viera ludicrously described Huffington as "the conservative author and columnist," a perspective Huffingon long ago abandoned in her successful quest for media approval, Behar quipped: "I'd like to make a pledge today: If I see a terrorist in the Hamptons I'm going to run him down with my SUV."

(For the cast of The View with pictures of them all: http://abc.abcnews.go.com/theview/hosts/hosts.html)

Can't end CyberAlert with a better line than that. -- Brent Baker