Right-wing media dishonestly accused President Obama and the Justice Department of "McCarthyism," "extortion," and carrying out a "vendetta" against JPMorgan Chase (JPM) after the two parties reached an historic $13 billion settlement over the company's role in the 2008 financial crisis. The attacks characterized the settlement as politicized "medieval justice," excusing JPM's responsibility for its own alleged wrongdoing and those of Bear Stearns and Washington Mutual -- two entities which played a large role in the collapse that were later acquired by JPM.
Fox News completely ignored the role of political brinkmanship over raising the debt ceiling in prompting a credit downgrade warning, erroneously claiming that the warning was prompted by concerns over long-term debt stabilization.
On October 15, credit rating agency Fitch placed the United States on a negative rating watch, threatening to downgrade the country's debt from "AAA" status if the debt ceiling is not raised in a timely manner.
On the October 16 edition of Fox News' America's Newsroom, co-host Martha MacCallum interviewed Fox Business' Stuart Varney regarding Fitch's downgrade threat, asking why the stock market has not reacted negatively to the warning. The conversation eventually turned to the United States' long-term debt prospects, with MacCallum asking if rating agencies have become less concerned about the national debt. Varney responded by claiming that not only are rating agencies still concerned about debt, but also that Fitch's warning was primarily in response to the United States' long-term debt:
MACCALLUM : It used to be that the credit rating agencies were very concerned about the long-term financial stability of the United States of America. Is that no longer the case Stuart?
VARNEY: No, they are still concerned. That's what this warning was all about. We have failed to get our long-term debt under control.
Varney's assessment of Fitch's warning is false.
At no point in their discussion did MacCallum or Varney mention the primary reason Fitch placed the United States' credit on negative watch: brinkmanship over raising the debt ceiling. In its warning, Fitch directly cited political obstacles to raising the debt ceiling as a "high" driver of the rating watch (emphasis added):
The U.S. authorities have not raised the federal debt ceiling in a timely manner before the Treasury exhausts extraordinary measures. The U.S. Treasury Secretary has said that extraordinary measures will be exhausted by 17 October, leaving cash reserves of just USD30bn. Although Fitch continues to believe that the debt ceiling will be raised soon, the political brinkmanship and reduced financing flexibility could increase the risk of a U.S. default.
While Varney contends that debt worries were a primary driver in prompting the warning, Fitch explicitly stated that current and near term debt levels (as a percentage of the economy) are consistent with the agency's "AAA" rating. Fitch did suggest that public debt should be put on a downward trend in the medium to long term, but noted this concern was secondary to the more immediate and potentially disastrous problem of failing to raise the debt ceiling.
Republicans have held firm in their unwillingness to raise the debt ceiling without extracting political concessions, most related to defunding, delaying, or eliminating provisions in the Affordable Care Act.
Virtually every other news outlet noted that Fitch was primarily concerned about brinkmanship and failure to raise the debt ceiling. Instead of noting this fact, Fox chose to continue its history of raising false alarms over the nation's debt load.
Fox jumped on a baseless and easily debunked conspiracy theory about a Democratic politician just days before Election Day.
The Daily Caller caused a stir on October 14 by publishing a story promoting flimsy claims that Newark Mayor and New Jersey senatorial candidate Cory Booker does not actually live in New Jersey. In the article, writer Charles Johnson and "filmmaker" Joel Gilbert (more on him in a minute) interview a handful of Booker's "supposed neighbors" claiming he has "never" lived in Newark and may actually live in New York, but provide no substantial evidence to support their claims.
After the story was promoted widely by conservative online media and subsequently adopted by Steve Lonegan, Booker's opponent in this week's special senate election, it fell apart. Buzzfeed explains that while "there is no clear evidence to support claims Booker lives elsewhere," property records and other documentation suggest that he does, in fact, live in Newark.
Slate's David Weigel points out another reason the story doesn't pass the smell test: the involvement of Joel Gilbert. Gilbert -- the "filmmaker" whose interviews served as a central facet of the Caller piece -- is best known for Dreams from My Real Father, the documentary he released in 2012 arguing that President Obama is the secret love child of communist poet Frank Marshall Davis.
Weigel explains that the misfire on Booker may be "only the second-flimsiest story that [Daily Caller] has published about a New Jersey politician this year," following that publication's ill-fated series of stories claiming New Jersey Senator Bob Menendez had short-changed prostitutes in the Dominican Republic.
Despite the story being entirely unconvincing and coming in part from a disreputable conspiracy theorist, it of course made it into the Fox News bubble, because it targeted a Democrat. (Fox had previously heavily promoted the Caller's series on Menendez, as well.)
