Scam watch: If you don’t like the Perry plan, just read a different newspaper!

WEDNESDAY, OCTOBER 26, 2011

The Post revives an old scam: Yesterday morning, Rick Perry released his “flat tax” proposal in little-known Gray Court, South Carolina—population 1021 in the year 2000.

Do you understand what Perry proposed? Different news orgs have described the proposal in amazingly divergent ways.

We recall the old joke about New England weather: If you don’t like the weather, just wait a while! It’s a bit like that with the Perry tax plan:

If you don’t like what Perry proposed, just read a different newspaper!

For starters, consider the way the plan is described in two of our most famous newspapers. Consider the way it’s described in today’s Washington Post—and in the New York Times.

Let’s start with the Times. For figure filberts, the Times provides a chart showing how different families would be affected by Perry’s proposal. (To examine that graphic, click here.) Meanwhile, here’s how the often befuddled Richard Oppel begins his news report:

OPPEL (10/26/11): Gov. Rick Perry of Texas unveiled a plan on Tuesday to scrap the graduated income tax and replace it with a 20 percent flat rate. By throwing out rates as high as 35 percent and eliminating estate and investment taxes, the plan would grant a major tax cut for the wealthy. It is the centerpiece of an ambitious proposal that aims to overhaul political sacred cows like Social Security and Medicare while slashing the federal budget.

Mr. Perry, a Republican presidential candidate, said his proposal would also offer benefits to middle-class Americans by giving a $12,500 deduction for every member of a household while preserving exemptions for state and local taxes, mortgage interest and charitable contributions for anyone making less than $500,000. He said anyone could still file under the current code, and he also pledged to lower the corporate tax rate to 20 percent, from 35 percent.

Is it basic facts you’re after? Oppel provides at least two basic facts in those opening paragraphs:

First, Perry’s plan would employ a single tax rate of 20 percent. (Oppel calls this a "flat rate." We wouldn't.)

Second, that tax rate would be applied to income only after the tax-payer has applied “a $12,500 deduction for every member of a household.”

Each of those facts is important. If you didn’t know that second fact, you’d be hard-pressed to understand most of the data found in that aforementioned New York Times graphic. For example, you would have a very hard time explaining this pair of facts:

Under Perry’s new proposal, a family of four earning $31,000 wouldn’t owe any income taxes at all, according to the Times graphic. A family of four earning $69,800 would owe only $2140—roughly three percent of their income.

You simply couldn’t understand those facts if you didn’t know about those per-person exemptions. Applying that “20 percent flat rate,” you would assume that a family of four earning $31,000 would owe roughly $6200 in income taxes! You’d assume that a family of four earning $69,800 would owe $13,960.

That makes the reporting in today’s Washington Post quite amazing. The Post’s reporting is hard to fathom. Truth to tell, it resembles a scam.

Start with Karen Tumulty’s front-page report in today’s hard-copy Post. Tumulty offers an overview of the tax proposals of various GOP candidates. She turns to Perry’s proposal first. Here’s the way she describes it:

TUMULTY (10/26/11): Latest to put forward a blueprint is Texas Gov. Rick Perry, a former front-runner who fully embraced a number of long-standing and far-reaching conservative goals.

"My plan does not trim around the edges," Perry said as he announced it Tuesday in South Carolina.

The centerpiece is a proposal that would give individuals the option to pay a 20 percent flat tax. Perry also would reduce the corporate tax rate from 35 percent to 20 percent; eliminate taxes on dividends and capital gains; make deep, unspecified cuts in federal spending; and establish individual retirement accounts outside the Social Security system.

Tumulty cites the “20 percent flat tax”—but she doesn’t mention those large per-person exemptions. Her report runs 1400 words, but she never mentions those exemptions at any point.

Good grief! If you don’t know about those per-person exemptions, you don’t have the slightest idea how the Perry proposal works! But Tumulty’s bizarre omission doesn’t seem to be some sort of oversight or accident. On-line, the Post also offers this long report on the Perry proposal, a report by the often befuddled Perry Bacon. (Bacon’s report does not appear in the hard-copy Post.) Like Tumulty, Bacon cites the “20 percent national flat tax” involved in the Perry proposal. But he never mentions those per-person exemptions either.

How strange! Bacon links to Perry’s op-ed piece in yesterday’s Wall Street Journal, the piece in which Perry unveiled his proposal. In that op-ed piece, Perry described the $12,500 per-person “standard deduction” quite early—right there in his fourth paragraph! Why then did Bacon fail to mention this part of the plan in his reporting? Why did Tumulty follow suit?

We don’t know the answer to that. But we’ll make two observations:

First: You can’t understand the Perry proposal if you don’t know about those per-person exemptions. In that sense, the Washington Post has grossly failed to explain this proposal. The error is astonishing—vast.

Second: This is precisely the way the Dole campaign mischaracterized the Forbes “flat tax” proposal in 1996. During that year’s New Hampshire campaign, the Dole campaign ran the most deceptive series of TV ads in American presidential history. Basically, the campaign lied to Granite State voters in a gross, extended, deliberate way. (For our earlier report, click here.)

At the time, the Washington Post and the New York Times basically averted their gaze from the Dole campaign’s gross misconduct. By way of contrast, the Boston Globe explained the Dole scam rather clearly. It wasn’t real hard to do.

This morning, the Washington Post seems to be reliving those halcyon days of yore. Dole disappeared the Forbes per-person exemptions. This morning, the Post follows suit with Perry.

Is this morning’s remarkable error being committed for a purpose? We have no idea—but the Post’s reporting is simply astounding. In our experience, Bacon is often befuddled, but Tumulty is quite sharp. What explains the Post’s presentation? We have no idea.

That said, if you don’t like the way the Perry tax plan is being explained, we’ll suggest that you read a different newspaper! In this morning’s New York Times, it’s largely sunshine for those families of four.

In this morning’s Washington Post, cold chilly winds seem to howl.

Later today: If you don’t like the Perry tax plan, just watch a different channel!