The campaign commercial I’ve seen most
recently and most often is the one where they say Obamacare is “the biggest tax
increase in history.” Rush Limbaugh, that bastion of misinformation and spin
originated the line and likely he never thought anyone would take it seriously,
but there it is being trotted out to frighten the masses into believing the
President is bound and determined to destroy the country as a tax mad Democrat.
Of course for subterfuge to really work it
must contain a kernel of truth as this one does. The Congressional Budget
Office (nonpartisan) estimates all the things put together in this package
(which is rather complicated to determine) but result in a total of 675 billion
between now and 2022. You could even add penalty payments perhaps up to $54
billion. At any rate there is a lot of money involved but is it the largest tax
increase in history.
A simple and a simplistic answer would be
yes, if you see things in raw dollars, meaning you forget about inflation. See
chart below (ACA is Affordable Care Act at 76.8 billion dollars.)
But that is definitely misleading because
inflation. If you account for that the ACA goes to 4th place behind
Reagan’s increases, see the next chart below.
But this is also misleading as if fails to
account for the increase in population which is 82 million more since Reagan’s
1982 increase. Plus, incomes have increased.
FactCheck.org says the best yardstick to
measure all of this is to see the tax increase in terms of its relationship to
Gross Domestic Product (GDP). Now the increase is under 1/4th of
Reagan’s 1982 increase. See the next chart.
There is more to it than even this, but
enough is enough but you could go back to 1942 and it seems like a pittance.
Probably a effective political ad, but it
is just wrong.
Using raw dollars in place of proporations has been used to cook the numbers by pundits and politicians for decades. This is why EVERY SINGLE ELECTION you hear conservatives claim that Democrat X is responsible for the "Biggest Tax Increase in History." I've seen more "Biggest Tax Increase In History"'s than I can count.
ReplyDeleteIf you measure in raw dollars, everything is biggest in history. The debt is the biggest in history. The economy is the biggest in history. The defense budget is the biggest in history. My last car purchase was my biggest in my history. My last raise was my biggest in my history. My last year's grocery bill was my biggest in history. Almost anything you choose to measure will be the 'biggest in history'.
What does it tell you? Nothing useful, but it makes a great sound bite which is what matters most in the Age of Disinformation. This is how to lie with statistics.
Raw dollars is in fact the most accurate way. Anything else is fudging/tampering/altering. Maybe with good reason, but it most definitely is cooking to move away from the actual (raw) figures. Percent of GDP is one of the common deceptive ways to cook numbers and misinform.
ReplyDeleteOne of the least is to adjust for inflation. This is a lot more honest. The first two charts are pretty good.
You're not being intellectually honest. This is so absurdist I don't believe that even you believe it - you can't sit there with a straight face claiming that a 2012 dollar is the same as a 1968 dollar. No one is that obtuse. It is fudging the facts in the worst way, mindlessly brushing aside the effects of time itself and ignoring the context of the figures.
DeleteIt's like looking at the 2012 DoD budget and comparing it to the war of 1812, in raw dollars. An utterly useless, blatantly dishonest analysis.
Correcting for inflation helps undo some of the worst of the distortion, but even that falls short as inflation is a manufactured number and is understated by design.
Proportions and percentages (usually of GDP) is the most honest comparison. Proportions don't mislead the way raw dollars do.
In financial analysis we always common-size company statements. We compare gross profit margin as a percentage of sales, not absolute dollars. Because the worth of dollars change - sticking with proportions gives you a better indication of how operations really compare.
The same goes for macro-economic stats. We talk about tax rates, not tax dollars. Household debt service burdens are measured as percentages of income, not as raw dollars. Raw dollars tells you NOTHING. It's a pure tool of rhetoric, employed when the goal is to mislead.
"Proportions and percentages (usually of GDP) is the most honest comparison"
ReplyDeleteThat is far and away the least honest way to measure it, and it is an intentionally deceptive way to cook books. It is highly arbitrary and is used in an attempt to deceive. It looks at overall gross domestic product, which as we know, includes the wealth of the rich. It ignores the stagnant earnings of the average home owner. As the wealth of the top few percent gets bigger (as has been discussed here) and those below do not have such an increased wealth, the cooked "divide by GDP numbers" end up understating a massive tax increase.
As for your question and accusation, it is not "absurdist" to be as accurate as possible. And if we are concerned with accurate straightforward information, the first chart is the best. It presents unadorned information, and the reader clearly sees the years listed, and he or she can adjust for inflation or other factors in their mind as they see fit.
I am not fudging the facts: I am peeling away the fudge. Raw dollars tells everything. It is employed when the goal is to present the information in as accurate a way as possible, and is as remote as possible from the "lies, damn lies, and statistics" problem.
As for "you can't sit there with a straight face claiming that a 2012 dollar is the same as a 1968 dollar."
Well, it all depends. In terms of buying computers, the 'worth' of a 2012 dollar is thousands of times the value of a 1968 dollar.