Budget

ABC's online "The Note" describes itself as "Washington's Original and Most Influential Tipsheet." ABC News's Senior Political Reporter Richard Klein is its current content creator.

We'll see how influential "The Note" really is if what Klein writes about the machinations behind the attempt to make us forget that the Obama stimulus plan was supposedly going to be making some kind of difference at this point gets out anywhere else. Color me skeptical.

No doubt, Klein gets in some pretty strong, accurate, and long-overdue rips (links are in original):

For Time Magazine, Kevin O'Leary has decided that he's figured out why California is in such a budget mess. Is it because the state indulges over generous social programs, or always has some of the highest taxes in the nation, or because the denizens of its capitol in Sacramento are paragons of waste, fraud and theft? Nope. It's because California has Proposition 13, a measure that prevents state government from too easily raising taxes. Yep, O'Leary thinks California is in a mess because it doesn't have high enough taxes. And it's all Reagan's fault.

With some of the highest taxes in America, California is a hard place to make a living. According to the Tax Foundation, on average it takes a citizen 110 working days to earn enough money to pay his yearly tax bill. That is the fourth worst in the country. California consistently ranks in or near the top 10 worst states for its tax burdens from property taxes, to corporate taxes, to individual taxes and fees of all sorts. So, how can O'Leary imagine that taxes aren't high enough in California?

Maybe reporters Brian Faler or Nicholas Johnston at Bloomberg asked Barack Obama some really challenging questions when they had a chance to interview the President at the White House. Maybe they even did some basic fact-checking. If so, there's precious little evidence of either in their June 16 report.

They allowed the president to blame most of the current year's deficit on George W. Bush. They let him speak of "robust" growth when the best guesstimates they quoted for the second half of this calendar year and all of next year are anemic -- at least as the press benchmarked growth during the Bush 43 years.

The Bloomberg pair also ignored the alarming deterioration in federal receipts from economic activity that has continued into June, one of the four biggest collections months of the year.

Here are key paragraphs from Faler and Johnston's failed filing (bolds are mine):

A calm Sunday breakfast might have been ruined after a glance at The Washington Post’s front page on June 14. A chart below the fold explained that under Obama’s federal spending proposals, the United States would be required to borrow $9 trillion during the next decade. That’s $9,000,000,000,000. The Post compared that, in today’s dollars, to the financial burden of World War II: $3.6 trillion. That’s not all of Obama’s spending plan. That’s only the part that’s in the red.

Is it any wonder that a recent Gallup poll found more people disapprove rather than approve of Obama’s handling of the deficit? But we’ve only just begun. Now President Obama wants to add another enormous chunk of government health-care spending. The Congressional Budget Office projects that the latest Democratic bill in the Senate would add another one trillion dollars to the budget over the next decade, and they suggest that’s only a partial estimate.

In John Harwood's Sunday Week in Review piece, "Rethinking The Reagan Mystique," he claimed Republicans are rejecting Ronald Reagan as a political inspiration and urging their party to look forward. He probably overstates the case. However, Harwood does come up with a novel insult of Reagan: The man the media labeled a heartless budget-cutter was actually a runaway spender in disguise!

For a liberal Democrat, President Obama has offered generous praise for the most celebrated of his recent Republican predecessors.

Mr. Obama has credited Ronald Reagan with having "changed the trajectory of America" in ways Bill Clinton didn't. "President Reagan helped as much as any president to restore a sense of optimism in our country, a spirit that transcended politics," Mr. Obama said earlier this month while signing the Ronald Reagan Centennial Commission Act in the presence of Nancy Reagan.

It's not surprising that Mr. Obama has embraced Mr. Reagan's achievement since it seems akin to his own aspirations and might also ingratiate him with conservatives. What is surprising is the increasingly ambiguous position Mr. Reagan holds on the right.

A fabulous 1934 Chicago Tribune cartoon that has recently been making the rounds in the blogosphere as an example of history sadly repeating itself was marvelously rerun at the paper's website on June 10.

In it, members of Franklin Delano Roosevelt's administration are seen shoveling money out of a wagon with a billboard on the side declaring, "Depleting the resources of the soundest government in the world."

