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Liberal Spin Prevails: How CBS Led the Networks' Charge Against the Bush Tax Cut

 

Contrary Information Omitted

When reporters validate one side’s partisan claims by embracing them as their own, they signal audiences that those partisan claims are essentially correct. In the case of the Bush tax cuts, there was ample evidence that the overall magnitude of these tax proposals was comparatively small, yet the networks persisted in repeating the claim of liberal partisans that the cuts were large.

Reporters frequently stated that the overall size of the tax package was $1.6 trillion, but usually omitted that this was the accumulated total over a ten-year period. NBC’s weekend anchor John Seigenthaler, on February 4, was the only correspondent during this time period to clearly state this point in his presentation of "the President’s plan to cut taxes by $1.6 trillion over ten years." This more complete description of the tax cut’s size makes it seem far less formidable. Under current law, federal revenues are expected to total about $28 trillion during this same ten-year period, meaning that the total tax reduction package amounts to less than six percent of the total anticipated revenue.

Further, all of the network coverage has relied on statistics derived from "static analysis" of the budgetary consequences of the President’s program. A "static analysis" does not take into account the fact that consumers, investors, workers and businesses will respond to lower tax rates by changing their behavior in ways that will lead to more economic growth. These changes in economic behavior are widely understood and expected — one reason why tax cuts are generally recommended when the economy is weak.

According to a detailed research paper recently distributed by the Heritage Foundation to more than a thousand members of the media — including those at ABC, CBS and NBC — a "dynamic analysis" of the Bush tax cut that considered these changes in economic behavior indicated that "because the tax relief would increase economic growth and employment, the larger tax base would generate $846 billion in tax revenue that is unaccounted for in a static analysis," slicing the estimated "cost" of the tax cuts by 47 percent.

Exhibit3Additionally, a study by the National Taxpayers Union (NTU) compared the Bush tax cut with two previous across-the-board income tax rate cuts: the Kennedy tax cut of 1963 and the Reagan tax cut of 1981. According to the NTU, Bush’s proposed cut is actually smaller than both previous cuts "as an average percentage of Gross Domestic Product (our nation’s yearly economic output) — a measure many economists believe is the most relevant factor regarding a tax cut." Reagan’s cut amounted to 3.3 percent of the overall economy, followed by Kennedy’s at 2.0 percent. Bush’s proposed cut — castigated by so many network reporters as "big" and "massive" — amounts to only 1.1 percent of the GDP. (See Exhibit 3: "Comparing Tax Cuts")

None of the networks even hinted at the Heritage and NTU studies, nor was there any evidence that they altered their commentary about the tax cut’s size after being presented with these contrary facts. The Heritage paper was specifically prepared to offer a factual rebuttal to the Concord Coalition, whose claims that the Bush tax cut was dangerously large were publicized on ABC’s World News Tonight and the NBC Nightly News. Yet none of the networks told viewers about either of these studies; doing so would have enabled audiences to think more critically about reporters’ labeling of the tax package as "big" and "huge."