Eric Bolling deceptively edited President Obama's remarks on the need to "reduce spending in the tax code" and accused him of using "fuzzy math, Obama math." In comments Bolling excised out of the address, Obama made clear he was comparing "tax expenditures" to spending, a comparison economists routinely use.
Loading the player ...
Bolling Airs Deceptively Edited Video And Says "We're Not Buying This Fuzzy Math, Obama Math"
Bolling: "Come On, Mr. President, We're Not Buying This Fuzzy Math, Obama Math." While guest hosting for Glenn Beck, Bolling aired a clearly edited portion of Obama's April 13 address on fiscal policy and accused Obama of using "fuzzy math, Obama math":
ERIC BOLLING: And number four -- get this, reduce spending in the tax code. Listen to how this is supposed to work.
[VIDEO CLIP] OBAMA: The fourth step in our approach is to reduce spending in the tax code ... In December I agreed to extend the tax cuts for wealthiest Americans because it was the only way I could prevent a tax hike on middle class Americans. But we cannot afford $1 trillion worth of tax cuts for every millionaire and billionaire in society ... and I refuse to renew them again.
BOLLING: The key phrase there is "reduce spending in the tax code." Tell me how raising taxes counts as a spending cut. Come on, Mr. President, we're not buying this fuzzy math, Obama math. After all, do you think we're dummies or something? [Fox News, Glenn Beck, 4/14/11]
But Obama Specifically Compared "Tax Expenditures" To "Spending In The Tax Code"
Obama: "The Fourth Step In Our Approach Is To Reduce Spending In The Tax Code, So-Called Tax Expenditures." In portions of Obama's address that Bolling excised out of his video clip, Obama made clear that he was talking about "so-called tax expenditures" when he discussed the need to "reduce spending in the tax code." From Obama's April 13 address:
The fourth step in our approach is to reduce spending in the tax code, so-called tax expenditures. In December, I agreed to extend the tax cuts for the wealthiest Americans because it was the only way I could prevent a tax hike on middle-class Americans. But we cannot afford $1 trillion worth of tax cuts for every millionaire and billionaire in our society. We can't afford it. And I refuse to renew them again. [President Obama's address, 4/13/11]
And In Fact, Tax Expenditures Are Routinely Considered Spending
CBO Director In 1981: "Tax Expenditures Add To The Federal Deficit In The Same Way That Direct Spending Programs Do." From testimony by then-CBO Director Alice M. Rivlin before the Senate Budget Committee in 1981:
Tax expenditures add to the federal deficit in the same way that direct spending programs do. They allocate resources and provide incentives and benefits in the same way that spending programs do. They are one of the ways the federal government plays a role in the economy and involves itself in the lives of its citizens. [Testimony before the Senate Budget Committee, 11/24/81]
CBO: Tax Expenditures Are "Comparable To Spending Programs." From a 1988 CBO report:
The Congressional Budget and Impoundment Control Act of 1974 (Public Law 93-344), more commonly referred to as the Budget Act, requires the President and the Congressional Budget Office (CBO) to prepare lists of tax expenditures with estimates of their costs each year. The Budget Act defines tax expenditures as federal revenue losses arising from provisions in the income tax code that give selective relief to particular groups of taxpayers or special incentives for particular types of economic activity. The use of the term assumes that the tax code has both normal and preferential elements. In addition, it suggests that the preferential elements are comparable to spending programs; that is, they deliver through the tax system government assistance that could be provided with loans, grants, or other direct funding. [The Effects of Tax Reform on Tax Expenditures, Congressional Budget Office, March 1988]
CRS: "Tax Expenditures, In Many Ways, Are Similar To Entitlement Spending." From a report by the Congressional Research Service:
Outlays, however, provide an incomplete picture of federal resources used to achieve national economic and social goals. Tax expenditures -- special deductions, exclusions, exemptions, and credits in the tax code -- are often used instead of direct expenditures (mandatory and discretionary spending) to achieve these national goals. Tax expenditures, in many ways, are similar to entitlement spending. Eric Toder notes that tax expenditures are available to everyone who qualifies and federal budgetary costs depend on program rules (the tax code), economic conditions, and behavioral responses. Furthermore, they often remain in the tax code until changed or eliminated by congressional action. [Tax Expenditures and the Federal Budget, Congressional Research Service, 9/10/08]
Erskine Bowles: "Tax Expenditures" Are "Just Spending In The Tax Code." Erskine Bowles, co-chairman of President Obama's National Commission on Fiscal Responsibility and Reform, said:
ERSKINE BOWLES: Everybody's going to pay for it. There are no sacred cows here. We're cutting defense, we're cutting non-defense discretionary spending. We're cutting Social Security and we're cutting -- we're cutting health care. I mean, you got to cut it all. Nothing can be left off. And we're taking these tax expenditures which is just spending in the tax code and we're taking $100 billion of that a year and applying it right to reduce the deficit. It's the only way. This problem is real. The solution is very painful, and everybody's got to be on the table. [Fox News, On The Record With Greta Van Susteren, 4/1/11 via Nexis, emphasis added]
Alan Simpson: "Tax Expenditures" Are "Simply Spending By Another Name." From the testimony of Alan Simpson, co-chairman of President Obama's National Commission on Fiscal Responsibitily and Reform, before the Senate Judiciary Subcomittee on Constitution, Civil Rights and Human Rights:
ALAN SIMPSON: I believe that private campaign contributions facilitate an unholy alliance between those with the means to fund political campaigns and those who depend on their contributions to get elected. The consequences for our nation's finances are severe.
Why is it that a quarter century since the last comprehensive tax reform, Washington has riddled the system with countless tax expenditures, which are simply spending by another name? These tax earmarks, which add up to more than $1 trillion of tax spending a year, can mean handsome profits for those interests who fought for their inclusion, but they do little to promote economic growth and competitiveness for the nation as a whole. [CQ Transcriptions, 4/12/11 via Nexis, emphasis added]