O'Reilly used misleading statistics, fiscal falsehoods to defend Bush economic record


On the September 19 editions of both Fox News' The O'Reilly Factor and Westwood One's The Radio Factor, host Bill O'Reilly offered misleading statistics and false assertions in response to former President Bill Clinton's recent criticism of the Bush administration's economic record. The following day, however, O'Reilly informed Radio Factor listeners that he had taken “Bill Clinton apart” the previous day. "[I] just demonstrated with facts that what he was saying was just not true," O'Reilly stated. “It was simply not true.” The following are five unfounded claims advanced by O'Reilly in defense of President Bush's fiscal policies.

O'Reilly again compared poverty rates at the midpoints of Clinton and Bush presidencies

During The O'Reilly Factor, O'Reilly aired a clip of Clinton's interview on the September 18 edition of ABC's This Week, in which Clinton argued that Republicans are not committed to reducing poverty. O'Reilly then informed his audience that the poverty rate in 1996 was higher than the poverty rate in 2004. While this assertion on its face is accurate, his comparison obscured the more relevant fact that the poverty rate declined every year of the Clinton presidency and has increased every year under the Bush presidency. During Clinton's tenure, the poverty rate fell from 15.1 percent in 1993 to a low of 11.3 percent in 2000; it has risen every year that Bush has been in office, from 11.7 percent in 2001 to 12.7 percent in 2004. Media Matters for America has previously documented (here and here) O'Reilly's use of this misleading comparison.

O'Reilly claimed that the tax rate under Clinton climbed higher than at any point since World War II

In a further attempt to bolster his case that the Clinton administration -- not the Bush White House -- has had a more detrimental effect on the economic well-being of Americans, O'Reilly claimed, “Under President Clinton, the tax rate climbed higher than at any time in history except in World War II.” O'Reilly was apparently referring to the effects of the Omnibus Budget Reconciliation Act of 1993 (OBRA), approved by Clinton early in his first term, which raised taxes on the wealthiest Americans. In 1992, the income tax rate for a married couple making more than $86,500 was 31 percent, which represented the highest tax rate at the time. The following year, however, OBRA instituted two new, upper-income tax brackets: a rate of 36 percent applied to couples making between $140,000 and $250,000 annually, and a rate of 39.6 percent applied to couples with an annual income of more than $250,000. But 39.6 percent is far from the highest income tax rate imposed by the federal government after World War II. The following are examples of the rates applied to equivalent income brackets during previous decades:

Year

Income Bracket

Tax Rate

1955

$44,000-$52,000

59%

1965

$52,000-$64,000

53%

1975

$88,000-$100,000

60%

1985

$169,020 and over

50%

O'Reilly asserted that the federal government will generate more tax revenue in 2005 than at any point in the Clinton presidency

After making the above claim about Clinton's tax rate, O'Reilly went on to state: “President Bush then came in and cut taxes for everyone. And guess what? Federal tax revenues will be more this year than at any time during the Clinton administration.” In fact, as the table below shows, a historical comparison of total revenue proves that -- when adjusted for inflation -- the federal government generated more revenue during the last year of the Clinton administration than it is estimated to receive in fiscal year 2005:

Fiscal year

Federal tax receipts (millions)

In constant FY2000 dollars (millions)

2000

$2,025,200

$2,025,200

2005 (estimate)

$2,142,000

$1,878,070*

* This figure was adjusted for inflation using the Bureau of Labor Statistics inflation calculator. Input was rounded to six significant digits.

O'Reilly claimed that Clinton “raised taxes every year”

On The Radio Factor, O'Reilly stated that during the Clinton presidency “taxes rose faster than any other time except World War II. Clinton raised taxes every year.” But Clinton signed into law only one federal income tax increase -- OBRA in 1993. O'Reilly was apparently referring to the fact that the average tax burden -- equivalent to total revenue as a percentage of the gross domestic product (GDP) -- increased every year under Clinton and has decreased steadily under Bush. But the average tax rate did not increase as a result of repeated tax increases. Rather, it rose because of the robust economic growth that the country experienced during Clinton's tenure, as an August 2003 Treasury Department fact sheet explained:

Despite the higher tax rates, other economic fundamentals such as low inflation and low interest rates, an improved international picture with the collapse of the Soviet Union, and the advent of a qualitatively and quantitatively new information technologies led to a strong economic performance throughout the 1990s. This, in turn, led to an extraordinary increase in the aggregate tax burden, with Federal taxes as a share of GDP reaching a postwar high of 20.8 percent in 2000.