On Wednesday, the Trib reprinted the cartoon with the caption "This is a 1934 Chicago Tribune political cartoon that many say rings true in today's political and economic climate. What do you think?" (full, largely legible print below the fold along with an explanation of the characters uncovered by The Federal Observer, h/t NBer Gary Hall):

It's pretty hard to dress up a disaster as something less than that, but the Associated Press's Martin Crutsinger gave it his best shot in his report yesterdayabout Uncle Sam's the May Monthly Treasury Statement, in effect understating the amount and significance of federal government's rapidly deteriorating financial situation.

With the help of dubious handling of last year's stimulus payments in May 2008's Treasury Statement, Crutsinger ignored serious declines in tax receipts from economic activity (over 30% in each of the past three months) that are, if anything, accelerating. I covered that problem in Part 1.

Additionally, after only briefly mentioning it last month (noted at the time at NewsBusters and at BizzyBlog), Crutsinger grievously erred in his explanation of how a convenient "accounting change" Treasury implemented in April relating to accounting for its Troubled Assets Relief Program (TARP) has affected the reported year-to-date deficit. He claims that it contributed to it, while in reality the accounting change reduced it by about $180 billion. That is the subject of this post.

Here are key background and accounting change-related paragraphs from Crutsinger's report:

It's pretty hard to dress up a disaster as something less than that, but the Associated Press's Martin Crutsinger gave it his best shot in his report yesterday about Uncle Sam's the May Monthly Treasury Statement, in effect understating the amount and significance of federal government's rapidly deteriorating financial situation.

With the help of dubious handling of last year's stimulus payments in May 2008's Treasury Statement, Crutsinger ignored serious declines in tax receipts from economic activity that are, if anything, accelerating. I'll cover that problem in this post.

Additionally, after only briefly mentioning it last month (noted at the time at NewsBusters and at BizzyBlog), Crutsinger grievously erred in his explanation of how a convenient "accounting change" Treasury implemented in April relating to accounting for its Troubled Assets Relief Program (TARP) has affected the reported year-to-date deficit. That is the subject of Part 2.

Here are key background and receipts-related paragraphs from Crutsinger's report:

Actor Jon Voight, who recently spoke critically of President Obama at a Republican fundraiser, appeared on Tuesday's The O'Reilly Factor to reiterate his problems with Obama. After recounting that America was "warned" by Hillary Clinton and Joe Biden during the Democratic primary season that Obama "had no experience" and was a "novice," the conservative actor reminded FNC viewers of the unheeded warnings about Obama's connections to questionable figures like Bill Ayers and the Reverend Jeremiah Wright:

Look, he was a fellow who was associated with all the wrong people. The signs were up. His associations with Bill Ayers, Alinsky, with ACORN, with Pfleger, with Wright. But no one seemed to take the warnings. And his inexperience was quite evident.

Ed Frank created an interesting little video that serves as a stark reminder of how harsh the Old Media was on Bush's "faltering" economy in comparison to today's hearts and flowers style of reporting during the age of Obama, even though the stats are far, far worse under Obama than they ever were under Bush.

Frank's video is shocking for its revelation of how Bush was slapped around and how every economic indicator during his tenure in the White House was deemed as obvious proof of the supposed though times we then faced. Yet now, every dismal indicator is celebrated as if recovery just around the corner. Under Bush the Old Media was sure the economy was a wreck, now the wreck proves we will surely be saved by Summer!

Every time voters face a ballot initiative of some sort that would raise their taxes, proponents of such measures will trot out any of the following components to champion the cause - school children, policemen, firemen or the release of criminals from jails.

But this time, the June 3 "NBC Nightly News" waited until after California voters denied passage of initiatives that would raise their taxes to say, "I told you so." NBC correspondent George Lewis followed up a dire, one-sided June 3 "Today Show" report with a "Nightly News" segment that blamed the budget cuts for one supposed hardship story - a California school district forced to cancel summer school, which in turn made it impossible for one child's mother to look for a job.

In a time when fiscal responsibility from politicians seems to be a thing of the past, NBC’s “Today Show”  and ABC’s “World News with Charles Gibson” criticized California Governor Arnold Schwarzenegger for his proposed budget cuts in his effort to save California from reaching total financial ruin.

