How Jeb Bush’s Tax Cuts Suckered the Media

[seafan]

How Jeb Bush’s Tax Cuts Suckered the Media, by Jonathan Chait, September 10, 2015

If you have heard about Jeb Bush’s new tax plan by reading political reporters, you have probably heard that it is a “proposal to reform the tax code” that will “crack down on hedge fund managers” (CNN), that it is “mainstream and ordinary” with “a populist note” (NPR), that it “challenged some long-held tenets of conservative tax policy” (the New York Times), and has “a nod to the populist anger roiling both parties” (The Wall Street Journal). It is, in other words, the same sort of coverage George W. Bush received when he unveiled his tax cuts in 1999, and which the campaign successfully cast as a populist departure from traditional Republican priorities.

On the other hand, if you have learned about the tax plan from some of the new policy-focused writers, you have drawn a very different impression. It is a “large tax cut for the wealthiest” (the Upshot) and a reprise of the Bush tax cuts, but “with more exclamation points" (Wonkblog). The difference lies between journalists who write narratives drawn from quotes from campaign sources and those who build their coverage on data. George W. Bush was fortunate that data-based journalism barely existed 16 years ago. His brother is counting on the power of narrative to obscure the data.

The overall structure of Bush’s plan is crystal clear. It is made of good old-fashioned, gigantic, regressive, debt-financed tax cuts, just like his brother used to do. Politically, Bush’s plan runs into the party’s classic resource-allocation problem: Tax cuts whose benefits overwhelmingly accrue to the very rich mean less money to finance spending programs that benefit a much broader share of the population. Taking stuff from the many and giving it to the few is bad politics because the many have more votes. Bush’s solution to this dilemma involves a number of misdirection attempts.

1. Emphasize the hedge-fund loophole. The narrative news stories all led with the news of Bush’s plan eliminating the carried-interest loophole, a completely unjustifiable giveaway to hedge-funders that Republicans have long refused to eliminate. And that is a positive step. But it is a tiny one, accounting for less than one percent of the size of the revenue lost by Bush’s tax cuts. The Bush campaign bought some great press coverage very cheaply by having its minuscule tax hike on the rich obscure its overwhelmingly larger tax cuts for the rich.

2. “Growth.”
......

3. Trade-offs.

.....

The trade-off problem is a political economy dilemma the Republicans have never been able to crack in three and a half decades of manic tax-cutting. They have never figured out a way to get government spending down to levels concurrent with their preferred levels of taxation. The only creativity they have shown in this area is developing new and innovative ways to hide the ball.

As we see, yet again with the Bu$h Family, the devil is in the details.

And it reeks of sulfur.

[Skittles]

1. will they ever get off their trickle-down bullshit?