It�s budget season, which means that we can expect to see the papers filled with articles about tax and spending plans that come attached to numbers like �million� �billion� and �trillion.� Since the vast majority of newspaper readers (even the highly educated ones) don�t often have occasion to play with such numbers, most of them will get little or no information from these articles, even if they read them. Of course, many readers will wisely skip these pieces, knowing that they will provide them with no useful information. I apply the strict �net gain� standard to budget reporting. The net gain standard is that a typical reader should be better informed about the budget and tax/spending priorities after reading the piece than before they started. The Post�s article on President Bush�s request for another $245 billion for the wars in Iraq and Afghanistan does not meet the net gain standard. The piece tells us that President Bush will ask for another $100 billion for fiscal 2007 and $145 billion for fiscal 2008. Is this a lot or a little? Most readers probably have some sense that this is big money, but how about telling them that the 2008 request is equal to approximately 5 percent of total spending, or maybe $2,000 for a family of four. The article then tells readers that President Bush is proposing a 1 percent increase in non-defense discretionary spending. There are probably about 50 budget wonks that can assign any meaning to this information. In fact (if I understand the proposal correctly), President Bush is proposing that non-defense discretionary spending will be cut by around 2 percent in real terms. As a result of inflation, government salaries and other expenses will rise by around 3 percent in 2008 compared to 2007. This means that to employ the same number of people and provide the same level of services, we would need approximately 3 percent more money, not 1 percent. (We also might need more government services in an economy that is projected to be 3 percent larger.) For those who don�t keep up on such things, non-defense discretionary spending includes items like education and training, funding for national parks, research on energy conservation, and veterans� benefits -- information not included in the article. Since I'm on the topic of beating up on the Post's budget reporting, let me also call attention to a bit of excessive gullibility in Friday's story on the Senate's minimum wage bill ("Senate Adds Tax Breaks to Minimum Wage Bill," 2-1-07;A1 [sorry, no links, the Post's website is not being cooperative]). This article reported that the tax breaks would help "businesses that would be hardest hit by the minimum-wage increase." Some qualifications would have been in order here like "businesses that Republicans claim would be hardest hit by the minimum-wage increase." I haven't studied the tax breaks closely, but according to the article, one of the tax breaks is an accelerated depreciation schedule for investments by small businesses. That does not seem obviously designed to help businesses that would be affected by the higher minimum wage.
--Dean Baker
