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The New York Times' Tax Coverage Goes Off the Rails

The Times news columns have been openly campaigning against Trump’s tax cuts from the moment they were rolled out.

Chan Long Hei / Pacific Press/NewscomChan Long Hei / Pacific Press/NewscomBinyamin Appelbaum is one of the more fair-minded and accurate reporters at The New York Times. For an example of his best work, one might look back to his reporting from Hazleton, Pa., in October of 2016. So it was particularly dismaying to read Appelbaum's dispatch over the weekend in the Times, under the headline "Trump Tax Plan Will Not Bolster Growth, Economists Say."

The Times news columns have been openly campaigning against Trump's tax cuts, from the moment they were rolled out. The paper's day one front page headline was "Tax Overhaul Would Aid Wealthiest." Its day two headline was "Trump's Plan Shifts Trillions To Wealthiest."

Even by that low standard, though, the Appelbaum story was something to behold. It's worth taking a careful look at as an example of the techniques that the press uses with the effect of distorting the debate about the tax cut.

The first ingredient is a headline that goes beyond what the story itself says. Buried in the penultimate paragraph of Appelbaum's article are two estimates of how tax cuts might bolster growth. "The Tax Foundation thinks 0.4 percent is a reasonable estimate of the best case. Mr. Holtz-Eakin said that he regarded 0.5 percent as an upper bound on the potential benefits," the story says.

It's not clear whether these estimates are of any tax cuts or of Trump's tax cuts in particular. But the Tax Foundation blog carries an article that says just a cut in the corporate tax rate to 15 percent—without the individual rate cuts Trump is also proposing—would generate "something more like 0.4 percent over the budget window: a sustained period of 2.3 percent growth instead of 1.9 percent growth, until the economy is eventually about 4 percent larger."

So the headline about "will not bolster growth" is inaccurate. The cuts would bolster growth, at least by some estimates, just not by the amount that Appelbaum has arbitrarily set up as a goalpost.

The way the Times describes these growth numbers—as decimal percentages—is itself a kind of spin. Using language like "0.4 percent" makes the growth sound small. But higher annualized growth rates compound over time. When, in other articles, the Times talks about other percent-based fees—say, those charged by money managers to public pension funds—it uses real dollar figures to make the numbers sound larger: "almost $750 million in direct investment expenses," "an additional $1.8 billion over five years and almost $8 billion after 15 years."

The U.S. annual gross domestic product is about $18 trillion, so a "4 percent larger" economy means $720 billion—or $720,000,000,000—more goods and services produced each year. That is nothing to sneeze at. At that is just the effect of a corporate tax reduction, not other growth-inducing steps such as personal income tax reductions, deregulation, increased energy exploration and production, a stable dollar, or (if you buy the idea that this is stimulative) a military buildup.

Nor are the growth numbers the only way that this Times article uses numerals in a misleading way. The newspaper is also spinning when it comes to tax rates. The article says: "there is little evidence that current rates are high enough to discourage people from earning as much money as they can. When Mr. Reagan took office, the top tax rate was 70 percent; now, it is 39.6 percent."

The Times-chosen comparison of "70 percent" and "39.6 percent" makes the current rate appear low. It would have been accurate, however, to write, "When Mr. Reagan left office, the top individual income tax rate was 28 percent; now, as the Times reported on its front page back in 2013, in California the combined top state and federal income tax rate is 51.9 percent, while in New York City it is 51.7 percent. Even for lower-income individuals, the combined effects of means-tested benefit phase-outs and marriage penalties can create all kinds of perverse incentives, as the University of Chicago economist Casey Mulligan argues in his book The Redistribution Recession."

The Times took this argument seriously in its economics blog back in 2013. Back then, it published an article under the headline "The Marginal Tax Rate Mess" that acknowledged, "As a result of losing eligibility for means-tested benefits, low-income and middle-income families sometimes experience much higher marginal effective tax rates (sometimes exceeding 90 percent) than those at the top of the income distribution."

Now that President Trump wants to reduce taxes, though, the Times doesn't even bother to mention that evidence; it just states, inaccurately, that there is "little evidence."

It's no wonder Trump rails against the "fake news" of the "failing New York Times." On the topic of taxes, Times coverage has gone off the rails.

Photo Credit: Chan Long Hei / Pacific Press/Newscom

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  • Diane Reynolds (Paul.)||

    Tax cuts do not bolster the growth of government. This is the starting point of all NYT articles. NYT is being honest on this.

  • Microaggressor||

    Money is the metric, after all. Won't somebody think of the destitute politicians?

