Fox Regurgitates False Talking Points To Defend Ryan Budget

››› ››› MIKE BURNS & DAVID SHERE

Fox News host Bill Hemmer advanced a number of false and dubious claims about Rep. Paul Ryan's (R-WI) new budget plan, including that the plan would lower tax rates for all individuals.

Ryan Released GOP Budget Plan

NY Times: Ryan Releases Budget Plan. The New York Times reported on Ryan's Tuesday release of his budget plan:

House Republicans, led by Representative Paul D. Ryan of Wisconsin, laid out a tax and spending plan that would cut spending by $4.6 trillion through 2023, in large part by rolling back many of the president's signature legislative accomplishments. It would repeal the health care overhaul of 2009, eliminate the subsidized insurance exchanges and Medicaid expansion that make up the core of the law, and turn Medicare into a system of private insurance plans financed by federal vouchers.[The New York Times3/12/13]

Fox's Hemmer Claimed Ryan Budget "Substantially" Lowers Tax Rates For Individuals

Bill Hemmer: Ryan's Budget Plan "Would Substantially Lower Tax Rates For Individuals." America's Newsroom co-host Bill Hemmer claimed that Ryan's plan "would substantially lower tax rates for individuals by establishing just two tax brackets -- 10 percent and 25 percent." [Fox News, America's Newsroom, 3/12/13]

But Ryan's "Vague" Plan Likely To Increase Taxes On Middle Class

Robert Reich: "Only Possible Way Ryan Could Pay For His Proposed Tax Cuts For The Wealthy And Corporations Would Be To Raise Taxes On The Middle Class." Former Labor Secretary Robert Reich wrote in The Huffington Post that "the only possible way Ryan could pay for his proposed tax cuts for the wealthy and corporations would be to raise taxes on the middle class":

Meanwhile, it redistributes upward, cutting the top tax rate for individuals down to 25 percent -- a bigger tax cut for the top than even Mitt Romney proposed -- and the corporate tax rate down to 25 percent, from 35 percent today.

Ryan would pay for these tax cuts by "closing tax loopholes," but -- where did we hear this before? -- his budget doesn't say which loopholes, or even hint at what it would do with rates on capital gains and dividends. Like Romney's plan, it leaves all the heavy lifting to Congress.

The reality, of course, is that the only possible way Ryan could pay for his proposed tax cuts for the wealthy and corporations would be to raise taxes on the middle class. [The Huffington Post, 3/12/13]

Wash. Post's Greg Sargent: "Impossible To Say" Whether Budget Can Cut Taxes On Rich "Without Targeting The Middle Class." The Washington Post's Greg Sargent explained that Ryan "has made it impossible to determine whether his budget would raise taxes on the middle class to pay for tax cuts on the rich":

Now, it is possible that the plan could be made revenue neutral without targeting middle class loopholes. But according to Williams, based on what little we know now about how the tax cuts would be structured, to make that work, you probably would not be able to cut the top rate to 25 percent. And you probably would have to raise rates on capital gains and dividends. But we don't know what the plan would do on either front, so it's impossible to judge it.

Ryan and Republicans, of course, will insist that they would cut taxes for the middle class, just as Romney did during the campaign. But there's no way -- as during 2012 -- to know whether this is feasible until the plan's details and targets are nailed down with more specificity.

And so, in yet another sense, we're back where we were during the 2012 campaign. Indeed, we've reverted somewhat. At least we could determine whether Romney's proposed tax cuts for the rich could be paid for without targeting the middle class -- they couldn't. In the case of the new Ryan budget, it cuts taxes on the rich, and vows to pay for it through tax reform -- but it's impossible to say, based on what we know now, whether this can be done without targeting the middle class. [The Plum Line, The Washington Post3/12/13]

Wash. Post's Ezra Klein: Ryan's "Vague Individual Tax Reform Plan" Could Require Tax Increases On Poor And Middle-Class Households. The Washington Post's Ezra Klein explained that Ryan's "vague individual tax reform plan ... will require either huge, deficit-busting tax cuts or increasing taxes on poor and middle-class households":

