The Complete Dishonesty Of Fox News' Economic Context

JEREMY HOLDEN/Media Matters for America:

Fox News anchor Martha MacCallum rewrote economic history to blame President Obama for the recession that began in December 2007, arguing that the economy "got worse" in 2009.

The Commerce Department on Friday reported that the economy grew by 1.5 percent during the second quarter, a slower rate of growth than the first three months of the year. MacCallum, claiming to provide "a little context" to those figures, noted that the economy actually declined throughout 2008. She then put some deceptive Fox spin on the numbers:

It got worse in 2009. In fact, that's when we had our two quarters of consecutive loss and that's what put us into the actual official recessionary status.

Nothing about MacCallum's analysis is true.

The economy reached official recessionary status in December 2007 - not in 2009. It got worse in 2008. In fact, during the final quarter of that year, the economy shrunk by 8.9 percent. Nearly 2 million jobs were lost during that one quarter, which was the worst for economic growth in more than 50 years.

Contrary to MacCallum's claim, the economy did not get worse in 2009. While the economy continued to contract during the first half of 2009, it did so at a slower rate than during the last quarter of 2008 before turning to growth in the second half of that year. The recession officially ended in June 2009.

MacCallum's economic distortion furthers the conservative argument that President Obama made the economy worse.

Meanwhile, actual economists are noting that the economy is not growing quickly enough because of drastic cuts to government spending. Nobel prize winning economist and New York Times columnist Paul Krugman called the current economic situation "a picture of an economy hobbled by premature austerity," led by severe cuts in spending by state and local governments. Government spending, which makes up part of the GDP figures released on Friday, has declined for 8 consecutive months.  

And while the White House has pushed Congress to pass a jobs bill that would provide aid to states and local governments, Fox News has led a campaign to celebrate the very austerity measures that economists say are hampering economic growth.

The Economic Conversation Fox News Doesn't Want To Have

by Leslie Rosenberg/Media Matters

After weeks of dismissing news that the economy is improving and downplaying concerns over income inequality, Fox News is now trying to pivot the conversation away from economic growth to focus on deficit reduction, even as economists continue to warn that doing so would be bad for the economy.

Fox News contributor Tucker Carlson and anchor Martha MacCallum argued that the debt "needs to be an issue" in the presidential election, and urged Republican candidates to make debt reduction "the issue" in the campaign. When guest Christopher Hahn argued that debt reduction could wait until the economy is on firmer ground before making our primary focus deficit reduction, MacCallum scoffed: "Oh please!"

 Economists warn that debt reduction should wait until the economic recovery is on firmer ground. Dean Baker, co-director of the Center for Economic and Policy Research, explained that prioritizing the deficit now "makes no sense": There are no businesses that are going to hire additional workers because the government laid off school teachers or firefighters and we cut back spending on food stamps. Businesses hire more workers when they see more demand for their product. All of these actions that reduce the deficit, either on the spending or tax side, translate into less demand and therefore less employment. In short, those who want to cut the deficit now are lobbying for fewer jobs and higher unemployment. Nobel Prize winning economist Paul Krugman has argued that a premature focus on deficits would be "counterproductive." This tactic of shifting the debate away from jobs and economic growth to fixate on debt is nothing new at Fox. In the spring of 2010, while economists were arguing that more needed to be done to reduce unemployment and help grow the economy, Fox News insisted that debt was "our number one issue." At the time, Krugman argued that "jobs now, deficits later was and is the right strategy." The effect of that hijacked debate was a credit downgrade that Fox News figures cheered. It's not just economists who say it's not time to shift attention away from economic growth. Voters overwhelmingly say that jobs and the economy should be the focus of this year's election, not the debt. Voters are also more likely to say that the economy is moving in the right direction, rather than the wrong direction; and they are more likely to say that the Republican Party is moving in the wrong direction. All of which could explain why Fox is trying to move the debate in a different direction.

Fox's "Straight News" Anchor Martha MacCallum Regularly Advocates GOP Positions

From Media Matters

Fox News defends its credibility as a legitimate news outlet by claiming that there is a dividing line between its news and opinion programming. Purported "straight news" anchor Martha MacCallum, however, has a long record of echoing GOP talking points to advocate for conservative policies.

MacCallum Says Flat Tax Is "A Better Idea"

MacCallum Decides "A Flat Tax Is A Better Idea." From the December 8 edition of Fox News Radio's Kilmeade & Friends:

KILMEADE: All right. Heidi, you're in Maryland.

CALLER: Hi there.

KILMEADE: Hi, Heidi.

CALLER: One part of the discussion that Obama keeps on talking about, the salary being $250,000, that the tax -- is where everybody's going to be taxed. I'm wondering why we haven't discussed taking salary as well as cost of living index. You could make $250,000 in rural Illinois and live like a king, but if you live in the D.C. area and make $250,000 -- $250,000 a year, your housing is ridiculous.

KILMEADE: Oh, yeah. I mean, they are talking -- these economists, these economic minds are looking at the cost of living index, but what if you move?

MacCALLUM: That's why a flat tax is a better idea.

CALLER: Well, I agree with a flat tax. But I just think that -- I mean, I haven't heard a lot of talk about the cost of living index. And I think that plays a huge role, in terms of, you know, how you live.

MacCALLUM: Absolutely. One town's rich is another town's, you know, just -- studio apartment, you know what I'm saying? [Fox News Radio, Kilmeade & Friends, 12/8/10]

As Far Back As 1996, Then-GOP Presidential Candidate Steve Forbes Backed A Flat Tax. From the Associated Press:

House Speaker Newt Gingrich (R-Ga.) took a swipe Thursday at the flat-tax proposal touted by GOP presidential hopeful Steve Forbes.

The multimillionaire publisher backs a 17% flat tax that would eliminate deductions for mortgage interest and charitable giving. [Associated Press, 2/9/96]

The Hill: "House Republicans Last Week Introduced The First Flat Tax Legislation Of The 112th Congress, The Freedom Flat Tax Act." From a March 14 blog post for The Hill:

House Republicans last week introduced the first flat tax legislation of the 112th Congress, the Freedom Flat Tax Act.

The bill, memorably numbered H.R. 1040, would give individuals and companies the choice to make an "irrevocable election" to be subject to the flat tax instead of the current system. Choosing the flat tax would result in a 19 percent tax for the first two years of election, followed by a 17 percent tax after that. [The Hill, 3/14/11]

MacCallum Says We "Need" To Raise Retirement Age

MacCallum: "We Need To Raise The Age At Which You Can Get" Social Security. From the November 15 edition of Fox News' America's Newsroom:

MacCALLUM: We've been talking circles around [Social Security reform], Bob, for so many years. I mean, you know, we need to do something. We need to raise the age at which you can get it -- the proposal is 69 at 2075. You know, the length of life that people are living is getting higher and higher, and it was supposed to be a widows and orphans fund, not a retirement plan. [Fox News, America's Newsroom, 11/15/10]

The Hill: Boehner Said Raising Retirement Age "Is A Step That Needs To Be Taken." From The Hill:

A Republican-held Congress might look to raise the retirement age to 70, House Minority Leader John Boehner (R-Ohio) suggested Monday.

Boehner, the top Republican lawmaker in the House, said raising the retirement age by five years, indexing benefits to the rate of inflation and means-testing benefits would make the massive entitlement program more solvent.

"We're all living a lot longer than anyone ever expected," Boehner said in a meeting with the editors of the Pittsburgh Tribune-Review. "And I think that raising the retirement age -- going out 20 years, so you're not affecting anyone close to retirement -- and eventually getting the retirement age to 70 is a step that needs to be taken." [The Hill, 6/29/10]

MacCallum Says Obama Should Call For Consideration Of Social Security "Investment Accounts"

MacCallum: Shouldn't Obama "Take This On Himself" And Say, "Let's Consider Investment Accounts For Younger People"? From the November 15 edition of America's Newsroom:

MacCALLUM: You know what? All you hear from politicians, Bob, is, "Oh, we're going to protect Social Security." I mean, shouldn't President Obama take this on himself and stand up and say, "Look, let's consider investment accounts for younger people who would like to put some of their money that they're putting away in an investment account. Let's consider the options. Let's raise the age." Where's the president on this? [Fox News, America's Newsroom, 11/15/10]

Bush Administration Unsuccessfully Attempted To Create Private Social Security Accounts.From a March 31, 2005, Slate.com article by Jacob Weisberg:

George W. Bush's plan to remake the Social Security system is kaput. This is not a value judgment. It's a statement of political fact. In the months since the president first presented the idea as his top domestic priority, Democrats in Congress have unexpectedly unified in opposition to any reform based on private accounts. Several Republican senators whose votes would be needed for passage are resisting private accounts as well. And public opinion, which has never favored any form of privatization, is trending even more strongly against Bush's scheme. At this point, there's just no way that the president can finagle enough votes to win. [Slate.com, 3/31/05]

MacCallum Tells Muslim Spokesman He "Should Be Supportive" Of GOP Hearings On Muslim Extremism

MacCallum To CAIR Spokesman: "I Believe You Should Be Supportive Of Hearings" On Muslim Extremism. From the March 8 edition of America's Newsroom:

COREY SAYLOR (Council on American-Islamic Relations spokesman): [Homegrown terrorism] is a huge concern for our community that we've been doing a lot about, and CAIR has submitted testimony to the hearing that will prove that conclusively. But what's not happening here is when you have the Southern Poverty Law Center reporting that white extremist groups are on the rise in this country, that movement produced the Oklahoma City bomber, and Congressman [Peter] King doesn't want to talk about that.

MacCALLUM: That was a long time ago. These instances -- there's 22 instances since May of 2009 that have people very concerned.

SAYLOR: They are on the rise right now Martha, and that frightens me.

MacCALLUM: I think that to deny that this is a problem and to deny that it needs to be looked at is to just turn away from something that -- you know, I think most Americans -- if you say, "What's your top concern in terms of terrorism in this country?" do you think they're going to say white extremists like Tim McVeigh?

SAYLOR: But Martha, I'm not denying it. I just said my testimony completely contradicts that and shows the work that CAIR is doing. Again, I already said to you, I'm the one who made the phone call that got the FBI involved --

MacCALLUM: Then I believe you should be supportive of hearings that would continue to look into this problem in this country.

SAYLOR: So how is that me denying the problem? What I'm saying is that it's a more widespread problem. [Fox News, America's Newsroom, 3/8/11]

MacCallum Equates Government Spending With Drug And Alcohol Abuse

Recalling "Just Say No" To Drugs Pins, MacCallum Suggests " 'Just Say No' To More Spending." From the December 15 edition of America's Newsroom:

MacCALLUM: You can go to our homepage at FoxNews.com at -- slash America's Newsroom and tell us what you think about this, folks. And you are weighing in huge numbers. It's critical to keep our government going and our economy, or is the whole thing completely out of control? Do you want to see them sort of just say no? We should have, like, those little symbols, those pins, you know, "Just Say No" to drugs? "Just Say No" to more spending, right? [Fox News, America's Newsroom, 12/15/10]

MacCallum: On Budget Deficits, Maybe America Is Like "A Drunk Who Finally Hits Bottom."From the January 27 edition of Fox News' America Live:

MacCALLUM: Even down to an individual level, you know, when you're running out of money as a person, right, you have a couple of options. You can either, you know, basically go to the loan shark, right? Pay way up for your interest rates. I mean, that's one way to look at it. You know, or you just have a situation where you say, "I'm going into bankruptcy," and you have to try to work something out.

You know, why are we closer to that now than we were before? You know, I mean, as the economy slowly but surely starts to kind of pull itself out of the hole a little bit, why is this problem getting so much worse now?

[...]

MacCALLUM: Well, maybe we're like, you know, a drunk who finally hits bottom. Maybe it takes a [deficit] number that big to start to see some real spending cuts, which I know you're a big proponent of, Stuart [Varney]. [Fox News, America Live, 1/27/11]

Sen. Hatch On Fiscal Discipline: "We're Worse Than Addicts." The Daily Caller quoted Sen. Orrin Hatch (R-UT):

Senate Republicans said Wednesday that without a rule requiring them to balance the budget, they would never be able to bring themselves to do it on their own.

"If you don't have this kind of fiscal discipline, you'll never get there," Hatch said. "We're worse than addicts." [The Daily Caller, 1/27/11]

MacCallum And Bachmann Agree: Obama's Proposals Are A "Lurch Towards Socialism"

MacCallum Tells Bachmann: "I Think You're Absolutely Right About That." From the March 24, 2009, edition of Fox News' The Live Desk:

REP. MICHELE BACHMANN (R-MN): But I'm very concerned about the Obama administration wanting now to tell private companies what they can pay their management and their employees. This is all about centralized government planning. This is not the road to go down.

The very first question I asked is, "Are we jettisoning free-market capitalism in favor of economic centralized planning?" And I don't -- I think we're getting the answer in actions of the Obama administration. This is a lurch towards socialism.

MacCALLUM: Well, hey. I mean, it was said by the administration that only government can help in this situation, so I think you're absolutely right about that. [The Live Desk, Fox News,3/24/09]

MacCallum And Bachmann Agree: Markets Don't Want Debt Ceiling Raised

MacCallum: "If We Refuse To Raise The Debt Ceiling, Our Creditors Will Look Upon That Favorably." From the May 13 edition of Fox News' America Live:

MacCALLUM: You know, my gut feeling and my, you know, background studying the markets tells me that if you -- if we refuse to raise the debt ceiling, our creditors will look upon that favorably. They'll say, "Finally, the United States is actually getting serious about their financial issues." And I think just -- you know, as a corporation, any company that borrows money is under that same kind of scrutiny. When they tighten their belt, Wall Street responds very favorably.

BERNARD WHITMAN (Democratic strategist): But you know, here's what I support: I support a deficit cap. A deficit cap would say if the national debt as a percentage of the entire economy does not start to go down in the next few years, it would trigger automatic spending cuts, automatic tax hikes. That's what would trigger -- that's what would say to the markets, "We're getting serious," rather than playing chicken.

MacCALLUM: Yeah, but our -- but, just the language of what you just said. If, if, if. "If this doesn't happen in the next few years, then we'll do this." It's too late for that. People are past that point. They want to see it now. They want to see it now.

WHITMAN: They don't want to see our government default. That is breaking a bond that we have with our creditors that would be outrageous.

MacCALLUM: We've already broken those bonds with everybody.

WHITMAN: It would be unacceptable.

MacCALLUM: We've broken those bonds. [Fox News, America Live, 5/13/11]

Bachmann: "Don't Let Anyone Tell You" That Raising Debt Ceiling Is "Going To Show The World That We're Even More Credit-Worthy." From Fox Broadcasting Co.'s Fox News Sunday:

BACHMANN: If we continue on the trajectory that we're going right now of borrowing money that we don't have, because 41 cents of every dollar the federal government spends today is borrowed money. So, every hour, we are borrowing $188 million. So, about a fifth of $1 billion in the hour you're on today, we will borrow.

We can't do that. This -- the music is about to end. The game is going to be over.

So, don't let anyone tell you that by increasing the debt limit, the ability for the federal government to keep borrowing, that somehow that's going to show the world that we're even more credit-worthy because we're borrowing? Very soon, Chris, we are going to be at the point where we're going to be -- we're going to be borrowing more money so that we're essentially having a $4 trillion budget and $2 trillion of it will be borrowed money. We can't live that way. [Fox News Sunday, Fox Broadcasting, 5/1/11, accessed via Nexis]

Fox Touts Division Between Its Reporting And Opinion Programming

LA Times: Fox Executives Argue "The Channel Plays It Straight With Its Daytime News Programming." From the Los Angeles Times:

Network executives vigorously dispute the notion that the channel has a conservative slant.

Although its popular prime-time commentators may be largely on the political right, the channel plays it straight with its daytime news programming, they argue. [Los Angeles Times, 3/6/09]

NY Times: "Fox Argues That Its News Hours ... Are Objective." From The New York Times:

In an interview, Mr. [senior vice president for news Michael] Clemente suggested that there was an element of "shoot the messenger" in the back and forth. "Sometimes it's actually helpful to have an organization or a person that you can go up against for whatever reason," he said.

Fox argues that its news hours -- 9 a.m. to 4 p.m. and 6 to 8 p.m. on weekdays -- are objective. The channel has taken pains recently to highlight its news programs, including the two hours led by Shepard Smith, its chief news anchor. And its daytime newscasts draw more viewers than CNN or MSNBC's prime-time programs.

"The average consumer certainly knows the difference between the A section of the newspaper and the editorial page," Mr. Clemente said. [The New York Times, 10/11/09]

Fox News VP Compares Fox's Reporting/Editorial Division To "The A-Section Of The Newspaper And The Editorial Page." From TVNewser:

[A] statement from Fox News SVP Michael Clemente: "An increasing number of viewers are relying on FOX News for both news and opinion. And the average news consumer can certainly distinguish between the A-section of the newspaper and the editorial page, which is what our programming represents. So, with all due respect to anyone who might still be confused about the difference between news reporting and vibrant opinion, my suggestion would be to talk about the stories and the facts, rather than attack the messenger...which over time, has never worked." [TVNewser, 10/11/09]