O'Reilly stated that the income tax originated in the 20th century due to Karl Marx and “the rise of communism”

O'Reilly later informed Radio Factor listeners that the federal income tax did not exist “until the turn of the 20th century” and that Karl Marx and the “rise of communism” were to blame. O'Reilly was likely referring to the ratification in 1913 of the 16th Amendment establishing the constitutionality of an income tax on individuals. But the origin of the federal income tax can be traced back to the Civil War, according to the Internal Revenue Service:

Its roots go back to the Civil War when President Abraham Lincoln and Congress, in 1862, created the Commissioner of Internal Revenue and enacted an income tax to pay war expenses. The tax was repealed 10 years later. Congress revived the income tax in 1894, but the Supreme Court ruled it unconstitutional the following year.

From the September 19 edition of Fox News' The O'Reilly Factor:

CLINTON [clip]: We concentrated tax cuts on lower-income working people, and benefits to low-income people to help them move from welfare to work. And we moved 100 times as many people out of poverty. We know what works. And we had a program that was drastically reducing poverty. And they got rid of it. So -- and they don't believe in it.

O'REILLY: Believe in what? What is Mr. Clinton talking about? What program did Mr. Bush get rid of? We called Mr. Clinton's office all day, looking for an answer to that very simple question. We didn't get one. Stephanopoulos sat there like a mummy, challenging nothing. The whole thing's absurd. Again, here are the facts. Black homeownership is up 2 percent under President Bush. Poverty spending is significantly higher under Bush than it was under Clinton. Educational spending for poor school districts is higher under Bush. And the poverty rate stood at 13.7 percent halfway through Clinton's tenure. It is 12.7 percent halfway through Bush's two terms.

This tax-cuts-for-the-rich business is also blatantly dishonest. It's a ruse for the secular left to institute their income redistribution scheme. Under President Clinton, the tax rate climbed higher than at any time in history except in World War II. President Bush then came in and cut taxes for everyone. And guess what? Federal tax revenues will be more this year than at any time during the Clinton administration.

From the September 19 edition of Westwood One's The Radio Factor with Bill O'Reilly:

O'REILLY: Now here's the kicker -- you ready for the kicker? This is estimated federal tax receipts 2005, this year, the highest in history. The highest in history. This year, 2005, the federal government will receive more tax dollars than any other time in history. Got it? $2 trillion -- I can't even read the number, it's so high. It's amazing. It is absolutely amazing.

Now, by percentage, it's 19 percent of income for all Americans, 19 percent. That's the average. Under Clinton he got it up to 23 percent. Clinton was -- remember, under Clinton taxes rose faster than any other time except World War II. Clinton raised taxes every single year. But tax receipts under Bush are more than Clinton, more. Why? Because the economy is expanding, and more corporations and individuals pay taxes.

[...]

Remember, if you're a citizen of Great Britain, you are a British subject. You're not a citizen; you're a subject. Here, you're a United States citizen. So the founding fathers clearly didn't want any imposition of religion and they didn't want the government to come to your house and take your stuff and give it to someone else. It was absolutely in stone clear that capitalism was going to rule the day, rule the day. If you made it, you kept it. And remember, there wasn't a federal income tax until the turn of the 20th century. If you made it, you kept it. No government intrusion. [President] Andrew Jackson didn't even want a bank, a central bank.

So, what's happened in the country? Well, what happened was that with the rise of communism in the '20s, Karl Marx and all these people, and the Soviet Union, and a lot of people got onto the socialistic bandwagon, and they're still there. Western Europe is a socialist area now. That's why [German Chancellor Gerhard] Schroeder got booted out [in elections on September 18]. They can't -- they cannot grow the economy with all the pension and entitlements they pay; they can't grow it. Not enough money coming in.

From the September 20 edition of Westwood One's The Radio Factor with Bill O'Reilly:

O'REILLY: We did a segment last night, and I just took Bill Clinton apart -- I hope you saw it on The Factor -- for what he said to George Stephanopoulos about the economy and poor people. And I just demonstrated with facts that what he was saying was just not true. It was simply not true.