  • Mark22||

    "You have no reason to remember, but we came out of the White House not only dead broke, but in debt"

  • Michael Hihn||

    "You have no reason to remember, but we came out of the White House not only dead broke, but in debt"

    We should celebrate their comeback???

  • Michael Hihn||

    Tax cuts do not bolster the growth of government.

    Nobody says otherwise. Except the supply-side retards who say tax cuts pay for themselves, and that income tax revenue skyrocketed after the Reagan tax cuts.

    This is the starting point of all NYT articles. NYT is being honest on this.

    A possibly overdramatic way of saying that tax cuts don't bolster revenues, which is .... impossible to know. So the Times is as full of shit as the supply-siders, because the entire political class traffics in bullshit propaganda ... including the libertarian establishment. Look how MASSIVELY Ira Stoll fucked up this story, and how eagerly the goobers swallowed it.

    Or, a related example, Nick Gillespie's insane claim that huge tax cuts after World War II were a "stimulus" for the postwar boom ... derived from bullshit data by Mercatus ... as their minions chant, "proggies" "libtards" "Streisand was a shitty singer" and the entire tribal hymnbook.

    America doomed. Libertarian politics could fix what's wrong with America ... if they had not been abandoned.

  • Rhywun||

    "there is little evidence that current rates are high enough to discourage people from earning as much money as they can"

    It's refreshing to hear the NYT admit that they want people to stay poor.

  • Michael Hihn||

    You said such total bullshit in public ... and Stoll TOTALLY failed to even address the issue.
    Progtards and contards aren't the only ones eager to be manipulated. Sad!

  • Adam330||

    "there is little evidence that current rates are high enough to discourage people from earning as much money as they can. When Mr. Reagan took office, the top tax rate was 70 percent; now, it is 39.6 percent."

    We're always hearing about that awesome 1980-81 economy. You know, the one with the double-dip recession.

  • Michael Hihn||

    Followed by the longest and strongest boom since the 1920s -- from the REAL worst recession since the 30s.
    The ONLY postwar booms followed the Kennedy and Reagan tax cuts, which were identical.
    Clinton took office in the 22nd month of a recovery,
    Thanks for bringing it up!

  • BYODB||

    So below you call the Reagan tax cut increase to government 'revenue' a myth, and now you're saying this. How do you reconcile those two statements one wonders? Last I saw, even the much-maligned Bush tax-cuts had a resulting uptick in revenue after a year.

  • Michael Hihn||

    r>So below you call the Reagan tax cut increase to government 'revenue' a myth,

    Income tax revenue is not GDP.

    and now you're saying this. How do you reconcile those two statements one wonders?

    Nothing to reconcile. "This" is a boom, which means GDP growth.
    "Below" was income tax revenue growth.
    GDP is the total economy.

    Last I saw, even the much-maligned Bush tax-cuts had a resulting uptick in revenue after a year.

    Politicians lie Heritage said the tax cuts would eliminate the entire federal debt! (lol)
    And the Bush tax cuts weren't remotely similar to the Kennedy and Reagan cuts

    http://www.taxpolicycenter.org.....nue-source

    2000 1,004,462 baseline
    2001 994,339 Bush I effective
    2002 858,345
    2003 793,699 Bush II
    2004 808,959
    2005 927,222
    2006 1,043,908

    Nominal dollars

    .

  • Adam330||

    yeah, that was my point. the times decided to rely on the tax rates during two of the worst years in the post-WWII US economy, which were famously followed by a very large tax cut and economic boom, in support of the claim that "there is little evidence that current rates are high enough to discourage people from earning as much money as they can." i suppose the time thinks that invoking reagan makes trump look bad or something.

  • Michael Hihn||

    Two totally different issues.

  • Libertarian||

    You crazy libertarians are always talking tax cuts, but you never say how you're going to pay for them.

  • Longtobefree||

    Tax cuts do not need to be "paid for". They just change the revenue of the affected government. The affected government then takes what steps are necessary to reflect that change. If the revenues increase, cut taxes more. If the revenues decrease, cut spending. Actually very simple.
    Full disclosure: If the affected government is the federal government of the United States, they just print more money.

  • Michael Hihn||

    Tax cuts do not need to be "paid for".

    Except when you say they should. And tell that to the fiscal conservatives who invented the lie.

    If the revenues decrease, cut spending. Actually very simple.

    And how they're "paid for."

    "Tax cuts pay for themselevs" is bullshit invented by fiscal conservatives, the supply-side faction. when they lie about the Reagan tax cuts. To their base, which is as gullible as the worst progs. It's how many of today's fiscal conservatives, including libertarians, excuse their lack of knowing HOW to cut spending.
    The laugher curve.