The June 3rd “Today Show” featured numerous opponents of Schwarzenegger’s budget cuts, but nobody supporting or defending them.

The segment began with a clip of the governor stating: “Our wallet is empty. Our bank is closed, and our credit is dried up,” a fact that does not seem to bother NBC, as they mourn the proposed solution to this problem: the cutting of what they deemed “essential services.”

Roll Call is reporting that during the typical Friday afternoon document dump -- a practice used to hide actions that might prove somewhat embarrassing to the White House -- the administration quietly announced that some of the former restrictions on lobbying ballyhooed about during the late campaign have been lifted. And now, we have to wonder: will the media notice this sudden change? I mean, a whole day has gone by and so far only Roll Call has mentioned it.

In any case, let special interests ring, baby!

Here's a CNN e-mail alert I just received a couple of hours ago:

So how did the Associated Press's Jeannine Aversa report the above raw news? As you would expect an Obama apparatchik to do it (reproduced in full as it existed at 3:15 p.m.; bold after title is mine):

Fed sees hopeful signs but downgrades '09 forecast

WASHINGTON (AP) — The Federal Reserve expects the economy to improve in coming months, even as policymakers have downgraded their outlook for all of 2009.

Wow. Just wow. If this New York Times headline isn't an act of advocacy for higher taxes in California, what is? With its May 20 coverage of the vote for California's tax hiking ballot measures, the Times plainly scolds fed-up voters for rejecting them with a headline that pointedly says: "Calif. Voters Reject Measures to Keep State Solvent."

Really? The Times thinks California's voters want a state headed into bankruptcy, that they voted for insolvency? The paper is strangely furious that voters rejected tax hikes, but I hate to break this to the New York rag: voters did not "reject measures" to keep the state "solvent." What voters did was reject wild tax hikes that would only lead to more corruption and profligate spending. The voters weren't fooled and knew that these measures would not lead to any long-term solution to the state's budget woes. If the state house in Sacramento had done its job properly and proposed a sensible budget in the first place, Californians would be happy to vote for it I am sure.

What is the idea of the American dream, of working hard and achieving something, and knowing that all, you know, half your wealth is going to someone who didn't do that?

So asked CNBC's Maria Bartiromo Thursday during a stirring discussion with a union advocate who had the nerve to claim the problems in the auto industry were all caused by a lack of a nationalized healthcare system, and that only the top one percent of wage earners in America should pay federal income taxes.

Unlike most media members who would have applauded such sentiments coming from one of their guests, Bartiromo pushed back, with respect and professional courtesy not seen much from journalists these days, and in a fashion that would make many Americans currently concerned about their nation's direction a wee bit nostalgic and tremendously proud.

What follows is a partial transcript of this exchange, as well as an embedded video of the entire segment:

In Part I (at NewsBusters; at BizzyBlog) of my coverage of Martin Crutsinger's Associated Press report about Uncle Sam's Monthly Treasury Statement and the Obama administration's deficit projections, I noted that the government "miraculously" shrunk the deficit through March, the first six months of its fiscal year, by $175 billion, by employing an "accounting change."

Even though this "accounting change," which does not report TARP disbursements as outlays because they are considered "investments," violates fundamental cash-flow reporting principles, Crutsinger gave the change an unskeptical treatment. He also failed to tell readers whether the administration used the old or new method in calculating its latest full-year deficit projection of $1.84 trillion. If Team Obama used the new method to determine it, the deficit under the old and more correct method will more than likely be over $2 trillion.

Crutsinger also failed to report the steep dive in federal receipts that took place in April, which is the government's highest month for collections, compared to last year's all-time record April haul, which I referred to as the "Supply-Side Stunner," and which Crutsinger and others also failed to report when it occurred last year (at NewsBusters; at BizzyBlog).

Here is how April 2009 collections compared to April of 2008:

You have to see this to believe it, and even then you'll have a hard time believing it. It's the Obama administration's deficit reduction program, otherwise known as "change the accounting."

