Sinclair Broadcast Group has in recent days aired misleading criticism of President Joe Biden’s infrastructure proposals from organizations that are corporate front groups or push an anti-spending austerity agenda. But the facts and commentary from economists and other experts show that much of this criticism is disingenuous.
Sinclair sought commentary from pro-austerity organizations funded by corporations and right-wing donors
On March 30, Sinclair’s morning program The National Desk -- which airs on 68 Sinclair-owned or -operated local television stations -- interviewed Manhattan Institute senior fellow Brian Riedl, who opposed spending trillions of dollars on infrastructure and was critical of including spending to combat climate change. Anchor Jan Jeffcoat chose not to disclose the Manhattan Institute’s funding from the fossil fuel industry and other corporate interests.
- Greenpeace has tallied more than $3 million in donations from Koch foundations to the Manhattan Institute between 1997 and 2017.
- The Manhattan Institute received millions of dollars from oil interests, including at least $800,000 from ExxonMobil and $1.9 million from the Claude R. Lambe Charitable Foundation, which was one of the family foundations of the oil billionaire Koch brothers.
- The Manhattan Institute employed a senior fellow named Robert Bryce who used his perch often to publicly question the reality of climate change.
Also on March 30, Sinclair chief political correspondent Scott Thuman included commentary in his report from Elaine Parker, chief communications officer of the Job Creators Network, which aired on dozens of Sinclair TV stations before re-airing on The National Desk the next morning. Thuman failed to disclose that Job Creators Network is a conservative organization and a corporate front group for wealthy donors.
- According to Sludge, a news outlet that reports on lobbying and money in politics, the Job Creators Network is “a front group for the interests of wealthy business executives. The nonprofit is linked to and funded by several wealthy corporate leaders who are also Republican political megadonors and oppose workers’ rights, including collective bargaining.”
- Eyes on the Ties, which advocates for more transparency in how corporate power shapes policy, published in 2019 an article titled “The billionaire Trump donors behind the ‘Job Creators Network.’” It listed the right-wing Mercer family, Trump donor Bernie Marcus, and conservative billionaire Philip Anschutz as major donors to the organization. It also described the Job Creators Network as “part of a network of other astroturf groups that all fight tooth-and-nail to defend elite interests against progressive efforts to regulate corporate power.”
On April 1, Sinclair national correspondent James Rosen included commentary from Adam Posen of the Peterson Institute for International Economics in his report on Biden’s infrastructure plan, which also aired on dozens of Sinclair stations before re-airing on The National Desk. But Rosen failed to mention the pro-austerity nature of the organization and its namesake.
- Peter G. Peterson, who founded the institute, had a long history of supporting austerity. In 2013, an editorial from The Nation explored Peterson’s Campaign to Fix the Debt, which it described as a “$60 million push to sell corporate America’s ruthless austerity agenda” and his “latest incarnation” of a “long campaign to get Congress and the White House to cut Social Security, Medicare and Medicaid while providing tax breaks for corporations and the wealthy.”
- As the Center for Media and Democracy’s PRWatch reported in 2013, economists employed by the institute authored an error-riddled study that was used by governments around the world to justify harmful spending cuts and high unemployment.
These pro-corporate Sinclair guests’ commentary on Biden’s infrastructure bill was misleading or lacked full context
The Manhattan Institute’s Brian Riedl claimed the price tag for Biden’s infrastructure plan is “just too big” to pay for and that Biden’s plan to rate the corporate tax rate from 21% to 28% “would return us to the highest corporate tax rate in the OECD,” referring to the Organisation for Economic Cooperation and Development. He also said: “The bill will simply not be paid for. Like a lot of what we’ve had with the stimulus, a lot of it's just going to go on the national credit card. So whether you think the infrastructure is helpful or not helpful, it’s probably going to be paid for mostly on the national debt if it’s enacted.” But Riedl’s comments are misleading at best and flat-out wrong at worst.
- Biden’s planned increase of the corporate tax rate to 28% will keep the U.S. corporate tax rate below numerous other OECD countries, including Australia, France, and Portugal.
