George Will Misleads on the Stimulus

On Sunday, August 7, 2011 ABC’s Sunday morning news show, This Week featured a roundtable discussion on the politics of the economy. During the discussion George Will stated,

It’s pretty clear what won’t work.  We’ve had a stimulus. There are now 2 million more people unemployed than there were when the stimulus was passed. We now have a record one in seven American households on food stamps. We have wagered this economy on a mistaken view of the multiplier effect of federal dollars spent to create jobs. It didn’t work, let’s try something else. 

Will is clearly implying that the stimulus either caused job looses or failed to create jobs. That is not true. Analysts have repeatedly found that the stimulus saved or created millions of jobs.

The non-partisan Congressional Budget Office found that, as of the first quarter of 2011, the stimulus increased the number of people employed by between 1.2 million and 3.3 million than if the stimulus hadn’t been passed.  

Various private organizations have looked into the issue as well. The President’s Council of Economic Advisors listed the assessments of private organizations on how many jobs the stimulus saved or created as of the first quarter of 2011.

            IHS/Global Insight:                      2.43 million jobs saved or created

            Macroeconomic Advisers:          2.48 million jobs saved or created

            Moody’s Economy.com              2.47 million jobs saved or created

Some may object to using jobs that were saved in the total, but those jobs wouldn’t have been with us had the stimulus not been passed.

The other primary criticism from conservatives on these analyses is the methodology of using specific multipliers in their calculations. The idea behind multipliers themselves is basic macroeconomics. When money is spent, a portion of that money is saved by the seller of a good and a portion is spent. That spent money stimulates economic growth and a portion of it is spent again, and so on, until all the money is saved by one person or another. Conservatives often think that these agencies are overestimating the size of the multiplier effect. But when multiple expert organizations, public and private, agree on multipliers of approximately the same size, I think they know what they are talking about.

The stimulus did work. It saved or created millions of jobs. It was also incredibly expensive. The CBO projects that it will cost 814 Billion dollars. If conservatives wish to say that the gains in employment and economic growth aren’t worth the cost of the stimulus, that’s fine. But they cannot say that it didn’t work or that it didn’t create jobs.

To her credit, Cokie Roberts confronted Will’s mischaracterization of the stimulus.

Right now the unemployment numbers are very much boosted by state and local governments laying off people because they no longer have the stimulus to pay them with.

Unfortunately the take away from this exchange for the average audience member is that there is a legitimate dispute on whether the stimulus created jobs. There isn’t, and ABC’s audience deserves to know it.

P.S. Fox News has been the primary purveyor of Stimulus misinformation. Media Matters has documented this countless times.

Originallly Written August 7, 2011

Factchecking the Peacock

On Tuesday July 5^th, NBC Nightly News did a segment on the debate over the debt ceiling. Brian Williams said that if the debt ceiling isn’t raised, “in less than a month the United States will not be able to pay its debts.”

Visit msnbc.com for breaking news, world news, and news about the economy

The best explanation of why this isn’t true was stated by Brit Hume on Fox News’ Special Report,

As President Obama enters the negotiations over extending the borrowing authority that is the debt ceiling there’s some things that need to be understood. The first is that there is almost no chance that government will default on its debt payments even if the debt ceiling is never raised. That’s because revenues will continue to flow into the treasury from income tax withholdings, which will be more than enough to cover the debt payments. So the only way that a default could occur would be if the treasury department inexplicably chose not to make the payments; but there will come a time when there won’t be enough money to fund all government departments and agencies, which would mean real disruptions. The administration would then get to decide which programs are funded and which are not.

Debt payments would almost certainly be the first bills to be paid because, just like a credit card, if you do not pay the interest on your debt, creditors will jack up the rate next time you need to borrow money. It is a possibility that this will happen simply due to creditors’ fear that the government may not pay the interest on its debt. But that is irrelevant to Williams’ claim that the government won’t be able to pay its debts.

The structure of the federal budget is very similar from year to year. So one could easily compare the effect that not raising the debt ceiling would have on government agencies this year based on its spending last year. Here is the breakdown of the federal budget for Fiscal Year 2011, which is the period from October 1^st 2010 through September 31^st 2011.

                                                         Billions          Percent of Budget

Receipts (Tax Revenue)                      2174                56.9%

Outlays (Spending)                              3819                100%

Deficit                                                 1645                43.1%

Interest on the debt                               207                  5.4%

Social Security                                     742                  19.4%

Medicaid                                              276                   7.2%

Medicare                                              488                  12.8%

Other mandatory programs                   716                  18.7%

Non-Security discretionary spending     507                  13.3%

Security discretionary spending            908                  23.4%

These categories are explained very well by the Politifact article that lead me to these numbers.

Not raising the debt ceiling would mean that the government couldn’t spend any more than it collects in tax revenue. It would leave the government enough money to pay its debts, but not nearly enough to pay for all the services provided by government agencies. That means that the treasury department (which is part of the Obama Administration) would have to cut 43.1 percent of the budget, the proportion of federal government spending which is financed through borrowing.

Brit Hume also explained the practical effect of cutting even the small portion of budget represented by the Agriculture Department (which is part of Non-Security discretionary spending)

I do think that when it gets closer to it the democrats and the white house have a certain advantage in that they get to decide when the money runs short which agencies and departments get funded and which do not. And they will be able to pick and choose in such a way as to put maximum pressure on republican lawmakers on the hill. One senator I know of has told his leader that if for example the agriculture department were not able to fund the meat and paltry inspections which would effectively shut down that industry because you have to have inspected meat to sell that that would be the moment that he caved and voted to raise the debt limit.

Not raising the debt ceiling would be disastrous, not because America wouldn’t be able to pay its debts, but because it would require the suspension of large numbers of critical government services. So politicians who tell you they don’t support raising the debt ceiling are really advocating for a drastic restructuring of the federal government or they’re being dishonest.

But even if the debt ceiling is never raised, the government will be able to pay its debts and will likely do so. Therefore Brian Williams is wrong. It is a rare thing indeed to find a factual error in an NBC report, but today the peacock hangs its head in shame.

Originally posted July 6^th, 2011

UPDATE (July 7, 2011): ABC and CBS News (both usually reliable sources) made the same mistake that NBC News did.  The website for ABC World News with Diane Sawyer features a countdown clock titled, "Countdown to US Debt Default". CBS Evening news introduced a segment on the debt ceiling by saying, "With the D-day for default less than 4 weeks away...," implying that the US will be required to default on its debt if the debt ceiling isn't raised.

P.S. I would like to thank Fox News, The Young Turks, Politifact, and whitehouse.gov for assisting in this factcheck.

The Story of Raymond Davis

The US Media, Lies, and Deception

Sunday, March 27, 2011, Jake Tapper filled in for Christian Amanpour on ABC’s Sunday show “This Week.”  He had an interesting panel discussion on the internationally enforced no fly zone in Libya with panelists with diverse viewpoints. He also did a concurrent interview with Secretary of State Hillary Clinton and Secretary of Defense Robert Gates about the US intervention in Libya. Towards the end of the interview Tapper switched to other topics. This part of the interview was incredibly revealing about US foreign policy and ABC News. This section of the interview begins at 9 minutes 15 seconds. 

Speaking about the likely fall of Ali Abdullah Saleh, the 32-year dictator of Yemen and a US ally, Gates said,

It is a real concern because the most active and at this point, perhaps the most aggressive branch of Al Qaeda, Al Qaeda in the Arabian peninsula, operates out of Yemen and we have had a lot of counter-terrorism cooperation from president Saleh and the Yemeni security services so if that government collapses or is replaced by one that is dramatically more weak then I think we will face some additional challenges out of Yemen. There is no question about it. It’s a real problem.

First of all, we really should stop referring to dictators, even ones that are allies, as “presidents.” At the very least let’s refer to them as “strongmen” so that we recognize that they weren’t democratically elected in free and fair elections. Second, this is one of the greatest ironies of all time. While we are helping the rebels in Libya over through their dictator we lavish unwavering support for Yemen’s dictator. It is true that Yemen has done a lot of important counter-terrorism work for the United States. But when a democratic uprising is about to over through him, our leaders should at least be calling for democratic reform. A more consistent foreign policy would use our leverage to call for his resignation, perhaps offering him asylum in the US.  

The most startling point in the show immediately followed Robert Gates’ response. Jake Tapper set up the next question this way,

Secretary Clinton, on Pakistan, Pakistan has been trying to block US counter-terrorism efforts in the Fatah region and continues to work with terrorists who attack India, it held a US diplomat in its prisons for several weeks as I don’t need to tell you, has this relationship gotten worse in the last six months, US-Pakistan?