Here is what the Monthly Treasury Statement (MTS) from Uncle Sam looked like in March:

Here is the report for April:

The Obama White House revised up 2009's budget deficit projections to $1.8 trillion Monday, and the press blamed it on George W. Bush.

Without considering how the current budget passed last year with virtually no Republican support, and that all spending associated with this record-breaking deficit was either approved by Senator Obama or signed into law by President Obama, news outlets echoed what Office of Management and Budget director Peter Orszag ascribed as the culprit in his blog: 

The deficits in these years, now projected to be 12.9 percent and 8.5 percent of GDP, respectively, are driven in large part by the economic crisis inherited by this Administration.

The New York Times accepted this assessment without question in its article on the subject Tuesday:

As he appeared as a guest on Thursday’s Countdown show on MSNBC to discuss Joe the Plumber’s recent criticism of the Republican party, Newsweek’s Richard Wolffe started off by suggesting that Republicans had "lost their heart" in the 1980s and had "lost their mind" in the 1990s. Wolffe: "You know, if they lost their heart in the 1980s, and they lost their mind in the 1990s, what we've seen in the 2000s is Republicans losing their image, and they lost it on national security."

Wolffe later demeaned the intelligence of participants in the recent Tax Day Tea Parties, whom he referred to as "tea baggers," and charged that they want to "have their cake and eat it." Wolffe:

With much fanfare, President Barack Obama rolled out his intentions to cut $17 billion from the federal budget on May 7. But despite the spinmeisters, not everyone was buying it.

"The White House today played up its proposed cuts to the federal budget," ABC "World News" anchor Charles Gibson said on his May 7 broadcast. "That budget plays up to $3.6 trillion. The White House wants to trim a tiny fraction - $17 billion. The president, arguing that seemingly small amount is a step in the right direction."

And that's exactly what ABC White House correspondent Jake Tapper emphasized during his report on the budget cuts.

In a hypocrisy sure to outrage, just as Attorney General Eric Holder gets ready to attend a ceremony to honor fallen police officers, the Obama administration is proposing to cut almost in half a program that provides benefits to the families left behind.

So much for the more loving, more caring president "we've been waiting for." So, wouldn't you think the Old Media would be braying at the hypocrisy here? Wouldn't you rather think that the Old Media would be up in arms about this one? Isn't this typically the type of story that would get them motivated to get their high dudgeon on? Guess not because it is nearly invisible in the media today.

President Obama today announced $17 billion in "spending cuts" Thursday.

Here are the substantive early paragraphs of the the Associated Press's coverage of what the President had to say:

Obama sent Congress a detailed budget Thursday proposing to eliminate or trim 121 programs and save $17 billion next year — not a trifle, for sure, but only about half of one percent of the $3.4 trillion in federal spending for the fiscal year begining in October.

The size of the savings clearly was a sore subject at the White House.

"It is important ... for all of you, as you're writing up these stories, to recognize that $17 billion taken out of our discretionary, non-defense budget, as well as portions of our defense budget, are significant," Obama told reporters. "They mean something."

Still, Obama's hit list was smaller than the one President George W. Bush included in his budget last year targeting 151 programs for $34 billion in savings.

These alleged cuts mean almost nothing, according to the Heritage Foundation's Brian Riedl, who cut through the misdirection earlier today at The Corner (bolds are mine):

At the recent media celebration of Barack Obama's first 100 days as President, Barack Obama made the bold claim that he created or saved over 150,000 jobs. 

This budget builds on the steps we’ve taken over the last 100 days to move this economy from recession to recovery and ultimately to prosperity.
We began by passing a Recovery Act that has already saved or created over 150,000 jobs and provided a tax cut to 95 percent of all working families.Source

This would be wonderful news, if it were true.  Unfortunately, no one seems to be able to figure out where he got these numbers from.  They just don't seem to add up to the facts.

So where do they get away with a number like that?

Rather than provide objective analysis of President Obama’s performance at Wednesday’s White House press conference, on Thursday’s CBS Early Show, correspondent Bill Plante issued what amounted to a press release and brushed aside criticism of Obama’s expansion of government during the first 100 days: "The President laughed off charges that he's intent on making the government bigger...And said the 100-day mark was just the beginning."

