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  • Experts point out Trump’s budget “just doesn’t add up”

    White House budget proposal bases its revenue numbers on unrealistically high economic growth projections

    Blog ››› ››› ALEX MORASH

    Experts and journalists have pointed out that President Donald Trump’s budget numbers for the 2018 fiscal year do not add up, as they rely on unrealistic growth expectations. Nonpartisan experts say the gap between the White House’s estimates and the Congressional Budget Office’s is “the largest on record.”

    On May 23, the White House released its full budget proposal, which not only calls for kicking millions of working- and middle-class Americans off vital public assistance programs to make room for gigantic tax cuts for top income earners, but also bases its tax revenue projections on expected annual gross domestic product (GDP) growth of 3 percent by 2020. While right-wing media commentators have repeatedly defended trickle-down economic fantasies that predict unlikely levels of economic growth because of tax cuts for the rich, assuming such growth when determining revenue projections for the federal budget hides the true cost of Trump’s devastating budget plans.

    Experts and journalists quickly noted the absurdity of Trump’s projections in their coverage of the budget request. In a Washington Post blog, former Treasury Secretary Larry Summers, an economist at Harvard University, called the logic of Trump’s growth assumptions “simply ludicrous” and compared it to believing in the tooth fairy. On the May 23 edition of MSNBC Live, economist Jared Bernstein, a senior fellow at the Center on Budget and Policy Priorities (CBPP), told host Ali Velshi that Trump’s budget “does not add up at all” while noting that economic growth “is a function of the growth of the labor supply,” and that’s going to slow as the country grows older. Bernstein compared the chances of Trump’s projections coming true to the chances of a kitchen appliance coming to life to sing and dance, concluding that it is reckless for budget numbers to be “based on on these kinds of fairy tales”:

    On May 23, Vox correspondent Matt Yglesias pointed out that for anyone over 35, annual growth of 3 percent “doesn’t sound outlandish” because it is reminiscent of GDP growth during the 1990s. But Yglesias noted that if the United States did manage today to replicate 1990s-level growth in the labor force, productivity, and capital investment, “even under that rosy scenario” the growth rate would not hit 3 percent:

    In a May 24 column for Vox, economist and former Obama adviser Jason Furman explained in even more detail why 3 percent economic growth was “extremely unlikely,” with a specific focus on the slowing growth of the labor force. Furman also noted that the American economy is already growing faster than other advanced economies around the world, which have struggled to keep pace.

    As FiveThirtyEights Ben Casselman explained, the reason this level of growth is not currently attainable is that during the 1990s, the U.S. saw “rapid growth in its labor force and rapid gains in the productivity of that labor force.” By comparison, the baby boom generation today is retiring, not entering the workforce, which slows labor force growth, and “growth in productivity has slowed to a crawl” as electronic and internet-based technologies from the 1990s have matured.

    On May 24, The Washington Post’s Ana Swanson also looked at how realistic Trump’s growth projections would be with regard to labor force growth after Mick Mulvaney, director of the Office of Management and Budget, told reporters that much of the growth could come from getting the 6 million Americans marginally attached to the workforce to be fully employed. Yet, as Swanson noted, adding 6 million workers to the 160 million Americans already in the labor force would generate only 2 percent growth.

    Trump’s budget projections were not just debunked for lacking numbers based in reality; CBPP pointed out the historic gap between the White House’s economic growth projections and those of the nonpartisan Congressional Budget Office (CBO). According to a May 22 CBPP blog post, Trump’s budget proposal projects $3 trillion less in deficit accumulation using its 3 percent growth model than it would using the CBO’s less optimistic economic forecasting. The difference is even more striking because, as CBPP pointed out, the gap between the White House’s proposal and CBO forecasting is “the largest on record”:

  • Some of the best media take downs of Trump’s “repugnant grab bag” of a budget

    ››› ››› ALEX MORASH

    On May 23, President Donald Trump released his vision for the fiscal year 2018 federal budget titled, “A New Foundation for American Greatness,” which called for deep cuts to Medicaid, Social Security Disability Insurance (SSDI), student loan assistance, and anti-poverty programs geared toward working- and middle-class Americans while providing gargantuan tax cuts for top income earners and increasing military spending. As details of the budget began to surface in the lead up to the announcement, Media Matters identified some of the best take downs from journalists and experts hammering the proposal for its “ruthless” cuts.