- Federal revenue from corporations is near record lows according to data from the Tax Policy Center.
- A new report from the Institute on Taxation and Economic Policy explained that “at least 55 of the largest corporations in America paid no federal corporate income taxes in their most recent fiscal year despite enjoying substantial pretax profits in the United States. This continues a decades-long trend of corporate tax avoidance by the biggest U.S. corporations.”
- The White House said that the proposed corporate tax increases would, over the course of 15 years, fully pay for the proposed spending.
- Even if the spending were fully deficit-financed, economists say that the current fiscal environment makes that acceptable. Jason Furman, former chairman of the White House Council of Economic Advisers, said: “Given that interest rates are still too low … $2T in *unpaid for* well-designed investments, some temporary, would be beneficial. As such I don't think this should all or even mostly be paid for.” Nobel Prize-winning economist Paul Krugman argued that in the fiscal environment the U.S. is facing, “sustained deficit spending on investment is actually good.”
Job Creators Network’s Elaine Parker hid the context of the business tax deduction she warned about removing when she said: “This is actually going to hit right at the heart of small businesses with that repeal of that 20% tax deduction. … That is the very tax deduction that helps the smallest of the small businesses, the heart of the middle class, and the employees who work for them.”
- Parker didn’t specify what tax deduction she was talking about, but it appears to be one that didn’t exist until Trump’s tax cut, which mostly benefited corporations and the wealthy. CNBC’s reporting suggested many business owners were not even aware of the tax deduction until recently.
- CNBC’s reporting also explained that tax deduction was temporary and is currently set to expire in 2025.
And the Peterson Institute’s Adam Posen left out necessary context when he warned: “This is the first truly credible inflation threat in decades.” But senior economists have pushed back against this kind of fearmongering over inflation.
- As Business Insider reported, Federal Reserve Chairman Jerome Powell said in a February speech that “inflation has been much lower and more stable over the past three decades than in earlier times.”
- San Francisco Federal Reserve President Mary Daly told Axios that Biden’s infrastructure plan is unlikely to lead to what Axios termed “out-of-control price increases.”
- Nobel Prize-winning economist Joseph Stiglitz also told Axios he supported Biden’s infrastructure proposal. Axios summed up Sitglitz’s view as that the plan “could break the U.S. out of the low-growth, low-inflation environment that has existed for the past 20 years.”
Economists and other experts agree Biden’s infrastructure spending plan is needed and beneficial
The fact is, massive investments in infrastructure are badly needed. An April 2 New York Times article explained: “Roadways and bridges are still in use decades after the end of their projected life spans. Sewer and water systems are aged and decaying. And a changing climate threatens to worsen old vulnerabilities and expose new ones.”
Reuters reported that the American Society of Civil Engineers said that “surface transportation, water systems, and schools are the most in need of help,” and that the U.S. “needs to spend $2.59 trillion in the next 10 years to fix existing infrastructure.” Biden’s infrastructure plan includes money for both existing and new infrastructure, such as energy and housing.
Economists from financial analysis firms have predicted that Biden’s infrastructure plan will create millions of jobs over a period of several years. Axios reported that S&P Global “predicts Biden's infrastructure plan will create 2.3 million jobs by 2024” and “raise per-capita income by $2,400.” And as USA Today reported, Moody’s Analytics expects Biden’s infrastructure plan to be more beneficial in the long term:
Mark Zandi, chief economist of Moody’s Analytics, says the projects won't begin in earnest until 2023. He expects the economy to grow just 1.3% from the fourth quarter of 2021 to the fourth quarter of 2022, with the Biden plan adding nothing to the gains.
Over a longer period, Biden’s plan would be a big positive, economists say. Zandi expects it to add about half a percentage point to growth in 2023 and 1.6 percentage points the following year. The blueprint, he reckons, would add about 1.4 million jobs in 2024 and 1 million jobs in 2025.
By 2030, the economy would be about $700 billion, or nearly 3%, larger than it would be without the upgrades and an additional 2.7 million Americans would be working, Moody's figures show.