Arianna Huffington Flat Out Lies About Investment Firm's Economic Opinion of Debt Ceiling Deal
UPDATE AT END OF POST: AOL HuffPo responds.
Joining our growing list of media members willing to flat out lie on national television to advance their political agendas is Arianna Huffington who falsely claimed this week that securities firm JPMorgan warned its clients the debt ceiling agreement "is going to reduce our growth by a point-and-a-half."
Such was dishonestly said during a segment of CNN's "Fareed Zakaria GPS" aired Sunday (video follows with transcript and commentary):
FAREED ZAKARIA, HOST: Now, you look at this and you say - I heard you somewhere say, if Obama thought he was playing for independence by being the grown-up in the middle, it didn't work. Why?
ARIANNA HUFFINGTON: Right. Well, you see the CNN polls. You see over 60 percent of Independents are opposed to the deal. So if Obama thought that this was really his way of saying to Independents, I'm the grown-up in the room, I'm going to compromise, go with me, it's not working.
So on purely economic terms, this is not working. I mean you had Larry Summers on your show say that without growth, you are not ever going to be able to really deal with the deficit crisis.
You had JPMorgan and with their top clients this week saying that this deal is going to reduce our growth by a point-and-a-half.
So you had basically a con - a pretty reasonable consensus among economists, this is not the right policy long-term to control the deficit. So if this is a political play from Obama. It's failed, because Independents are turning on him and the deal.
"So you had basically a con."
And she should know, for as reported Tuesday by the website Zero Hedge, Huffington was only off by 400 percent:
As such, regardless of how the Committee fares, it appears that a first rough estimate is that the total tightening implied by the recent legislation would subtract about 0.3%-point from GDP growth next year.
That's right. JPMorgan predicted the spending cuts in the debt ceiling agreement would reduce 2012's GDP by about 0.3 percentage points NOT 1.5.
In reality, as Huffington likely got this from the shills at Think Progress who she so often refers to, it appears that not only is her honesty in question but so is her reading comprehension.
TP's reference Wednesday to the JPMorgan opinion accurately noted "a combination of the stimulus ending, the debt ceiling deal, the payroll tax cut expiring, and aid to states slowing down — will cost the U.S. 1.7 points of GDP growth next year."
Again, from JPMorgan's opinion:
This drag may appear fairly small, but it is on top of the substantial tightening that was already in place prior to the passage of the debt deal. Most of that fiscal tightening comes about through the automatic expiration of temporary stimulus measures. The table below details those measures, the largest of which is the one-year 2%-point payroll tax holiday, which expires next January. Other large programs that are scheduled to expire or phase out are emergency unemployment benefits, accelerated depreciation, increased transfers to the states, and much of the remaining spending associated with the 2009 Recovery Act. All in all, by our estimates federal fiscal policy will subtract around 1-3/4%-points from GDP growth next year.
So, it is the combination of a variety of factors including the debt ceiling agreement which in JPMorgan's view will cut around 1.75 percentage points from GDP next year.
It appears that not only is Huffington completely willing to misrepresent the economic projections of others, she's also incapable of getting any of their assessments right.
Exactly why would someone lacking both integrity and credibility be allowed to offer totally erroneous opinions on the supposedly "Most trusted name in news?"
*****Update: I received an email message from AOL Huffington Post Media Group's communications director Rhoades Alderson moments ago that included a link to Arianna's source attempting to refute my assertion that she lied about this issue. Here's the relevant section (emphasis added):
Impending fiscal drag for 2012 remains intact. The deal does nothing to extend the various stimulus measure which will expire next year: we continue to believe federal fiscal policy will subtract around 1.5%-points from GDP growth in 2012. Its possible the fiscal commission could do something to extend some measure such as the one-year 2% payroll tax holiday, though we think unlikely, as it would need to be paid for, which would be tough. If anything, the debt deal may add modestly to the fiscal drag we have penciled in for next year.
As you can see, this JPMorgan report Alderson sent me confirms the one posted by Zero Hedge.
JPM had been looking for a 1.5 percentage point decline to 2012 GDP as a result of various fiscal stimuli expiring at the end of this year.
In their view, "the debt deal may add modestly to the fiscal drag we have penciled in for next year." In the JPM report posted by Zero Hedge, this was defined as 0.3 percentage points.
As such, what Alderson sent me confirmed Huffington's falsehood rather than refuted it.