  • News reports on Trump's budget highlight human cost of his broken promises

    Budget proposal will include deep cuts to Medicaid and Social Security, programs Trump promised to protect during campaign

    Blog ››› ››› ALEX MORASH

    Multiple news outlets have reported on the harsh human toll of President Donald Trump’s budget proposal, which is expected to gut programs that guarantee basic living standards, including parts of Medicaid and Social Security. These cuts directly contradict Trump’s promise to save the programs “without cuts.”

    The White House first hinted at slashing programs that help working- and middle-class Americans on February 26 when, according to Bloomberg, Trump floated proposals to increase defense spending by 10 percent while cutting programs including assistance for low-income Americans while still promising not to touch Medicare, Medicaid, and Social Security. The White House claimed these drastic cuts would help spur economic growth, an absurd claim that was resoundingly ridiculed by economists as “deep voodoo” and “wholly unrealistic.” The administration’s initial budgetary proposals were so drastic and poorly thought out that they stunned many observers and experts. The White House even advocated cutting assistance to the Corporation for Public Broadcasting, which would be particularly harmful to “small-town America,” and Meals on Wheels, which “doesn’t make economic sense” and would cruelly deny millions of elderly Americans basic companionship and a hot meal.

    On May 21, The Washington Post reported that the White House will unveil a formal federal budget proposal that goes even further than the administration’s earlier indications by proposing “massive cuts to Medicaid” and other anti-poverty public assistance programs. On May 22, Axios reported that the president plans to cut $1.7 trillion over 10 years from federal assistance programs including the Supplemental Nutrition Assistance Program (SNAP), the Children’s Health Insurance Program (CHIP), and Social Security Disability Insurance (SSDI), which collectively serve tens of millions of people. (Axios incorrectly stated that Trump’s budget plan “won’t reform Social Security or Medicare,” before outlining Trump’s plan to cut SSDI and incorporate massive Medicaid restrictions that would become law if his Obamacare repeal plan is ever enacted.)

    As details of Trump’s budget plan continued to leak, some media outlets explained the devastating consequences for millions of Americans if the White House gets its way and these drastic cuts take effect. They also explained that Trump’s embrace of deep cuts to components of Medicaid and Social Security represent a betrayal of his promises from the campaign.

    CNN chief business correspondent Christine Romans explained on the May 22 edition of CNN Newsroom that much of the money being cut from mandatory spending would come from Medicaid, which could see up to a 25 percent reduction in federal funding, pushing the financial burden onto the states and kicking 14 million people off their health insurance programs. Romans mentioned that protecting Medicaid is one of many campaign promises from Trump “that are turning out not to be true.”

    On the May 22 edition of MSNBC Live, host Chris Jansing went even further in breaking down the human toll of Trump’s budget cuts with NBC News senior editor Beth Fouhy and New York Times national reporter Yamiche Alcindor. The show aired part of an interview with a mother of two young children, who told Fouhy that if these cuts are enacted, the costs of care for her child with cerebral palsy will bankrupt her. Then they showed a clip of Trump on the campaign trail proclaiming that he would “save Medicare, Medicaid, and Social Security without cuts.” Alcindor discussed a report she wrote for the Times earlier this month about the human costs of budget cuts that would lead eliminate programs that help provide small communities with access to clean drinking water, drug rehabilitation centers, and jobs programs:

  • Trump Claimed He Saved American Jobs At Ford, But The Company Is Reportedly Shedding Thousands

    Ford May Lay Off 10 Percent Of Global Workforce, Highlighting Problematic Media Promotion Of Trump’s Empty Jobs Boasts

    Blog ››› ››› CRAIG HARRINGTON

    Reports are circulating that American auto giant Ford Motor Co. plans to cut up to 10 percent of its global workforce in a bid to boost the company’s profits and its share price, with a focus on cutting nonunion salaried workers in North America and Asia. The news is potentially devastating for thousands of American workers and reveals another empty boast from President Donald Trump, who previously enjoyed a flood of positive press when he took personal credit for job creation at the company.