  • Michael Hihn||

    Great. Now Reason is publishing fake news.
    Stoll states, correctly, that the Tax Foundation forecasts 0.4% growth.
    That's also the number that gets from 1.9% growth to 2.3% growth.

    Then, still kicking the Times in the balls, Stoll says it's more common to report the growth in dollars, and he calculates annual growth of $720 billion. But he uses 4.0% not .04% The actual growth forecast is only $7.2 billion. So, the goddamn Times is correct on the slow growth, and Stoll needs a math tutor.

    I thought Republicans were the only Tax Quacks, with wild delusions like income tax revenues "skyrocketed" after the Reagan tax cuts. I've been saying for months that fiscal conservatives have been off the rail for decades. This is just another example. As the threats to liberty mount. It's scary out there,

  • BYODB||

    .4 is 4% in Decimal last I checked...

  • Jima||

    If you guys are arguing about this dog's breakfast of the literary arts,"something more like 0.4 percent over the budget window: a sustained period of 2.3 percent growth instead of 1.9 percent growth, until the economy is eventually about 4 percent larger." I'd argue you could both be right, wrong, or neither. It's such a non specific generalization, it's hardly worth hair splitting, no?

  • Michael Hihn||

    If you guys are arguing about this dog's breakfast of the literary arts,"something more like 0.4 percent over the budget window: a sustained period of 2.3 percent growth instead of 1.9 percent growth, until the economy is eventually about 4 percent larger." I'd argue you could both be right, wrong,

    I am PRECISELY correct.
    0.4% is the ANNUAL increase.
    4% of the EVENTUAL total increase.
    But Stoll multiplied the 4% (eventual) and said that would be the growth "per year"

    it's hardly worth hair splitting, no?

    It's the difference between $720 billion and $72 billion (mine corrected).

  • Johnimo||

    OK … this is the biggest nonsense ever. I'm really, really bad at math, however I think the following is correct:

    4% means "four hundreths" which is expressed in decimal form as 0.04
    .4 is four tenths, nearly 1/2 of something, right? That's expressed in percentage form as 40%

    If I told you I was going to take 0.4 of all your money, you'd risk losing 40% of your money:
    0.4 x $1.00 = $0.40, or 40 cents. Get out your calculator, key in .4 x 100 and you find the answer is 40

    Gang, I'm pretty sure that this is all ELEMENTARY math: 4% of 1 = 0.04, just as 4% of $1.00 = $0.04, or
    4% of 100 cents = 4 cents.

  • Longtobefree||

    On the other hand, you are applying elementary math to the federal government.
    In that world, a 5% increase is a massive cut if a 6% increase was projected by some fool in the press.

  • Michael Hihn||

    OK … this is the biggest nonsense ever

    So why did you post it?

  • Michael Hihn||

    .4 is 4% in Decimal last I checked.

    Check again. 4% in decimal is .04. And 0.4% = .004 decimal.
    Which is totally irrelevant.

    What he did was screwup the 0.4%..annual with the 4% TOTAL "eventually"

    would generate "something more like 0.4 percent over the budget window: a sustained period of 2.3 percent growth instead of 1.9 percent growth, until the economy is eventually about 4 percent larger

    Then he wrongly applied the EVENTUAL 4% to ANNUAL growth.

    The U.S. annual gross domestic product is about $18 trillion, so a "4 percent larger" economy means $720 billion—or $720,000,000,000—more goods and services produced each year

    There is no 4% larger economy per year

    That is nothing to sneeze at

    ACHEW

  • Adam330||

    You're both wrong. 0.4% of $18T is $72B.

  • BYODB||

    I didn't even bother checking his math, but it was obvious at face value that if the economy only grew by 7.2 billion the last word anyone would be using is 'slow' in terms of growth. They would be using 'Armageddon'.

  • Michael Hihn||

    Yes. Thanks!

  • the_decadents||

    Reading comprehension, folks. "...until the economy is eventually about 4 percent larger.""

  • Michael Hihn||

    Reading comprehension, folks. "...until the economy is eventually about 4 percent larger.""

    That's where Stoll blew it.

  • ||

    Everybody's wrong.