Fox News continued to hype the myth that the debt ceiling raises the national debt, smearing President Obama's comments at an October 8 press conference as false. In reality, the debt ceiling does not raise the debt or authorize additional spending, but instead enables the U.S. government to finance existing legal obligations.
Fox hyped a discredited report on federal disability benefits to falsely claim that the Obama administration purposely made it easier to claim disability in order to keep the unemployment rate low. In fact, it is harder than ever to receive benefits as the percentage of approved claims has fallen since 2007, and experts agree disability is not connected to a decrease in the labor force.
Major media outlets are pushing the narrative that the United States Department of the Treasury could prioritize payments to bond holders and select groups of recipients in lieu of an increase of the federal borrowing limit, also known as the debt ceiling, beyond October 17. This ignores Treasury Department officials and other experts who explain such prioritization is unworkable and legally dubious, and that default would still happen.
From the October 3 edition of MSNBC's All In with Chris Hayes:
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Fox Business host Stuart Varney believes that the ongoing government shutdown, while presenting no real threat to the economy, offers an opportunity to "punish" federal workers for "living on our backs."
On the October 2 edition of AM 560's The Big John & Amy Show, co-hosts John Howell and Amy Jacobson interviewed Fox Business' Stuart Varney and asked him about the government shutdown and its effect on workers and the economy. Varney stated, incorrectly, that the shutdown was not having an impact on financial markets or the greater economy before launching into a tirade against federal employees. When asked if federal employees deserved to be recompensed for lost wages during the shutdown, Varney had this to say:
HOWELL: Do you think that federal workers, when this ends, are deserving of their back pay or not?
VARNEY: That is a loaded question isn't it? You want my opinion? This is President Obama's shutdown. He is responsible for shutting this thing down; he's taken an entirely political decision here. No, I don't think they should get their back pay, frankly, I really don't. I'm sick and tired of a massive, bloated federal bureaucracy living on our backs, and taking money out of us, a lot more money than most of us earn in the private sector, then getting a furlough, and then getting their money back at the end of it. Sorry, I'm not for that. I want to punish these people. Sorry to say that, but that's what I want to do.
After co-host Amy Jacobson responded that "it's not the federal employees' fault" and that she hates to see them victimized by a political fight, Varney complained that in "the big picture" he is "getting screwed" by government workers who are "living large":
JACOBSON: But it's not their fault. It's not the federal employees' fault. I mean, that's what I'm sick of, I hate and it makes me anxious, to see people who are victimized because of a political fight.
VARNEY: I take your point Amy, it is not directly their fault, but I'm looking at the big picture here. I'm getting screwed. Here I am, a private citizen, paying an inordinate amount of money in tax. I've got a slow economy because it's all government, all the time. And these people are living on our backs, regulating us, telling us what to do, taxing us, taking our money, and living large. This is my chance to say "hey, I'm fed up with this and I don't miss you when you're on furlough." Sorry if that's a harsh tone, but that's the way I feel.
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Right-wing media are accusing President Obama of using "scare tactics" to score political points with the upcoming debt limit deadline, but professional economists agree that debt limit brinkmanship could end in disaster.
On October 2, President Obama sat down for an interview with CNBC correspondent John Harwood in which he said that Washington's political posturing was "different" this time, and that major financial institutions "should be concerned" by Republican threats to not raise the debt ceiling before October 17. But the right-wing media response to President Obama's caution has been to downplay the looming deadline while accusing the president of engaging in "scare tactics."
On the October 3 edition of Fox News' Fox & Friends, co-hosts Steve Doocy and Brian Kilmeade questioned if the president was hoping to "trigger a stock market sell-off":
In a later segment, the Fox & Friends crew was joined by Fox Business host Stuart Varney to discuss the effect the president's statements might have on financial markets. Varney and the hosts agreed that the president's rhetoric was designed to drive markets down and thus provide him with "extra leverage" in the debt ceiling fight:
Fox Business host Stuart Varney misleadingly downplayed the harm that a government shutdown would inflict on the U.S. economy by claiming Wall Street would be mostly unaffected and that it could help the housing market. In fact, a shutdown would harm the housing recovery and economists say it would slow economic growth.
Fox Business host Stuart Varney argued that the potential nomination of Federal Reserve Vice Chairwoman Janet Yellen to succeed Chairman Ben Bernanke would be based in part on her gender, making no mention of her aptitude or qualifications for the position.
