A Massive Reporting Deficit
Since the 2006 State of the Union address, the networks have complained about the deficit and called it “soaring,” “ballooning,” “record high” and “exploded.”
Though the deficit has trended steadily downward by billions of dollars, network news mentions have insisted it is an increasing problem. Broadcast stories spun the deficit negatively 35 times since February 1 – and told the good news of its decline only once without undermining it, Business & Media Institute analysis showed.
Deficit projections dropped throughout the year until the White House’s October 11 announcement that the deficit for fiscal year 2006 was $248 billion, down from the February prediction of $423 billion. Bush had pledged the deficit would be cut in half by 2009, but the recent drop accomplished that goal three years early. The White House based its halving projection on the FY 2004 projected peak of $521 billion.
“The good news is the deficit fell to its lowest point in four years,” said anchor Brian Williams on the October 11 “NBC Nightly News,” before undermining it: “It’s also the bad news, $248 billion. Higher tax receipts from corporations and individuals helped the bottom line this year. The problem is next year the deficit is expected to rise again, and long-term, the budget will be strained by the retirement of those 78 million American baby boomers.”
Since February 1, the media have reported that the deficit is increasing, that taxes must be increased to fix it, that tax cuts will cause the deficit to grow and that the Republicans are to blame for the “record-high” deficit.
“The president is selling slower spending coupled to growth produced by his tax cuts to cut the deficit in half,” said Jim Axelrod on the February 6 “CBS Evening News.” “But many in Congress may not be buying, having watched the national debt increase $2.5 trillion on the president’s watch.”
NBC’s Tim Russert hyped the deficit as an election issue on the June 15 “Today” show. “They see the lack of action, record deficits, high gasoline prices, no immigration bill. They just think it’s a do-nothing Congress.”
Now, however, that the much-lower figure has been announced, good-news reporting has been scarce.
Broadcasts regularly included statements that tax cuts could not lower the budget deficit but would add to the problem, which was false.
For example, ABC’s George Stephanopoulos said of Sen. John McCain (R-Ariz.) on the May 14 “This Week,” “when you mention that he’s making Bush’s tax cuts permanent as a plus to him as a conservative, that is going to collide with his talk about the deficit.”
And some even openly pushed for tax hikes, as CNN’s Lou Dobbs did on the July 12 CBS “Early Show”: “without meaningful, meaningful increases in taxation we’re not going to see this deficit erode.”
In reality, since the tax cuts, revenue is the side of the budget that has “soared.” As Heritage Foundation economist and Business & Media Institute Adviser Dan Mitchell pointed out in an October 13 WebMemo, “Federal tax collections jumped by 11.8 percent, climbing from $2.15 trillion in FY2005 to $2.41 trillion in FY2006. This $254 billion increase was more than three times faster than needed to keep pace with inflation.”
Tax cuts can’t be blamed for the deficit, explained Lawrence Lindsey, former chief economic adviser to Bush, in an October 13 Wall Street Journal commentary. “The Joint Committee on Taxation estimated that the FY 2002 revenue loss of the first Bush tax cut was $38 billion and $51 billion from the second Bush tax cut – $89 billion in all,” Lindsey wrote. “This leaves $268 billion of the shortfall to be attributed to the effects of the collapse of the 1990s bubble, the attacks on 9/11, and other economic drags.”