WaPo's jihad against Social Security continues by Dean Baker

[hfojvt]

http://www.prospect.org/csnc/blogs/beat_the_press_archive?month=01&year=2009&base_name=the_posts_jihad_against_social

"Another day, it's another front page article in the Washington Post about the budget deficit. The Post has apparently not yet heard about the economic downturn that has the rest of the country concerned. "

Between the WaPo and NYT they seem to be pushing the Republican Spin point about deficits. That the "deficit and the debt are serious concerns, if not our most serious concern and therefore we cannot afford an economic stimulus or any other social programs or health care reform."
As Dean's other post for today says

"Can't The NYT Find Anyone Other than the Deficit Hawk Concord Coalition to Talk About Deficits?

Apparently not, since an NYT article on the budget quoted two people from the Concord Coalition and no one else. It would be helpful to readers if the NYT did not rely exclusively on people who believe that reducing budget deficits is the most important economic priority in its reporting."



I happened to see part of Hannity and Colmes (I wanted to see if Colmes was still there because I thought he had already gone to the short-lived Colbert and Colmes.) and a Republican spokesman was also pushing deficit, deficit, deficit. Along with two other talking points

1) The deficit is a spending problem. Too much government spending.

This is a lie, (or an error depending on if the speaker is evil or just misinformed). Between 1997 and 2007 spending increased by 70.5% in nominal dollars or by 34.37% in real dollars (factoring out inflation). In the 1960s and 1970s, when there was hardly any deficit, real spending increased by 57% and 41.9% and nominal spending increased by 112% and 202%.

Then there's the revenue side, what I claim is the real source of the deficit. A claim which is based on facts.

year *** Revenue

2000 2025.5
2001 1991.4
2002 1853.4
2003 1782.5
2004 1880.3
2005 2153.9
Seems to me that three straight years of declining revenues (and the decline is even bigger if you include inflation) probably had something to do with the deficit. Which brings me to their second spin point

2) "supply side" tax cuts increase tax revenue

Another lie (or error) as shown by both Reagan and Bush's income tax cuts. Here's real income tax revenue in the 1980s

1977 - 241.05
1978 - 256.22
1979 - 286.07
1980 - 286.93
1981 - 306.63
1982 - 297.92
1983 - 276.77
1984 - 275.94
1985 - 301.2
1986 - 304.12
1987 - 336.86
1988 - 332.64
1989 - 355.03
1990 - 354.49

Note well the decrease between 1981 at 306.63 and 1986 at 304.12. Note that 6% yearly increases were normal from 1977-1981. If revenue had continued to increase at just 5% per year it would have been at 475.68 in 1990 instead of just 354.49.

Here's nominal income tax revenue from 2000 to 2007

2000 - 1004.5
2003 - 793.7
2004 - 809.0
2005 - 927.2
2006 - 1043.9
2007 - 1163.5

Yes, there's nothing quite like taking six years to return to your previous level to increase revenues. Except that if you take inflation into account, it looks like this

2000 - 1004.5
2003 - 742.8
2004 - 737.8
2005 - 817.53
2006 - 891.66
2007 - 966.3

Thus, other than the war in Iraq, the main contributor to the deficit has not been spending, it has been revenue, which declined because of tax cuts. Thus, if Republicans are really concerned about the deficit, they should act to reverse the Bush tax cuts for the top 5% as soon as possible.