Wednesday, April 6, 2011

Will the New York Times make up their mind?

In late March, the New York Times ran an article saying that GE was using "aggressive...lobbying" and "innovative accounting" to avoid paying US taxes, and even claim a tax refund of billions.  There is some dispute as to the accuracy of the claims, but it's true that GE is taking advantage of tax laws to lower their tax burden.  Whether this is "fiduciary responsibility" or "exploiting loopholes" is debatable.

In today's editorials, the Times, as one would expect, blast Paul Ryan's budget proposal.  They blast it several times, including implicating it in any impending government shutdown, but I'm focusing on that one editorial.  I agree with the editorial that "serious deficit reduction requires everything to be on the table, including tax increases", something Ryan does not envision.  And Ryan dodges the whole third rail of Social Security.  However, the Times goes on to say (italics mine)
The Republican plan calls only for tax simplification. It would get rid of loopholes and reduce rates in a way that would not raise overall revenues but would invariably cut the tax bill of wealthy taxpayers for whom lower rates are more valuable than assorted loopholes.
The Times cannot run an article complaining that tax loopholes let GE get away with paying no taxes, then, just a couple of weeks later, run an editorial that belittles the value of loopholes.  This is intellectual dishonesty.

Instead of blanket condemnation of Ryan's proposals, how about "we like getting rid of the loopholes. but lets increase his top rate from 25% to X%", and actually propose something concrete and constructive.

A couple of the more conservative Times columnists offer a more balanced evaluation of the Ryan proposal, Ross Douhat and David Brooks.

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