    Given Tax Foundation's 0.4% figure, the economy would grow 0.4% until the total growth reached 4%, and then presumably the growth would level off. Log (1.04, 1.004) = in about 9.8 years, the economy would have grown 4% due to the tax cuts and would then return to baseline growth. The baseline growth probably complicates further, but whatever.
    Year Pct Econ Diff
    1 1.004 $18,072,000,000,000.00 $72,000,000,000.00
    2 1.008 $18,144,288,000,000.00 $144,288,000,000.00
    3 1.012 $18,216,865,152,000.00 $216,865,152,000.00
    4 1.016 $18,289,732,612,608.00 $289,732,612,608.00
    5 1.020 $18,362,891,543,058.40 $362,891,543,058.43
    6 1.024 $18,436,343,109,230.70 $436,343,109,230.66
    7 1.028 $18,510,088,481,667.60 $510,088,481,667.59
    8 1.032 $18,584,128,835,594.30 $584,128,835,594.26
    9 1.037 $18,658,465,350,936.60 $658,465,350,936.64
    10 1.040 $18,720,000,000,000.00 $720,000,000,000.00

  • ||

    Everybody wrong definitely includes me. The baseline growth will definitely complicate this. Include 1.9% baseline growth, and you get to $720Bil increase above baseline about midway through year 8.

    Thought it's unclear whether Cole meant a an absolute 4% bigger, or 4% bigger relative to the baseline. If the former, then the increase above baseline is only about $147Billion instead of $720Billion.

  • Michael Hihn||

    Everybody's wrong.

    Nobody did that extension.

  • MarkLastname||

    Mike not read numbers good.

  • Michael Hihn||

    I READ the numbers perfectly. Stoll fucked up bigly.
    I CALCULATED wrong, said $7.2 billion which should be $72 billion.
    Thanks again to Adam330 for the helpful contribution..

  • KerryW||

    The only thing "wrong" in Ira's statement was that he used vague language. He said the economy would be $720 billion bigger "eventually", which is correct but doesn't specify when eventually is. In fact, it would be that much larger after about 8.5 years. (It would have been 10 years except that the baseline growth rate is above zero. Joshua above says midway in year 8, but I think it's really midway in year 9.) So Ira's basic point is correct.

    After one year it is only $72 billion larger, as Tony suggests, but after two years it is $147 billion larger, and the difference grows with each succeeding year.

    And Ira's main point (that the Times contradicted itself) is spot on.

  • Michael Hihn||

    The only thing "wrong" in Ira's statement was that he used vague language.

    You read him wrong. And he had a massive fuckup on reading the Times. So that's a fuckup squared (a fuckup times a fuckup).

    He said the economy would be $720 billion bigger "eventually", which is correct

    He never said that!

    "...or $720,000,000,000—more goods and services produced each year"

    Plus, he's fucked up the "4 percent economy," assuming that would be be year, after HE wrote 0.4% annually UNTIL 4% (or a little less than ten years)

    but doesn't specify when eventually is.

    Irrelevant to anything he wrote -- except that his math fuckup caused HIM to be wrong (NOT the Times)

    In fact, it would be that much larger after about 8.5 years. (It would have been 10 years except that the baseline growth rate is above zero.

    Wrong again. It's the BASELINE would be higher by 0.4% per year (not the 4% annually that Ira said)

    After one year it is only $72 billion larger, as Tony suggests,

    "Tony" appears nowhere on this page.
    And Ira said it would be $720 billion larger.

    And Ira's main point (that the Times contradicted itself) is spot on.

    Only to those who lack elementary arithmetic or reading skills, or both -- which is nearly half the commenters here.

  • MarkLastname||

    Congratulations then to you and Mr. Stoll on joining the 'off by only one order of magnitude' club together.

  • Michael Hihn||

    Try again. Mine was a calculation error. Ira used the wrong number entirely.
    First he said 0.4% annually until an eventual 4% total.
    THEN he used 4% per year for his arithmetic example.
    Yours is merely an error in elementary reading, almost identical to his.
    So the Times is smarter than both of you. And half the commenters here. Sad! (but not that surprising)

  • Dizzle||

    Lol you spend a whole thread criticizing others arithmetic only to have to admit you screwed up too. It amazes me you still think your method of communication is effective, especially if you're trying to "recruit for a revolution" as your website says, assuming you are who you say you are. You're actively souring people to your ideas in the comments of a publication where the majority of its readers probably agree with you. How do you ever expect to "recruit" anyone from the outside? I don't think you do, you have zero clue of how to engage and are far more concerned with proving your intellect than educating anyone. As I've stated before, high horse intellectual pricks like you damage our goals more than achieve. Your successful at turning people off of you, that's about it.

    You're so smart, yet still can't figure out people don't dislike your ideas, they dislike you lol.