Here is Paul Ryan's path to a balanced budget in three sentences: He cuts deep into spending on health care for the poor and some combination of education, infrastructure, research, public-safety, and low-income programs. The Affordable Care Act's Medicare cuts remain, but the military is spared, as is Social Security. There's a vague individual tax reform plan that leaves only two tax brackets -- 10 percent and 25 percent -- and will require either huge, deficit-busting tax cuts or increasing taxes on poor and middle-class households, as well as a vague corporate tax reform plan that lowers the rate from 35 percent to 25 percent. [Wonkblog, The Washington Post3/12/13]

Center For American Progress: Ryan Budget Faces "Massive Hole" Unless "Enormous Middle-Class Tax Hikes" Pay For Tax Cuts For Rich. Michael Linden, Director for Tax and Budget Policy at the Center for American Progress, wrote that Ryan's budget faces "a massive hole" unless he and other Republicans are "calling for enormous middle-class tax hikes to pay for their huge tax cuts for the rich and for corporations":

Of course, Rep. Ryan could avoid all this red ink if he paid for these tax cuts with offsetting tax expenditure savings, which he claims to want to do. Unfortunately, he fails to identify even one tax expenditure he would close to generate the missing revenue. Perhaps that's because the enormity of his tax hole makes it practically impossible for him to actually make the math work. A total and complete repeal of all itemized tax deductions -- the mortgage interest deduction, the charitable deduction, and the state and local tax deduction, for example -- would generate less than $2 trillion in added revenue. Not only would that still leave him $5 trillion short of his claimed revenue levels, but he would also be financing a massive tax cut for the rich with a huge middle-class tax increase.

If all of this sounds vaguely familiar, that's because this is the same play that Rep. Ryan and his running mate, former Massachusetts Gov. Mitt Romney, ran in the 2012 election: promising enormous tax cuts with no way to pay for them except by raising taxes on the middle class. The only difference this time is that this version of Rep. Ryan's budget has a bigger revenue hole than the Romney budget did, meaning his tax increases on the middle would have to be even bigger.

Unless Rep. Ryan and his colleagues are calling for enormous middle-class tax hikes to pay for their huge tax cuts for the rich and for corporations -- a politically and morally toxic position -- then they are facing a massive hole in their budget. [Center for American Progress, 3/12/13]

Slate's Matthew Yglesias: Ryan Budget Will Most Likely Result In "Higher Taxes On The Middle Class." Slate's business and economics correspondent Matthew Yglesias wrote that Ryan's budget would most likely raise taxes on the middle class:

Ryan's plan starts, like all good GOP deficit reduction plans, with a giant tax cut. Specifically, he wants to replace the current progressive rate structure with a two-rate structure -- 10 percent and 25 percent. If you're currently an individual paying a 39.6 percent marginal tax rate on your income over $400,000, that's an enormous tax cut. If you're currently an individual paying a 25 percent marginal tax rate on your income of $70,000 a year you may wonder what's in it for you here. The answer is, most likely, higher taxes.

We went through this when Mitt Romney and Ryan were running for the presidency, but the proposal here is to make the enormous rate cut for the highest earners affordable through unspecified tax reform. Since the tax reform is unspecified, it's difficult to say exactly what the consequences of it would be. But a 2012 report for Brookings by Samuel Brown, William Gale, and Adam Looney found that Romney/Ryan-style tax reform (PDF) would result in higher taxes for most families earning less than $100,000 a year. I'm sure D.C.'s eager think tankers will be rerunning the numbers on this relative to the updated policy baseline later today, when I'll update you.

[...]

