Fox News' Megyn Kelly misrepresented President Obama's call for a “balanced approach” to reducing the budget deficit, claiming it means he wants tax hikes while Republicans want spending cuts. In fact, a balanced deficit-reduction plan includes a combination of the two -- which economists agree would be the best approach.
On America Live, Kelly reported that Obama said he “wants a balanced approach to the debt deal, which has been how he describes a request for tax hikes in the past,” adding, “This is how they're split: He wants tax hikes, and the Republicans don't want tax hikes, and they want some spending cuts, and he doesn't want to give those.”
But the “balanced approach” to deficit reduction includes a combination of both tax increases and spending cuts -- a plan Obama has repeatedly endorsed as the right way to deal with the deficit.
As Bloomberg reported on Wednesday:
Obama “will offer a brand-new plan of his own,” Steve Bell, senior director of the Economic Policy Project at the Bipartisan Policy Center, said in an interview.
Bell said one option the Obama administration is considering is pushing anew for a “balanced” plan to cut as much as $100 billion in spending as a deficit-reduction down payment while letting the George W. Bush-era tax cuts expire for top earners.
In a September 9 CBS News interview, Obama outlined a deficit-reduction plan that “would cut $2.50 in spending allowances for every $1 of increased tax revenue” -- which Republicans have rejected. Obama stated:
"You can't reduce the deficit unless you take a balanced approach that says, 'We've gotta make government leaner and more efficient.' [...] But we've also got to ask people -- like me or Gov. Romney, who have done better than anybody else over the course of the last decade, and whose taxes are just about lower than they've been in the last 50 years -- to do a little bit more.
“And if we go back to the tax rates for folks making more than $250,000 a year, back to the rates that we had under Bill Clinton [...] we can close the deficit, stabilize the economy, keep taxes on middle class families low, [and] provide the certainty that I think all of us would be looking for.”
Economists agree that this is the best solution.
A report released in September by the National Association for Business Economics found that a vast majority of economists “favor some combination of higher taxes and reduced spending to reduce the federal budget deficit.” In an article about the study, the Christian Science Monitor reported that the most common response to “how should Congress reduce the federal budget deficit?” was “equally with spending cuts and tax increases”:
The survey found 90 percent of respondents supporting some blend of those two methods of reducing deficits, while Mr. Romney's espousal of “revenue neutral” tax reform lines up most closely with the 9 percent of economists in the survey who called for “spending cuts only.”
Business leaders also share this view.
As the Associated Press reported in an October 25 article, CEOs from more than 80 major U.S. companies, including JPMorgan Chase, Verizon, and GE, wrote a letter to Congress urging them to reduce the federal deficit by raising taxes and cutting spending:
The CEOs said the solution requires a combination of higher taxes and reduced government spending including on entitlement programs such as Medicare and Medicaid. They also seek federal investment in infrastructure and math and science education.
The CEOs head a diverse array of corporations, including Aetna Inc., Microsoft Corp., JPMorgan Chase & Co., Time Warner Cable Inc., Merck & Co. Inc., General Electric Co., Dow Chemical Co., Verizon Communications Inc., Bank of America Corp., AT&T Inc. and Allstate Corp.
Some members of the group rang the opening bell Thursday at the New York Stock Exchange.
The group endorses the proposals of a special bipartisan commission that called for about $3 in spending cuts for every $1 in tax increases to save around $4 trillion.
Fox News has repeatedly distorted Obama's deficit-reduction plans.