    On May 15, The Wall Street Journal reported that Ford CEO Mark Fields plans to shrink his company's global workforce by roughly 10 percent as part of a “drive to boost profits and the auto maker’s sliding stock price.” The Journal noted that such heavy job cuts at a company with 200,000 employees around the world, “half of which work in North America,” could “trigger a political backlash at the White House” for a president who “has repeatedly pointed to auto makers like Ford as examples of companies adding U.S. jobs.” The initial report was soon corroborated by Bloomberg, CNBC, CNNMoney, Reuters, and the Detroit Free Press, with some reporting that thousands of nonunion salaried employees in the U.S. might face layoffs. Many reports discussed the political fallout such a move could create for a Trump administration that has routinely claimed unfounded credit for spurring job growth at Ford and other companies in the U.S. On the May 16 edition of MSNBC Live, CNBC reporter Dominic Chu explained that the cuts would likely target administrative and managerial positions throughout the company as Ford tries to squeeze its workers:

    In the past, Trump has promoted reports of job creation at Ford and other companies by shoehorning himself into fawning press reports of business decisions he had little or nothing to do with. (See: Alibaba, Carrier, SoftBank.) Trump even falsely took credit for Ford canceling a planned factory expansion in Mexico, but the company later broke ground on a new Mexican factory expansion at a different location.

    After months of allowing themselves to be misled by Trump’s false tweets and rants, reporters finally appeared to have caught on; they largely downplayed Trump’s role in a March 28 investment agreement between Ford and the United Auto Workers union, which he heralded on Twitter. Unfortunately, much of the damage from the earlier glut of insipid coverage has been done. American companies are not making business decisions based on Trump’s rhetorical flourishes, but millions of news viewers still erroneously think of the president as a sort of “dealmaker-in-chief.”

  • White House Spokesperson Echoes CNN’s Misfire On Manufacturing Jobs Growth

    Sarah Huckabee-Sanders Credits Positive April Jobs Report To Fantasy Manufacturing And Mining Employment

    Blog ››› ››› ALEX MORASH

    White House spokesperson Sarah Huckabee-Sanders doubled down on false claims that Obamacare is a job killer while making the ridiculous assertion heard earlier on CNN that the solid job growth in April was driven by job creation in manufacturing. In reality, the vast majority of jobs came from health care, business services, and hospitality while only a fraction came from manufacturing.

    During a May 5 White House press briefing, Politico’s Matthew Nussbaum asked Huckabee-Sanders if President Donald Trump still believed Obamacare was “a job killer” after the April 2017 jobs report showed a net gain of 211,000 jobs as part of a record breaking 79 consecutive months of job growth. Huckabee-Sanders initially deflected before making the head-turning statement that “the most growth in this jobs report were in manufacturing, coal miners, other places.” An odd statement considering a breakdown of the jobs report by employment industry showed the manufacturing sector created only 6,000 jobs last month while coal mining added approximately 200 total jobs. Even after accounting for all mining and logging jobs (10,000 jobs), as well as the “Other” category (7,000 jobs), the huge majority of new jobs created in April were created elsewhere:

    The White House’s claim that job growth was concentrated in coal mining and manufacturing is nonsensical. Coal mining’s mere 200 new jobs does not even account for one-tenth of one percent of all the jobs created in April -- by comparison, the performing arts created 32 times as many jobs (6,400) as coal mining. The greatest job growth in the April report came from the “Leisure and hospitality” industry, which added 55,000 jobs. Education and health care services added 41,000 jobs during the same timeframe, and according to data compiled by the Washington Center for Equitable Growth, since 2007 -- the start of the Great Recession -- these two sectors have seen the largest job gains of any industry:

    This clear break with reality follows an earlier misstep by CNN, which also hyped manufacturing growth in the April jobs report despite there being little reason to boast. If CNN or the White House are truly interested in jobs, perhaps they should look at what gutting Obamacare would do to employment in the health care and social services industry, an industry that has seen some of the largest post-recession gains in the U.S. economy and employs more workers (19.4 million) than the entire manufacturing sector (12.4 million).

  • The Passage Of Trumpcare Means It Is Time To Interview Kati McFarland Again

    The “Resistance Recess” Star Said ACA Repeal Would Mean Certain Death; Americans Need To Hear Her Story

    Blog ››› ››› CRAIG HARRINGTON

    Republican attempts to coalesce around a plan to repeal the Affordable Care Act (ACA) were initially stymied after tens of thousands of Americans swamped constituent events across the country during a week of actions collectively known as the "Resistance Recess." One of the activists whose story caught national attention was Kati McFarland, a 25-year-old Arkansan battling chronic health conditions, whose heartfelt plea to Sen. Tom Cotton (R-AR) helped contextualize the GOP's health care repeal agenda. Her story is now more important than ever.