Obviously Ryan's Medicare ideas are important for the long term. But in the 10-year horizon these are the important means by which he wants to balance the budget -- lower taxes on the rich, higher taxes on the middle class, less program spending for the poor and the working class. It's a little difficult to say why that would be your policy response to a couple decades worth of rising inequality, which is presumably why Ryan prefers to sweep the question of how under the rug. [Moneybox, Slate,3/12/13]

Hemmer Claimed Ryan Budget Calls For Reinstating Welfare Work Requirements

Hemmer: Budget Calls For "The Reinstating Of Welfare Programs' Work Requirements." On America's Newsroom, Hemmer said that Ryan's budget "calls for welfare and food stamp reform, including the reinstating of welfare programs' work requirements." [Fox News, America's Newsroom, 3/12/13]

But Obama Admin. Has Not Removed Work Requirements From Welfare

Obama Admin. Announced It Would Consider States' Request For Greater Flexibility In Welfare Program. The Obama administration announced in July 2012 that it would comply with governors' requests -- including Republicans -- to consider proposals to create more efficient ways to report on the work requirement for people receiving Temporary Assistance for Needy Families (TANF) benefits. According to the Department of Health and Human Services, any program that weakened or undercut welfare reform would not be approved, and waivers would only be granted to proposals that "move at least 20% more people from welfare to work." [Media Matters7/15/123/4/13]

Hemmer Cites The Size Of The Deficit As Evidence The Government Is Too Big

Hemmer: Paul Ryan Argues That "The Government Is Frankly Just Too Big. You Look At The Deficits Right Now." Hemmer said "What [Ryan] argues ultimately is that the government is frankly just too big. You look at the deficits right now, debt's increased $6 trillion in just over 4 years' time in the administration. Annual deficits more than a trillion dollars for each of the past four years." The Fox host then read from Ryan's op-ed: "The truth is, the nation's debt is a sign of overreach. Government is trying to do too much, and when government does too much it does not do anything well." [Fox News, America's Newsroom, 3/12/13]

But The Deficit Is Shrinking At Its Fastest Rate Since World War II

Wash. Post's Ezra Klein: "The Deficit Is Expected To Fall Faster In 2013 Than At Any Time In The Last 60 Years." In a post titled "The deficit chart that should embarrass deficit hawks," Ezra Klein wrote that "the deficit is expected to fall faster in 2013 than at any time in the last 60 years," and included this chart from Investors.com: 

[Wonkblog, Washington Post2/12/13]

NY Times' Krugman: "The Deficit Is Falling More Rapidly Than It Has For Generations." In his New York Times column, Nobel Prize winning economist Paul Krugman wrote that "the deficit is falling more rapidly than it has for generations" and that "it is already down to sustainable levels." He explained that "after peaking in 2009 at $1.4 trillion, the deficit began coming down. The Congressional Budget Office expects the deficit for fiscal 2013 (which began in October and is almost half over) to be $845 billion. That may still sound like a big number, but given the state of the economy it really isn't." [The New York Times3/10/13]

Hemmer Says 10-Year Delay Of Medicare Changes Is A Sign Of Fairness

Hemmer: "Ryan Would Argue" That His Plan Is "Not Lopsided" Because "Changes In Medicare Don't Even Take Place For Another Ten Years." After Rep. Chris Van Hollen (D-MD) called Ryan's plan "lopsided" and "uncompromising," Hemmer said: "What Paul Ryan would argue is that it's not lopsided, it's not unfair. The fact that changes in Medicare don't even take place for another ten years. 2024, so you've got a decade to wait for that."  [Fox News, America's Newsroom, 3/12/13]

But 60 Million People Could Lose Their Health Insurance Under Ryan's Plan

The Hill: "As Many As 64 Million People Could Lose Access To Health Care Coverage" Under The Ryan Plan. The Hill's Healthwatch blog used data from the Urban Institute and the Congressional Budget Office to conclude that under the Ryan plan "as many as 64 million people could lose access to health care coverage." The Hill found that 37 million people would lose out on the insurance expansion in health reform, and another 14 to 27 million would lose their current eligibility for Medicaid. The blog noted that "the loss of coverage would fall primarily to low-income taxpayers, who are primary recipients of Medicare as well as the health care law's subsidies." [Healthwatch, The Hill3/12/13]

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