Last Call

I know I shouldn't give myself heartburn by ever reading an unsigned editorial from Investor's Buisness Daily on President Obama, but I went and did it anyway.  And lo and behold, their proof that they've caught the President in "five big lies" in his speech in Kansas this week reads like it was put together by an intern on cold medicine.

Let's start at the top.

• Tax cuts and deregulation have "never worked" to grow the economy.  There's so much evidence to disprove this claim, it's hard to know where to start. But let's begin with the fact that countries with greater economic freedom — lower taxes, less government, sound money, free trade — consistently produce greater overall prosperity.

But of course, actually producing that evidence doesn't matter.

Here at home, President Reagan's program of lower taxes and deregulation led to an historic two-decade economic boom. Plus, states with lower taxes and less regulation do better than those that follow Obama's prescription.

"Do better" how? What's you're measure for that?

Obama also claimed the economic booms in the '50s and '60s somehow support his argument. This is utter nonsense. Taxes at the time averaged just 17% of the economy. And there was no Medicare, no Medicaid, no Departments of Transportation, Energy or Education, and no EPA. Had Obama been around then, he would have decried it all as un-American.

The 50's and 60's also saw far more middle class manufacturing jobs and powerful industrial unions that leveraged America's post-war manufacturing capacity into a burgeoning middle class, as well as a growing civil rights movement to share the fruits of that middle class with all Americans.  Perhaps that had some effect as well as these "awful" programs listed here that Americans just hate.
(More fisking below the fold.)

• Bush's tax cuts on the rich only managed to produced "massive deficits" and the "slowest job growth in half a century." Budget data make clear that Obama's spending hikes, not Bush's tax cuts, produced today's massive deficits.

Really?  Because Bush's tax cuts alone cost more than President Obama's new spending.



Try again, please.

And Obama only gets his "slowest job growth" number by including huge job losses during his own term in office. Also, monthly pre-recession job growth under Bush was about 40% higher than post-recession growth has been under Obama.

So President Bush's policies were so awful that we're still digging out of the jobs hole.  Oh, and Republicans keep blocking measures to create new jobs.  Got it.  Moving on to number 3:

• During the Bush years, "we had weak regulation, we had little oversight." This is patently false. Regulatory staffing climbed 42% under Bush, and regulatory spending shot up 50%, according to a Washington University in St. Louis/George Washington University study. And the number of Federal Register pages — a proxy for regulatory activity — was far higher under Bush than any previous president.

But I thought the Republicans were saying we needed to return to Bush era levels of oversight.  And it's not oversight if the departments are larded with career staffers from the industries they are supposed to be regulating.  And I thought cutting federal jobs was what the GOP wanted.  I'm confused on this.

• The "wealthiest Americans are paying the lowest taxes in over half a century." Fact: the federal income tax code is now more progressive than it was in 1979, according to the Congressional Budget Office. IRS data show the richest 1% paid almost 40% of federal income taxes in 2009, up from 18% back in 1980.

Wait, what?  After the richest 1% made more than half of the income gains for the entire country during that same period, would you not expect them to be paying more of a share of the total country's income tax revenue?





On top of that, the top marginal tax rate is extremely low, as are corporate and capital gains taxes. Far lower in fact than the boom periods of the 50's and 60's. We should be having super boom periods by that logic. But we're not.

• We can keep tax breaks for the rich in place, or make needed investments, "but we can't do both." Not true. Repealing the Bush tax cuts on the "rich" would raise only about $70 billion a year, a tiny fraction of projected deficits. With or without the Bush tax cuts, the country can't afford Obama's agenda.

Wrong again.



The percentage of deficit created by extending the Bush tax cuts yes, would be a small fraction of our deficit. In 2012. (It's that small light blue sliver at the top of the 2012 deficit figure.) Please notice how large the light blue section gets over the next ten years, plus the growing medium blue section of additional debt interest payments caused by deficits created by the Bush tax cuts.

So when all is said and done, four of these five "lies!" are in fact true, and the other (the first) is too subjectively broad to be worth anything.

Please come again.