In an effort to push for federal spending cuts, right-wing media figures have repeatedly claimed that the U.S. is on the path to becoming Greece, which is facing a severe debt crisis. However, the comparison between the two countries is wholly misleading, and sharp spending cuts in Greece have exacerbated the country's economic contraction.
Wall Street Journal editorial board member Stephen Moore claimed that enacting spending cuts is the only way to reduce government debt. However, economists argue that focusing on economic growth is a crucial part of reducing deficits.
In an appearance on Fox News' Happening Now, Moore, lamenting the fact that spending cuts were not a primary focus of the January 1 budget deal, claimed that "unless you cut spending...you can't bring that debt down."
While spending cuts could be implemented to address the deficit and debt, they are hardly the only option. Throughout the debate on budget negotiations, numerous economists felt that deficit reduction should be addressed through a balanced approach, with revenue increases offsetting the need for deep spending cuts.
Furthermore, some economists, such as the Center for Economic and Policy Research's Dean Baker, argue that focusing on deficit reduction is largely a distraction, especially considering that increased deficits over the past few years "are entirely the result of the economic downturn."
Given this fact, some economists have rightly claimed that economic growth should be a priority when attempting to address deficits. According to former Secretary of Labor Robert Reich:
The deficit is a problem only in proportion to the overall size of the economy. If the economy grows faster than its current 2 percent annualized rate, the deficit shrinks in proportion. Tax receipts grow, and the deficit becomes more manageable.
But if economic growth slows -- as it will, if taxes are raised on the middle class and if government spending is reduced when unemployment is still high -- the deficit becomes larger in proportion. That's the austerity trap Europe finds itself in. We don't want to go there. [The New York Times, 11/7/2012]
Indeed, many economists have argued that cutting spending in a weak economy could negatively impact growth. So while spending cuts may reduce deficits in the short term, they could add to debt in the long run through decreased revenues from lowered economic activity.
Conservative media figures have long insisted that top marginal income tax rates effectively target small businesses. This "zombie lie" has sprung up throughout President Obama's first term as an argument against Democratic proposals to renew the Bush-era rates only for middle- and low-income Americans. Despite continual efforts by experts to debunk this claim, media figures continue to repeat these lies in the 2012 edition of the fight over high-income tax rates.
Fox News' Special Report falsely suggested that the recent growth of the food stamp program was due to President Obama's 2009 economic stimulus, asserting that the bill "eviscerated" work requirements for food stamps. In fact, most of the growth in the program was due to economic factors, primarily the recession, and 46 states had received work requirement waivers before Obama took office.
In an effort to discredit President Obama's plan to increase taxes on the wealthy, conservative media outlets have pushed a number of myths to suggest that a large number of Americans will be negatively affected. In reality, only a small percentage of taxpayers would be affected by Obama's proposals.
From the October 24 edition of Fox News' Happening Now:
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Following the first presidential debate, Fox has enthusiastically echoed Mitt Romney's call to end public funding for Sesame Street and other public broadcasting. Fox's attacks on public broadcasting have focused on criticism of Big Bird.
Fox News regular Stephen Moore, a Wall Street Journal editorial board member, today argued in favor of Mitt Romney's stated plan to end federal funding for PBS, by claiming that Sesame Street character Big Bird "has made more money than a lot of Wall Street firms." In fact, records show that the show's production company loses money annually.
As a Slate article explained in January, "Sesame Street and its production company the Sesame Workshop do make a lot of money from product licensing, but not nearly enough to cover expenses." Indeed, according to the company's most recent available federal tax returns, Sesame Workshop lost $6 million in 2010: Total revenue that year was about $133 million, but expenses added up to more than $139 million.
Though that may seem like a significant figure for a children's program, Sesame Street is a "relative bargain" compared to other TV shows. As Slate noted, "The production budget for Sesame Street domestically is about $16 or $17 million per year, which produces about 26 episodes." This works out to less than a million dollars per episode, whereas "a cable show like The Walking Dead can cost $3 million per episode," reported Slate.
According to a recent audit of the program, the remaining revenue Sesame Workshop gains is spent on expenses such as "education, research and outreach," "Sesame Street in schools," and content distribution.
The New York Times reported that to make up for the losses, PBS hopes prime-time hits like Downton Abbey and Sherlock, which attract significantly more donations, will in turn help "finance other programs like 'Sesame Street.'"
But on Fox News' Your World, Moore cheered Romney's decision to end PBS' federal funding, saying that "Big Bird is big enterprise in fact." He went on to argue that "people who listen to it, and watch it, and like the programming, they should pay for it," adding:
MOORE: My feeling is look, if people like Warren Buffet and people like, you know, people like Ted Turner feel that this is such an important programing, why shouldn't they pay for it?
In fact, people who think the programming is important and want to keep it on-air already do pay for it.
Right-wing media claim that the recently reported drop in unemployment was caused by a high rate of public sector hiring. In fact, private sector job growth far outpaces public sector employment.
Fox News is distorting President Obama's economic agenda by pushing the straw-man argument that taxing the entirety of millionaires' incomes would fund the government for less than three months. In fact, Obama has proposed no such thing, and this Republican talking point obscures the billions in revenue that would be generated from letting the Bush tax cuts expire for wealthy households.
From the September 23 edition of Fox News' Hannity's America
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Fox News is obscuring the negative impact of Congressman Paul Ryan's Medicare plan on seniors by accusing President Obama and the Democrats of "stoking fears" about the plan. In fact, Ryan's plan would adversely affect current and future seniors, forcing them, among other things, to pay more for prescription drugs, and it would create a voucher system that would drive up health care costs.
From the August 3 edition of Fox News' Hannity:
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Fox News has seized on Stockton, California's announcement that it will file for bankruptcy in order to blame state and local governments' budget problems on public sector pension obligations. In fact, the budget problems facing these governments are the result of the dramatic drop in revenue after the recession, not pensions.
Wall Street Journal editor and frequent Fox News guest Steve Moore claimed that concerns over a scheduled expiration of tax cuts is "the whole problem with the U.S. economy right now." In fact, economic experts say that a lack of demand for goods and services is the main factor dragging down jobs growth, and several recent surveys of small business owners show that lack of demand is their main concern.