Plante offered no facts about the massive spending and growth of government under the Obama administration, but instead concluded his report: "Anyway, they [the White House] think that the public is well disposed to give the President some more time. How much, is the question."

At the top of the show, co-host Harry Smith declared: "A lot of people watching President Obama last night. How do you celebrate 100 days in office? Speak to the news media." Based on reporting from Plante and New York Times reporter Jeff Zeleny’s "enchanting" question to Obama, that would be a party with close friends for the President.

Somebody needs to 'fess up. Who put truth serum in Calvin Woodward's coffee this morning?

Whoever it is, they're in a heap of trouble, as Woodward produced a fact-checking critique of Barack Obama that is so good you'd swear most of it was ghostwritten by a conservative talk host.

It will be interesting to see how much distribution it gets. I would suggest not counting on too much, but being open to a pleasant surprise.

Regardless of its distribution, you'd better believe they've read it in the White House, and they're wondering what in the world happened.

Here are key paragraphs from Woodward's rundown, which is really, seriously, a read (and save) the whole thing item (it is saved at my host for future reference; HT to Mark Levin, who excerpted the report on his show tonight):

It was just a question of time. While it was hard to know where it would come from (although MSNBC is always a safe bet), someone was going to make the entire swine flu pandemic a partisan political issue. 

MSNBC's Ed Schultz on the April 27 "The ED Show" blamed Republicans on two levels for the swine flu pandemic that some think has been a bit overblown.

"Well, here we go again - Republicans are playing politics with our health," Schultz said. "This kind of stuff just makes my temperature go up. I'm boiling over this - as many as 150 have been killed by this flu in Mexico. Cases are popping up allover the United States."

If CNBC on-air talent has really had their hands tied by General Electric and NBC management on criticizing the current administration's economic policy, you couldn't tell it from watching Rick Santelli and Larry Kudlow.

 On CNBC's April 24 "The Call," Santelli expressed his frustration with an overreaction by the government to solve the financial crisis when Kudlow asked him about the expansion of bailout obligations from the original TARP bailout price tag $750 billion to the $3 trillion.

"Listen - I'm glad I didn't say that, I'm glad I didn't say all that," Santelli said. "Do I disagree with it? Probably not. But, I'll take it a step farther - in the beginning, whether it was the commercial paper program, there was a need just like babies have a need for milk. But I don't need to drink a couple of gallons anymore."

Almost a year ago, I was posting on what I called the "Supply-Side Stunner" (at NewsBusters; at BizzyBlog).

In April 2008, the US Treasury collected an all-time record $407.3 billion ($403.75 billion after subtracting the first $3.35 billion wave of stimulus checks, which really should have been treated as outlays, that went out just before month-end). It was an indication that, as I said at the time, "many (entrepreneurs, businesspeople, and investors) are thinking, in the face of relentless media harping to the contrary, that 2008 will be at least as profitable (as 2007)."

This year, it's shaping up to be the "Bailout Year Bummer." Uncle Sam's fiscal year began on October 1 of last year, mere days before Congress passed the legislation that has come to be known as TARP, and a bit more than three months after Nancy Pelosi, Barack Obama, and Harry Reid promised to starve the economy of energy and punitively tax its highest producers, creating what I have since called the POR (Pelosi-Obama-Reid) Economy.

Through March, federal receipts were running 14% behind the previous year. Each month during the fiscal year has trailed the previous year, and degree of the difference has steadily increased.

Now look at what we're facing in April:

Ladies and Gentlemen,
The Lamestream Media The media coverage of the more than 800 Taxed Enough Already (TEA) Party protests that took place in all fifty states on April 15 ranged from disdainful dismissal of their nature, significance and import, to outright hostility towards the events and individual participants, to sexual innuendo-based full-on ridicule.

In this summary, we focused on the three major networks - NBC, ABC and CBS, the two left-of-center cable news networks - CNN and MSNBC and the three major "national" newspapers - the USA Today, the New York Times and the Washington Post.

While not an exhaustively comprehensive oeuvre of TEA Party bias, it contains many, many examples which serve to illustrate the broader antipathetic themes.

To wit: