When Figures Lie And Liars Figure

Current events are providing teaching opportunities these days.  We saw last time how increases in spending can be called cuts and vice versa.  This time we look at how tax cuts are not really tax cuts, and how a politician can promise no tax increases with big increases coming.

President Obama is now claiming that Romney will bankrupt the government by cutting taxes some astronomical amount.  But a closer look reveals how figures lie, and how liars figure on giving us a snow job.

This bate and switch is done by a scheduled tax increase put into effect first by Bush, then extended by Obama 2 years ago. (Hence the name Bush Tax Cuts)  As you think about this keep in mind that Washington lives in a static world.  It looks at the revenues today then assumes that if taxes are raised 10%, then revenues will increase 10%.  Therefore, if there is already a scheduled tax increase set to trigger next year, a corresponding increase in revenues is figured into its budget.  So if someone delays that scheduled increase, it is called a cut.  See?  Simple.

This allows for politicians to say the opposite of the truth without technically lying.  They can say “I will not raise your taxes”, for example.  Which is true.  The law raises them; or put differently, the taxes raise themselves.  At the same time it can also be said that your opponent is going to bankrupt the government by cutting taxes, even if that person simply promises to keep the existing rates in place.

We will all be less moronic if we realize this one simple truth.  When money, power, taxes and politicians are put into a pot and stirred around, no matter how good it looks or smells, don’t be too eager to gobble it down.



Filed under Government, Politics, taxation

2 responses to “When Figures Lie And Liars Figure

  1. Okay … it’s economics for morons … but this kind of thinking makes my head hurt. That puts me somewhere far below moron, right?

  2. Well said (written) as usual. The Thursday night debate was such a living example of this!!!

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