The “diplomat” that Tapper referred to was Raymond Davis, whose story in Pakistan is quite complex.

On January 27, 2011, CIA agent Raymond Davis shot and killed two men in Lahore, Pakistan. He claimed it was in self-defense; Pakistani officials charged him with murder. Since then, top US representatives have lobbied for his release. The story received very little coverage in the US press, and the sources that did cover it knowingly lied to their readers by telling them that Davis was a diplomat rather than a CIA agent. The New York Times, Washington Post, and Associated Press all did so at the request of the US State Department. Raymond’s real identity was first revealed in the Western press by the British newspaper “The Guardian” on February 20^th, 2011. The NYT, WP, and AP admitted their deception to their readers and explained that they did so to try to protect Davis, even though his CIA affiliation was well known in Pakistan at the time.

US officials tried to get Davis released on diplomatic immunity, a status where diplomats are immune from prosecution. The reasoning behind diplomatic immunity is that if Country A does something Country B doesn’t like, Country B can’t retaliate by bringing false charges against diplomats from Country A. It is my opinion that genuine charges of murder should not be subject to diplomatic immunity. On top of that, it is quite a stretch to try to apply diplomatic immunity towards a CIA agent. Thus, the nature of Davis’ job is critically important to understanding the story, and claiming that Davis was a diplomat had the potential to dramatically change reader’s views on whether he should be released.

Raymond Davis was released from Pakistan on March 16^th after the US gave the Pakistani government over 1 million dollars to reimburse the victim’s families.

I do not know if Raymond Davis committed murder in Pakistan or if he merely acted in self-defense. I also don't know if he was carrying out the orders of the CIA when he killed the two men. If he was acting without orders from the CIA and he murdered those men, then he deserves a life sentence. But if he was acting in self-defense or carrying out CIA orders then he was merely doing dangerous work for his country. Unfortunately, we won't know the truth of the matter until the government documents surrounding this event become declassified in the distant future. 

In many ways this case was the opposite of the Valarie Plame affair. Valarie Plame was a CIA agent who was outed by the Bush Administration because her husband publicly contradicted the administration’s line that Iraq was developing weapons of mass destruction. This outing to the press endangered her life and ruined the career of a woman who risked her life for decades to serve her country.

In both the Raymond Davis and Valarie Plame incidents the press was pushed to report a story a certain way based on the persuasion of government officials. The difference between the Valarie Plame and Raymond Davis stories is that Davis was credibly charged with the most serious crime a person can commit. That changes the press’ requirement to keep an agent’s job secrete to requiring them to disclose it.

Jake Tapper cannot plead ignorance in this case. Any serious US journalist knows that Raymond Davis was a CIA operative and not a diplomat. 3 months after the shooting, 1 month and 1 week since the Guardian article, and 1 week and 4 days after Davis was released, ABC is still deceiving its viewers about the details of the Raymond Davis case. It goes without saying that noting Davis is a CIA operative no longer puts him in danger as he walks freely in the United States.

The US press has been much more skeptical about US intervention in Libya than it was about the war in Iraq. All US news outlets bought the falsehoods promoted by the Bush administration, that Saddam Hussein was perusing weapons of mass destruction and that Saddam was tied to Al Qaeda. MSNBC even canceled the only program which aired anti-war voices. The coverage of Libya has shown how far the US press has come since then. The rare and inaccurate coverage of the Raymond Davis incident shows how far we have to go. 




Originally posted March 27, 2011





UPDATE: The US has changed its position on Yemen and now supports Saleh leaving office. This is a small but important step toward a more consistent foreign policy of supporting democracy abroad.  Hopefully it will translate towards greater respect towards America in the Arab world as well. 



AUTHOR'S NOTE: This article has been slightly changed from its original form. It originally called for Raymond Davis to stand trial in Pakistan in order to determine his guilt and to deliver justice. After more thought on the matter, I decided that the Pakistani public was so convinced of his guilt that he could never get a fair trial. An innocent man could have been sentenced to life or worse. The text was changed to reflect a more generic opinion of what I think would be the proper punishment under a variety of circumstances. The reason I wrote this article was the fact that various US news outlets lied to their viewers on the request of the government and in the process misinformed the public on the most basic facts surrounding the case. That is a criticism I still hold.