On the September 26 edition of Fox Business' Varney & Co., host Stuart Varney was joined by Fox Business host Melissa Francis and Fox News contributor Juan Williams to discuss the current and continuing role of the Federal Reserve. The panel largely focused on the recently politicized nature of the nomination process and who is expected to replace Ben Bernanke as chairman. Varney ended the segment by arguing that the potential nomination of Janet Yellen as the next Fed chair would in part be driven by her gender.
VARNEY: Would you agree with me that the lady in question here, Janet Yellen, is a shoo-in to be the next Fed chair because she's female, she's academic, and it is assumed that she would keep on printing money. That conforms with everything that President Obama wants in a Fed chair. She's a shoo-in, agreed?
Varney's contention that gender would play a role in the nomination process reveals a troubling development in right-wing media. Rather than discussing Yellen's qualifications as an economist, her history of accurate econometric predictions, or her broad base of support among economists, conservative media instead focus their attention on Yellen's gender.
On September 18, the Institute for Women's Policy Research sent a letter to President Obama supporting Janet Yellen, signed by more than 500 economists from across the country. The signatures included several former White House economic policy officials and Nobel Prize-winning economist Joseph Stiglitz. Nobel Prize-winning economist Paul Krugman also expressed his support for Yellen's candidacy in The New York Times. From Krugman's article:
Janet Yellen, the vice chairwoman of the Fed's Board of Governors, isn't just up to the job; by any objective standard, she's the best-qualified person in America to take over when Ben Bernanke steps down as chairman.
Fox News is resorting to dishonest misrepresentations of President Obama's record of deficit reduction by cherry picking data and completely disregarding Bush-era deficit levels.
On the September 24 edition of Fox News' Fox & Friends, co-hosts Steve Doocy, Elisabeth Hasselbeck, and Brian Kilmeade were joined by Fox Business anchor Stuart Varney for a falsehood-laden discussion of the federal budget and budget deficit. Varney argued that President Obama first ran up the deficit before hemming it down, claiming that in the president's "first full year in office" the federal budget deficit was approximately $1.4 trillion.
Fox provided a graphic of deficit spending from 2008 to projected 2013 levels, claiming that the deficit is up 137.7 percent since 2008.
The 137.7 percent deficit increase cited by Fox is ostensibly calculated by comparing the 2012 deficit to that of 2008. This figure, however, completely misrepresents deficits under the Obama administration, by picking erroneous start and end dates.
The federal budget deficit in fiscal year 2009 was $1.4 trillion. However, fiscal year 2009 began on October 1, 2008, months before President Obama was sworn into office. Attributing the 2009 budget deficit to President Obama is simply incorrect.
According to the Congressional Budget Office's (CBO) budget and economic outlook report for 2009 -- released prior to President Obama's first inauguration -- the federal budget deficit was projected to be $1.2 trillion for the 2009 fiscal year. Citing turmoil in the housing and financial markets, the CBO projected deficits to rise to their largest percentage of GDP since the Reagan administration. From the report:
A drop in tax revenues and increased federal spending (much of it related to the government's actions to address the crisis in the housing and financial markets) both contribute to the robust growth in this year's deficit.
The report noted that the projected deficit also included the initial $180 billion cost of the Troubled Asset Relief Program (TARP) and the estimated $200 billion takeover of mortgage giants Fannie Mae and Freddie Mac.
Choosing 2012 deficits as the end point for analysis of deficit growth is also erroneous. Why Fox didn't choose the most recent data -- projected levels for fiscal year 2013, which ends on September 30 - as the end point remains a mystery.
If Fox had chosen the correct starting and end points for its analysis of deficits under President Obama, a completely different picture of deficit reduction would emerge. Indeed, according to the latest CBO budget and economic outlook released in May, deficits are projected to fall to less than 3.4 percent of GDP in 2014, the lowest level in years. Current deficit projections for 2017, President Obama's final fiscal year, are estimated to fall to just 2.4 percent of GDP. None of these facts were featured in Fox's reporting.
Fox & Friends has dedicated three segments in one week to a discussion of the debt, debt ceiling, and deficit. Each time their reports have been plagued by misunderstanding or mischaracterizing the facts.
Fox's Martha MacCallum preemptively attacked President Obama's upcoming remarks regarding healthcare costs in relation to the implementation of the Affordable Care Act (ACA), commonly known as Obamacare, claiming that the truth behind premium costs "flies in the face" of what Obama has previously said and would say in his speech. MacCallum predicted that Obama would incorrectly claim that healthcare costs are lowering -- but Obama reported that while rising healthcare costs are a continuing concern, the rate of increase in costs is at its lowest in 50 years, a fact he's acknowledged in the past.