  • Michael Hihn||

    Lol you spend a whole thread criticizing others arithmetic

    (lol) you lie about what I've done to support your own bullshit -- then TOTALLY FUCKUP my website!!!

    especially if you're trying to "recruit for a revolution" as your website says,

    (smirk) That's a web archive of things published over 20 years ago.
    Umm, why it's called, "Best of ..."
    And you even lied about it's purpose. "A how-to guide for taking back America." Which is way ahead of Cato and Reason.

    You're so smart, yet still can't figure out people don't dislike your ideas, they dislike you lol.

    If they're as phony as you, I take pride in it.

    Assholes like you are why so many are terrified to admit their errors. (on a MINOR point)
    The MAJOR point was how Ira -- and so many here -- fucked up annual vs eventual growth.
    Try again?

  • loveconstitution1789||

    Ira you are more dedicated than I to read anything from the NYT. I never give them money and try to avoid giving them any ad revenue by clicking on any of their material.

    In fact, if the only people visiting the lefty media's material were writers at Reason, we could all get to see what bat-shit crazy stuff the left is talking about, Reason gets all the ad revenue and the lefty media goes out of business.

    The NYT, hire writers who are team left players, so chances are the articles are skewed left. I have grown up having to get news from the left and became astute at picking out the insidious spin quickly.

  • Libertarian||

    Ira reads the NY Times because he gets a chance to win $3 for doing it.

  • Michael Hihn||

    Why read the Opinion pages anyhow, which are as useless as Fox's?
    The Times and Fox (and most) NEWS sections are all fine.

  • Warren||

    What is it with Reason and arithmetic today.

  • Longtobefree||

    Blah, blah, blah, New York Times, blah, blah, yawn.

  • Michael Hihn||

    Don't disturb your tribal cave.

  • Sanjuro Tsubaki||

    Come to think of it, the NYT has been campaigning against Trump ever since he was first rolled out. What's so special about his tax policy?

  • Michael Hihn||

    the NYT has been campaigning against Trump ever since he was first rolled out

    By reporting his nonstop bullshit?
    Fox defended Trump on the Russian secrets thing .., for which he totally humiliated them. Opinion, news reported the facts. You can't see the pattern here?

  • aajax||

    Right. There are a dozen things worse about Trump. I lived in New York when this huckster was all over the gossip pages. Meanwhile he was a joke on Wall Street and just about anywhere else in the business world. I sfor uspect he still is. If it wasn't for Comey and Trump's mentor Putin, he'd be nowhere.

  • Michael Hihn||

    Nearly 10 million voted against Trump, plus he got a record number of "anti" votes (anti the opponent, not for him). He got the nomination with like 37% of Republicans, about the same number who believe Obama is a Kenyan, mostly because there were so many opponents splitting the vote.

  • SUPERHEAVYDOODY||

    HA! Reason just had an article about speech and taxes. Why is letting me keep more of my money in this article a "tax cut"?
    No really. I await an answer from an editor. Glad I stopped paying for the print version I enjoyed. Yall following falling New York Times style of reporting?

  • Michael Hihn||

    Yeah, what's next, a review of a Streisand movie?
    Keep the tribal bubble pure!

  • MarkLastname||

    Syntax, it's important. If GDP would grow by 2.3% instead of 1.9%, it would grow by .4% more; or, alternatively, the growth rate would be ~17% higher. Gotta get the order of the derivative right.

  • Michael Hihn||

    Syntax, it's important.

    Yes, but elementary literacy is more important.

    If GDP would grow by 2.3% instead of 1.9%, it would grow by .4% more;

    That's what both Stoll and the Times said. Stoll's wacky fuckup came much later. This is your second one, the worst of two.

    or, alternatively, the growth rate would be ~17% higher.

    So syntax is important -- to making totally irreverent comments? Plus,
    YOU USED THE WRONG DENOMINATOR!!

    17% is 0.4 of 2.3. But the growth rate is applied to the STARTING value (1.9%)
    So 0.4% growth is 21% greater growth. (0.4 / 1.9 = 21%)
    Alternatively, 2.3 is 121% of 1.9! (2.3 / 1.9 = 1.21

    Gotta get the order of the derivative right.

    Far more relevant, it's crackers to slip a rozzer, the dropsy in snide. Unless rainy Thursdays in July.

    2017
    (Now you can debate what year it is. Or regale us all again with your wacky notions on privatizing Social Security. Your choice!)

  • aajax||

    There is no way you can adequately cover tax policy implications in a one page article like this. As an example, just try searching for the word "debt' anywhere in this article.

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