Saturday, October 13, 2012

How the Media Plays Out its Role in Our Risible Economic Debate

After a couple of opening paragraphs of pure snark, the Washington Post's editorial board criticizes the President for failing to clearly articulate why he is running for a second term. I've previously called for the President to do exactly that, but unlike the Post's editorial board I'm not going feign outrage if the President sets different priorities than I would prefer.

After attempting to trivialize the President's stated second term agenda by pointing to his plan to help states hire more math and science teachers, and his proposal to end certain tax subsidies for the energy industry,
He wants to take away $4 billion in tax breaks from oil companies. (The deficit in the fiscal year that just ended was $1.1 trillion.)
Why am I reminded of Robert Samuelson's notion of what constitutes "pocket change". Have we truly entered an era in which $4 billion in waste is not worthy of consideration, and in which a proposal for its elimination is mocked? If your concern truly is to balance the budget, why not respond, "One $4 billion item of waste down, 224 to go"? If you read the Post you know the answer - that's not the type of government expenditure that concerns its editorial board.

From there the Post gets to the meat of the President's tax proposal,
And he wants to increase tax rates for the wealthy. That would put a serious dent in the deficit, but it wouldn’t solve the fiscal problem, which unaddressed will “lead to a level of federal debt that would be unsustainable from both a budgetary and an economic perspective,” the Congressional Budget Office recently said.
First the problem is the deficit, and cutting waste isn't enough. Next it's, "The President has a clearly stated proposal that will cut the deficit" but, after a bit of sleight of hand, the deficit is no longer the issue.

So now that we're no longer talking about deficits, but are talking about the "level of federal debt", what does the Post have to say?
A solution can come only from restraining spending, especially growth in Medicare and Medicaid, and raising revenue, and not just from the rich.
Let's back up for a moment. The leading reasons we have a significant deficit at the moment are the Bush tax cuts, the Bush Administration's unfunded wars, and the economic downturn. As I recall, the Post supported all of the above. Yes, we would have a substantial deficit right now even without those factors, but principally attributable to revenue reduction from a profound recession and spending measures meant to help us pull out of the recession and to soften its blow on families. The point being, as we pull out of the recession and return to more normal levels of employment, more people will have income and tax revenues will rise.

And yet, when it comes to figuring out how to raise more revenue, creating more jobs, reducing unemployment, reinvigorating a middle class and improving its wages, none of that occurs to the Post's editorial board. It's "Why aren't you cutting entitlements." It's not that they're unaware that growing the economy will raise tax money - it's that they aren't being candid about their own agenda. If the Post's editorial board has a proposal by which tax revenues can be raised without impairing the economy, above and beyond as a result of growth or the proposed modest rollback of the Bush tax cuts, it's high time they shared it. After all, they found the time to chide Mitt Romney for not sharing the details of his secret plan to make revenue neutral his proposed massive tax cuts, so why keep their own secret plan so close to the vest?

You have to love this part. Remember how "A solution can come only from restraining spending... and raising revenue, and not just from the rich"? Seriously, this is the next sentence of the editorial:
Yet Mr. Obama has put forward no plan to curtail entitlement costs, while Mr. Romney at least is willing to say that benefits for wealthy Medicare recipients will have to be cut back.
That is, immediately after acknowledging that the President proposed a tax increase that will significantly reduce the deficit, and poo-pooing that it's not enough because it isn't sufficiently broad-based, they're praising Romney for making an economically meaningless pledge about trimming Medicare benefits for the wealthy. Even if he keeps that promise, the revenue savings will be trivial. So why is it bad for the President to take a serious, effective measure to close the deficit, but laudatory for Romney to make a cynical, hollow gesture? The most obvious inference is that the Post's concern is not with deficits but is instead with entitlements.

The editorial board next returns to its prior snarkiness,
Why the reticence? Maybe, after promising so explicitly four years ago that he would make hard choices and refrain from kicking the can down the road, he’s reluctant to make the same promises again. Maybe the usual Democratic “Mediscare” campaign is so useful he does not want to muddy the waters — or, more accurately, un-muddy them — with budgetary honesty.
You would think that at least one member of the editorial board would remember the Affordable Care Act, including its serious effort to find cost savings in Medicare. You would think that they would remember that the Republicans immediatedly engaged in demagoguery about the ACA, screaming at the top of their lungs about "death panels" and "cuts to the Medicare benefits you paid for." They claim to have watched the debates, so it's difficult to believe that they could have missed the demagoguery from Romney and Ryan about "cuts" to Medicare. Which side is engaged in budgetary dishonesty and is resorting in "Medicare" tactics, again?

Funny, also, how the Post is suddenly unconcerned about Social Security. Which candidate explicitly addressed Social Security and what it would take to make it fiscally sound over the long term? If you need the reminder, it was President Obama. Does the editorial board have the grace our courtesy to say, "At least he has promises to fix this other thing we've been harping about?" Nope. As with discussion of the ACA, any such honesty would undermine the two points they are trying to make, that the President has made no proposals to prevent entitlement costs from spiraling out of control, and that the only possible solution is massive cuts in those programs.

It seems fair at this juncture to ask, how does the editorial board believe that the federal government can cut Medicaid spending? We're not talking in that context about a population with a lot of resources to spare. To the contrary, if you have significant resources you don't qualify for Medicaid. If you cut Medicaid you cut the provision of medical care to that population.

You can, of course, use ACA-type measures to try to identify waste, to evaluate which treatments are the most cost-effective. But in case they missed it, the Supreme Court recently ruled that Medicaid is such a large program, contributing so much money to state coffers, that states must be given the right to opt out of any significantly revised program and be allowed to continue with the status quo. Seriously, does the Post have even one idea it can share? Romney at least came up with PBS and Sesame Street - and the repeal of the cost-saving measures for Medicare that the board wants to pretend Obama didn't sign into law.

As for Medicare, even if they assume Romney is sincere, they know that savings from his proposal to trim benefits for the wealthy would be trivial. They know that his pledge to repeal Obamacare will increase the cost of the program. They know that a promise to do something a decade from now, even if it's something they would applaud (i.e., turning Medicare into a voucher program) is nothing more that irresponsible buck-passing. Within that context, they want the President to promise additional cuts to Medicare - above and beyond the cuts that Romney and Ryan are suggesting will devastate seniors' ability to obtain care?

The Post is right about this: It would be nice if we could have an adult discussion about these issues and how we might mitigate, if not solve them. If the editorial board spent any appreciable amount of time reflecting on the subject, though, they would realize that unless they break with their longstanding tradition they aren't part of that solution. They're not even making an effort.

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