First from FactCheck.org and Newsweek:

A TV spot claims Obama once voted for a tax increase “on people making just $42,000 a year.” That’s true for a single taxpayer, who would have seen a tax increase of $15 for the year – if the measure had been enacted. But the ad shows a woman with two children, and as a single mother, she would not have been affected unless she made more than $62,150. The increase that Obama once supported as part of a Democratic budget bill is not part of his current tax plan anyway…

The TV ad claims in a graphic that Obama would “raise taxes on middle class.” In fact, Obama’s plan promises cuts for middle-income taxpayers and would increase rates only for persons with family incomes above $250,000 or with individual incomes above $200,000.

And on separate Spanish and English-language radio ads:

A Spanish-language radio ad claims the measure Obama supported would have raised taxes on “families” making $42,000, which is simply false. Even a single mother with one child would have been able to make $58,650 without being affected. A family of four with income up to $90,000 would not have been affected…

The [English-language] radio ad claims Obama would increase taxes “on the sale of your home.” In fact, home-sale profits of up to $500,000 per couple would continue to be exempt from capital gains taxes. Very few sales would see an increase under Obama’s proposal to raise the capital gains rate.

Lots more analysis from FactCheck and Newsweek here (under “analysis”).

Really, this graph from the Urban/Brookings Tax Policy Center analysis is probably one of the best illustrations of the presidential candidates’ tax proposals because it illustrates the stark difference in priorities.

Sen. Obama’s tax relief is overwhelmingly focused on the lower and middle brackets while raising taxes on the wealthy (over $250,000). Sen McCain’s tax plan is sharply regressive, lowering taxes the most in percentage terms for the wealthy and the least for lower and middle-income brackets.

And how will the candidates’ respective proposals affect the federal budget deficit? The Washington Post ran an analysis under the misleading title “Obama’s Tax Plan Would Balloon Deficit, Analysis Finds.” While the article does discuss an interesting debate over whether it’s better to evaluate a spending proposal against a budget baseline (assuming current fiscal policy remains unchanged) or just compare proposals to one another in terms of their effect on the national debt, the headline will leave a misleading impression for casual readers who do not delve into the details of the article. This is because it’s actually the case that if all McCain’s tax proposals were implemented, they would balloon the national debt significantly more than Obama’s proposals.

As Media Matters for America notes:

The article stated in its third paragraph that “[a]ccording to a recent analysis by the nonpartisan Tax Policy Center, Obama’s tax plan would add $3.4 trillion to the national debt, including interest, by 2018.” The 10th paragraph stated that “[a]ccording to the Tax Policy Center, McCain’s tax plans would increase the national debt by at least $5 trillion over the next 10 years.”

So not until the 10th paragraph of the article did the Post see fit to tell its readers that McCain’s plan is actually worse for the national debt. There’s some “fair and balanced” journalism.

Link to the original site

I am sure Barack Obama will deliver a stirring Inaugural address tomorrow. However, Obama’s most important remarks since his election came in an interview the other day with The Washington Post. There, he promised to convene a bipartisan fiscal summit in February. This has the potential to be the most important step of his Presidency. Yes, at least as important as fixing the immediate economic mess.

It is not the idea of a summit that is so critical—we’ve seen plenty of those in recent years. Nor was it his vow to use some of his copious political capital to confront the controversial issues of Medicare, Medicaid, and Social Security. We’ve heard that promise before too. It was just four years ago that George Bush made precisely the same vow to tackle Social Security. And we all know how that one ended up.

No, it is neither the summit nor the confident commitment that is so important. It is instead, the language he used in his meeting with The Post.

In his discussion of Medicare, for instance, Obama was channeling Peter Orszag, his nominee for Budget Director. When he says, “You can’t solve Medicare in isolation from the broader problems of the health-care system,” that is pure Orszag. So is his talk of “bending the curve” of medical spending (econo-speak for sharply slowing the rate of health cost growth).

Orszag’s (and now Obama’s) diagnosis is on the mark. The cure, however, will be exceedingly difficult. 

And it will take a lot more than fine words.

On Social Security, for instance, Obama breezily told The Post, “Social Security, we can solve.” No problem.

Well, he’ll have to do a lot more than what he promised in the campaign, when his plan centered on rising payroll taxes for a handful of wealthy workers—two years after the end of his second term. That is no way to fix Social Security.

By now, I’m sure Obama knows that in any bipartisan deal, reducing promised future benefits will have to be part of the mix. Period. And that is going to seriously antagonize his friends on the left. On the other hand, Obama is correct when he recognizes that Social Security is the easy bet in the entitlement trifecta.

When it comes to Medicare, “bending the curve” means rationing care. It means, somehow, convincing Americans that the most expensive treatment is not always (or even often) the best care. It means telling them, for example, that Medicare is not going to pay for that back surgery because exercise and anti-inflammatory drugs work just as well, and at far less cost. That is going to anger patients and doctors.

Long-term fiscal reform also means sensible tax policy. And by promising to exempt  anyone making up to $200,000 from any tax increases, Obama has built himself something of a fiscal box. I’m sure Orszag and others have told him that by now as well.

Still, the post-election Obama sounds like he gets it, or, at least for now, he’s listening to people who do. Let’s all hope it lasts.  

Link to the original site