Discussing Walgreens' recent decision to move some employees to private health insurance exchanges on America's Newsroom, Fox Business host Stuart Varney claimed that Walgreens made their decision because, as he paraphrased, they "can't afford the constant rising cost of healthcare and [they] cannot afford the cost of compliance with Obamacare." MacCallum, along with co-host Bill Hemmer, later responded to the news, saying (emphasis added):
HEMMER: But this is the beginning of a flood. We talked about it last week, when the big companies step up and say we're going to change the policy, many, many others will follow.
MACCALLUM: And it flies in the face of what you're hearing from the president, and we'll hear it today as well: That premiums are going down. That costs are going down. So if costs were truly going down, what would be forcing these companies to push people off of their rolls onto this, you know, 'Here's your check,' and, you know, 'good luck.'
Despite MacCallum's claim, what the president has previously acknowledged is that while healthcare costs are still rising, increases have slowed to their lowest rate in 50 years -- a fact that Fox failed to report.
OBAMA: Healthcare costs, which were and continue to be a major source of concern, are increasing at the slowest rate in 50 years, and for many of you, in terms of your bottom lines, employer based healthcare plans have gone up at about a third of what they were going up when I first took office.
Fox has a habit of pre-emptively dismissing, ignoring, and cutting away from Obama's speeches. MacCallum's misconstruance of Obama's remarks on healthcare costs is not surprising given the network's long history of reporting misinformation about the Affordable Care Act.
Fox Business' Stuart Varney falsely claimed that government spending and increased tax revenue were harming economic growth, despite the fact that economists say government spending cuts negatively affect GDP growth and the rise in revenue has reduced the deficit, a goal Varney has previously championed.
On the September 12 edition of Fox & Friends, Varney discussed the recent Congressional Budget Office (CBO) report to Congress estimating that U.S. budget revenue is up $284 billion dollars. Varney ignored that the report revealed this increased tax revenue has been used to reduce the deficit by $400 billion, instead falsely claiming that government spending and high taxes are the cause for "a lousy growth rate," a "shrinking middle class, and appalling rates of unemployment amongst young people and minorities."
In fact, a number of economists have pointed to decreased government spending as the greatest drag on economic growth and a contributor to the sluggish recovery, and research from the CBO reveals that the economy's current low growth rate can be attributed to the large cuts in government spending known as sequestration. The CBO estimated that canceling sequestration would raise GDP by 0.7 percent, could generate 900,000 new jobs by 2014, and would lead to greater output and higher employment in the next few years.
Furthermore, Varney failed to mention that this rise in revenue has led to a two-thirds decline in the deficit, despite the fact that he has previously fixated on reducing the deficit as an economic priority. The deficit is now the lowest it has been since 2008.
Fox News psychiatrist Keith Ablow used the anniversary of the September 11 attacks to smear President Obama with the accusation that "he hates us," but was elected because Americans suffered from Stockholm Syndrome.
In a discussion on Fox Business' Varney & Co. about the anniversary of the September 11 terror attack, host Stuart Varney asked Ablow whether America's psyche had changed in the twelve years after the attack. Ablow responded that America suffers from a "captive mentality" like Stockholm Syndrome. As evidence, Ablow pointed to the election of Obama, who he claimed "doesn't even like us, he hates us," concluding that "when things get bad enough," America "will elect a patriot" (emphasis added):
ABLOW: Yes, but I hope not irrevocably so. Because I think what it set in motion is a kind of captive mentality. The same kind of thing that happens when a plane is hijacked and people aboard say "You know what? I am starting to think like the people who took this plane over." Why? Because they want to be safe and they want to endear themselves to their adversaries. And I think that the whole Obama apology tour, the election of Barack Obama was a manifestation of us wanting to say, "Look, we are not that bad, don't hurt us. Here is this guy, how bad can we be? He doesn't even like us, he hates us and we are electing him president."
CHARLES PAYNE (Fox Business contributor): When do we come out of this Stockholm Syndrome that you are talking about, when do we escape it?
ABLOW: It's good to be with another psychiatrist. Stockholm Syndrome -- We escape it when things get bad enough from that failed psychological attempt. Right? what is it? It's a form of denial. Bad enough that, just like an alcoholic falling on the pavement, you say, "You know what, oh my God, this didn't work. Trying to dodge and weave around who we are and pretend we're other than that by electing someone friendly to adversaries is not working, hence we will elect a patriot, someone very high on the Constitution and someone who isn't afraid to use power when it's indicated." And then we'll set things right.