Tuesday, September 18, 2012

Wall Street Journal Gets a Taste of Its Own Medicine - And Wants to Spit it Out

Obama Ad Violates the Rule That Only Conservatives Can Be Misleading

The blatant use of false facts, false analysis and faulty reasoning graces the editorial pages of the Wall Street Journal.  It is the reason why their commentary is almost never taken seriously.  But suddenly the editors of the WSJ are outraged, outraged because of a factual but slightly misleading ad by the Obama re-election effort.

The issue is the Romney plan to cut tax rates by 20% across the boardHere is the story of the ad.

"To pay for huge new tax breaks for millionaires like him," the narrator says, "Romney would have to raise taxes on the middle class—$2,000 for a family with children, says a nonpartisan report." Then this newspaper's nameplate glides across the screen, with the text, "Study: Romney's Tax Plan Hits Middle Class, 8/1/12."

So what we have hear is the reference to the “Study” with the citation of where a report was made on the study, namely the Wall Street Journal.  This is correct, but the inference is that the report is that of the Wall Street Journal when in fact it is the Tax Policy Center report.

So the Journal thinks this is not fair.

Since Mr. Obama's ad makers had perhaps a million such uncritical blurbs to choose from, and most of them lacked straight-up-the-middle headlines, our guess is that they deliberately choose the Journal to associate Mr. Obama with this editorial page's antitax credibility. It's a subtle if familiar appeal to authority: "Even the Wall Street Journal . . ."

Now had the Journal stopped here no one would have a complaint, as the Obama campaign was guilty of a mild infraction, but one pretty tame considering all the other stuff that goes on in a campaign.  They should have cited the TPC, not the Journal.  But no, the Journal has to defend the indefensible and namely claim that the TPC study has been refuted.

the larger problem is citing a month-old blog post about what is a single and now discredited report. The Tax Policy Center authors—Samuel Brown, William Gale and Adam Looney, the last a former Obama Administration economist—concluded that Mr. Romney's tax plan was "mathematically impossible" and therefore to avoid increasing the deficit he would have to dip into the lower-income brackets for more revenue.

But it turns out the authors made selective and speculative assumptions and even invented tax details that Mr. Romney has never endorsed. In a follow-up paper on August 16, they conceded that they were merely looking at "the broad implications" of Mr. Romney's reform.

Later in August, Harvard economist and Romney adviser Martin Feldstein published his own calculations in these pages. He concluded, "Since broadening the tax base would produce enough revenue to pay for cutting everyone's tax rates, it is clear that the proposed Romney cuts wouldn't require any middle-class tax increase, nor would they produce a net windfall for high-income taxpayers. The Tax Policy Center and others are wrong to claim otherwise."

Notice the comment that the TPC invented tax details Mr. Romney never endorsed, which is technically true since Mr. Romney has not endorsed any tax details but they had to make reasonable assumptions to do any analysis of the proposal.  But the real problem is the Feldstein study, which even Mr. Feldstein has admitted had huge errors.

So our message to the Journal is fairly basic.  Clean up your own house WSJ before you lecture the rest of us on the integrity of either campaign ads or economic analysis.  And yes, the rest of us have to smile at one of the few “hoist on your own petard” moments in a the middle of an excruciatingly awful election season.

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