    The May 4 party-line passage of the American Health Care Act (AHCA) means the Republican Party’s years-long crusade to “repeal and replace” Obamacare faces only one more hurdle before arriving at the president’s desk: the Republican-controlled U.S. Senate. According to reporting from The Washington Post, members of the GOP caucus plan to draft and pass their own version of a health care overhaul, which may or may not reflect the disastrous principles outlined in the AHCA. An independent congressional analysis predicted the original House version would disproportionately impact poorer, older, and sicker Americans, resulting in 24 million additional uninsured adults in 10 years and an additional $337 billion in deficit spending.

    As the Senate begins deliberations over its own health care agenda, it is vital that news outlets include perspectives from the tens of millions of Americans whose lives and livelihoods may be impacted by that legislation, and share what losing access to care will mean for them.

    In February, tens of thousands of Americans flooded constituent services events around the country demanding that elected officials offer viable health care reform policies. A Media Matters analysis of cable news programming from February 18 through 26 revealed that just three of the 88 guests featured during prime-time discussions of those events were attendees affected by the outcome of the health care debate. Prime-time news programming overwhelmingly featured political reporters and pundits arguing about the optics of town halls filled with constituents demanding answers, and very little attention was paid to the residents themselves or their concerns. Kati McFarland, whose exchange with Cotton became a viral sensation, was interviewed once each by CNN and MSNBC far outside of the prime-time window that would have brought her story to millions of viewers.

    Most of the media coverage of the AHCA so far has focused on whether President Trump has finally won his first legislative victory, with reporters hyping the optics of the legislation rather than discussing the threat it represents to tens of millions of Americans. Outlets still have a chance to get the story right, and with members of the House of Representatives headed home for recess over the next week, there should be no shortage of outraged constituents willing to share their stories -- if media are willing to listen.

  • MSNBC Anchor Stephanie Ruhle On New GOP Health Care Amendment: “Isn’t It Basically Universal Health Care?”

    Blog ››› ››› MEDIA MATTERS STAFF

    MSNBC anchor Stephanie Ruhle made several severely misinformed statements about Rep. Fred Upton’s (R-MI) new amendment to the American Health Care Act (AHCA). Ruhle first questioned whether covering pre-existing conditions in the AHCA means the bill is “basically universal health care” and then, rephrasing, stated “it is coverage for all then.” She also suggested that the $8 billion the proposed -- but still unreleased -- Upton amendment provides is sufficient funding for the AHCA’s high-risk pools. The AHCA is far from universal care and it is also not “coverage for all.” When the AHCA was originally scored by the Congressional Budget Office several weeks ago, it estimated that 24 million people will lose their health care (not including the new amendments which would likely cause even more to lose coverage). Additionally, new estimates from the Center for American Progress show that the AHCA’s high risk pool financing is woefully insufficient as it “would leave a $20 billion shortfall annually” -- meaning an additional $8 billion over 5 years is functionally a drop in the bucket. From the May 3 edition of MSNBC Live:

    KRISTEN WELKER: Steph, according to our hill team, representative Fred Upton of Michigan is working on an amendment that would deal with the issue of pre-existing conditions. That's the major sticking point. Because there is concern that the bill so far could allow insurance companies to hike up the prices for people living with pre-existing conditions. So under this Upton amendment, it would effectively bring $8 billion over the next five years to help people living with pre-existing conditions to pay for their coverage. The reaction, we're still waiting to get that. What we do know is that Fred Upton and Billy Long of Missouri, who's also currently a no vote, are planning to meet with President Trump here at the White House later on this morning to discuss this amendment and this sticking point, this major sticking point. President Trump now getting personally engaged in this plan and in this effort to revive the plan to repeal and replace Obamacare. I was also told according to one of my sources here at the White House that the president was working the phones overnight, reached out to a number of Republicans trying to switch those no votes to yes. As you point out, the margin is very slim. They can't afford to lose any more votes or else this new plan to repeal and replace Obamacare will be sunk, Steph.

    STEPHANIE RUHLE (HOST): I want to talk about this amendment. $8 billion that could get these moderates over the hump. What's it going to do to the freedom caucus? $8 billion is a very big number. Fundamentally, if you -- isn't it basically universal health care if you do cover pre-existing conditions?

    ELISE JORDAN: I don't think it's basically universal health care by any stretch, but still --

    RUHLE: It is coverage for all then, excuse me. 

    JORDAN: I agree that the $8 billion, how can that be palatable to these Freedom Caucus members that are already unhappy about this new spending bill. It just seems like there's so many initiatives floating around right now that the Freedom Caucus isn't going to stand for it. That's why I wonder if they're going to splinter this already pretty fragile coalition.